Glossary of Mortgage Terms

An interest rate floor is the lowest rate a variable-rate loan can ever reach. It is a contractually set minimum that keeps the borrower's rate from going below a certain level, no matter how low market rates go.

An investment property is a piece of real estate that someone buys to make money from rent payments, price increases, or both, instead of living in it themselves.

A joint mortgage is a home loan shared by two or more borrowers who apply together, combine their income and credit profiles, and share equal responsibility for repaying the debt.

Joint tenancy is a way for two or more people to own property together and share it equally. It also gives each owner the right of survivorship, which means that when one owner dies, the others automatically get that share.

A jumbo loan is a mortgage with a higher loan amount than the Federal Housing Finance Agency's annual limits on conforming loans. Because of this, Fannie Mae and Freddie Mac cannot buy or guarantee it.

A jumbo loan refinance replaces an existing mortgage that is higher than the limits for conforming loans with a new loan. This lets homeowners of high-value properties get a lower rate, a different term, or access their home equity.

A land contract is a seller-financed deal in which the buyer pays the property owner directly instead of going through a bank. The seller keeps legal title to the property until the full purchase price is paid.

A land survey is a professional way to measure and map the boundaries, size, and physical features of a piece of land. It is used to set legal property lines and help with real estate deals.

A lease option is a rent-to-own agreement that gives you the right, but not the obligation, to buy a home you're renting at a price you and the seller agree on upfront.

A lien is a legal claim on a piece of property made by a creditor or government agency. It gives them the right to collect on an unpaid debt before the property can be sold or given to someone else.