Canadian Maple Leaf Licensing Info: FSCO (Ontario) #11363,
and serving all other provinces.
 

GLOSSARY

Canadian Financial, Real Estate and Mortgage Glossary

How often this word is used
 
^
50% - Moderately

Principal


Synonyms:loan principal, mortgage principal, principal amount, principal sum, principal value
Filed Under: financial-banking, mortgages
Tags: banking, mortgage
 

Definition of principal

principal
1. In mortgage terms, principal is the original balance of loaned money on an outstanding loan and fees, excluding interest. Also the remaining balance of a loan, excluding interest.

Related Terms and Acronyms:

  • annual mortgage statement   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.
  • high-ratio mortgage   A mortgage in which a borrower places a down payment of less than 20% of the purchase price.
  • interest rate (IR)   The rate a lender charges an individual to borrow money.
  • loan-to-value (LTV)   The ratio of the principal amount of the loan to the lesser of the purchase price of the property or the property's appraised value. This can be expressed as an 80% loan, or 80% LTV.
      ➥  A widely used term in the mortgage brokerage and lending industry, especially by mortgage underwriters.
  • mortgage (mtg)   A mortgage is a contract stipulating a specific real property, typically a residence or building, as collateral for a loan. The mortgage incurs a rate of interest that varies according to term and other features.
  • principal, interest and taxes (PIT)   Principal, interest and taxes. The components of a monthly mortgage payment.
  • principal, interest, taxes, and insurance (PITI)   Acronym for the elements of a mortgage payment: principal, interest, taxes and insurance.
  • reconveyance   The transfer of title to the borrower after a mortgage has been paid fully.
  • simple interest (SI)   Interest computed only on the principal balance, without compounding.
  • step-rate mortgage   A fixed-rate home loan on which payments are lower at the beginning, typically for two years, and which then rise.

More Related Terms and Acronyms

Search the Glossary

Mortgage Payments Calculator
A different down payment amount can make the difference between buying a house and buying your dream house. Our mortgage calculator can show you how a change in your down payment amount can affect how much you pay in interest, either saving you thousands or giving you the room to buy that house you've always wanted.
Mortgage Payments Calc
 
Mortgage Rates
With the rates they offer, applying for a mortgage at your bank is like throwing your hard-earned money in the trash. We offer amazing mortgage rates, apply today!
Mortgage Rates
 
Mortgage Brokers
We feel that we're in the business of making your dreams come true. Our brokers genuinely want to help you get that dream house, and we will do whatever it takes to find you the best mortgage to suit your needs.
Mortgage Brokers Make Dreams Happen