Real Estate
Glossary
This glossary has been provided to help Colorado Springs
homebuyers understand the unique language
of the real estate business.
A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | Y | Z Original
principal balance:
The sum amount of the principal which is owed on a mortgage before
any payments are made is called the Original principal balance.
Partial Payment:
This is a payment which is not sufficient to cover the scheduled
monthly payment on a mortgage loan. Generally, a lender will
not accept a partial payment, but when hardship comes one can
make this request of the loan servicing collection department.
Payment Change Date:
The date on which a new monthly payment amount takes effect on
an adjustable-rate mortgage or a graduated-payment mortgage is
called the Payment Change Date. Normally, the payment change
date occurs in the month straight away after the interest rate
adjustment date.
PITI:
PITI stands for principal, interest, taxes, and insurance. An "impounded" loan
means that the monthly payment covers all of these, and perhaps
mortgage insurance, if your loan so calls for it. If you do not
have an impounded account, then the lender still calculates this
amount and uses it as part of determining your debt-to-income
ratio.
PITI Reserves:
PITI reserves is a cash amount which a borrower must have on
hand after making a down payment and paying all closing costs
for the purchase of a home. The principal, interest, taxes and
insurance reserves must equal the amount which the borrower would
have to pay for PITI for a pre-defined number of months.
Power of Attorney:
This is a legal document which authorizes another person to act
on one's behalf. A power of attorney can grant absolute authority
or can be limited to certain acts or certain periods of time.
Prepayment:
Any amount that is paid to reduce the principal balance of a
loan before the due date is called prepayment. Full payment on
a mortgage which may result from a sale of the property, the
owner's decision to pay off the loan in full, or a foreclosure,
in each case, prepayment means payment which occurs before the
loan has been fully amortized.
Principal:
The amount which is borrowed or remains unpaid is called Principal.
The part of the monthly payment that reduces the remaining balance
of a mortgage is also refers to the Principal.
Principal balance:
Principal balance is the outstanding balance of principal on
a mortgage. This does not include interest or any other charges.
Private Mortgage Insurance:
This is a kind of mortgage insurance which is provided by a private
mortgage insurance company to protect lenders against loss if
a borrower defaults. Most lenders normally require Mortgage Insurance
for a loan with a loan-to-value percentage in excess of 80 percent.
Public Auction:
Public auction is a kind of a meeting in an announced public
place where people gather to sell property to repay a mortgage
that is in default.
A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | Y | Z
| 
