A formal offer by a lender stating the terms under which it agrees to loan money to a homebuyer.

A fee charged when an agreement is reached between a lender and a borrower for a loan on specific terms and conditions. Rate and points may be locked-in or may be “floating”.

A promise by a lender to make a loan on specific terms or conditions to a borrower or builder. A promise by an investor to purchase mortgage from a lender with specific terms or conditions.

Money paid to a Real Estate agent or broker by the seller as compensation for finding a buyer and completing the sale. Usually it is a percentage of the sale price–6 to 7 percent on houses, 10 percent on land.

Something of value pledged as security for a loan. In mortgage lending, the property itself serves as collateral for a mortgage loan.

One who is individually and jointly obligated to repay a mortgage loan and may or may not share ownership of the property with one or more of the borrowers.

An outstanding claim or encumbrance which adversely affects the marketability of title.

A transaction in which the formalities of a Real Estate sale are concluded. The certificate of title, abstract, and deed are generally prepared for the closing by an attorney and this cost charged to the buyer. The buyer signs the mortgage, and closing costs are paid. The final closing merely confirms the original agreement reached in the agreement of sale.

The numerous expenses which buyers and sellers normally incur to complete a transaction in the transfer of ownership of Real Estate. These costs are in addition to price of the property
and are items prepaid at the closing day. This is a typical list:
Buyer’s Expenses
– Documentary Stamps on Notes
– Recording Deed and Mortgage
– Escrow Fees
– Attorney’s Fee
– Title Insurance
– Appraisal and Inspection
– Survey Charge
Seller’s Expenses
– Cost of Abstract
– Documentary Stamps on Deed
– Real Estate Commission
– Recording Mortgage
– Survey Charge
– Escrow Fees
– Attorney’s Fee

The agreement of sale negotiated previously between the buyer and the seller may state in writing who will pay each of the above costs.

A mortgage principal amount that is fixed and can not be increased during the life of the loan.