Fairway Asset Corporation - MORTGAGE DICTIONARY

Morgage Dictionary

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There are currently 13 names in this directory beginning with the letter P.
Principal and Interest payment on a home loan. This does not include taxes, insurance, or HOA dues.

Payment Cap
The maximum monthly payment amount a borrower can pay. Only for adjustable rate mortgages.

Piggyback Loan
When a borrower opens two mortgages (first and second) simultaneously when buying a home. This is usually done to avoid private mortgage insurance.

The buyer's full housing payment. Principal, Interest, Taxes, Insurance. This includes all costs from each plus any HOA dues.

Power of Attorney
Legal document authorizing one person to act on behalf of another.

Process of determining what the borrower(s) can afford through verification of legal documentation of income, assets and debts. Different from pre-qualification.

Process of determining what the borrower(s) can afford from non-verified information provided by the borrower(s).

Any expenses necessary to create an escrow account or adjust the seller's existing escrow account. This can include any taxes, insurance and special assessments.

Primary Residence
A house or condo which is occupied for the majority of the year by the borrower.

Prime Rate
Interest rate offered by commercial banks

the amount of money you borrow based on the sale price of the home. In the early stages of your mortgage term, your monthly payment includes only a small portion that repays your original principal. As you continue to make payments through the years, a greater portion of your payment goes to reduce the principal.

Private Mortgage Insurance (PMI)
An insurance policy that covers your mortgage lender In case the borrower defaults on the loan. This is borrower paid monthly when there is less than 20% down on a conventional loan.

Property Taxes
Annual local taxes charged upon the value of a homeowner's property.