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Glossary N
National Do Not Call Registry
See Do Not Call Registry.
Negative Amortization
Occurs when the monthly payments are not enough to pay all of the interest due on a loan. This unpaid interest is added to the unpaid principal balance of the loan. Instead of going down each month, the principal balance goes up.
No-Cost Loan
This is a deliberate misnomer. There is no such thing as a “no-cost loan.” All loans have costs associated with them. Whether the borrower pays cash at close for points, finances the points into the loan, or takes a loan that shows zero points on the Good Faith Estimate, the borrower still bears the cost of the loan!
Non-Conforming Loan
A loan that for one or more reasons cannot be purchased by Fannie Mae or Freddie Mac.
Notary
A person licensed by the state to verify signatures and the person’s identity when they sign legal documents, such as loan documents.
Notary Fee
The fee charged by a notary for their services.
Note
The legal document signed by the borrowers that states the terms of the loan and the borrower’s promise to repay it.
Note Rate
The interest rate stated on the note. This is the rate interest on a loan is calculated and which determines the monthly payment. The note rate is different than the annual percentage rate.
Notice of Default
A legal notice sent to the borrower stating that since the payments on a loan haven’t been met, legal action will follow which can include foreclosure.
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Letter A