Glossary Terms

Optional upfront fees paid directly to the lender at closing to permanently reduce the mortgage interest rate over the life of the loan.

An upfront good-faith cash deposit submitted with an executed purchase offer to demonstrate serious buying intent, later credited toward down payment and closing costs.

A custodial account held by a mortgage servicer that collects monthly funds to pay property taxes and homeowners insurance on your behalf.

A government-backed mortgage insured by the Federal Housing Administration featuring low down payments (3.5%) and flexible credit underwriting guidelines.

The percentage of a borrower’s gross monthly income dedicated solely to the proposed housing payment, including principal, interest, taxes, hazard insurance, and HOA dues.

Indiana’s state housing agency offering down payment assistance grants and low-interest second mortgages to qualified Hoosier homebuyers.

A non-conforming mortgage that exceeds standard FHFA baseline loan limits, typically requiring higher credit scores, larger down payments, and verified cash reserves.

A standardized three-page federal disclosure provided within three business days of application detailing estimated interest rates, monthly payments, and total closing costs.

The percentage of a home’s appraised value or purchase price financed through the mortgage, calculated by dividing the loan amount by property value.

The four core components of a total monthly mortgage payment: Principal, Interest, real estate property Taxes, and homeowners Insurance.