Mortgage Dictionary

Periodic Cap 

The maximum rate increase for a specific period for a specific loan (ARM) only.  


Principal, interest, taxes and insurance--the components of a monthly mortgage payment.

Planned Unit Developments (pud)

A subdivision of five or more individually owned lots with one or more other parcels owned in common or with reciprocal rights in one or more other parcels.


Charges levied by the mortgage lender and usually payable at closing. One point represents 1% of the face value of the mortgage loan.


Those expenses of property which are paid in advance of their due date and will usually be prorated upon sale, such as taxes, insurance, rent, etc.

Prepayment Penalty

A charge imposed by a mortgage lender on a borrower who wants to pay off part or all of a mortgage loan in advance of schedule.  


Amount of debt, not including interest. The face value of a note or mortgage.

Private Mortgage Insurance (pmi)

Insurance provided by nongovernment insurers that protects lenders against loss if a borrower defaults. Fannie Mae generally requires private mortgage insurance for loans with loan-to-value (LTV) percentages greater than 80%.