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Glossary M
Margin
The amount the lender adds to the index on an adjustable rate mortgage. This total establishes the adjusted interest rate and determines the new monthly payment. The margin added to the index is called the fully indexed rate. For example, if the current index is 5% and your loan has a margin of 2%, the fully indexed rate would be 7%.
Market Value
The current value of a property based upon a willing seller and a willing buyer
MIP
See Mortgage Insurance Premium
Mortgage Banker
A lender that originates and funds their own loans. After the loan closes, it is sold on the secondary market.
Mortgage Broker
A company who does not fund their own loans. A broker arranges financing for their borrowers with lenders. Usually a broker has a wide range of lenders they use, each wit a variety of products to choose from.
Mortgage Insurance
See PMI
Mortgage Insurance Premium
Insurance from FHA that protects the lender should the borrower default on the loan payments. Also called MIP.
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Letter A