Glossary of Mortgage Terms

When a borrower misses one or more monthly mortgage payments, they are in danger of defaulting on the loan and possibly losing their home.

Mortgage forbearance is a short-term deal between you and your loan servicer that lets you stop or lower your monthly mortgage payments when you're having trouble making ends meet.

A mortgage grace period is the time after your payment is due when you can still pay without having to pay a late fee or hurt your credit.

Mortgage insurance is a way for lenders to protect themselves from losing money if a borrower doesn't pay back their loan. The type of mortgage insurance depends on the loan program used to buy the home.

The mortgage interest deduction is a federal tax break that lets homeowners who itemize their deductions take the interest they paid on a qualifying home loan off of their taxable income. This lowers the amount of income tax they owe.

An investor in mortgages buys home loans from lenders on the secondary market. This gives those lenders more money to make new mortgages for home buyers.

A mortgage loan originator (MLO) is a licensed professional or lending institution that helps people who want to buy a home apply for, process, and close a mortgage loan.

The mortgage maturity date is the exact date on the calendar when you have to make your last loan payment and pay off your mortgage in full.

A mortgage note is a legal document that a borrower signs at closing. It promises to pay back a home loan according to certain terms, such as the interest rate, payment schedule, and total amount owed.

A mortgage payoff statement is a document from your loan servicer that shows the exact amount of money you need to pay to close out your mortgage in full on a specific date.