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Real Estate Terms Glossary
: M
margin
The difference between the interest rate and the index on an
adjustable rate mortgage. The margin remains stable over the life
of the loan. It is the index which moves up and down.
maturity
The date on which the principal balance of a loan, bond, or
other financial instrument becomes due and payable.
merged credit report
A credit report which reports the raw data pulled from two or
more of the major credit repositories. Contrast with a Residential
mortgage credit Report (RMCR) or a standard factual credit report.
modification
Occasionally, a lender will agree to modify the terms of your
mortgage without requiring you t refinance. If any changes are
made, it is called a modification.
mortgage
A legal document that pledges a property to the lender as
security for payment of a debt. Instead of mortgages, some states
use First Trust Deeds.
mortgage banker
For a more complete discussion of mortgage banker, see
"Types of Lenders." A mortgage banker is generally
assumed to originate and fund their own loans, which are then sold
on the secondary market, usually to Fannie Mae, Freddie Mac, or
Ginnie Mae. However, firms rather loosely apply this term to
themselves, whether they are true mortgage bankers or simply
mortgage brokers or correspondents.
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.
mortgage insurance (MI)
Insurance that covers the lender against some of the losses
incurred as a result of a default on a home loan. Often mistakenly
referred to as PMI, which is actually the name of one of the
larger mortgage insurers. mortgage insurance is usually required
in one form or another on all loans that have a loan-to-value
higher than eighty percent. Mortgages above 80% LTV that call
themselves "No MI" are usually a made at a higher
interest rate. Instead of the borrower paying the mortgage
insurance premiums directly, they pay a higher interest rate to
the lender, which then pays the mortgage insurance themselves.
Also, FHA loans and certain first-time homebuyer programs require
mortgage insurance regardless of the loan-to-value.
mortgage insurance premium (MIP)
The amount paid by a mortgagor for mortgage insurance, either
to a government agency such as the Federal Housing Administration
(FHA) or to a private mortgage insurance (MI) company.
mortgage life and disability insurance
A type of term life insurance often bought by borrowers. The
amount of coverage decreases as the principal balance declines.
Some policies also cover the borrower in the event of disability.
In the event that the borrower dies while the policy is in force,
the debt is automatically satisfied by insurance proceeds. In the
case of disability insurance, the insurance will make the mortgage
payment for a specified amount of time during the disability. Be
careful to read the terms of coverage, however, because often the
coverage does not start immediately upon the disability, but after
a specified period, sometime forty-five days.
mortgagee
The lender in a mortgage agreement.
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.
Equal Housing Opportunity
REALTOR® -- A registered collective membership mark that identifies a real estate professional who is a member of the National Association of REALTORS® and subscribes to its strict Code of Ethics. Inquiries regarding the Code of Ethics should be directed to the board in which a REALTOR® holds membership.
John Rice, LLC Realtors
334-364-0480
fax: 334-364-0481
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