A mortgage is a legal agreement that allows a borrower to obtain a loan from a lender to finance the purchase of a property. The property serves as collateral for the loan, and the borrower makes regular payments to repay the loan amount over time.

A fixed-rate mortgage (FRM) offers a constant interest rate for the entire duration of the loan. This means that the monthly payments remain the same throughout the loan term, providing stability and predictability in repayment.

A down payment is the upfront payment made by a borrower when purchasing a property. It represents a percentage of the property's purchase price and is typically paid in cash or through other financial means.

An interest-only mortgage (IO) allows the borrower to make payments that cover only the interest portion of the loan during an initial period, typically ranging from 5 to 10 years. After this period, the borrower starts making payments that include both interest and principal.

Closing costs are the fees and expenses incurred by both the buyer and seller during the finalization of a real estate transaction. These costs typically include appraisal fees, title insurance, loan origination fees, and other administrative charges.

An escrow account is a temporary holding account used in real estate transactions to collect and disburse funds related to property taxes, insurance premiums, and other recurring expenses. The lender typically holds the escrow account and makes payments on behalf of the borrower.

A balloon mortgage involves making regular payments during the loan term, but the remaining balance is due in a single lump sum payment at the end of the loan term. This type of mortgage is often used for short-term financing or when the borrower expects to have a large sum of money available at the end of the loan term.

Loan origination refers to the process of initiating and processing a mortgage application. It involves gathering the necessary documentation, evaluating the borrower's creditworthiness, and determining the loan terms and conditions.

A prepayment penalty mortgage allows the borrower to make additional payments towards the principal balance without incurring any penalties. This flexibility can help borrowers reduce the overall cost of the loan and pay it off sooner.

A deed is a legal document that transfers ownership of a property from the seller to the buyer. It is typically signed by both parties and recorded with the local government to establish the new ownership rights.

An adjustable-rate mortgage (ARM) has an interest rate that can change periodically, typically based on a predetermined index, such as the prime rate. The interest rate adjustments can result in changes to the monthly mortgage payments.

Amortization refers to the process of gradually repaying a loan through regular installments that include both principal and interest. Each payment reduces the outstanding loan balance, and the loan is fully repaid at the end of the amortization period.

A zero-down mortgage is a type of mortgage that allows the borrower to purchase a property without making a down payment. This type of mortgage typically requires the borrower to have a strong credit score and meet specific lender requirements.

Refinancing involves replacing an existing mortgage with a new one, typically with different terms and conditions, such as a lower interest rate, a shorter loan term, or a different type of mortgage. Refinancing can help borrowers save money on interest payments or improve their overall financial situation.

A conventional mortgage is a type of mortgage that is not insured or guaranteed by a government agency. Conventional mortgages typically require a down payment of at least 20% of the property's purchase price and have stricter credit and income requirements compared to government-backed loans.