The mortgage industry is full of terms that are foreign to many people. The following glossary of terms should help you translate the mortgage language into English and help you make sense of the mortgage process.

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An expert opinion on the value of a property.

This is not the note rate applied for, but rather is a government mandated formula that shows the cost of the loan in a yearly rate by using the note rate plus certain other upfront costs.

Adjustable Rate Mortgage. Mortgage characterized by an interest rate that can adjust up or down at certain intervals based on a current index (commonly the 1 year T-Bill) plus a preset margin.

A Mortgage characterized by level fixed payments for a predetermined time frame followed by either a refinance or adjustment in interest rate.

The tax paid upon certain types of real estate transactions. Contact accountant for specifics.

The amount of money needed from the borrower at the time of closing (usually in a purchase transaction only). This amount needs to be made out in the form of a cashiers check and made payable to the title company.

Date stated on the purchase agreement that buyer and seller agree to finalize or close the transaction.

The total cost for the transaction that include but are not limited to loan origination fee, processing fee, appraisal fee, credit report fee, underwriting fee, escrow fee and title fee.

Property types that usually have the following characteristics: they are attached, have a homeowners association and dues, the outside maintenance is taken care of by the association, and common areas and amenities available to all owners in the association.

Standard, non-government financing.

Agencies that provide compilations of your credit history. The three main credit bureaus are Experian, Trans Union, and Equifax.

Report provided by the credit bureaus which shows the history, current status, and profile of an individual.

The number generated by the credit bureaus which is a numerical representation of the subjects credit profile, range is from 450 on the low side to 900 being the highest score possible.

Ratio of debt to pretax income, often expressed as a front (housing payment only) or back (all debt) ratios. Ex- $5000 monthly income, $1400 housing payment, $1700 total debt would equal ratios of 28%/34%.

One point equals one percent of the loan amount. Points are used to lower the interest rate. One point does not equate into lowering the interest rate one percent. Generally lowering the interest rate 1/8 will cost about 1/2 point, although this can vary based on daily pricing. Typically is tax deductible.

Difference between loan amount and purchase price.