Glossary of Mortgage Terms

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 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.

A mortgagee is the company (bank, credit union or financial institution) or individual that gives you money to buy or refinance a home. Until you pay off the loan, they also have a legal claim to the property.

A mortgagee clause is a part of your homeowners insurance policy that protects your lender's financial interest in your property if it gets damaged or lost.

A mortgagee clause in your homeowners insurance policy protects the lender's financial interest in the property by making sure they get paid if the home is damaged or destroyed.

A mortgagor is the person or entity that borrows money from a lender to buy real estate, pledging the property as collateral until the loan is fully repaid.

A multifamily home is a type of residential property that has two or more separate housing units under one roof or on a single lot. Each unit has its own kitchen and entrance.

A multiple listing service, or MLS, is a private database that real estate agents use to share and search property listings in a specific region, giving buyers and sellers access to the widest pool of homes on the market.

Negative equity happens when you owe more on your mortgage than your home is currently worth, a situation also called being "underwater" or "upside down" on your loan.