Real Estate Terms starting with (P)

The Following are real estate terms and topics: Starting With the Letter (P)

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Are you confused and overwhelmed by the extensive terms and words used in real estate? Every person working in real estate or planning to buy or sell real estate can benefit from learning some of the terms….

Real Estate Terms P

Real Estate Terms P

Partial payment
A payment that is not sufficient to cover the scheduled monthly payment on a mortgage loan.

Passing Papers
Describes a closing transaction where the parties meet face-to-face and exchange documents.

Payment change date
The date when a new monthly payment amount takes effect on an adjustable-rate mortgage (ARM) or a graduated-payment adjustable-rate mortgage.

Payoff Statement
The document issued that shows the exact amount needed to pay an existing loan

Periodic payment cap
For an adjustable-rate mortgage (ARM), a limit on the amount that payments can increase or decrease during any one-adjustment period.

Periodic rate cap
The maximum amount an interest rate can increase or decrease from one adjustment period to the next on an adjustable rate mortgage.

Personal property
Any property that is not designated by law as real property (ie, money, goods, evidences of debt, rights of action, furniture, automobiles).

Prepaid Item
An item for which the seller has already paid but has not used up.

PITI
Principle, Interest, Taxes and Insurance. Used in home-budgeting calculations like “How much home can you afford?” calculator. Your combined PITI should not exceed 36 percent of your monthly salary, experts say.

PITI reserves
A cash amount that a borrower must have on hand after making a down payment and paying all closing costs for the purchase of a home.

Planned unit development
A zoning designation for property developed at the same or slightly greater overall density than conventional development, sometimes with improvements clustered between open, common areas. Use may be residential, commercial, or industrial.

Point
A one-time charge by the lender for originating a loan. A point is 1 percent of the amount of the mortgage.

Power of attorney
A power of attorney (POA) or letter of attorney in common law systems or mandate in civil law systems is an authorization to act on someone else’s behalf in a legal or business matter.

Prearranged refinancing agreement
A formal or informal arrangement between a lender and a borrower wherein the lender agrees to offer special terms.

Preforeclosure sale
A procedure in which the investor allows a mortgagor to avoid foreclosure by selling the property for less than the amount that is owed.

Prepayment
Any amount paid to reduce the principal balance of a loan before the due date.

Prepayment penalty
An amount that may be charged to the borrower by the lender for the early repayment of a debt. The prepayment penalty compensates the lender for the interest on the loan it would now not be earning.

Pre-qualification
An informal process in which a lender will offer an opinion on how much money you may be able to borrow. This opinion is based entirely on the financial information you provide and is neither binding nor necessarily accurate because lenders have not yet verified your financial information.

Prime rate
The interest rate charged to the bank’s most creditworthy clients. A benchmark or guideline interest rate that a bank establishes from time to time and uses in calculating an appropriate rate for a particular loan contract. The interest rate a bank pays to borrow money.

Principal
The amount borrowed or remaining unpaid.

Principal balance
Principal balance, in regards to a mortgage or other debt instrument, is the amount due and owing to satisfy the payoff of the underlying obligation.

Private mortgage insurance (MI)
Paid by a borrower to protect the lender in case of default. PMI is typically charged to the borrower when the Loan-To-Value Ratio is greater than 80%.

Promissory note
The document signed by the borrower promising repayment of the loan showing the amount of monthly payments, interest rate, first payment date, last payment date, and the late charge and prepayment provisions.

Proration
The process of dividing prepaid or accrued items( such as real estate taxes or utlity bills) between the buyer and the seller.

Public auction
A meeting in an announced public location to sell property to repay a mortgage that is in default.

PUD – Planned Unit Development
A zoning designation for property developed at the same or slightly greater overall density than conventional development, sometimes with improvements clustered between open, common areas. Use may be residential, commercial, or industrial.

Purchase and sale agreement
The “contract” that defines the real estate transaction. This legal instrument identifies the property, the purchase price, the parties to the contract, and every addition detail of the transfer of title from the seller to the purchaser.

Purchase money transaction
The purchase of a property with money or something of equivalent value to the buying price.

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