REAL ESTATE TERMS

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There are currently 10 names in this directory beginning with the letter P.
PERIOD PAYMENT CAP
For an adjustable-rate mortgage (ARM), a limit on the amount that payments can increase or decrease during any one adjustment period.

PERIOD RATE CAP
For an adjustable-rate mortgage (ARM), 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.

PITI
Stands for principal, interest, taxes, and insurance, and refers to the sum of each of these charges, typically quoted on a monthly basis.

POINTS
A generic term for a percentage of the principal loan amount which the lender charges for making the loan; each point is equal to one percent of the loan amount.

POWER OF ATTORNEY
The authority to act for another person in specified or all legal or financial matters.

PREPAYMENT CLAUSE
In a mortgage, the statement of the terms on which the mortgagor may pay the entire or stated amount of the mortgage principal at some time prior to the due date.

PREPAYMENT PENALTY
A charge imposed on a borrower by a lender for early payment of the loan principal to compensate the lender for interest and other charges that would otherwise be lost.

PRINCIPAL
The mortgage amount initially borrowed or the portion still owing on the mortgage; the money used to pay down the balance of the loan.

PRIVATE MORTGAGE INSURANCE (PMI)
Mortgage insurance that is provided by a private mortgage insurance company to protect lenders against loss if a borrower defaults

PURCHASE AGREEMENT
A written contract signed by the buyer and seller stating the terms and conditions under which a property will be sold.