Buyer's Information

• Negative amortization: An increase in the outstanding balance of a mortgage resulting from the failure of periodic debt service payments to cover required interest charges on the loan.
• Note: A written promise to pay a certain amount of money.
• Origination fee: A fee or charge for work involved in the evaluation, preparation and submission of a proposed mortgage loan.
• Pre-payment penalty: A fee paid to the mortgagee for paying the mortgage before it becomes due. Also known as pre-payment fee or reinvestment fee.
• Private mortgage insurance (PMI): Insurance issued to a lender by a private company to protect the lender against loss on a defaulted mortgage loan. Its use is usually limited to loans with high loan-to-value ratios. The borrower pays the premiums.
• Promissory note: A written contract containing a promise to pay a definite amount of money at a definite future time.
• Radon: A colorless, odorless gas formed by the breakdown of uranium in subsoils. It can enter a house through cracks in the foundation or in water and is considered to be a health hazard.
• REALTOR® and REALTOR®-Associate: Registered collective membership marks that identify real estate professionals who are members of the National Association of REALTORS® and who subscribe to its strict Code of Ethics.
• Rent with option: A contract which gives one the right to lease property at a certain sum with the option to purchase at a future date.