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
Mortgagor
The person who receives funds from a lender in exchange for a security interest in the property. Commonly known as the borrower.
Multifamily Mortgage
A residential mortgage on a dwelling that is designed to house more than four families, such as an apartment complex.
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Name Search
A fee charged by title companies in some states to cover the cost of searching the public record for court orders against the current owner or proposed purchaser that could affect the title of the property. For our comparison purposes, the name search fee is considered to be a third party fee.
National Association of Purchasing Management (NAPM) Survey
This prices-paid index gives insight into inflation in the manufacturing sector. A reading above 50% generally indicates that the manufacturing sector is expanding, and below 50% signifies contraction. Frequency: monthly. Source: National Association of Purchasing Management.
National Association of Realtors®
An organization of Realtors®, devoted to encouraging professionalism in real estate activities
National tenant
A lessee with a presence and established reputation in most of the United States. These tenants are typically well-known and usually have better credit than local tenants
Negative Amortization
A gradual increase in mortgage debt that occurs when the periodic monthly payment is not sufficient to cover the monthly principal and interest due. The amount of the deficit is added to the remaining principal balance to create negative amortization.
Net Cash Flow
The income that remains for an investment property after the monthly operating income is reduced by the monthly housing expense, which includes principal, interest, taxes, and insurance.
Net Closing Costs
For our comparison purposes, the net closing costs are the total closing costs quoted by a lender, less any credit or rebate that is offered.
Net Worth
The total value of all of a person's or company's assets, minus all liabilities.
New Home Sales
Reports the number of new single-family homes sold, expressed on an annual basis. Can be combined with Existing Home Sales to determine the total volume of home sales, a strong predictor of future national mortgage origination volume. Frequency: monthly. Source: Commerce Department.
No Cash Out Refinance
A refinance loan is an amount that pays off the existing mortgage balance on the property and does not provide the borrower with any cash at closing.
Non-Conforming Loan
A mortgage that exceeds the maximum loan amount for the most common mortgage investors. The cost of obtaining a non-conforming mortgage is generally higher than the cost of obtaining a conforming mortgage. Also known as a jumbo loan.
Non-liquid Assets
Any assets that cannot easily be converted into cash
Notary Fee
A fee for a licensed notary public to certify your signature on the loan documents.