Mortgage Glossary
Definitions and explainations of mortgage terminology.
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Mortgage Glossary
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Lock or Lock In - A designated period of time during which a borrower and a lender have agreed to a specific interest rate. Most locks are from 30 to 45 days. This usually involves paying a fee to the lender. Mortgage rates not "locked in" are subject to changing market conditions and are said to be "floating." Under some conditions, if you lock and the rates drop, the better rate can be obtained. |
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Mortgage Glossary
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Mortgage Fraud is getting a mortgage or getting more favorable terms than your risk level allows on a mortgage by misrepresenting (lying) on your loan application or supporting documents. |
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Mortgage Glossary
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Mortgage Insurance (MIP or PMI) - Insurance that covers the lender against losses incurred as a result of a default on a home loan. This is generally required on all loans that have a Loan To Value (LTV) ratio higher than 80%. Also, FHA loans and some first-time buyer programs still require mortgage insurance regardless of the LTV. When you have accumulated 20% of your home’s value as equity, you can ask your lender to waive the PMI. |
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Mortgage Glossary
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Mortgage-Backed Security (MBS) - A security backed by a group of mortgages usually issued by the Federal National Mortgage Association (FNMA) or the Federal Home Loan Mortgage Corporation (FHLMC) . Investors of mortgage backed securities receive payments derived from the interest and principal of the underlying mortgages. |
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Mortgage Glossary
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Negative Amortization - A gradual increase in mortgage principal that occurs when the monthly payment is not large enough to cover the entire principal and interest due. This shortfall is added to the outstanding balance to create "negative" amortization. |
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Mortgage Glossary 
