Knowledge is power and there’s no difference when it comes to obtaining a home loan! To help you on the journey to becoming an educated borrower, we’ve created this glossary of terms you’ll need to know during your home loan process.
There are 7 names in this directory beginning with the letter P.
PITI
PITI is an acronym for the four components of a mortgage payment- Principal, Interest, Taxes and Insurance.
Points
Buying points, or buying down your rate, allows you to pay a percentage of your mortgage amount up front in exchange for a lower interest rate. One point equals 1% of your mortgage amount.
Pre-Approval
Pre-approval is the evaluation of a potential borrower by a lender to determine whether the borrower qualifies for a loan from the lender.
Primary Residence
A primary residence is the legal residence of a person. A person may only have one primary residence at any given time.
Principal
The principal is a component of your mortgage payment which is dedicated to paying back the amount of money you borrowed for your loan.
Processing Fees
A processing fee is a fee charged to process a loan application, including applications for credit checks, property appraisals, and basic administrative costs.