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Mortgage Loan Glossary

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0-9 | MORTGAGE LOAN TERMS
MORTGAGE LOAN COLLECTION

A

"A" Borrower
See Prime Borrower
"A" Paper
Borrower meeting the criteria for obtaining premium mortgage loan interest rates. Such criteria includes items such as a high income, great credit scores, and a good amount of equity in their home.
SIMILAR MORTGAGE TERMS: Prime Borrower
RELATED MORTGAGE TERMS: Credit Score|Equity
Accrued Interest
Interest that is part of the total mortgage loan balance, but is not paid in each monthly payment.
SIMILAR MORTGAGE TERMS: Negative Amortization
Acceleration Clause
A provision within a mortgage loan agreement that enables the lender to demand payment of the whole mortgage loan balance prior to its maturity date in the event that a payment is missed or another type of payment default occurs.
SIMILAR MORTGAGE TERMS: Demand Clause
MORTGAGE LOAN EXAMPLES: Acceleration Clause
Additional Principal Payment
Method for reducing a mortgage loan balance by paying an increased amount over the scheduled monthly payment that is due.
Adjustable Rate Mortgage (ARM)
Mortgage loan that has an interest rate that changes over the life of the loan according to an index rate. Fluctuations in the interest rate usually affects the amount of the monthly payment that are due throughout the life of the loan. Also known as Variable Rate Mortgages (VRM) and Adjustable Mortgage Loans (AML).
RELATED MORTGAGE TERMS: Amortization Type
MORTGAGE LOAN EXAMPLES: ARM Mortgage Loan
Adjustment Basis
A property's cost plus the value of improvements made to the property and minus any property depreciation taken.
Adjustment Interval
The time period between interest rate changes or monthly payment fluctuations during the life of an adjustable rate mortgage (ARM).
RELATED MORTGAGE TERMS: Adjustable Rate Mortgage (ARM)
Affordability Analysis
A review of one's total income, total liabilities, amount of available funds, and mortgage loan closing costs to determine a buyer's ability to afford the purchase or refinance of a home.
Agreement of Sale
A signed contract between a buyer and seller stating the conditions and terms that a property will be sold under. This document is also known as a purchase contract and purchase agreement.
MORTGAGE LOAN EXAMPLES: Agreement of Sale
Alternative Documentation
Documentation used to substitute or supplement the standard list of documents needed when applying for a mortgage loan.
SIMILAR MORTGAGE TERMS: Stips
RELATED MORTGAGE TERMS: Full Documentation|No Income No Asset Loan (NINA)|"Go Stated"
MORTGAGE LOAN EXAMPLES: Alternative Documentation
Amenity
Feature of a property or home that may increase its appraised value and is a benefit to the buyer, but is not necessary for the property's use. An amenity to a property may be natural as in the location of oceanfront or lakeside property, or may be man-made as in the addition of a swimming pool or central air conditioning to a home.
RELATED MORTGAGE TERMS: Appraisal
MORTGAGE LOAN EXAMPLES: Amenity
Amortization
The repayment of the entire mortgage loan amount including principal and interest through a set payment schedule. It is standard for such a payment schedule to be on a monthly basis that lasts for 30 years at which time full ownership of the home by its buyer takes place.
Amortization Schedule
Table that is presented in a mortgage loan contract that usually displays the total mortgage loan balance, the payments to be due broken down by interest and principal, any tax and insurance payments that may be made by the lender as well as the balance of such payments to be made by an escrow account.
MORTGAGE LOAN EXAMPLES: Amortization Schedule
Amortization Term
Length of time that is usually expressed as a number of months required to fully pay for a mortgage with all interest and any additional costs. The standard term lengths for mortgage loans in the United States is 15 years, 30 years, and more recently 40 years.
Amortization Type
As seen in a standard mortgage loan application, this field regards the type of loan program and contains 4 values: Fixed Rate, GPM, ARM(type), and Other(explain). Click on one of the terms above see their meaning.
RELATED MORTGAGE TERMS: Uniform Residental Loan Application (1003)
MORTGAGE LOAN EXAMPLES: Amortization Type
Amount Financed
As seen on the truth in lending form of a mortgage loan contract, this dollar figure reflects the total mortgage loan amount minus the prepaid finance charges.
RELATED MORTGAGE TERMS: Truth in Lending Act
Annual Percentage Rate (APR)
A rate that is calculated using a standardized formula and shows the cost of a mortgage loan including interest, mortgage insurance, and any other fees included in the loan amount. Expressed as a yearly interest rate, this value is usually different from the given mortgage loan interest rate.
RELATED MORTGAGE TERMS: Interest Rate
Application
See Uniform Residental Loan Application (1003)
Application Fee
Fee that is charged by various lenders to accept a mortgage loan application. This fee sometimes include the amount to cover other lender costs for items such as credit reports and home appraisals.
RELATED MORTGAGE TERMS: Good Faith Estimate (GFE)
MORTGAGE LOAN EXAMPLES: Application Fee
Appraisal
In terms of a mortgage loan, it is the reported market value placed on a property by an appraiser.
RELATED MORTGAGE TERMS: Appraised Value
MORTGAGE LOAN EXAMPLES: Appraisal
Appraisal Fee
Amount an appraiser, lender, or both will charge to produce an appraisal for a property's value.
RELATED MORTGAGE TERMS: Good Faith Estimate (GFE)
MORTGAGE LOAN EXAMPLES: Appraisal Fee
Appraised Value
An educated opinion of a property's fair market value by an appraiser that is usually based on their analysis of the property, analysis of market values for properties surrounding the property in question, as well as the appraiser's knowledge and experience.
RELATED MORTGAGE TERMS: Appraisal|Appraiser
Appraiser
Certified professional skilled in estimating the value of a property. With regard to a mortgage loan, it is standard for the appraiser to be selected by the lender, and an appraisal fee is usually charged to the borrower by the appraiser, lender, or both.
RELATED MORTGAGE TERMS: Appraisal
APR
See Annual Percentage Rate
Approval
See Loan Approval
ARM
See Adjustable Rate Mortgage
Assessor
Official of the goverment who determines the value of property for tax purposes.
Asset
Possessions retaining value including real estate, cash, and investments. With regard to a refinance mortgage loan, the asset most crucial in determining interest rate is the property being refinanced.
MORTGAGE LOAN EXAMPLES: Asset
Assignment
Mortgage transfer from the name of one individual into the name of another individual.
Assumable Mortgage
Mortgage loan transferable into the name of another borrower.
RELATED MORTGAGE TERMS: Assumption Fee
Assumption
The actual agreement between the buyer and seller of a mortgaged property where payments of the sellers current mortgage loan are taken over by the buyer.
RELATED MORTGAGE TERMS: Assumable Mortgage|Assumption Fee
Assumption Fee
Fee charged for the assumption of a mortgage loan.
RELATED MORTGAGE TERMS: Assumable Mortgage
MORTGAGE LOAN EXAMPLES: Assumption Fee
Authorized User
Any person given permission to use the credit or banking account of another without being liable for any charges made to those accounts.
Automated Underwriting
A computerized method for selecting the best rate and loan program for a prospective mortgage loan borrower based on their income, credit history,and loan to value ratio of the property being financed. Such systems are currently only offered to current mortgage loan customers of a few major banks and wholesale mortgage loan lenders that are not available to the public. A few systems have been developed to work in favor of the consumer, but the success of such systems are still under review.
RELATED MORTGAGE TERMS: Credit History|Income|Loan to Value (LTV)
MORTGAGE LOAN EXAMPLES: Automated Underwriter
Award Letter
In terms of a mortgage loan, its is a form of income documentation that presents a fixed income. Such types income documentation include social security award letters and pension award letters.
RELATED MORTGAGE TERMS: Stips
MORTGAGE LOAN EXAMPLES: Award Letter

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