Private Mortgage Insurance.
A type of mortgage insurance available to conventional lenders on the first, high risk portion of a loan
A one-time charge by the lender
for originating a loan to increase the yield of a mortgage loan above the contract rate to the market
rate so that it is competitive with other investments and is equal to the difference between the stated
principal amount on the note and the lesser amount loaned. A point is 1 percent of the amount of the mortgage.
Power of Attorney
A legal document that authorizes
another person to act on one's behalf. A power of attorney can grant complete authority or can be limited
to specified acts on his or her behalf for certain periods of time.
The power that an instrument
such as a trust deed grants to a trustee or mortgagee to sell the secured property without judicial proceedings
if a borrower defaults in payment of the promissory note or otherwise breaches the terms of the mortgage
or trust deed.
A lending practice where a
borrower can demonstrate to a seller and broker that they can qualify for an specific loan amount which
permits a prospective buyers to shop with condidence that a loan will be approved.
A procedure in which the investor
allows a mortgagor to avoid foreclosure by selling the property for less than the amount that is owed
to the investor.
Any amount paid to reduce
the principal balance of a loan before the due date. Payment in full on a mortgage that may result from
a sale of the property, the owner's decision to pay the loan off in full, or a foreclosure. In all cases,
prepayment means payment occurs before the loan has been fully amortized.
A fee that may be charged
to a borrower who pays off a loan prior to its maturity.
A preliminary assessment of
a buyer's ability to secure a loan, based on a specific set of lending guidelines and buyer representations
made which is not a guarantee or commitment by a lender to extend credit.
The lowest commercial interest
rate charged by banks on short-term loans to their most creditworthy customers. Changes in the prime rate
influence changes in other rates, including mortgage interest rates.
1. The amount borrowed or
remaining unpaid. 2. The part of the monthly payment that reduces the remaining balance of a mortgage.
3. A main party in a real estate transaction such as a buyer, seller, owner, lessor or borrower.
The outstanding balance of
principal on a mortgage. The principal balance does not include interest or any other charges.
Principal, Interest, Taxes, And Insurance (PITI)
The four components of a mortgage
payment. Principal refers to the part of the monthly payment that reduces the remaining balance of the
mortgage. Interest is the fee charged for borrowing money. Taxes and insurance refer to the amounts that
are paid into an escrow account each month for property taxes and mortgage and hazard insurance.
Private Mortgage Insurance (PMI)
Mortgage insurance that is
provided by a private mortgage insurance company to protect lenders against loss if a borrower defaults.
Most lenders generally require MI for a loan with a loan-to-value (LTV) percentage in excess of 80 percent.
A written promise to repay
a specified amount over a specified period of time and where the note is the evidence of the debt and
the borrower takes on liability for its repayment and the mortgage is the security for the debt.
A planned meeting in an announced
location to sell property to repay a mortgage that is in default.
PUD (Planned Unit Development)
A coordinated, real estate
development where common areas are shared and maintained by an owner's association or other entity for
the benefit and use of the individual PUD unit owners.
(or Adobe House)
An early twentieth-century
house that is made of adobe brick or other material made to look like adobe brick and which has the unique
characteristic of projecting roof beams.
Purchase and Sale Agreement
A written contract signed
by the buyer and seller stating the terms and conditions under which a property will be sold.
The definitions of Real Estate
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