Glossary of Mortgage Terms

An escrow account is a special account that your mortgage servicer keeps for you. They take part of each monthly payment to pay for property taxes and homeowners insurance when those bills come due.

During a real estate deal, an escrow agent is a neutral third party who keeps money, papers, and property deeds until the buyer and seller meet all of the terms of their contract.

Escrow fees are charges paid at closing to a neutral third party, such as an escrow company, title company, or real estate attorney, for managing the transfer of funds and documents between buyer, seller, and lender during a real estate transaction.

An escrow holdback is an agreement to set aside money in a third-party account at closing to pay for necessary repairs to the property that can't be done before the sale is final.

If you get an escrow waiver, you don't have to use an escrow account to pay your property taxes and homeowners insurance. Instead, you can pay them directly.

Fannie Mae, which stands for Federal National Mortgage Association (FNMA), is a government-sponsored business that buys and guarantees mortgage loans from lenders. This keeps money moving through the housing market so that more Americans can buy and refinance homes.

Fannie Mae HomePath is a website where you can look for and buy homes that Fannie Mae took back through foreclosure. These homes are often sold for less than their market value and come with special financing options.

Fee simple is the highest level of property ownership in the US. It gives owners full rights to use, sell, or pass on their land and any buildings on it.

The Federal Housing Administration backs the FHA 203(b) loan, which is the most common type of government-backed mortgage. You can buy a home with as little as 3.5% down.

You can buy or refinance a fixer-upper with an FHA 203(k) loan, which is a government-backed mortgage that lets you combine the costs of repairs and renovations into one loan.