Glossary of Mortgage Terms

A condo association is made up of all the owners of units in a condo complex. It takes care of shared spaces, collects fees, enforces community rules, and keeps the building's common areas in good shape.

A condominium is a privately owned apartment or house in a larger building or community where owners share common areas, amenities, and maintenance responsibilities. These are managed by a homeowners association.

A construction loan is a short-term loan that pays for the cost of building a new home. The money is given out in stages as the work is done, and then it becomes a permanent mortgage or is replaced by one.

A contingent offer in real estate is a purchase agreement that has certain conditions, called contingencies, that must be met before the sale can close. This protects the buyer from unexpected problems.

A conventional mortgage is a home loan that the federal government does not insure or guarantee. It usually follows the rules set by Fannie Mae and Freddie Mac for lending.

Correspondent lending is a mortgage model where a lender originates, underwrites, and funds your home loan using its own money, then sells that loan to a larger investor after closing.

Debt service is the total amount of money you need to cover all your loan payments, including both principal and interest, over a set period of time.

A debt-to-income ratio (DTI) is a percentage that compares your total monthly debt payments to your gross monthly income. Lenders use it to figure out how much mortgage you can afford.

A deed in lieu of foreclosure is a voluntary agreement between a homeowner and their mortgage lender in which the homeowner gives the lender ownership of the property in order to pay off the loan and avoid the formal foreclosure process.

When you pay off your mortgage or deed of trust in full, a deed of reconveyance is a legal document that gives you back the title to your property.