Understanding Mortgage Terminology

A glossary of common mortgage terms for better understanding.

October 5, 2023

Understanding Mortgage Terminology

When navigating the mortgage process, understanding the terminology is crucial. Here’s a glossary of common mortgage terms:

Amortization

The process of paying off a loan over time through regular payments.

Escrow

A financial arrangement where a third party holds funds until certain conditions are met, often used for property taxes and insurance.

Principal

The original sum of money borrowed in a loan, excluding interest.

Equity

The difference between the market value of a property and the amount owed on the mortgage.

Familiarizing yourself with these terms can help you make informed decisions throughout the mortgage process.