Below is a mortgage glossary of terms. There may be words listed that no longer apply in todays market. Please call us if you have any questions.

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

Balloon Mortgage -
Behaves like a fixed-rate mortgage for a set number of years (usually five or seven) and then must be paid off in full in a single "balloon" payment. Balloon loans are popular with those expecting to sell or refinance their property within a definite period of time.

Balloon Payment -
The final lump sum that is paid at the end of the balloon mortgage.

Bankruptcy -
A tactic that individuals use to relieve themselves of debts and/or liabilities when they are no longer able to repay. The most common form of individual bankruptcy is a Chapter 7, when an individual frees himself from most of his/her debts. Borrowers who have undergone bankruptcy usually cannot qualify for "A" paper loans until after two years after declaration and a re-establishment of credit.

Best Faith Estimate -
An estimate of the total costs for securing a real estate loan, that is given to borrowers prior to closing.

Bill of Sale -
A written document that transfers a title to personal property.

Biweekly Mortgage -
Mortgage loan payments that requires a payment twice monthly, yielding thirteen payments per year instead of twelve. This significantly reduces the time a principal is paid off.

Blanket Mortgage -
A mortgage secured by the pledging of more than one property or collateral.

Book Value -
Acquisition costs less any accrued depreciation.

Broker -
An individual in the business of assisting in arranging funding or negotiating contracts for a client but who does not loan the money himself. Brokers usually charge a fee or receive a commission for their services.

Bridge Loan -
An equity loan secured to solve short-term financing problem.

Budget Mortgage -
A mortgage that includes a portion for taxes and insurance as well as principal and interest.

Buy down -
Allows loans to be made at less-than-market interest rates by paying front-end discounts. The interest rate is brought down for a temporary period, usually from one to three years. In order to acquire this discount, a lump sum is paid and held in an account used to supplement the borrower's monthly payment. After the discount period, the payment is calculated as the note rate.