Glossary Of Real Estate Terms
Amortization Schedule: A table that lists how much a mortgage payment will be each month based on the mortgage amount and the interest rate.
Credit Report: A report on a buyer's credit history required by the lender before approval.
Debt Service: The total amount of the loan payment, including principal and interest.
Earnest Money: The deposit used to secure a purchase agreement.
Escrow: Deposit of money and documents to a third party until the closing.
Fair Market Value: The sale price of a property on the open market given a reasonable time to sell.
Fixed Rate Loan: A loan that has an unchanging interest rate.
Good Faith Estimate: A required statement from the lender that shows all of the expected closing costs.
Gross Income: All money coming into a household on a regular basis.
Interest: Money paid to a lender as compensation for money that is borrowed.
Loan Fee: Also known as points, discount points or origination fee, this is a one time charge by a lender as compensation for their services. 1 point equals 1% of the mortgage amount.
Mortgage: The legal instrument by which property is offered as security.
PITI: Principal, interest, taxes, and insurance. This is your monthly house payment.
PMI: Private mortgage insurance, required by many lenders when a borrower's down payment is less than 20% of the purchase price.
Prequalifying: The lender's process of finding whether a borrower is creditworthy and capable of making payments on a loan.
Principal: The amount of money borrowed.
Property Tax And Insurance Escrow: Money collected monthly by the lender and held to pay taxes and insurance when due.
Realtor: A trademark for real estate agents who are members of the National Association of Realtors.
Term: The length of time in which a loan is to be paid off.
