Mortgage Dictionary
When your lender says . . .Accelerated Payment Schedule
What they mean is . . . An option you have to pay back a loan quicker than required.
When your lender says . . .Adjustable Rate Mortgage (ARM)
What they mean is . . . A loan with an interest rate that increases or decreases over time.
When your lender says . . .Amortization
What they mean is . . . The process of paying back, over a period of time.
When your lender says . . .Annual Cap
What they mean is . . . The limit on the amount an adjustable rate the mortgage can go up.
When your lender says . . .Buy Down
What they mean is . . . The option you have to lower the overall interest rate.
When your lender says . . .Certificate of Eligibility
What they mean is . . . What you can use to prove your status as a veteran.
When your lender says . . .Credit Report
What they mean is . . . A document produced by a credit report firm that provides a credit statement.
When your lender says . . .Discount Points
What they mean is . . . The amount of money you can choose to pay to lower your interest rate.
When your lender says . . .Down Payment
What they mean is . . . The amount you pay in cash towards the total sales amount.
When your lender says . . .Fannie Mae
What they mean is . . . A nickname for the Federal National Mortgage Association.
When your lender says . . . FHA Loan
What they mean is . . . A loan offered by the Federal Housing Authority (FHA).
When your lender says . . .Fixed Rate Mortgage
What they mean is . . . A loan with an interest rate that stays the same.
When you lender says . . .Freddie Mac
What they mean is . . . A nickname for the Federal Home Loan Mortgage Association.
When your lender says . . .Home Equity Loan
What they mean is . . . A loan that lets you borrow back money against the home.
When your lender says . . .Interest
What they mean is . . . The amount of money a lender charges you to borrow.
When your lender says . . .Loan Application
What they mean is . . . The formal document you fill out when you apply for funds.
When your lender says . . .Loan Term
What they mean is . . . The total amount of time you are given by a lender to pay back the loan.
When your lender says . . .Loan-to-Value Ratio (LTV)
What they mean is . . . A mathematical equation mortgage experts use to determine how much they will lend you.
When your lender says . . .Lender
What they mean is . . . A financial institution, like a bank, which loans you money.
When your lender says . . .Monthly Housing Allowance
What they mean is . . . The percentage of a person’s income they can use for housing.
When your lender says . . .Mortgage
What they mean is . . . The legal document outlining your responsibilities.
When your lender says . . .Mortgagee
What they mean is . . . The lender that provides a borrower with a home loan.
When your lender says . . .Mortgage Insurance
What they mean is . . . An insurance policy you are required to get if the loan-to-value is too high.
When your lender says . . . Maturity Date
What they mean is . . . .The scheduled date for your final payment on a loan.
When your lender says . . .No Doc Loan
What they mean is . . . A loan requiring no documentation of income.
When your lender says . . .Obligations
What they mean is . . . The things you have to pay for consistently each month.
When your lender says . . .Origination Fees
What they mean is . . . The charges you must pay when first buying a home.
When your lender says . . .Per-diem Interest
What they mean is . . . Interest charges that cover the period of time––usually calculated on a per-day basis.
When your lender says . . .PITI
What they mean is . . . An acronym that refers to the payment, principle, interest, taxes & insurance.
When your lender says . . .Principal
What they mean is . . . The money a lender lets you borrow to buy a home.
When your lender says . . .Pre-Approval
What they mean is . . . A way you can establish your ability to get a home.
When your lender says . . .Rate Lock
What they mean is . . . A way you can establish that the interest rate on your home is locked in.
When your lender says . . .Refinancing
What they mean is . . . The way you can replace your current home loan with another.
When your lender says . . .Retire a Debt
What they mean is . . . When you pay off your home loan completely.
When your lender says . . .Self-Amortizing Loan
What they mean is . . . A loan that gets paid back through regular monthly payments.
When your lender says . . .Up-Front Costs
What they mean is . . . The total amount of cash you need to pay when you buy a home.
When your lender says . . .VA Loan
What they mean is . . . A way that veterans of the armed services can borrow.