Adjustable-Rate Mortgage (ARM): A type of mortgage loan with an interest rate that can change periodically based on changes in a specified index.

Amortization: The process of gradually paying off a loan, typically through regular payments that include both principal and interest.

Annual Percentage Rate (APR): The total cost of borrowing, expressed as a yearly percentage rate, which includes the interest rate and other fees.

Appraisal: An assessment of the value of a property, conducted by a professional appraiser, often required by lenders before approving a mortgage.

Assumption: The act of taking over someone else's mortgage, typically with the lender's approval.

Balloon Mortgage: A type of mortgage that requires a large payment at the end of the loan term.

Closing Costs: Fees and expenses paid by the buyer and seller at the closing of a real estate transaction, which can include loan origination fees, title insurance, and taxes.

Closing Disclosure: A document provided to the borrower before closing that outlines the final terms of the loan.

Credit Score: A numerical representation of a borrower's creditworthiness, based on their credit history and other financial information.

Debt-to-Income Ratio (DTI): A measure of a borrower's monthly debt payments compared to their gross monthly income, used by lenders to assess the borrower's ability to manage payments.

Deed: A legal document that transfers ownership of a property from one party to another.

Default: Failure to fulfill a legal obligation, such as making mortgage payments.

Down Payment: The initial payment made by the buyer towards the purchase price of a property, typically expressed as a percentage of the total price.

Equity: The difference between the market value of a property and the outstanding balance of any loans secured by the property.

Escrow: A financial arrangement where a third party holds and regulates payment of funds required for two parties involved in a transaction.

Fixed-Rate Mortgage: A mortgage loan with an interest rate that remains constant for the entire term of the loan.

Forbearance: A temporary postponement of mortgage payments granted by the lender.

Foreclosure: The legal process by which a lender takes possession of a property when the borrower fails to make mortgage payments.

Homeowners Insurance: Insurance that protects a homeowner against damages to their property and liability for accidents that occur on the property.

Home Equity: The value of a homeowner's interest in a property, calculated as the current market value of the property minus the outstanding balance of all liens.

Interest Rate: The rate at which interest is charged on a loan, expressed as a percentage of the loan amount.

Interest-Only Mortgage: A type of mortgage where the borrower pays only the interest on the loan for a specified period, after which the payments increase to cover both principal and interest.

Loan Modification: A change to the terms of a mortgage loan, often used to make payments more manageable for the borrower.

Loan-to-Value Ratio (LTV): The ratio of the loan amount to the value of the property, expressed as a percentage.

Mortgage: A legal agreement by which a bank or other creditor lends money at interest in exchange for taking title of the debtor's property, with the condition that the conveyance of title becomes void upon the payment of the debt.

Mortgage Broker: A middleman who helps borrowers find mortgage lenders.

Origination Fee: A fee charged by a lender for processing a loan application.

Points: Prepaid interest on a mortgage, with each point equal to 1% of the loan amount.

Prepayment Penalty: A fee charged by a lender if a borrower pays off a loan before the end of the term.

Principal: The original amount of money borrowed in a loan, excluding interest and other charges.

Private Mortgage Insurance (PMI): Insurance that protects the lender in case the borrower defaults on the loan, typically required for loans with a down payment of less than 20%.

Refinance: The process of replacing an existing mortgage with a new loan, often to obtain a lower interest rate or to change other terms of the loan.

Second Mortgage: A mortgage taken out on a property that is already mortgaged, with the second mortgage taking priority over the first in case of default.

Title: A legal document that establishes ownership of a property.

Title Insurance: Insurance that protects the lender (and sometimes the buyer) against loss arising from disputes over ownership of a property.

Underwriting: The process by which a lender evaluates the risk of a borrower and decides whether to approve a loan.