A provision in a mortgage that gives the lender the right to demand
payment of the entire principal balance if a monthly payment is missed.
An offeree’s consent to enter into a contract and be bound by the terms of
additional principal payment
A payment by a borrower of more than the scheduled principal amount
due in order to reduce the remaining balance on the loan.
adjustable-rate mortgage (ARM)
A mortgage that permits the lender to adjust the mortgage's interest
rate periodically on the basis of changes in a specified index. Interest
rates may move up or down, as market conditions change.
The original cost of a property plus the value of any capital
expenditures for improvements to the property minus any depreciation
The date on which the interest rate changes for an adjustable-rate
The period that elapses between the adjustment dates for an
adjustable-rate mortgage (ARM).
A person appointed by a probate court to administer the estate of a
person who died intestate.
A detailed analysis of your ability to afford the purchase of a home.
An affordability analysis takes into consideration your income,
liabilities, and available funds, along with the type of mortgage you plan
to use, the area where you want to purchase a home, and the closing costs
that you might expect to pay.
A feature of real property that enhances its attractiveness and
increases the occupant’s or user’s satisfaction although the feature is
not essential to the property’s use. Natural amenities include a pleasant
or desirable location near water, scenic views of the surrounding area,
etc. Human-made amenities include swimming pools, tennis courts, community
buildings, and other recreational facilities.
The gradual repayment of a mortgage loan by installments.
A timetable for payment of a mortgage loan. An amortization schedule
shows the amount of each payment applied to interest and principal and
shows the remaining balance after each payment is made.
The amount of time required to amortize the mortgage loan. The
amortization term is expressed as a number of months. For example, for a
30-year fixed-rate mortgage, the amortization term is 360 months.
To repay a mortgage with regular payments that cover both principal
annual mortgagor statement
A report sent to the mortgagor (the borrower) each year. The report
shows how much was paid in taxes and interest during the year, as well as
the remaining mortgage loan balance at the end of the year.
annual percentage rate (APR)
The cost of a mortgage stated as a yearly rate; includes such items as
interest, mortgage insurance, and loan origination fee (points).
An amount paid yearly or at other regular intervals, often on a
guaranteed dollar basis.
A form used to apply for a mortgage loan and to record pertinent
information concerning a prospective mortgagor and the proposed security.
Lenders use the information on the loan application to evaluate whether or
not they can give the loan, and if so, the amount of money they can lend.
A written analysis of the estimated value of a property prepared by a
qualified appraiser. Contrast with home inspection.
An opinion of a property's fair market value, based on an appraiser's
knowledge, experience, and analysis of the property.
A person qualified by education, training, and experience to estimate
the value of real property and personal property.
An increase in the value of a property due to changes in market
conditions or other causes. The opposite of depreciation.
The valuation placed on property by a public tax assessor for purposes
The process of placing a value on property for the strict purpose of
taxation. May also refer to a levy against property for a special purpose,
such as a sewer assessment.
The public record of taxable property.
A public official who establishes the value of a property for taxation
Anything of monetary value that is owned by a person. Assets include
real property, personal property, and enforceable claims against others
(including bank accounts, stocks, mutual funds, and so on).
The transfer of a mortgage from one person to another.
A mortgage that can be taken over ("assumed") by the buyer when a home is
The transfer of the seller’s existing mortgage to the buyer. See assumable
A provision in an assumable mortgage that allows a buyer to assume
responsibility for the mortgage from the seller. The loan does not need to
be paid in full by the original borrower upon sale or transfer of the
The fee paid to a lender (usually by the purchaser of real property)
resulting from the assumption of an existing mortgage.
One who holds a power of attorney from another to execute documents on
behalf of the grantor of the power.