Bear Island Land Co., Inc.

~Your Recreational Real Estate Professionals~

Dictionary of Terms

~P~

 

PITI
Principle, interest, taxes and insurance. Also called monthly housing expense.
Party Wall
A wall erected on a line between adjoining properties for the use of both properties.
Personal Property
Generally, all things which are not real property; things of a temporary or movable nature.
Points (Loan Discount Points)
Prepaid interest accessed at closing by the lender. Each point is equal to 1 percent of the loan amount. For example, 2 points on a $100,000 mortgage would be $2,000.00 The IRS considers points to be a form of prepaid interest which means they can be deducted from taxable income. Lenders often require that the borrower pay one or two points at closing in exchange for a lower mortgage rate (the lender's target APR remains the same).
Power of Attorney
A legal instrument which authorizes another person to act, either a specific act or generally, in the stead of the person drawing the instrument.
Prepaids
Expenses necessary to create an escrow account or to adjust the seller's existing escrow. Can include taxes, hazard insurance, private mortgage insurance and special assessments.
Prepayment
Paying off a loan before its due date.
Prepayment Penalty
Money charged for an early repayment of a debt. Prepayment penalties are allow in some form (but not necessarily imposed) in 36 states and the District of Columbia.
Principle
Any person, partnership, association or corporation who authorizes or employs another, called the agent, to do certain acts on his behalf.
Principle Note
The promissory note which is secured by the mortgage or trust deed.
Private Mortgage Insurance (PMI)
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 percent. The Homeowners Protection Act of 1998 mandates that a lender notify a borrower when the LTV falls below 80 percent, at which time a borrower is allowed to cancel the PMI coverage.
Procuring Cause
The cause that results from an agent's employment in the sale or leasing of property, finding a buyer.
Property
The rights of ownership; the right to use, possess, enjoy, and dispose of a thing in every legal way and to exclude everyone else from interfering with these rights. Property is generally classified into two groups; persona property and real property.
Public Trustee
the public official in each county, whose office has been created by statute, to whom title to real property is conveyed by Trust Deed for the use and benefit of the beneficiary, who usually is the lender.
Purchase Money Mortgage
mortgage given by the purchaser to secure a loan for part or all of the purchase price. Such a mortgage becomes a lien on the property simultaneously with the passing of title, and if immediately recorded becomes prior to any lien against the purchaser.

 

RETURN TO PREVIOUS PAGE

 

Ely, Minnesota's most experienced Realtors, serving Buyers and Sellers in the Ely, MN area since 1995.