Adjustable Mortgage Loans: Mortgage loans under which the interest rate is periodically adjusted to more closely coincide with current rates. The amounts and times of adjustments are agreed to at the inception of the loan. It is also called Adjustable Rate Mortgages. Amortization: Payment of a debt in equal installments of principle and interest-only. A.R.P (Annual Percentage Rate): the yearly interest percentage of a loan, as expressed by the total finance charge paid (interest, loan fees). The A.R.P is discloses as a requirement of federal truth in lending statues. Assessor: a government official who is responsible for determining the value of a property for the purpose of taxation. Cap: in adjustable rate mortgages, the limit on how much the interest rate or monthly payment can change. Closing: The final procedure in which documents are executed and/or recorded, and the sale (or loan) is completed. Closing Statement: A statement which lists the financial settlement between buyer and seller. CMA (Competitive Market Analysis): is a comparison of homes similar to a seller’s home in terms of size, features, and location that has sold recently or is on the market. A CMA is prepared by a real estate agent to help set a home’s listing price. Contingency: Commonly, a stated event which must occur before a contract is binding. For example, a home sale may be contingent upon the buyer obtaining financing. Down payment: Cash portion of the purchase price paid by a buyer from his own funds as opposed to that portion which is financed. Escrow: A contract, deed, bond, or other written agreement deposited with a third person, by whom it is to be delivered to the grantee or promisee on the fulfillment of some condition. FHA Loan: A loan insured by the Federal Housing administration, a part of the Department of Housing and Urban Development. FHA insurance enables lenders to loan a very high percentage of the sale price. GPM (Graduated Payment Mortgage): is a mortgage with low initial monthly payments which gradually increase over a specified time frame. Hazard Insurance: Known as homeowners’ insurance. This is a usual requirement of a mortgage lender and an advisable safeguard for any homeowner to protect against loss. Index or Rate Index: A measure of interest rate changes used to adjust the interest rate of an Adjustable Mortgage Loan. Example: the change in the US treasury securities (T-bills) with a 1-year maturity, based upon their weekly average yield. Lien: A legal claim in property as security for payment of a debt or for the discharge of an obligation. Loan-to –Value Ratio: The ratio- expressed as a percentage- of the amount of a mortgage loan to the appraised value or selling price of the property. Lock Box: a key storage system placed on a home that is accessible only by active, licensed real estate agents who must abide by strict set of guidelines when showing a seller’s home. MLS (Multiple Listing Services): by which member brokers cooperate in the sale of each other’s listings. There by giving property best exposure. PITI (Principle, Interest, Taxes, and Insurance): four major items included in a monthly mortgage payment. Points: A fee charged by a lender as a service charge or as an amount needed to make the yield on a mortgage competitive with other types of investments. Each point represents 1% of the loan amount. Principal: Amount of debt, not including interest; the face value of a loan. PMI (Private Mortgage Insurance): Insurance issued by a private company against a loss by a lender in the event of default. Private mortgage insurance is generally required for conventional financing whenever less than 20% is put down. Second Mortgage: A mortgage which ranks after the first mortgage lien in priority Settlement: Financial details of closing. Title Insurance: Insurance against loss resulting from defects of title of public records. VA loans: Loans partially guaranteed by the Veteran’s administration, enabling veterans to buy a home with little or no down payment.