Glossary of Mortgage Terms

A quitclaim deed transfers any ownership interest one person has in a property to another person. This is done without any guarantees that the title is free of problems.

A rate-and-term refinance gives you a new loan with a different interest rate, repayment term, or both, but it doesn't change the amount you owe.

A real estate investment trust (REIT) is a business that owns, runs, or finances real estate that makes money and gives most of its taxable income to shareholders as dividends.

A real estate notary is a licensed professional who witnesses and verifies the signing of mortgage and property documents at closing, helping protect both buyers and lenders from fraud.

A real estate purchase agreement is a legally binding contract between a buyer and seller that spells out the price, terms, contingencies, and timeline for transferring ownership of a home.

Real estate valuation is the process of figuring out how much a home is worth by looking at its features, location, condition, and the prices of similar homes that have sold in the area.

A mortgage recast is when a homeowner makes a one-time payment toward the loan's principal balance. The lender then re-amortizes the remaining balance so that the monthly payments are lower, but the interest rate and loan term stay the same.

The month when your total savings from a lower mortgage payment equal the closing costs you paid to refinance is the break-even point.

Rent control is a set of state or local laws that limit how much a landlord can charge for rent or raise the rent on an existing tenant. The goal is to keep housing affordable in areas where there is a lot of demand for it.

A rent-back agreement is a short-term deal that lets a home seller stay in the property and pay rent to the buyer after closing.