Terms with Category Mortgages

  • Abandonment Definition,
    • A disclaimer of ownership by the trustee or debtor in property deemed burdensome or inconsequential. Once property has been "abandoned" it is no longer the property of the estate and creditors can seek to recover their money.
  • Abstract of Title (ab) Abbreviation,
    • A written history of all the transactions that bear on the title to a specific piece of land. An abstract of title covers the time from when the property was first sold to the present.
    AB is a common abbreviation for Abstract of Title when used in property listings and real estate classifieds.
  • Acceptance Definition,
    • A property seller's formal, written approval of a buyer's offer.
  • Accredited Mortgage Professional (AMP) Acronym, Canada, Very Important,
    • The Accredited Mortgage Professional (AMP) is the only national proficiency standard created by CAAMP for Canada's mortgage industry.
    Accreditation offered by Canadian Association of Accredited Mortgage Professionals (CAAMP).
  • Accrue Bank,
    • To gather together an amount often over a period of time.
  • Accrued Interest Bank,
    • Interest which has already been earned but has not yet been paid.
  • Acquisition Fee Bank,
    • A fee charged by some leasing companies for originating the loan, just as mortgage lenders charge points as an origination fee. This fee is often not specified in a contract, but rolled into the capitalized cost when calculating monthly payments.
  • Add-on Interest Bank,
    • Interest that is computed at the beginning of the loan, then added to the principal, so that all must be repaid, even if the loan is paid off early.
  • Additional Principal Payment Bank,
    • Extra money included with a loan payment to pay off the amount owed faster. Over time, this practice reduces the amount of interest paid.
  • Additional Property Definition,
    • A property that is owned by the person that is not being financed.
  • Adjustable-Rate Mortgage (ARM) Bank,
    • A type of mortgage loan program in which the interest rate and payments may be adjusted as frequently as every month. The principal loan balance or term of the loan may also be adjusted to reflect the rate change. The purpose of the program is to allow mortgage interest rates to fluctuate with market conditions.
    A type of variable rate mortgage product.
  • Adjustment Period Definition,
    • The time between changes in the interest rate in an adjustable-rate mortgage.
  • Agency (agcy) Bank,
    • A relationship between two parties -- a client and an agent -- in which the agent represents the client in transactions with a third party.
  • Agency Closing Bank,
    • The use of a title company to supervise the meeting where the property is transferred and mortgage is settled.
  • Agent (agt) Bank,
    • A person who acts on behalf of another. In real estate, an agent is a person who conducts transactions on behalf of sellers and sometimes buyers.
  • Alienation Clause Definition,
    • A requirement that the borrower pay the mortgage in full upon transfer of the property.
  • Alternative Mortgage Definition, Important,
    • A home loan that is not a standard fixed-rate mortgage.
  • Amortization Bank,
    • Amortization refers to the process of gradually paying down the principal of a loan. Each payment toward the principal reduces your loan by that amount. This is different than an interest-only loan payment where the principal balance is never reduced. Amortization for a mortgage loan in Canada is normally 25 years, but can be as few as 5 years.
  • Amortization Period Bank,
    • The amount of time it will take to pay off a mortgage by making routine payments.
  • Amortization Schedule Bank,
    • A detailed table showing the amortization of a loan which includes the beginning principal amount, period payments, the interest portion of each payment, the principal reduction portion each payment, and the ending balance. The Canadian Equity Group has developed a mortgage rate calculator which will generate a perfect example of an amortization schedule.
  • Amortization Table Bank,
    • A mathematical formula used to calculate monthly mortgage payments based on the borrowed loan amount, the interest rate, and the loan term.
  • Amortization Term Bank,
    • The time required to amortize (repay) an entire mortgage loan.
  • Amortized Loan Bank,
    • A loan that is completely paid off, interest and principal, by a series of regular payments that are equal or nearly equal.
  • Amount Financed Bank,
    • The principal that is financed. It could include the cost of the purchase and other items rolled into the payments.
  • Annual Administrative Fee Bank,
    • An annual (yearly) fee charged for the administration of a service.
  • Annual Mortgage Statement Definition, Important,
    • A report sent to the borrower every year, detailing how much principal remains on the home loan and how much was paid in taxes and interest during the previous year.
  • Annual Percentage Rate (APR) Bank, Very Important,
    • A yearly rate of interest that includes fees and costs paid to acquire the loan. Lenders are required by law to disclose the APR. The rate is calculated in a standard way, taking the average compound interest rate over the term of the loan, so borrowers can compare loans. In mortgages, it is the interest rate of a mortgage when taking into account the interest, mortgage insurance, and certain closing costs including points paid at closing. There is no APR in an automobile lease; instead, the cost of money is expressed as the money factor.
    A number used to compare costs associated with mortgage loans and other forms of financing.
  • Application Fee Bank,
    • What the lender charges to process the document in which a prospective borrower details his or her financial situation to qualify for a loan.
  • Appraisal Definition,
    • An estimate of the market value of a piece of real estate made by a competent professional who knows local real estate prices and markets.
  • Appraisal Fee Definition,
    • What someone charges to deliver a professional opinion about how much a property is worth.
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