The amount paid for FHA mortgage insurance. When paid to a private company, it is commonly referred to as Private Mortgage Insurance (PMI).

A refinancing plan to help a mortgagor in default. The payment may be reduced if the amount refinanced is lower than the original mortgage amount or the term is extended. A mortgagor may qualify if he/she has recovered from a financial problem and can afford the new payment amount.

To finance the total cost of a property or project.

See: Loan Policy.

A group or “pool” of mortgages, an interest in which can be purchased through a securities dealer. Because of market changes in interest rates and points (discounts), early payoffs, and foreclosures, pools have different returns and, therefore, different investment values. The rate of payoffs and foreclosures is called the “speed” of the pool.

Bonds sold on a state or local level (tax exempt) to finance real estate sales, construction, or refurbishing. Used in many instances to create affordable housing.

A clause in the CC&R’s (covenants, conditions, and restrictions) which states that a violation of the CC&R’s shall not defeat a subsequent mortgage made in good faith and for value.

Controlling the necessary duties of a mortgagee, such as collecting payments, releasing the lien upon payment in full, foreclosing if in default, and making sure the taxes are paid, insurance is in force, etc. Servicing may be done by the lender or a company acting for the lender, for a servicing fee.

A system whereby a mortgage company will hold loans which would ordinarily be sold, in order to sell later at a lower discount. These mortgages are used as collateral security with a bank to borrow new money to loan.

See: Mortgage-backed Securities.

Securities similar to bonds, but having their value based on a pool of mortgages or trust deeds (usually government insured). The rate of return is based on the interest rate of the mortgages, plus early payoffs, which increases the value of any discounts. The price of the securities will vary as comparative (current) interest rates rise and fall. See: Collateralized Mortgage Obligation.

The party lending the money and receiving the mortgage. Some states treat the mortgagee as the “legal” owner, entitled to rents from the property. Other states treat the mortgagee as a secured creditor, the mortgagor being the owner. The latter is the more modern and accepted view.

The party who borrows the money and gives the mortgage.

A rectangular opening, cut in wood or other material, to receive a bar of wood or other material for the purpose of securing the two parts in a mortise joint.

Originally, a building near a major highway to accommodate travelers, offering a place to sleep and park. Over the years, motels have come to offer most of the features of hotels, such as restaurants, recreation, etc.

A vertical bar separating panes of a window or panels of a door. Also an upright framing member of panels or wainscoating.

Multifamily property with a certain percentage of the units set aside for low income families. The rental amount is based on a percentage of the median income of the area, adjusted for family size. Appropriate units meet FNMA’s Multifamily Affordable Housing lending requirements.

(1) A building occupied by more than one family. (2) A building designed as a dwelling for more than four families at the same time.

A loan secured by a mortgage on a residence consisting of more than four units.

To meet the FNMA definition it is a residential property of not less than five dwelling units with not more than 20 percent of the net rentable area rented or set aside for rent to non-residential tenants.