Mortgage Shorthand

 If you're considering buying a home or refinancing an existing mortgage, you're likely to come across a lot of acronyms that can be confusing at first glance. To help you understand the mortgage industry jargon, we have compiled a list of the most common mortgage acronyms and their meanings. This guide is designed to be a helpful resource for anyone navigating the home buying or refinancing process. 

Mortgage Basics 

APR - Annual Percentage Rate: The APR represents the cost of borrowing money over a year, including interest rates and fees. 

ARM - Adjustable Rate Mortgage: A type of mortgage where the interest rate can fluctuate over time. 

FHA - Federal Housing Administration: A government agency that provides mortgage insurance for loans made by approved lenders. 

FICO - Fair Isaac Corporation: A credit scoring model used by lenders to evaluate a borrower's creditworthiness. 

HELOC - Home Equity Line of Credit: A type of loan that allows a borrower to borrow against the equity in their home. 

LTV - Loan-to-Value Ratio: The ratio of the loan amount to the appraised value of the property. 

PMI - Private Mortgage Insurance: Insurance that protects the lender in case the borrower defaults on their loan. 

PITI - Principal, Interest, Taxes, and Insurance: The four components of a monthly mortgage payment. 

USDA - United States Department of Agriculture: A government agency that provides mortgages for rural homebuyers. 

VA - Department of Veterans Affairs: A government agency that provides mortgages for eligible veterans and their families. 

Mortgage Process
REPC- Real Estate Purchase Contract FPPA – Final Purchase Price Addendum 

AUS - Automated Underwriting System: A computer program that evaluates a borrower's creditworthiness and determines whether they qualify for a mortgage. 

CD - Closing Disclosure: A document that outlines the final terms of a mortgage loan.

DTI - Debt-to-Income Ratio: The ratio of a borrower's monthly debt payments to their monthly income. 

GFE - Good Faith Estimate: A document that outlines the estimated costs associated with a mortgage loan. 

HUD - Department of Housing and Urban Development: A government agency that oversees the Federal Housing Administration and other housing programs. 

LE - Loan Estimate: A document that outlines the estimated costs associated with a mortgage loan. 

LPMI - Lender-Paid Mortgage Insurance: A type of mortgage insurance where the lender pays the premium. 

MIP - Mortgage Insurance Premium: Insurance that protects the lender in case the borrower defaults on their loan. 

POC - Paid Outside of Closing: Expenses that are paid before closing on a mortgage. ROI - Return on Investment: The amount of money gained or lost on an investment. 

Mortgage Servicing 

ARM - Adjustable Rate Mortgage: A type of mortgage where the interest rate can fluctuate over time. 

CFPB - Consumer Financial Protection Bureau: A government agency that protects consumers in the financial marketplace. 

GSE - Government-Sponsored Enterprise: A financial institution created by the federal government to support the mortgage industry. 

HAMP - Home Affordable Modification Program: A government program that provides assistance to homeowners facing financial hardship. 

HARP - Home Affordable Refinance Program: A government program that helps homeowners refinance their mortgages. 

LAR - Loan Application Register: A database that tracks mortgage applications and loans.

MBS - Mortgage-Backed Security: A type of investment that is backed by a pool of mortgages. 

NOD - Notice of Default: A legal document that notifies a borrower that they are in default on their mortgage. 

REO - Real Estate Owned: A property that is owned