Mortgage Glossary
There are a lot of unfamiliar terms that get tossed around during the mortgage process. But don't worry, we've put together this glossary to help you get a better grasp of any terms that may be less than clear.
M
Maturity
The date on which the principal balance of a financial instrument becomes due and payable.
Maximum Financing
Usually, a loan amount that is within 5 percent of the highest loan-to-value (LTV) percentage allowed for a specific product.
Merged Credit Report
A credit report that contains information from at least three credit repositories. Any duplicate entries are combined to provide a concise summary of your credit.
Military Classification
Indicate whether the military service was as an Active Duty Member, Reserve Service Member or National Guard Member.
Monetary Policy
Actions by the Federal Reserve System to influence the cost and availability of credit, with the goals of promoting economic growth, full employment, price stability and balanced trade with other countries.
Money Market Account
A type of savings account that provides bank depositors with many of the advantages of a money market fund. Certain regulatory restrictions may apply to the withdrawal of funds.
Money Market Fund
A mutual fund that allows individuals to participate in managed investments in short-term debt securities, such as certificates of deposit and United States Treasury bills.
Mortgage
The legal document used by a borrower to pledge their property as security in order to obtain a loan. In some areas of the country, the mortgage is called a "deed of trust".
Mortgage Banker
A company that originates mortgages for resale in the secondary mortgage market.
Mortgage Insurance
Insurance provided by a private company to protect the mortgage lender against losses that might be incurred if a loan defaults. The borrower usually pays the cost of the insurance and is most often required if the loan amount is more than 80% of the home's value. Sometimes referred to as private mortgage insurance.
Mortgage Insurance Premium (MIP)
Amount paid by a borrower for mortgage insurance, either to a government agency such as the Federal Housing Administration (FHA) or to a private mortgage insurance (PMI) company
Mortgage Life Insurance
A type of term life insurance often bought by mortgagors. In the event that the borrower dies while the policy is in force, the debt is automatically repaid by insurance proceeds. Not to be confused with mortgage insurance.
Mortgage Registration Fee
A fee or tax charged by some state and local governments when a mortgage is obtained. For our comparison purposes, the mortgage registration fee is considered to be a tax and other unavoidable fee.
Mortgage Tax
A tax charged by some state or local governments that is paid to the state when a mortgage is obtained. For our comparison purposes, the mortgage tax is considered to be a tax and other unavoidable fee.
Mortgagee
The person or company who provides the loan funds to the borrower.