Montrose, CO Office

Moab, UT Office

Prepaid Interest – Interest charged to a borrower at closing to cover interest on the loan between closing and the end of the month in which the loan closes.

Prepayment - Full or partial payment of the principal before the due date. This might occur if the borrower makes extra payments, sells the property, or refinances the existing loan.

Prepayment Penalty - Fee charged by a lender for early payment of debt.

Pre-qualification - The process of determining how much money a prospective homebuyer will be eligible to borrow prior to application for a loan.

Primary Mortgage Market - Includes banks, savings and loans, credit unions, and mortgage banks that make mortgage loans directly to borrowers. These lenders sometimes sell their mortgages to lenders such as FNMA in the secondary mortgage market.

Prime Rate - Lowest commercial interest rate charged by a bank on short-term loans to its most credit worthy customers.

Principal - The amount of debt, not counting interest, left on a loan.

Private Mortgage Insurance (PMI) – See "Mortgage Insurance."

Profit and Loss Statement - Financial statement showing sales, expenses and profits over a period of time.

Property Tax - A government tax based on the market value of a property.

Purchase Agreement - Contract signed by buyer and seller stating the terms and conditions under which a property will be sold.

Qualifying Ratio  - Comparison of a borrower's expenses (housing or total debt) to income.