major deficiency
A deficiency that strongly impacts the usability and habitability of a house. Or a deficiency that may be very expensive to repair.
manufactured housing
Once known as ''mobile homes,'' manufactured housing is any building which has been constructed off site, then moved onto a piece of real property.
margin
The number of percentage points the lender adds to the index to calculate the ARM interest rate at each adjustment. For example, an index rate of 8% plus a margin of 2.5% could result in a home loan rate of 10.5%. The fixed margin over the index covers the lender's operating expenses and profit margin.
maturity
The date on which the principal balance of a loan, bond, or other financial instrument becomes due and payable.
metes and bounds
A traditional way of describing property, generally expressed in terms of distance from a known landmark or intersection, and then following the boundaries of the property back to its origin.
mineral rights
The legal right to exploit and enjoy the benefits of any minerals located below the surface of a parcel of land.
modification
A change in any of the terms of the loan agreement.
mortgage
A legal document specifying a certain amount of money to purchase a home at a certain interest rate, and using the property as collateral.
mortgage banker
The lender or one making the loan in a mortgage contract.
mortgage broker
A mortgage company that originates loans, then places those loans with a variety of other lending institutions with whom they usually have pre-established relationships.
mortgagee
The lender in a mortgage agreement.
mortgage insurance (MI)
Guaranty insurance that protects conventional lenders from losses on a portion of a particular loan. Also known as MI, PMI or Private Mortgage Insurance.
mortgagor
The borrower in a mortgage agreement.
multidwelling units
Properties that provide separate housing units for more than one family, although they secure only a single mortgage.
negative amortization
Occurs when loan payments are not enough to cover the amount of interest due for that payment period. The unpaid interest is calculated and added to the total loan amount, increasing your outstanding balance.
no-cost loan
Almost all lenders offer loans at "no points." You will find the interest rate on a "no points" loan is approximately a quarter percent higher than on a loan where you pay one point.
non-conforming use
The use of land for purposes contrary to the applicable municipal zoning specifications. Often occurs when zoning changes after a property is in use.
note
A legal document that obligates a borrower to repay a mortgage loan at a stated interest rate during a specified period of time.
note rate
The interest rate stated on a mortgage note.
notice of default
A formal written notice to a borrower that a default has occurred and that legal action may be taken.
obsolescence
The process of an assets value diminishing due to the development of more desirable alternatives or because of the degradation of its capabilities.
off-site improvements
Buildings, structures or other amenities which are not located on a piece of property, but are necessary to maximize the use of the property or in some way contribute to the value of the property.
on-site improvements
Buildings, structures or other amenities that are erected on a piece of property and contribute to its value.
original principal balance
The total amount of principal owed on a mortgage before any payments are made.
origination fee
A fee charged by most lenders--also called points--for processing a loan. A point is 1 percent of the total loan amount.
owner financing
A property purchase transaction in which the property seller provides all or part of the financing.
owner occupied
The state of property wherein the owner occupies at least some portion of the property.
