Mortgage Basics

Borrower consent allowing a lender or settlement party to verify information needed for the mortgage file.

Borrower consent allowing a lender to obtain credit information for mortgage review.

Complete mortgage record containing application data, documents, disclosures, underwriting, and closing information.

Identifier assigned to a mortgage file for lender, servicer, disclosure, and payment tracking.

Reason for the mortgage request, such as purchase, refinance, cash-out refinance, or construction financing.

Lender commitment to make a mortgage subject to stated terms, conditions, and closing requirements.

Borrower statement about intended property use, such as primary residence, second home, or investment property.

Standard mortgage application form used to collect borrower, income, asset, debt, and property information.

Mortgage interest that has built up over time but has not yet been paid.

An amortization schedule is a payment-by-payment table showing how much goes to principal, interest, and remaining balance.

Large lump-sum mortgage payment due at a set point, often at maturity of a balloon loan.

Mortgage payment method where payments are made every two weeks instead of once per month.

Person or entity obligated to repay a mortgage under the loan documents.

Property pledged to support mortgage repayment, giving the lender a claim if the loan is not repaid.

Interest amount that accrues on a mortgage for each day the balance remains outstanding.

Optional mortgage payment amount directed to reduce principal beyond the scheduled payment.

Primary mortgage loan on a property, usually tied to the first lien position.

Date the first regular mortgage payment is due after closing.

Mortgage structured so scheduled payments repay all principal and interest by the end of the term.

Part of a mortgage payment that covers borrowing cost rather than reducing principal.

Mortgage principal amount borrowed at closing or requested in the loan application.

Mortgage professional or company role involved in taking, arranging, or making a home-loan application.

Mortgage funds advanced by the lender and applied to the purchase, refinance, or payoff transaction.

Scheduled date when the mortgage must be fully paid according to the loan documents.

Party that holds mortgage-related rights in the debt or security interest, distinct from the servicer.

Formal mortgage-document term for the lender-side party receiving the mortgage interest.

Formal mortgage-document term for the borrower or property owner granting the mortgage interest.

Negative amortization happens when unpaid interest is added to the mortgage balance.

Date shown on the mortgage note that helps identify the signed repayment obligation.

Party entitled to enforce or receive payment under the mortgage note, depending on the loan records.

Borrower's legal duty to repay the mortgage debt and follow the loan terms.

Starting mortgage principal balance when the loan closes before later payments change it.

How often mortgage payments are scheduled or made, such as monthly or biweekly.

Planned timing and amount pattern for required mortgage payments across the loan term.

Amount required to satisfy the mortgage in full on a specific payoff date.

Part of a mortgage payment that reduces the unpaid loan balance.

Contract price for the home before down payment, loan amount, and closing-cost math are applied.

Recalculation of a mortgage payment schedule using the remaining balance, rate, and term.

Time left on the mortgage's scheduled repayment period before the maturity date.

Required mortgage payment amount due under the loan's current payment schedule.

Loan backed by collateral, such as a mortgage secured by a home.

Total mortgage interest paid over a period or across the full repayment schedule.

An electronic note is a digital mortgage note that records the borrower's promise to repay without a paper original.

Amortization is the gradual repayment pattern that reduces mortgage principal over time through scheduled payments.

A home loan is borrowed money used for a home purchase or refinance, usually secured by the property itself.

Interest is the lender's charge for letting the borrower use money over time.

A loan officer is the lender-side professional who helps guide the borrower through the mortgage application and origination process.

Loan term is the length of time the mortgage is scheduled to run before full repayment.

Monthly payment is the amount the borrower is expected to pay each month under the mortgage terms.

A mortgage is a home-secured loan and the legal arrangement that lets the property stand behind repayment.

A mortgage application is the borrower's formal request for a home loan and the starting point for lender review.

Core mortgage terms that explain what the loan is, how repayment works, and who the main borrowing parties are.

A mortgage broker helps a borrower shop or place a loan with lenders rather than funding the mortgage directly.

A mortgage lender is the bank, credit union, or other institution that provides the mortgage funds.

Mortgage note is the mortgage-specific promissory note that states the borrower's repayment obligation.

P&I is the principal-and-interest portion of a mortgage payment, excluding taxes, insurance, and other added housing costs.

Principal is the amount borrowed that still has to be repaid, excluding interest and most other charges.

Principal balance is the unpaid portion of the loan principal that the borrower still owes, not including future interest.

A promissory note is the signed document in which the borrower promises to repay the mortgage debt under stated terms.

A correspondent lender is a lender that originates and often closes mortgages in its own name, then later sells them to a larger investor or aggregator.