Glossary of Mortgage Terms

A mortgage rate is the interest a lender charges you to borrow money for a home purchase or refinance, expressed as a yearly percentage of your loan balance.

A mortgage rate lock is an agreement between you and your lender that keeps your interest rate the same for a certain number of days. This protects you from changes in the market while your loan is being processed.

A mortgage recast is when you make a large lump-sum payment toward your loan balance and your lender recalculates your monthly payment based on the lower amount you owe.

Mortgage reinstatement is when a homeowner pays all missed payments, late fees, and related costs in a lump sum to bring a delinquent mortgage back to current status and stop the foreclosure process.

Mortgage seasoning requirements are lender-imposed waiting periods between specific financial events and the approval of a new home loan or refinance transaction.

After you close on your home loan, a mortgage servicing company takes care of it. They handle monthly payments, escrow accounts, and borrower support for the loan's owner.

Mortgage servicing rights give you the right to manage the day-to-day operations of a home loan, such as collecting payments and managing escrow for the loan's owner.

A mortgage transfer lets a new borrower take over an existing home loan from the original borrower. The new borrower keeps the same interest rate, balance, and repayment terms.

Mortgage underwriting is the process a lender uses to verify a borrower’s finances, creditworthiness, and property value before deciding whether to approve a home loan application

A government-sponsored enterprise like Fannie Mae, Freddie Mac, or Ginnie Mae issues or backs an agency MBS. This gives investors a safety net that is linked to the government.