Glossary of Terms - P

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Paper
A mortgage, deed of trust or land contract which is given instead of cash.

Partial Release
A release of a portion of property covered by a mortgage.

Permanent Mortgage
A mortgage on completed construction on the same property under one mortgage or trust deed.

Personalty
Property which is movable. All property is either personalty, realty or mixed.

PITI
Abbreviation for principal, interest, taxes and insurance, often combined in a single monthly mortgage payment.

Plat
A map or chart of a lot, subdivision or community, showing boundary lines, buildings and easements.

PMI
Abbreviation for private mortgage insurance: insurance issued by a company, which insures the lender against loss in the event that the borrower defaults on the mortgage.

Points
Origination fees charged by the originating lender or broker and/or discount fees charge by lenders to increase the overall yield. A point is equal to one percent of the principal amount of your mortgage.

Portfolio Loan
Loans held as an investment by a bank, savings and loan or credit union.

Power of Attorney
A written instrument authorizing a person to act as the agent of the person granting it, and a general power authorizing the agent to act generally on behalf of the principal. A special power limits the agent to a particular or specific act as: a landowner may grant an agent special power of attorney to convey a single and specific parcel of property. Under the provisions of a general power of attorney, the agent having the power may convey any or all property of the principal granting the general power of attorney.

Prepaid Interest
Prepaid interest is the interest charged to borrowers at loan closing to pay for the cost of borrowing for a partial month. For example, if a loan closes on the 15th of the month and the first payment is due 45 days later, the lender will charge 15 days of prepaid interest.

Prepaid Items of Expense
Prorations of prepaid items of expense which are credited to the seller in the closing statement, such as real estate taxes already paid by the Sell er.

Prepayment
Full payment of the principal before the due date; occurs when a property is sold or the borrower refinances the existing loan.

Prepayment Penalty
Charge levied by the lender for paying off a mortgage loan before its maturity date.

Primary Mortgage Market
The process of obtaining a real estate loan, including the consumer's completion of a loan application form, validation of the credit and property information, loan underwriting by the lender and closing of the mortgage loan.

Primary Residence
Considered the permanent location of residency.

Principal
1) The outstanding balance of a loan. 2) A party to a real estate transaction. 3) The head of a real estate firm.

Private Mortgage Insurance (PMI)
Insurance which covers the portion of a mortgage loan above 80% thereby reducing the lenders risk to principal loss in the event of a borrowers default. The insurance coverage allows lenders to make higher loan-to-value ratios (95% LTV).

Processing, Underwriting and Document Fees
Charges for the lender's services associated with making the loan.

Property
The rights of ownership. The right to use, possess, enjoy, and dispose of a thing in every legal way and to exclude everyone else from interfering with these rights. Property is generally classified into two groups, personal property and real property.

Property Tax
A tax levied by the local municipality or county on real and personal property.

Prorations
The allocation of expenses, such as taxes between buyer and seller at closing based on the number of days the property is owned during the month of closing.

Prorate
To divide in proportionate shares, such as taxes, insurance, rent, or other items.

Planned Unit Development (PUD)
A housing development where there is a homeowners association and common areas owned by the homeowners. Created and regulated in accordance with State law.

Purchase Money Mortgage
A mortgage used to finance the purchase of real property.

 

 

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