Glossary of Mortgage Terms

An energy-efficient mortgage (EEM) is a loan that lets you add the cost of home improvements that save energy to your mortgage so you can pay for them over time instead of all at once.

Equal opportunity housing is a set of federal and state laws that protect people from being discriminated against when they buy, rent, finance, or advertise housing because of their race, religion, sex, national origin, disability, or family status.

A mortgage lender or third-party servicer manages an escrow account, which is a holding account that collects and pays out money for property taxes, homeowners insurance, and other housing costs on behalf of a borrower.

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.

An escrow shortage happens when your escrow account doesn't have enough money to cover upcoming property tax and insurance payments, which usually leads to a higher monthly mortgage bill.

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.