Mortgage Terms

A, B, C, D-E, F-G, H-K, L-M, N-Q, R-S, T-Z

 

Abstract of Title
an historical summary provided by a title insurance company, of the successive conveyances affecting the title to a property.

Acceleration Clause
a provision in a mortgage enabling the lender to declare the entire outstanding balance of a loan immediately due and payable in the event the borrower violates any condition of the mortgage or note (such as missing payments).

Adjustable-Rate Mortgage (ARM)
a mortgage with an interest rate that changes periodically, according to an index that is selected when the mortgage is issued, plus a margin that remains constant. Although the initial interest rate may be lower than that of a fixed-rate mortgage, the monthly payments can go up or down when the rate is adjusted.

Alienation Clause
a provision stating that a mortgage loan must be paid in full if the ownership is transferred.

Amortization
the gradual repayment of a mortgage loan by regular installments including both interest and principal. The timetable covering this process is called an amortization schedule.

Annual Percentage Rate (APR)
a stated rate that reflects the entire cost of your mortgage, including interest, points, origination fees, etc.

Appraisal
a written estimate of the value of a property, made by a licensed real estate appraiser.

Appreciation
an increase in the value of a property, due to changes in the market and/or improvements to the property.

Assessed Valuation
a value placed on property for the purpose of levying property taxes. This is not necessarily the same as the appraised or market value of the property.

Assumable Mortgage
a mortgage that can be taken over by the buyer of a property. FHA and VA loans are fully assumable loans.