| Term |
Definition |
| Margin |
The amount a lender adds to
the index on an adjustable rate mortgage to establish the adjusted
interest rate. |
| Market Value |
The highest price that a
buyer would pay and the lowest price a seller would accept on a
property. Market value may be different from the price a property
could actually be sold for at a given time. |
| Marketable Title |
A title that is free and
clear of objectionable liens, clouds, or other title defects. A
title which enables an owner to sell his property freely to others
and which others will accept without objection. |
| Material Debt |
Liability that is
substantial. The debt results from a recent inquiry and could affect
the ratios used to make a decision on the loan. |
| Merged Credit Reports
|
Information issued by one
credit reporting company that receives credit history information
from more than one credit repository and combines all of it into one
concise format. May be individual or joint. |
| Minimum Down Payment
|
Minimum down payment is the
amount of money you are required to put down at closing. If the
minimum is 10%, you must make a down payment of at least $10,000 on
a $100,000 house. |
| Monthly Payment |
The amount paid each month
towards the principal and interest amount of a loan. The monthly
payment may or may not include taxes and insurance. |
| Monthly Payment
(P&I) |
The monthly payment amount
shown includes only principal and interest. When comparing with
other offers please take this into consideration. |
| Mortgage |
A lien or claim against
real property given by the buyer to the lender as security for money
borrowed. Under government-insured or loan-guarantee provisions, the
payments may include escrow amounts covering taxes, hazard
insurance, water charges, and special assessments. Mortgages
generally run from 10 to 30 years, during which the loan is to be
paid off. |
| Mortgage (Open-End) |
A mortgage with a provision
that permits borrowing additional money in the future without
refinancing the loan or paying additional financing charges.
Open-end provisions often limit such borrowing to no more than would
raise the balance to the original loan figure. |
| Mortgage Broker |
A person or entity that
specializes in loan originations, receiving a commission to match
borrowers and lenders. The Mortgage Broker performs some or most of
the loan processing functions such as taking loan applications,
ordering credit reports, appraisals, and title reports. Typically
the Mortgage Broker does not underwrite the loan and generally does
not use its own funds for closing. The Mortgage is generally closed
in the name of the lender who commissioned the broker's services. A
Mortgage Broker will not service the Mortgage. An entity or
individual engaged to handle or perform, for a Seller or
correspondent, part of the mortgage application processing,
underwriting, funding or postclosing functions, but not any
activities related to obtaining an application for a wholesale
origination. This entity is typically paid on a fee basis for
services performed, with the payment of fees not being contingent on
Mortgage approval or closing. |
| Mortgage Commitment |
A written notice from the
bank or other lending institution saying it will advance mortgage
funds in a specified amount to enable a buyer to purchase a house.
|
| Mortgage Insurance |
Money paid to insure the
mortgage when the down payment is less than 20 percent. |
| Mortgage Insurance
Premium |
The payment made by a
borrower to the lender for transmittal to HUD to help defray the
cost of the FHA mortgage insurance program and to provide a reserve
fund to protect lenders against loss in insured mortgage
transactions. In FHA insured mortgages this represents an annual
rate of one-half of one percent paid by the mortgagor on a monthly
basis. |
| Mortgage Note |
A written agreement to
repay a loan. The agreement is secured by a mortgage, serves as
proof of an indebtedness, and states the manner in which it shall be
paid. The note states the actual amount of the debt that the
mortgage secures and renders the mortgagor personally responsible
for repayment. |
| Mortgagee |
The lender. |
| Mortgagor |
The borrower or homeowner.
|
