Mortgage glossary

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Margin: an amount the lender adds to an index to determine the interest rate on an adjustable rate mortgage.

Market Value: the highest price that a motivated buyer would pay, and the lowest price that a motivated seller would accept on a property. Market value is not necessarily the price that a property could actually be sold for at a given time.

Maturity: the date on which the remaining balance of a loan financial instrument becomes due and payable. The date the mortgage must be paid off.

Mechanic's Lien: a formal recorded claim against a property for work and materials for construction or repair of a property. Mechanic's liens attach to both the building(s) and land.

Modification: any change to the original terms of a mortgage.

Mortgage: a lien on the property that secures the Promise to repay a loan.

Mortgage banker: a company that originates loans and resells them to secondary mortgage lenders like :Fannie Mae or Freddie Mac.

Mortgage broker: a firm that originates and processes loans for a number of lenders.

Mortgage Indemnity Guarantee (MIG): a one off payment made when you set up a mortgage a kind of insurance policy for the lender. This offers them protection against the value of the home falling to less than the mortgage. It is generally only charged to borrowers with a less than 10% deposit, but this can vary. FFI mortgage glossary.

Mortgage insurance: a policy that protects lenders against some or most of the losses that can occur when a borrower defaults on a mortgage loan; mortgage insurance is required primarily for borrowers with a down payment of less than 20% of the home's purchase price.

Mortgage insurance premium (MIP): a monthly payment - usually part of the mortgage payment - paid by a borrower for mortgage insurance.

Mortgage Interest Rate: the percentage of interest you agreed to pay in your mortgage loan terms.

Mortgage Life/Disability Insurance: a form of insurance where the insurance amount decreases in lock step with the remaining loan balance. It is not usually required by lenders and is relatively expensive. FFI mortgage glossary.

Mortgage Margin: for adjustable rate mortgages this is the set amount of how much your interest rate can increase at each adjustable period of time. For instance, if your loan agreement states that your interest rate can not increase more than 1/2% in any 6 month period of time then that is your mortgage margin. FFI mortgage glossary.

Mortgage Modification: a loss mitigation option that allows a borrower to refinance and/or extend the term of the mortgage loan and thus reduce the monthly payments.

Mortgage Note: the legal paperwork of a mortgage loan that specifies the terms of the loan which include the monthly mortgage payment amount, the interest rate, the amount of the loan, and the length of time the term of the loan is for.

Mortgage term: the term over which you agree to repay the loan.

Mortgagee: the lender in a mortgage agreement.

Mortgagor: the borrower in a mortgage agreement.

Multifamily mortgage loan: a mortgage loan secured by a property containing five or more residential dwelling units.