Glossary

A bond used to guarantee the specific completion of an endeavor in accordance with a contract.

Principal, Interest, and Taxes – the three elements of a monthly mortgage payment; payments of principal and interest go directly towards repaying the loan while the portion that covers taxes goes to the city for payment of property taxes.

Discount charges imposed by lenders to raise the yields on their loans. One point equals one percent of the amount of the loan.

A written instrument duly signed and executed by an owner of property, which authorizes an agent to act on behalf of the owner to the extent indicated in the instrument.

Lender commits to lend to a potential borrower; commitment remains as long as the borrower still meets the qualification requirements at the time of purchase.

Allows a defaulting borrower to sell the mortgaged property to satisfy the loan and avoid foreclosure.

A lender informally determines the maximum amount an individual is eligible to borrow.

An amount paid on a regular schedule by a policyholder that maintains insurance coverage.

Payment of the mortgage loan before the scheduled due date; may be subject to a prepayment penalty.

A clause in a mortgage which gives a mortgagor the privilege of paying the mortgage indebtedness before it becomes due.

The employer of an agent or broker; the broker's or agent's client.

The amount borrowed from a lender; doesn’t include interest or additional fees.

A printed statement disclosing all material aspects of a real estate project.

A note secured by a mortgage given by a buyer, as mortgagor, to a seller, as a mortgagee, as part of the purchase price of the real estate.