Click on a link below
for an alphabetized list of Real Estate and Mortgage
Terms.
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Margin
The difference between the interest rate and the index
on an adjustable rate mortgage. The margin remains stable
over the life of the loan. It is the index which moves
up and down.
Maturity
The date on which the principal balance of a loan, bond,
or other financial instrument becomes due and payable.
Merged credit report
A credit report which reports the raw data pulled from
two or more of the major credit repositories. Contrast
with a Residential Mortgage Credit Report (RMCR) or
a standard factual credit report.
Modification
Occasionally, a lender will agree to modify the terms
of your mortgage without requiring you t refinance.
If any changes are made, it is called a modification.
Mortgage
A legal document that pledges a property to the lender
as security for payment of a debt. Instead of mortgages,
some states use First Trust Deeds.
Mortgage banker
For a more complete discussion of mortgage banker, see
"Types of Lenders." A mortgage banker is generally
assumed to originate and fund their own loans, which
are then sold on the secondary market, usually to Fannie
Mae, Freddie Mac, or Ginnie Mae. However, firms rather
loosely apply this term to themselves, whether they
are true mortgage bankers or simply mortgage brokers
or correspondents.
Mortgage broker
A mortgage company that originates loans, then places
those loans with a variety of other lending institutions
with whom they usually have pre-established relationships.
Mortgagee
The lender in a mortgage agreement.
Mortgage insurance (MI)
Insurance that covers the lender against some of the
losses incurred as a result of a default on a home loan.
Often mistakenly referred to as PMI, which is actually
the name of one of the larger mortgage insurers. Mortgage
insurance is usually required in one form or another
on all loans that have a loan-to-value higher than eighty
percent. Mortgages above 80% LTV that call themselves
"No MI" are usually a made at a higher interest
rate. Instead of the borrower paying the mortgage insurance
premiums directly, they pay a higher interest rate to
the lender, which then pays the mortgage insurance themselves.
Also, FHA loans and certain first-time homebuyer programs
require mortgage insurance regardless of the loan-to-value.
Mortgage insurance premium (MIP)
The amount paid by a mortgagor for mortgage insurance,
either to a government agency such as the Federal Housing
Administration (FHA) or to a private mortgage insurance
(MI) company.
Mortgage life and disability insurance
A type of term life insurance often bought by borrowers.
The amount of coverage decreases as the principal balance
declines. Some policies also cover the borrower in the
event of disability. In the event that the borrower
dies while the policy is in force, the debt is automatically
satisfied by insurance proceeds. In the case of disability
insurance, the insurance will make the mortgage payment
for a specified amount of time during the disability.
Be careful to read the terms of coverage, however, because
often the coverage does not start immediately upon the
disability, but after a specified period, sometime forty-five
days.
Mortgagor
The borrower in a mortgage agreement.
Multidwelling units
Properties that provide separate housing units for more
than one family, although they secure only a single
mortgage.
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