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Payment: A payment that is not sufficient to cover the scheduled
monthly payment on a mortgage loan. Normally, a lender will not accept
a partial payment, but in times of hardship, you can make this request
of the loan servicing collection department.
Payment Change Date: The date when a new monthly payment amount takes effect on an adjustable-rate mortgage (ARM) or a graduated-payment mortgage (GPM). Generally, the payment change date occurs in the month immediately after the interest rate adjustment date.
Periodic Payment Cap: A limit on the amount that payments can increase or decrease during any one adjustment period on an adjustable-rate mortgage.
Periodic Rate Cap: The limit on the amount that the interest rate can increase or decrease during any one adjustment period, regardless of the index, on an adjustable-rate mortgage.
Personal Property Any type property which is not real property.
PITI Principal, Interest, Taxes and Insurance: The amount of the monthly payment including principal, interest, and an amount to be placed into the escrow (impound) account.
PITI: The four components of a monthly mortgage payment on impounded loans. Principal refers to the part of the monthly payment that reduces the remaining balance of the mortgage. Interest is the fee charged for borrowing money. Taxes and insurance refer to the amounts that are paid into an escrow account each month for property taxes and mortgage and hazard insurance.
PITI Reserves: A cash amount that a borrower must have on hand after making a down payment and paying all closing costs for the purchase of a home. The principal, interest, taxes, and insurance (PITI) reserves must equal the amount that the borrower would have to pay for PITI for a predefined number of months.
Planned Development: Five or more individually owned lots where one or more other parcels are owned in common or there are reciprocal rights in one or more other parcels; A subdivision.
Planned Unit Development: A type of ownership where individuals actually own the building or unit they live in, but common areas are owned jointly with the other members of the development or association.
Contrast with condominium, where an individual actually owns the airspace of his unit, but the buildings and common areas are owned jointly with the others in the development or association.
Plat: A map or plan of a certain parcel of land.
Plat Book: A book showing the lots and legal subdivisions of an area.
PMI: Mortgage insurance that is provided by a private mortgage insurance company to protect lenders against loss if a borrower defaults, normally insuring the top 20% of the loan and not the whole loan.
Pocket Listing: A real estate term where a real estate agent keeps an open listing hidden from his/her associates.
Point: A point is 1% of the amount of the mortgage.
Points: A fee charged by the lender in order to obtain a higher earning than the interest stated in the mortgage note.
Possessory Interest: The right to possess.
Power of Attorney: A legal document that authorizes another person to act on one’s behalf. A power of attorney can grant complete authority or can be limited to certain acts and/or certain periods of time.
Pre-Approval: When a lender commits to a loan before the borrower finds a property to buy. Even if you haven't found a property, some lenders will give you a written preapproval on a loan so that homebuyers will know exactly what they can afford to offer for a home; and to show a seller and your realtor how serious you are about buying a home.
Preliminary Title Report: A report showing the condition of title before a sale or loan transaction. After completion of the transaction, a title insurance policy is issued.
Prepayment: Paying off all or part of the mortgage before the scheduled date.
Prepayment Penalty: A fee that may be charged to a borrower who pays off a loan before it is due.
Pre-Qualification: A loan officer’s written opinion of the ability of a borrower to qualify for a home loan based on verbal inquiries about the borrower's debt, income, and savings.
Prescription: Obtaining title to property by adverse possession by occupying it for the period determined by law to bar action for recovery.
Prima Facie: Presumptive on its face; true, valid, or sufficient at first impression.
Prime Rate: The interest, or discount rate charged by a commercial bank to its largest and strongest customers. Changes in the prime rate are widely publicized in the news media and are used as the indexes in some adjustable rate mortgages, especially home equity lines of credit. Changes in the prime rate do not directly affect other types of mortgages, but the same factors that influence the prime rate also affect the interest rates of mortgage loans.
Principal: The remaining unpaid amount or the amount borrowed. Also the amount of the monthly payment that reduces the remaining balance of a mortgage.
Principal Balance: The outstanding balance of principal on a mortgage. The principal balance does not
include interest or any other charges.
Principal Balance: The amount of principal that has not yet been repaid.
Principal, Interest, Taxes, and Insurance: The four components of a monthly mortgage payment on impounded loans. Principal refers to the part of the monthly payment that reduces the remaining balance of the mortgage. Interest is the fee charged for borrowing money. Taxes and insurance refer to the amounts that are paid into an escrow account each month for property taxes and mortgage and hazard insurance.
Private Mortgage Insurance: Mortgage insurance that is provided by a private mortgage insurance company to protect lenders against loss if a borrower defaults, normally insuring the top 20% of the loan and not the whole loan.
Promissory Note: The written document signed by the borrower promising repayment of the loan showing the amount of monthly payments, interest rate, first payment date, last payment date, and the late charge and prepayment provisions.
Proration of Taxes: To divide or prorate the taxes equally or proportionately to time of use.
Public Auction: A meeting in an announced public location to sell property to repay a default mortgage.
Puffing: An exaggerated buildup by a salesperson or seller about a property. Legally, it is regarded only as an opinion and does not necessarily represent the facts.
Purchase Agreement: A written contract signed by the buyer and seller stating the terms and conditions under which a property will be sold.
Purchase Money Encumbrance: A trust deed or mortgage given by the buyer to the seller as part or all of the purchase price of the property.
Purchase Money Transaction: The acquisition of property through the payment of money or its equivalent.