| Real Estate Terminology, Wording |
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| Gladwin Real Estate Information |
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| Partial Payment
A payment that is less than the agreed upon monthly payment on a loan Partition The forced dividing of real estate among parties who were previously its co-owners Patent A first in a series of documents by which the federal or state government transfers ownership of public lands to an individual 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. Pay-off Amount The total balance on an existing loan or mortgage Percolation Test A testing of the soil on a property to evaluate if its absorption and drainage capacity will allow installation of a septic system Periodic Payment Cap For an adjustable-rate mortgage where the interest rate and the minimum payment amount fluctuate independently of one another, this is a limit on the amount that payments can increase or decrease during any one adjustment period. Periodic Rate Cap For an adjustable-rate mortgage, a limit on the amount that the interest rate can increase or decrease during any one adjustment period, regardless of how high or low the index might be. Personal Property Property that does not qualify as real property PITI Acronym for principal, interest, taxes and insurance, the four components of a monthly mortgage payment, which are taken into account when a lender is evaluating a borrower's financial qualifications for a loan 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 Unit Development (PUD) 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, or Plot A map showing a piece of land subdivided into lots, streets and common area, if applicable P.M.I, or Private Mortgage Insurance Acronym for Private Mortgage Insurance, see below Point A one-time fee charged by the lender for originating a loan, one point being equal to one percent of the amount of the mortgage Power of Attorney A written legal document authorizing a person to act as agent for another, to the extent outlined in the document Power of Sale A provision in a will, mortgage or trust agreement authorizing the sale or transfer of land in accordance with the terms of the provision Pre-Approval A commitment from a lender to loan a certain amount of money to a buyer at a designated interest rate and for a specified period of time, which gives the buyer an advantage in competing to purchase real estate or a home Preforeclosure Sale The sale of a property by a mortgagor for less than the amount owed to the lender of the mortgage for the property, thereby allowing the mortgagor to avoid foreclosure, and done with the approval of the lender Prepayment Penalty A fee that is charged by the lender to a borrower who pays off a loan earlier than the due date, thereby costing the lender interest and other income from charges Pre-qualification The process by which the amount of loan a prospective buyer will be eligible to borrow is determined, based on his or her income and expenses, which can be used to demonstrate the buyer's financial capability to the seller Prime Rate The most favorable interest rate that banks charge, usually to their preferred customers Principal The amount borrowed, not including interest or other charges Principal Balance The portion of the original amount borrowed that is due on a loan or mortgage at any point in time Private Mortgage Insurance, or P.M.I. A policy that insures that the lender will recover a specific percentage of the loan amount from the insurance company in the event that the borrower defaults; is not backed by any government agency; is usually required when a down payment of less than 20% is put on real estate or a home purchased Probate The court proceedings to prove that a will is valid Procuring Cause The action or person who brings about the desired result; e.g., under an open listing, the broker who brings in the buyer who actually purchases the property Promissory Note A written promise to pay a specified amount of money in a designated period of time, which is also transferable to a third party Prorate To divide the proportionate share of existing expenses on a piece of property between the seller and buyer, e.g., taxes owed at the time of a transfer of title from the seller to the buyer Public Auction A meeting in an announced public location to sell property to repay a mortgage that is in default. Purchase and Sale Agreement A written contract signed by the buyer and seller that states the conditions under which a property will be transferred or sold Purchase Money Mortgage An agreement whereby financing provided by the seller is included in the purchase price Purchase Toney Transaction The acquisition of property through the payment of money or its equivalent. |