Real Estate Dictionary

Occasionally, a lender will agree to modify the terms of your mortgage without requiring you to refinance. If any changes are made, it is called a modification.

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.

The date on which the principal balance of a loan, bond, or other financial instrument becomes due and payable.

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.

The time period during which the lender has guaranteed an interest rate to a borrower.

An agreement in which the lender guarantees a specified interest rate for a certain amount of time at a certain cost.

The percentage relationship between the amount of the loan and the appraised value or sales price (whichever is lower).

After you obtain a loan, the company you make the payments to is "servicing" your loan. They process payments, send statements, manage the escrow/impound account, provide collection efforts on delinquent loans, ensure that insurance and property taxes are made on the property, handle pay-offs and assumptions, and provide a variety of other services.

How a lender refers to the process of obtaining new loans.

Also referred to by a variety of other terms, such as lender, loan representative, loan "rep," account executive, and others. The loan officer serves several functions and has various responsibilities: they solicit loans, they are the representative of the lending institution, and they represent the borrower to the lending institution.

A sum of borrowed money (principal) that is generally repaid with interest.

A cash asset or an asset that is easily converted into cash.

An agreement by a commercial bank or other financial institution to extend credit up to a certain amount for a certain time to a specified borrower.

For an adjustable-rate mortgage (ARM), a limit on the amount that the enterest rate can increase or decrease over the life of the mortgage.

A legal claim against a property that must be paid off when the property is sold. A mortgage or first trust deed is considered a lien.