Mortgage Terms

We know home buying can be confusing, and as we’ve said, we’re here to make it easy. Use this glossary to learn mortgage jargon and any lingo you’ll need to know.


100% Financing

A home buyer who finances the entire sale price of the home uses 100% financing. Mortgage loan options that allow this include USDA Rural Development and VA loans. 100% financing does not include cash to close for items like funding escrow or origination fees. Another way to think of this is a no down payment mortgage.

203k Loan

Also called the FHA 203k, the FHA backs the 203k loan which home buyers can use to finance home improvements, renovations or repairs before purchase or as a refinance. The purchase loan provides financing for a property including the work to be done, all rolled into the life of the mortgage. Luxury items such as pools are not covered. The 203k Streamline covers repairs of less than $35,000 and which are NOT structural.


Accrued Interest

Accrued interest is the interest earned, but not paid. This adds to the amount owed. Also known as negative amortization.

Adjustable Rate Mortgage (ARM)

An adjustable rate mortgage (ARM) is a home loan where the interest rate on the note is periodically adjusted based on an index. That index reflects the cost to the lender of borrowing on the credit markets. The loan may be offered at the lender’s standard variable rate/base rate. An ARM implies a mortgage regulated by the Federal government with limitations on charges (“caps”). Also called a variable-rate mortgage.


A mortgage application is a request for a home loan that includes the information about the potential borrower, the property, and the requested loan that the lender needs to make a decision. In a narrower sense, the application refers to a standardized application form called the “1003” which the borrower is obliged to fill out.


Estimated value for a home or property for a specific purpose on a given date. This is the “bank value” of the home and will include factors such as sales of similar homes in the past 6 months and other historical data. Appraisals can be verbal or written.

Appraisal Fee

The appraisal fee is the amount charged by an appraiser to appraise a home, paid by the home buyer.


An appraiser is a person who estimates value on a professional level. The professional performing the home appraisal. ASA, MAI, SRA, SRPA, and SREA are some professional designations.


Appreciation is an increase in the value of a property. This is the exact opposite of depreciation.

APR (Annual Percentage Rate)

The APR is essentially the mortgage interest rate and associated fees rolled into one figure. An annual percentage rate describes the interest rate for an entire year (annualized) rather than just the monthly fee or rate. Lenders are required to disclose the APR when advertising interest rates. They must also disclose the APR before the loan is finalized.

As-Is Condition

As-is condition is any property sold in its present condition with no warranties made about the plumbing, heating, electrical, or other physical plant attributes, or the possibility of infestation by termites.


An assessment is the official value of a property for tax purposes.


Assumption is the method of selling real estate where the buyer agrees to become responsible for the repayment of an existing loan on the property. Unless the lender also agrees, however, the seller remains liable for the mortgage.

Assumable Mortgage

An assumable mortgage is a home loan that allows (or does not prohibit) a creditworthy buyer from assuming the mortgage contract of the seller. Assuming a loan will save the buyer money if the rate on the existing loan is below the current market rate, and closing costs are avoided as well. A loan with a “due-on-sale” clause stipulating that the mortgage must be repaid upon sale of the property, is not assumable.

Authorized User

An authorized user is someone authorized by the original user (often a credit card holder) to use the account (or credit card holder’s card). The original user is responsible for the debts accrued by the authorized user, but the authorized user is not responsible for paying any charges, including their own. However, authorized users are sometimes contacted for the unpaid bills of the card holder.

Automated Underwriting

Automated underwriting is a computer-driven process that informs the loan applicant very quickly whether he or she will be approved, or whether the application will be forwarded to an underwriter. The quick decision is based on information provided by the applicant, subject to later verification, and other information retrieved electronically including information about the borrower’s credit history and the subject property. Two examples of automated underwriting systems include Fannie Mae’s “Desktop Underwriter” and Freddie Mac’s “Loan Prospector.”


Balloon Mortgage

A balloon mortgage is a home loan where the regular monthly payments do not amortize the loan. At an agreed period in the future, the loan is due and payable in full. The amount of the balloon payment must be stated in the contract if Truth-in-Lending provisions apply to the loan.

Basis Points

Lenders use basis points to express a relationship to interest rates. One basis point is equal to 100th of one percent. The difference between 3.25% and 3.50% is 25 basis points.

Bi-Monthly Mortgage

A bi-monthly mortgage allows the borrower to pay half the monthly payment on the first day of the month and the rest on the 15th of the month.

Bi-weekly Mortgage

Bi-weekly mortgage loans have 26 bi-weekly payments through the year versus 12 monthly payments. This may allow a borrower to repay the mortgage faster and amortize the loan more quickly. A bi-weekly mortgage often comes with higher fees and costs and is rarely offered by lenders in the current market.

Breach of Contract

Breach of contract is a failure to perform a specific item or items within a contract. The party that did not violate the contract is typically able to sue for damages or to force the other party to perform under terms of the contract. In the home buying process, a purchase agreement is a contract.

But Loan

A trademarked term by Neighborhood Loans Home Mortgage, the But Loan® is a mortgage loan program for homebuyers who find a home they love but find issues that turn them off. For instance, a buyer who finds a house in the perfect neighborhood with the right number of bedrooms BUT the roof is old and there’s no deck and it could use another bathroom is the perfect home for the But Loan. The But Loan solves the problems that come after, “I’d but this house BUT…” The But Loan uses the FHA 203k to finance home improvements, remodeling, renovations, or repairs on the house you’d like to buy.

Buy Down

A permanent buy down allows the buyer to pay points up front to bring down the interest rate on a mortgage loan. A temporary buy down concentrates the interest rate reduction for the early years of the loan.

Buy Up

Buy up allows the home buyer to pay a higher interest rate in exchange for lower fees at closing.


Capital Gain

Capital gain is a taxable profit from the purchase and subsequent sale (at a profit) of an asset, like a house.

Cash-out Refinance

A cash-out refinance allows the homeowner to cash in on the equity of the house. You would refinance the equity with the balance of the loan into a new mortgage. It is one alternative to a home equity line of credit. Also called a cash-out refi.

Cash to Close

Cash to close is the amount a home buyer needs to close the deal. This includes money for closing costs like appraisal fees, title insurance, or attorney fees, as well as the down payment and pre-paid items like escrow funds. Cash to close is the entire amount you will need on the day of closing your mortgage loan.

Certificate of Insurance

Your certificate of insurance proves that insurance is in force. This type of certificate indicates that type of insurance, the amount of coverage, the date of coverage, and the in-force and expiration dates. In the home buying process it refers most often to homeowners insurance.

Certificate of Title

A certificate of title is prepaid by a licensed abstractor, attorney, or title company. It is a written opinion on the status of the title to real property based on public records. This type of certificate does not guarantee the title, but simply gives an opinion of the title. The only document that guarantees title is title insurance.

Certified Check

A bank or credit union issues a certified check. This type of check cannot be revoked by a stop payment. In real estate transactions, a certified check is normally required to close the transaction.

Clear Title

“Clear title” states the owner of the property owns it free and clear of encumbrances such as liens or easements. The only exception is when both parties agree on any liens, claims or defects.

Closed-End Mortgage

A closed-end mortgage is loan amount that is fixed and cannot be increased. Unlike open-ended mortgages, there are no savings involved in paying off the closed-end mortgage early.


“Closing” is the process of actually transferring a title. Closing can be handled by an attorney, escrow company, lender, broker, or occasionally by the parties themselves, depending on state law.

Closing Costs

Closing costs are one component of a home buyer’s cash to close. They can include (but not limited to): mortgage origination fee, credit report fee, appraisal fee, recording fees, home inspection fee, mortgage tax, title search expense, BA funding fee, costs of termite report, survey, sales commissions and mortgage insurance premiums. It does not include down payment or prepaid items like escrow funds.

Closing Date

A home buyer’s closing date is the scheduled day on which closing occurs and the home is yours.


Co-borrowers are the people who sign the mortgage note with the home buyer. Co-borrowers are equally responsible for paying the loan and can include a spouse, parent, significant other, sibling or acquaintance. Also called a co-signer.

COFI (Cost of Funds Index)

The Cost of Funds Index is one of many interest rate indices used to calculate the rate of an adjustable rate mortgage. A COFI is an average of interest expenses from regional financial institutions.


Assets pledged as a security to loan repayment are collateral. For instance, a car owned free and clear (with no lien on it) can be used as collateral.


Comparables are used in determining market value of a home for sale. Sales of similar or comparable property can be the basis for determining the value of a property. An appraiser uses comparables.

Conventional Mortgage

A conventional mortgage is not associated with the VA or FHA. They are called conventional loans because they adhere to conventional standards within legal limits by mutual consent of the lender and borrower.

Construction Financing

Construction financing is a mortgage loan used to finance the construction of a house. This covers new construction, not remodeling or renovating. Construction financing often comes with special monitoring by the lender, as well as different guidelines to ensure project completion and repayment of the loan.

Conversion Option

A conversion option covers the chance to convert an adjustable rate mortgage into a fixed rate mortgage. Loans of this designation often come with higher interest rates than an ARM without the conversion option.

COSI (Cost of Savings Index)

The Cost of Savings Index is one of several interest rate indices used to calculate the rate of an adjustable rate mortgage. The popular COSI is a weighted average of the interest rates on the deposit accounts of the federally insured depository institution subsidiaries of Golden West Financial Corporation (GDW). These subsidiaries currently operate under the name World Savings.


A co-signer is someone who lends his/her credit and character to another individual for the purpose of obtaining credit. The co-signer is on the loan application and note, but not on the deed of trust or mortgage. The co-signer shares in the liability for the loan, but not the ownership. Also called a co-borrower.

Counter Offer

A counter offer is a change and re-submission of the original offer to buy or sell a property, made in response to the original offer.

Credit History

Credit history is the history of a person’s credit accounts and any debts they hold. This can include collections and other negative reports, but it also includes the positive effects of paying bills on time. Your credit history does not necessarily include your credit score.

Credit Report

A credit report is the written report from a credit bureau (the common credit bureaus being Transunion, Equifax, and Experian) that serves to help the lender decide the credit risk of potential borrowers.

Credit Score

A credit score is the number assigned to you by the credit bureaus. Lenders use this number to evaluate the risk associated with loaning money to you. Other companies like mobile phone carriers and insurance companies can also use your credit score. FICO is the most widely used credit score designation. U.S. FICO scores range from 300-850, with 723 being the median FICO score of Americans in 2010.

Cumulative Interest

Cumulative interest adds up the sum of all interest payments made on a loan over a designated time period. For amortizing loans, cumulative interest increases at a decreasing rate, as each subsequent periodic payment on the loan is a higher percentage principal and a lower percentage interest. Cumulative interest is sometimes used as a measure of loan economics to determine which loan is most economical.



The deed is the document used to transfer ownership of a property from one person or entity to another. Ownership begins with the recording of the deed for the purchaser, and ownership terminates with recording the deed for the seller.

Deed in Lieu of Foreclosure

A deed in lieu of foreclosure is basically a willing foreclosure. The homeowner deeds the property back to the lender as an alternative to the foreclosure process. A homeowner taking this “strategic default” route will have fewer late payments than a foreclosure, but pay for the decision with a major credit score ding.


Default means the homeowner has failed to pay their mortgage loan for an extended period of time. That window differs between lenders. Many times a borrower 60 days late is considered “in default” and may be eligible for assistance.


A delinquent mortgage payment (or delinquency) is more than 30 days late, but not yet in default.

Demand Clause

A demand clause in the mortgage allows a lender to require repayment at any time for any reason. This is a rare feature in today’s market.


Disclosure determines that lenders are required by the Truth In Lending Act to inform borrowers what the true cost of borrowing the money is, the closing costs, and the special conditions of a mortgage.

Discount Points

Discount points refers to a discount expressed as a point or a percentage. A discount of 4 points would be 4% of the loan amount.

Discretionary ARM

An adjustable rate mortgage where the lender can change the interest rate at any time is a discretionary ARM. The lender must provide advanced notice. A popular mortgage in Europe, but not the U.S.

Documentation Requirements

Documentation requirements are set forth by the lender, and specify how the borrower’s information like assets and income are gathered, and how the lender will use that information.

Down Payment

A down payment (also called downpayment) is the initial upfront portion of the total amount due for purchase (the mortgage loan), usually made in cash or check at the time of closing. The purpose is to ensure the lender that you can pay this loan. It shows that the borrower can raise a certain amount of money for long-term investment; evidence that that the borrower’s finances are sound. Down payments range from zero to 3.5% to 5% and higher.

Due-on-Sale Clause

A due-on-sale clause in the mortgage requires the homeowner pay off the balance of the loan when the property is sold. Essentially this means the borrower cannot transfer responsibility for the loan to the buyer. It is not an assumable mortgage.


Earnest Money

Earnest money is a cash deposit accompanying a sales contract. It shows good faith to abide by the terms of the contract. Earnest money can be forfeited by the buyer, who does not abide by the conditions of the purchase agreement. At closing, earnest money is usually credited toward the down payment.


How much money is “invested” or paid into a property is its Equity. A $100,000 property with a $75,000 mortgage has $25,000 in equity.

Escrow Account

An escrow account is the account funded by the borrower and held by the lender to pay for third party fees like homeowners insurance and property taxes. Escrow can also pay for construction costs like renovations and remodeling, depending on the mortgage loan option.


Fair Credit Reporting Act (FCRA)

The Fair Credit Reporting Act is U.S. Federal Government legislation enacted to promote the accuracy, fairness, and privacy of consumer information contained in the files of consumer reporting agencies.

Fair Housing Act

The Fair Housing Act law covers selling or leasing residential property, which makes it unlawful to discriminate based on factors including color, race, sex, national origin, religion, family status, or disability. HUD and the Office of Fair Housing and Equal Opportunity (FHEO) handle complaints.

Fannie Mae

Fannie Mae (Federal National Mortgage Association or FNMA) is a government sponsored entity that purchases mortgages from lenders on the secondary market. The agency finances the purchases by packaging the mortgages into pools and issuing securities against the pools.


Mortgage fees are all upfront cash payments required by a lender as part of the loan process. Fees can include origination and processing fees as well as other terms.


The Federal Housing Administration or FHA provides mortgage insurance for single-family and multifamily homes in the U.S. FHA works with approved lenders to insure loans against default.

FHA 203k or FHA 203(k)

One of the most popular and diverse home improvement loans is the FHA 203k. You can make home improvements to the house you want, or the home you already own. Use the funds for simple upgrades to your home like a kitchen or bath improvement, or to completely reconstruct a home that is presently unlivable. You can even use a 203k Rehabilitation Loan to tear down an existing structure and build a new one using some portion of the existing foundation. You can borrow up to 96.5% of the appraised value – based on the value when the improvements or repairs are completed.

FHA Loans or FHA Mortgages

One of the most popular and diverse home improvement loans is the FHA 203k. You can make home improvements to the house you want, or the home you already own. Use the funds for simple upgrades to your home like a kitchen or bath improvement, or to completely reconstruct a home that is presently unlivable. You can even use a 203k Rehabilitation Loan to tear down an existing structure and build a new one using some portion of the existing foundation. You can borrow up to 96.5% of the appraised value – based on the value when the improvements or repairs are completed.

FICO Score

FICO score is the most-used credit scoring system in the U.S., based on the scores from the major credit bureaus Experian, TransUnion and Equifax. The FICO score range is 300-850.

Financing Points

When a borrower includes points in the loan amount, they are financing points. It’s a way to reduce the initial cost by amortizing them with the mortgage.

First Mortgage

A first mortgage is the primary “original” mortgage, taking precedents over all prior loans, making those loans “junior” to the first mortgage. The property security, which is collateral for this primary mortgage, is evidence of the full appraised value at the precise time the loan is made.

First Time Home Buyer

A first time home buyer is a borrower who has never owned a home. A common myth is that first time home buyers have specific mortgage loan options available only to them. In actuality, FHA loans and other options are available to most borrowers. First time home buyers often have less money for down payments and lower credit scores, which determines the mortgage loan option they will likely use for buying a house. Some mortgage loan options define first time home buyers as someone who has not owned a home is 3 years or more.

Fixed Rate Mortgage (FRM)

A fixed rate mortgage (FRM) is a home loan where the interest rate does not change. The only way for your payment to change with the FRM is for your property taxes or homeowners insurance to change, affecting the escrow account.

Flexible Payment ARM

Flexible payment ARM is an adjustable-rate mortgage where the borrower can choose from four different payment options each month: a 30-year, fully amortizing payment; a 15-year, fully amortizing payment; an interest-only payment or a “minimum payment.” A flexible payment ARM is also known as a payment option ARM.


Float means the interest rate is not locked and can change with the market conditions. Allowing a float means your interest rate could go up or down with the market. The interest rate must be locked before closing.


Foreclosure is the legal action taken by a creditor or mortgage company to force the sale of property to satisfy a debt secured by the property. Judicial foreclosure, non-judicial foreclosure, and strict foreclosure are three types of foreclosure.

Freddie Mac

Freddie Mac (Federal Home Loan Mortgage Corporation or FHLMC) is a government backed agency that purchases mortgages from lenders on the secondary market. The agency finances the purchases by packaging the mortgages into pools and issuing securities against the pools.


FSBO (pronounced fizz-boe) stands for “for sale by owner.” This means there is no listing agent on the home for sale.

Fully Amortizing Payment

A fully amortizing payment is a periodic loan payment (part is principal and part is interest). If the borrower makes payment according to the loan’s amortization schedule, the loan will be paid off by the end of its set term. On a fixed-rate mortgage, each fully amortizing payment will be equal an amount. For an adjustable-rate mortgage, the fully amortizing payment may change as the interest rate on the loan changes.

Fully Indexed Interest Rate

The fully indexed interest rate on an adjustable-rate loan is calculated by adding the margin to an index level. When calculating the fully indexed interest rate, the index level varies according to market conditions but the margin is usually a constant value. For example: if the initial interest rate is 5.5% for one year, the fully indexed interest rate is 8.5% and the rate adjusts every year subject to a 1% cap, the 8.5% rate will be reached at the end of the third year.


Gift Letter

If some or all of a down payment is in the form of a gift from a relative, most lenders require a gift letter to verify the source of the funds. Each lender has different requirements as to what must be in the gift letter, and limitations of the gift.

Gift of Equity

A gift of equity happens when the seller keeps the home price below market value or appraised value, essentially gifting the difference to the buyer. A gift of equity most likely happens between family members. Lenders may allow this equity to be used as a down payment.

Ginne Mae (GNMA)

Ginnie Mae (GNMA or Government National Mortgage Association) is the federal agency that guarantees mortgage securities issued against pools of FHA and VA mortgage loans.

Good Faith Estimate (GFE)

The good faith estimate (GFE) is an estimate of the settlement charges the borrower will incur at closing. This written documentation is required by the Real Estate Settlement Procedures Act (RESPA). Any changes to this estimate must be presented in written form to the borrower.

Grace Period

Lenders offer a grace period after the due date of a mortgage loan where the borrower can pay without fees. For instance, if your payment is due on the first of the month, you may be able to pay by the 15th without getting hit with late fees. That is your grace period.


Hazard Insurance

Hazard insurance covers physical damage to property. Guidelines for hazard insurance are established by each lending institution for the minimum coverage required.

Home Affordability Refinance Program (HARP or HARP 2.0)

HARP enables borrowers with little or no equity to refinance into more affordable mortgages without new or additional mortgage insurance.

Home Equity Line of Credit (HELCO)

A home equity line of credit is a form of revolving credit in which your home serves as collateral. Because a home often is a consumer’s most valuable asset, many homeowners use home equity credit lines only for major items, such as education, home improvements, or medical bills, and choose not to use them for day-to-day expenses.

Home Equity Loan

A home equity loan is a second mortgage based on the equity the owner possesses in a home. This loan can be used to improve the property, or for other uses. The amount is loaned as a lump sum rather than a line of credit – like a HELOC.

Home Improvement Loans

Home improvement loans are usually short-term. They may or may not be secured by the homes whose work they finance, but those that are secured generally carry lower interest rates.

Homeowners Insurance

A borrower will purchase homeowners insurance to protect the property against loss from fire and other hazards. This is often a lender requirement, paid by the homeowner.

HomeStyle Renovation

The HomeStyle Renovation mortgage enables a borrower to obtain a purchase transaction mortgage or a limited cash-out refinance mortgage and receive funds to cover the costs of repairs, remodeling, renovations or energy efficient improvements to the property.

Housing Bubble

Housing bubble refers to a specific increase in home prices. A bubble is often fueled by the expectations that values will continue to rise. According to most experts and reports, the most recent housing bubble talked about ended in 2006. Home prices seem to have bottomed out and stabilized in 2012.

Housing Code

A housing code is a municipal ordinance regulating heating, plumbing, occupancy standards, roofing and other standards for occupied structures.

Housing Expense

Housing expense is the sum of the monthly mortgage amount, homeowner insurance, property taxes and any possible homeowner association fees. It’s also called PITI or principal, interest, taxes & insurance.

Housing Expense Ratio

One measure of qualifying borrowers is a housing expense ratio. This is the ratio of housing expense in relation to borrower income.

HUD1 Form

The HUD1 form is the official form a borrower receives at their closing which details all payments and receipts among all parties involved. Parties include: borrower, lender, seller, and various service providers during the buying process.

Hybrid ARM

A hybrid ARM is an adjustable rate mortgage where the initial rate holds for a specified period of time then begins to adjust. In general, a hybrid ARM has an initial fixed rate for 3 years or longer.


Indexed ARM

An indexed ARM is an adjustable rate mortgage where the interest rate adjusts based on changes in an interest rate index. This differs from a discretionary ARM wherein the lender can change the adjustable rate at any time (subject to advanced notice).

Initial Interest Rate

The initial interest rate refers to the first fixed interest rate in an adjustable rate mortgage. An ARM may have 6 months of a fixed rate or initial interest rate before it begins to adjust. This is also called a “teaser” interest rate when it falls below the fully indexed interest rate.

Initial Rate Period

An initial rate period is the amount of time, often measured in months, where the initial interest rate in an ARM holds before it adjusts.

Inspection Certification

Lenders often require an inspection certificate to ensure the collateral used for a loan is the same as indicated in a loan application.

Interest Due

Interest due is the amount of interest a borrower owes based on this formula: multiply the loan balance at the end of the preceding period by annual interest rate, then divide that amount by the interest accrual period.

Interest Only Mortgage

An interest only mortgage refers to a home loan where the borrower only pays the interest due for a period of time. While paying only interest may save on monthly payments, it does not pay down the balance, making for higher payments once the borrower begins to pay the full amount. Neighborhood Loans Home Mortgage does not offer an interest only mortgage option.

Interest Rate

The interest rate is the rate you pay as a borrower on the money you are loaned. An interest rate does not necessarily include the APR, so will often be less than the actual cost of borrowing. Make sure you also know the APR when shopping for interest rates.

Interest Rate Ceiling

The highest amount your interest rate can be in an ARM is called the interest rate ceiling. It’s also known as the lifetime cap, and expressed in specified percentage points above the initial interest rate.

Interest Rate Decrease Cap

An interest rate decrease cap refers to the maximum allowable decrease of an interest rate on an ARM each time it is adjusted. The most common amount allowed is one or two percentage points.

Interest Rate Floor

The interest rate floor on an adjustable rate mortgage refers to the lowest interest rate possible.

Interest Rate Increase Cap

An interest rate increase cap is the maximum allowable increase in the interest rate on an ARM each time the rate is adjusted. Most often you will find a cap of one or two percentage points.


A real estate investor is a buyer who purchases a property as an investment – to sell or rent out – rather than a residence.


Joint and Several Liability

Joint and several liability is: A lender can sue one or all of the borrowers to force satisfactory performance and payment; an obligation from all or one of the borrowers to the lender.

Jumbo Mortgage

A jumbo mortgage is a home loan larger than the maximum amount allowed by Fannie Mae or Freddie Mac. As of October 2011, the jumbo conforming limit is $729,750.

Junk Fees

Junk fees refer to lender fees expressed in dollars rather than points, and is a derogatory term reflecting the idea that the lender has hidden the fees until closing time so the borrower will not walk away from the deal. Some common junk fees include: settlement fees, sign-up fees, translation fees or messenger fees.


Late Fees

Late fees refer to penalties a lender levies on the borrower for paying their loan later than the due date. A grace period is often observed by lenders of 10-to-15 days.

Late Payment

A late payment happens when you pay your loan payment past the grace period date. Late payments are often subject to late fees and can be reflected on your credit report.

Latent Defect

A latent defect is a problem in the home that is hidden or concealed. A latent defect is not easily seen nor discovered by the purchaser or inspector, but is known by the sellers.

Lease Purchase

Sellers and Purchasers can enter into a lease purchase to buy a property with the rent payments going towards the sales price, most often towards the down payment. Most lenders provide guidelines for this type of plan. If the rent paid is less than fair market rent, the lender can view the transaction as the seller giving the buyer the down payment via reduced rent. Also called lease-to-own.


Lender refers to the financial institution originating the loan. Also called a mortgage lender, mortgage company or mortgage banker.

Level Payment Mortgage Originator

A level payment mortgage originator is a constant payment of a fixed amount each month until the debt is paid. By constant payment, it is meant to be a fixed rate mortgage versus an adjustable rate of graduated payment mortgage.


Liens are claims made against the property of another as security for the money owed. Liens can be general or specific, and can be statutory or equitable.


Litigation refers to any legal action, including all proceedings therein; a lawsuit.

Loan Agreement

The loan agreement is the written agreement to repay a loan. If it is secured by a mortgage, it is a note describing how the payments will be made and any other actions that will be performed.

Loan Amount

The loan amount on your mortgage is the amount you agree to pay back, set up in your mortgage contract. The loan amount differs from the amount of cash the lender disburses by the amount of points and other upfront costs included in the loan.

Loan Commitment

A loan commitment is the document from a lender agreeing to lend a specific amount of money for a specific purpose over a specific amount of time.

Loan Officer

The loan officer is the representative at the mortgage lender who helps you get your loan. This person will work with you through the process of pre-approval, approval, and closing. Also called a mortgage consultant.

Loan to Value Ratio (LTV)

The loan to value ratio is the percentage borrowed in the acquisition or refinancing of property compared to the appraised value of that property. If a home is worth $100,000, and the loan is for $80,000, then the LTV is 80%.


When an interest rate gets a lock, it is locked into the current market rate. This option is available to the borrower so the rate is locked between the time application is taken and closing, regardless of what happens in the market. Lock times range from 15-day to 45-day for most lenders.

Lock Commitment Letter

The lock commitment letter is the written statement from your lender verifying your rate and terms of your loan have been locked. This is often offered through a mortgage broker.

Lock Failure

Lock failure is the inability or refusal of a lender to honor a mortgage interest rate that the borrower believed was locked.

Lock Period

The lock period is the amount of days that an interest rate lock holds. Typically a borrower will pay a higher price in points for a longer lock period.


Mandatory Disclorsure

The mandatory disclosure is the set of laws that dictates the information the lender must disclose to the mortgage borrower, including the method and timing of the disclosure.

Manufactured Home (Manufactured Housing)

A manufactured home (formerly known as a mobile home) is built to the Manufactured Home Construction and Safety Standards (HUD Code) and displays a red certification label on the exterior of each transportable section. Manufactured homes are built in the controlled environment of a manufacturing plant and are transported in one or more sections on a permanent chassis.


The margin is the amount added to the interest rate index to come up with the fully indexed interest rate on an adjustable rate mortgage, or ARM. The margin is typically around 2-to-3 percentage points.

Market Value

Market value is the general price at which, barring distress, a purchaser is willing to pay and the seller is willing to sell.


A loan’s maturity is the period until the final payment is due. Most often this is also expressed as the term of the loan, which is used to calculate the mortgage payment.

Maximum Loan Amount

A maximum loan amount is the largest loan size permitted on a particular mortgage loan option. For instance, if the loan is backed by (purchased on the securitized mortgage market) Fannie Mae or Freddie Mac, the maximum loan amount is the top amount these agencies will purchase from the servicing lender. For FHA loans, the agency sets its own limits and vary by geographical location.

Maximum Loan to Value Ratio

The maximum loan to value (LTV) ratio is the highest ratio allowed for the loan amount compared to the value of the home. For instance, the maximum LTV for FHA loans would be 96.5% – meaning a borrower must have a 3.5% down payment.

Maximum Lock

A maximum lock is the longest amount of time a lender will lock your interest rate on a given mortgage loan option. A 45 or 60 day maximum lock period is common, with 90 days another common option.

Minimum Down Payment

Your minimum down payment is the least amount of cash on hand allowed for a particular mortgage loan. For instance, on an FHA loan, your minimum down payment is 3.5%. If the house is selling for $120,000 your minimum down payment would be $4,200.

Modular Home (Modular Housing)

A modular home is not a mobile home; it is simply a home that is built off-site, as opposed to on-site. These homes are often called factory-built, system-built or prefab (short for prefabricated) homes. Modular and manufactured homes are not the same. Manufactured homes are not placed on permanent foundations.

Mortgage (Mortgage Loan)

A mortgage is the charging of real (or personal) property by a debtor to a creditor as security for a debt (especially one incurred by the purchase of the property), on the condition that it shall be returned on payment of the debt within a certain period.

Mortgage Approval

Mortgage approval happens when the lender approves the borrower for a mortgage. Approval means the borrower meets the mortgage lender’s requirements. This can happen more quickly when mortgage pre-approval is done early in the home buying process.

Mortgage Banker

The mortgage banker (also called a mortgage lender) is the financial institution loaning the money for a home purchase. A mortgage banker must be registered with the National Mortgage Licensing System (NMLS). Loan officers working for a mortgage bank must also be licensed with the NMLS. A mortgage bank funds the loan.

Mortgage Broker

A mortgage broker is an independent contractor who sells mortgage services to borrowers, working with multiple lenders. A mortgage broker works with the borrower through the process, then submits the loan application to lenders he or she contracts with, which then underwrite the loan. The mortgage broker does not fund the loan.

Mortgage Company

The mortgage company is the financial institution loaning the money for a home purchase. Mortgage companies can (and do) sell the mortgage note on the secondary market.

Mortgage Formulas

Mortgage formulas are the standard equations used in the housing market to come up with common financial measurements such as monthly loan payment, loan balance, and APR.

Mortgage Insurance

Mortgage insurance protects the lender against loss in the event of borrower default. The borrower most often pays the premium in monthly installments or an up-front fee. FHA loans are insured by the Federal Housing Administration and its mortgage insurance program. (see private mortgage insurance)

Mortgage Insurance Premium

The mortgage insurance premium is the monthly or up-front fee the homeowner/borrower pays for mortgage insurance.

Mortgage Lender

A mortgage lender (also called a mortgage banker) is the financial institution that holds the note on the mortgage loan and disperses the funds to the borrower to buy the home.

Mortgage Loan Program

Mortgage loan program refers to the option used to finance a home purchase. Examples of mortgage loan programs include: ARM, FRM, FHA, USDA rural development, or VA loans. This is also called the mortgage loan option.

Mortgage Modification

Mortgage modification is any change in the terms of your mortgage. This most often refers to the interest rate or term, typically related to a borrower’s inability to make the monthly payments under the current mortgage agreement.

Mortgage Payment

Your mortgage payment is the amount you pay each month to your mortgage company. It includes the interest and principal, and any escrow or insurance premiums that may be included in your mortgage contract.

Mortgage Pre-Approval

Mortgage pre-approval happens when your lender approves you as the borrower for a certain amount to buy a house. The process most often includes pulling your credit score and verifying income with paystubs or a W2 tax form. Mortgage pre-approval positions a buyer to better negotiate a purchase because the seller knows your offer is backed by a lender. Mortgage approval comes after pre-approval.

Mortgage Price

The interest rate, points and fees paid to the lender add up to the mortgage price. On adjustable rate mortgages (ARMs) the mortgage price includes the fully indexed rate and the maximum rate.

Mortgage Spam

Mortgage spam is the unsolicited offers in your email for great deals, low interest, refinancing opportunities and other advertising. You may also see mortgage spam in your actual mail box. This is correspondence you have not opted in for or asked to receive. Mortgage spam is generally generated by trigger lead systems.


Negative Amortization

Negative amortization results in the mortgage loan balance actually increasing instead of decreasing. The monthly payments do not pay the full interest due for the month, and the remaining interest rolls over and is added to the principal.

Negative Points

Negative points are paid by a lender for a loan with a rate above the rate on a zero-point loan. Here’s how it might work: a wholesaler quotes the following prices to a mortgage broker. 5%/0 points, 4.5%/3 points, 5.75%/-3 points. Some lenders and advertisements refer to negative points as “rebates” because they are used to reduce a borrower’s settlement costs.

No Change Scenario

When an adjustable rate mortgage (ARM) comes with the assumption that the value of the index it’s tied to does not change from the initial level, you have a no change scenario.

No Cost Mortgage

A no cost mortgage is the name for a mortgage loan where the lender or seller pays for all closing costs except for per diem interest, escrow and transfer taxes.

Non-Permanent Resident Alien

Non-permanent resident aliens (NRAs) are citizens of another country who live in the United States under a Conditional Resident Alien Card, Temporary Resident Card, work visa, student visa or some other permit for some specified period of time. They often have very strict conditions for qualifying for a mortgage.

No Asset Loan

A no asset loan refers to the mortgage option where the borrower did not have to disclose assets.

No Income Loan

A no income loan is the mortgage option where the borrower is not required to disclose their income.

No Income No Asset Loan

A type of reduced documentation mortgage program in which no income and no assets are disclosed on the loan application, but employment is verified. NINA loans usually fall into the Alt-A classification, and may carry a higher interest rate than a prime mortgage.

Nominal Interest Rate

The nominal interest rate is a quoted interest rate not adjusted for intra-year compounding or inflation. For example, a quoted rate of 5% on a mortgage is nominal. Adjusted rates are called effective.


Open End Mortgage

An open end mortgage happens when the lender and borrower agree that future advances of principal can be arranged. The borrower will receive a limit of the total outstanding balance. Open end mortgages are similar to a line of credit.

Option ARM

An adjustable rate mortgage with flexible payment options, monthly interest rate adjustments and low monthly payments in the early years is an option ARM. Option ARMs carry a high risk of inflated payments in the later years. Option ARMs are often considered a major contributor to the housing bubble and foreclosure glut of 2007.

Option Fee

Home buyers pay an option fee under a lease-to-buy agreement. The fee – typically around one-to-five percent (1%-5%) of the price – is then credited to the purchase price when the buyer exercises the option to buy.

Origination Fee

A lender charges an origination fee to process and writes your mortgage. Lenders will often express the amount in a percentage of the loan amount.


Payment Adjustment Interval

The payment adjustment interval is the period between payment changes on an adjustable rate mortgage. The interval may or may not be the same as the interest rate adjustment period. ARMs where the payment adjusts less frequently than the rate may generate negative amortization.

Payment Increase Cap

Payment increase cap refers to the maximum percentage increase in the payment on an ARM at a payment adjustment date. You’ll see a common cap of 7.5%.

Payment Decrease Cap

Payment decrease cap refers to the maximum percentage decrease in the payment on an ARM at a payment adjustment date.

Payment Period

The payment period is the time the borrower must make their loan payments. For most mortgages the payment period is monthly.

Payment Shock

Payment shock refers to any shock over the change in payment of a loan. For instance, a borrower may experience payment shock when the payment amount on an adjustable rate mortgage jumps. Payment shock also refers to the surprise renters feel when buying their first house, and make that first house payment.

Per Diem Interest

Any interest accrued from the day of closing a mortgage loan until the first day of the following month is called per diem interest.

Personal Property

Personal property is any item you own such as cash, jewelry, furniture, and securities that are not classified as real property or real estate.


PITI is an acronym that stands for: Principal, Interest, Taxes, and Insurance. It’s essentially your total monthly house payment.


Points are the upfront cash payment required by a mortgage lender as part of the charge for the loan. Lenders express points as a percent of the loan amount. For instance, “2 points” means a charge equal to 2% of the loan balance. In today’s housing market you’ll see some lenders advertising a wide range of rate/point combinations, including combinations with negative points. A negative point loan means the lender contributes cash toward meeting closing costs.

Portfolio Lender

Portfolio lender is a term for the mortgage banker which retains the loan rather than the common practice of selling it on the secondary market.

Power of Attorney

Power of attorney is the written permission for one person or party to act on the behalf of another person or party.

PowerSaver Grant

The Neighborhood Loans PowerSaver program from Neighborhood Loans Home Mortgage offers a $1,000 closing cost credit when a home buyer (or homeowner refinancing their home) makes specific eco-friendly home improvements with the FHA 203k renovation loan.


Pre-Approval is the first step in the mortgage process. Once done you will better understand what price range you can look for a home in. A good pre-approval will also strengthen your offer.

Predatory Lending

Predatory lending is a term covering a wide range of practices by businesses designed to take advantage of unwary borrowers. Predatory lenders want to make a quick buck, no matter the cost to the consumer.


Prepayment is an advanced payment on a loan. Loans can either permit such payments without penalty, or there may be a penalty for such prepayments, called a prepayment penalty.


Mortgage prequalification is the verbal commitment from a lender that the borrower can get approved or qualified for a mortgage. This generally consists of verbal commitments to income and credit questions, rather than documented proof.

Primary Residence

Primary residence refers to the home where the borrower lives the majority of his or her time. The time required may differ between lenders and programs, but the idea is that the primary residence is not a second home or vacation home, nor is it an investment property that will be rented to a tenant.


Principal is the actual loan balance. Principal can also mean the portion of the monthly payment that goes to paying off the loan balance, indicate a party to a transaction, or the principal can hire an agent to represent him in wither a purchase or sale.

Principal Limit

Principal limit is the current value of a house under the FHA reverse mortgage program, given the elderly owner’s right to live there until death or voluntary move-out.

Private Mortgage Insurance (PMI)

Private mortgage insurance (PMI) is insurance against the default of a loan. Costs are dependent on the amount of insurance required and the guidelines in force at the time of loan. It’s also simply called mortgage insurance.


Processing is the compiling and maintaining of the file of information about a mortgage transaction. Paperwork in processing includes a credit report, appraisal and verification of employment and assets. The processing file is handed off to underwriting for the loan decision.



Qualification is the process which determines whether a prospective home buyer has the ability to repay their mortgage loan. Part of this process includes looking at assets and income. However, it falls short of approval because it does not look at the credit history and FICO score of the borrower. Approval and mortgage pre-approval are stronger indicators of your chances to buy a home.

Qualification Rate

A qualification rate is the interest rate used to calculate the initial mortgage payment when qualifying the borrower. This rate may not match the initial rate on the mortgage loan. For example, a qualification rate for an adjustable rate mortgage could be qualified at the fully indexed rate rather than the initial interest rate.

Qualification Ratios

A qualification ratio is the requirement from the lender that the ratio of housing expense to borrower income as well as the housing expense plus other debt service to borrower income, cannot exceed specified maximums (like 31% and 36%). Qualification ratios may reflect the maximums specified by Fannie Mae and Freddie Mac and can vary with the loan-to-value ratio and other factors.

Qualification Requirements

Qualification requirements refer to lender standards for granting loan qualification. Requirements may include maximum ratios of housing expense & total expense to income, maximum loan amounts or maximum loan-to-value ratios. These are less comprehensive than underwriting requirements, which take into account a borrower’s credit history and FICO score.


Rate Caps

Rate caps are used in adjustable rate mortgages (ARMs) to limit the increase or decrease in the interest rate of the mortgage. There can be rate caps for each period as well as the life of loan caps.

Recast Payment

A homeowner can “recast payment” to raise or lower the mortgage payment to the fully amortizing payment. Periodic payment-increase recasts exist on adjustable rate mortgages. When borrowers have made extra payments and need to have their payment reduced, they may see a payment reduction recast.

Refinance (Refi)

Refinance (also called refi) refers to the paying off of an existing mortgage with a new loan. Homeowners might refinance to a lower interest rate to save money on their monthly house payment. A homeowner might also refinance into a shorter-term mortgage loan. Homeowners might even refinance and remodel with a home improvement loan rather than a line of equity.

Release of Liability

A release of liability means releasing a lender from personal liability for a mortgage loan.

Required Cash

Required cash refers to the monies a borrower will need to close the mortgage loan. It’s also known as cash-to-close and includes closing costs.


RESPA is an acronym the stands for “Real Estate Settlement Procedures Act.” The federal government enacted the consumer protection statute in 1974. RESPA was designed to protect home buyers and homeowners shopping for settlement services by mandating certain disclosures, and prohibiting referral fees and kickbacks.

Retail Lender

A retail lender offers mortgage loans directly to borrowers through loan officers or mortgage consultants working for that lender. The opposite of a retail lender is a wholesale lender, which operates through mortgage brokers and correspondents.

Reverse Mortgage

Reverse mortgages are loans to senior citizen homeowners (at least 62 years old). The balance rises over time and is not repaid until the owner dies, sells the house, or moves out permanently. In lieu of repayment, the lender takes possession of the home.

Right of Rescission

Right of rescission is a borrower’s right to cancel a refinancing deal at no cost to self within 3 days of closing. This right comes from the Truth in Lending Act.


Scenario Analysis

Scenario analysis determines how the interest rate and payment on an adjustable rate mortgage (ARM) will change in response to specified future changes in market interest rates called “scenarios.”

Scheduled Mortgage Payment

Your scheduled mortgage payment is the amount you must pay each period. This includes interest, principal, mortgage insurance, and any escrow payments under the terms of your mortgage contract. Not paying or paying less than the scheduled amount puts you in delinquency.

Seasoned Loan

A seasoned loan means the loan has been paid on time for a sufficient amount of time, giving a lender the reasonable belief that it will continue in a like manner. FHA requires a loan to be outstanding for twelve months before it is seasoned. Other secondary marketers may have varying guidelines.

Second Mortgage

A second mortgage is a real estate mortgage that is a second or junior mortgage to the first or senior mortgage. The first mortgage gets paid off first before the second mortgage. Therefore, second mortgages are riskier for lenders and generally come with a higher interest rate. Examples include home equity loans or a home equity line of credit, among other more general second mortgages.

Secure Option ARM

A secure option ARM refers to an adjustable rate mortgage (ARM) where the initial rate holds for 5 years rather than one month.

Secondary Market

The secondary market is the financial market where investors buy mortgages and mortgage-backed securities.

Self Employed Borrower

Self-employed borrowers are entrepreneurs with their own businesses. They are subject to more strict pre-approval requirements like long-term tax returns rather than pay stubs.

Seller Contribution

A seller contribution is and money paid to the borrower’s cash-to-close like a down payment, paid by the home seller.

Seller Financing

Seller financing refers to the provision of a mortgage by the home seller (like a second mortgage) as a condition of the home sale.


Servicing refers to the administration of services of a loan from the time it’s closed until it is paid off by the borrower. Servicing includes the collection of payment from the borrower, payment by the lender of insurance and property taxes from escrow, maintaining the record of loan payment progress, and pursuing delinquent accounts.

Servicing Agent

A servicing agent is a business that services the mortgage loan. This servicing agent may be different from the lender that originated the mortgage if that lender does not serve its own loans.

Servicing Transfer

Servicing transfers occur when the originating lender turns over-servicing responsibilities to another servicing agent.


For real estate and home buying purposes, “settlement” is the same as “closing,” which is the process of actually transferring a title. This can be handled by an attorney, escrow company, lender, broker, or occasionally by the parties themselves, depending on state law.

Settlement Costs

Settlement costs, also called closing costs, refer to fees a borrower pays at the time the loan closes. Down payment and escrow funding are not typically considered settlement costs.

Short Sale

A short sale refers to a sale of real estate in which the sale proceeds fall short of the balance owed on the property’s loan. It often occurs when a borrower cannot pay the mortgage loan on their property, but the lender decides that selling the property at a moderate loss is better than pressing the borrower. Both parties consent to the short sale process, because it allows them to avoid foreclosure.

Silent Second Mortgage

A silent second mortgage is any second mortgage used to deceive the first mortgage bank or to provide preferential (subsidized) terms to qualified home buyers.

Simple Interest Mortgage

Simple interest mortgages are loans on which interest is calculated daily, based on the balance at the time of the last payment. For this home buying option, daily interest charge within the month is constant — interest is not charged on the interest charges of prior days.


Solvent is a financial position of being able to meet one’s current financial obligations.

Stated Assets

“Stated assets” refers to the documentation requirement where the borrower discloses assets, but the lender does not verify those assets.

Stated Income

“Stated income” is the documentation requirement where the lender verifies the source of the income but not the amount.

Strategic Default

A homeowner who has the ability to pay the mortgage loan but decides to stop paying because of negative equity commits strategic default. Any default, strategic or not, negatively affects a borrower’s credit score substantially.

Streamlined Refinancing

Streamlined refinancing omits steps in the refinancing process such as home appraisal and other standard risk control measures in order to save time and money in the refi process.


A submortgage uses a mortgage as security for obtaining additional mortgages. As an asset, it can be used as collateral for a loan.

Subordinate Financing

Subordinate financing is any second mortgage on a property that is not paid off when a new loan is issued. The second mortgage lender must allow subordination to the newer first mortgage loan.

Subordination Policy

A subordination policy is the policy of a second mortgage lender allowing a borrower to refinance the first mortgage loan while leaving the second mortgage in place.

Sub-Prime Market

The sub-prime market is a network of sub-prime lenders, mortgage brokers, warehouse lenders, and investment bankers who made possible the delivery of loans to sub-prime borrowers. This is often credited with the collapse of the US housing market in 2007.

Sub-Prime Mortgage

A sub-prime mortgage is a loan given to a borrower with poor credit to buy a house. These borrowers pay higher points and rates than prime borrowers.


A survey is the drawing completed by a licensed surveyor who details the measurements of the land parcel as well as the improvements to the land. The survey used for loan transactions will need to be performed no more than 90 days before the closing of the loan and must be accompanied by a certificate.


Tangible Net Benefit

Tangible net benefit refers to the net gain to a borrower from a refinancing.

Tax Lien

Tax lien is the lien made by the federal or state government against a property for unpaid taxes.

Tax Service Fee

The tax service fee charged by some lenders at closing covers the cost of paying taxes on the buyer’s property when they come due. It’s essentially a charge for offering an escrow account.

Teaser Rate

The teaser rate on an adjustable rate mortgage (ARM) is the initial rate, which falls below the fully indexed rate.

Temporary Buydown

A temporary buydown is a reduction in the mortgage loan payment in the early years of the loan. A borrower can get a temporary buydown in exchange for an upfront cash payment provided by the home buyer, the seller, or both.


Term is the period of time used to calculate the monthly mortgage payment. The term is usually the same as the maturity, but can also differ. For instance, on a 9-year balloon loan, the maturity is 9 years but the term in most cases is 30 years.


The title is the documentation to the rightful ownership. In real estate, it refers to the rightful ownership of real property.

Title Insurance

Title insurance protects a creditor against losses related to defects in title, paid by the borrower as a fee. It’s also called a lender’s policy.

Total Interest Payments

“Total interest payments” refers to the sum of all interest payments to date or over the life of the loan. Because this measurement does not include up-front cash payments and it is not adjusted for the time value of money, it is an incomplete measure of the cost of credit to the borrower.

Trigger Leads

Trigger leads are essentially spam. The major credit agencies are allowed to flag files when someone applies for a mortgage, and can also sell this private information with no recourse. Companies can buy personal information like names, phone numbers, mortgage histories and FICO scores, then solicit your business unwarranted.

Truth in Lending Act

The Truth in Lending Act is a 1969 law requiring full disclosure – in writing – of any and all costs associated with the credit side of the purchase, including the Annual Percentage Rate, if applicable.



Underage covers fees collected from a borrower by a loan officer which are lower than the target fees specified by the lender or mortgage broker who employs the loan officer.


In the mortgage approval process, underwriting is the process of examining all the data about a borrower’s property and the transaction to determine whether the mortgage applied for by the borrower should be issued. The person who does this is called an underwriter.

Underwriting Standards

Underwriting standards are requirements imposed by the lender to determine whether a borrower qualifies for a loan. These standards are more comprehensive than qualification requirements because they include evaluating the borrower’s credit history and FICO score.



VA stands for “Veterans Administration” and refers to the agency which backs programs like the VA mortgage loan.

VA Mortgage Loan (VA Loans)

A VA loan is a mortgage loan in the United States guaranteed by the U.S. Department of Veterans Affairs (VA). The loan may be issued by qualified lenders. The VA loan was designed to offer long-term financing to eligible American veterans or their surviving spouses (provided they do not remarry).


Waive Escrows

“Waive escrows” is the authorization by the lender for the borrower to pay taxes and insurance directly. Typically the lender adds the taxes and homeowners insurance to the monthly mortgage payment, which is then deposited in an escrow account. From there, the lender pays the borrower’s taxes and insurance when they are due. On some loans, lenders will not waive escrows, and on loans where a waiver is permitted lenders are likely either to charge for it in the form of a small increase in points or restrict it to borrowers making a large down payment.

Warehouse Lender

A warehouse lender is the financial institution which lends to temporary lenders against the collateral of closed mortgage loans prior to the sale of the loans in the secondary market.

Wholesale Lender

Wholesale lenders provide home loans through mortgage brokers or correspondents. The broker or correspondent initiates the transaction with a borrower, takes that borrower’s application, and processes the loan.

Work Out Assumption

Work out assumption is the assumption of a mortgage, with permission of the lender, from a borrower unable to continue making the payments.

Wrap-Around Mortgage

A wrap-around mortgage is a type of financial allowing a junior mortgage (new) to be treated as a prior or senior mortgage. The wraparound mortgage payment is a combination of all mortgage payments.


Yield Curve

The yield curve is the graph that shows how the yield varies with the period to maturity at any given time. In a typical scenario the curve slopes up, but occasionally it slopes down or is flat. A flat yield curve means that yields on long-term bonds are not much higher than those on short-term notes.


Zero Down Loan (Zero Down Mortage)

A zero down loan, also called 100% financing requires no down payment. However, the borrower may be required to pay money at closing to cover escrow, inspections or fees.

Zero Ordinances

Zero ordinances are a local government’s authorized rules regarding building codes and restrictions for property land usage.