Mortgage Glossary

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Accrued Interest – Accrued Interest is the interest that has accumulated from one payment due date to the next as well as the total amount of interest paid on a loan over time.


Adjustable Rate Mortgage (ARM) – A mortgage with an interest rate and payment that changes periodically over the life of the loan based on the change in the specific index. Adjustable rate mortgages may have features that allow for the interest rate and payments to be fixed for an initial period (3 years, 5 years, 7 years, 10 years) and thereafter adjusting periodically based on the specific index.


Adjustment Date – The date on which the interest rate changes for an adjustable-rate mortgage (ARM).


Adjustment Interval – The adjustment interval is the time between changes in the interest rate and/or monthly payment for an adjustable rate mortgage, usually one, three or five years.


Amortization – The gradual repayment of a mortgage debt through consistent payment installments of principal and interest. The installment amounts are calculated to pay off the obligation in a fixed period of time.


Amortization Schedule – A timetable for payment of a mortgage; showing the amount of each payment being applied to interest and principal, as well as the remaining balance.


Annual Percentage Rate (APR) – The cost of a mortgage stated as a yearly rate, including such items as interest, mortgage insurance and loan origination fee (points).


Appraisal – A written analysis of the estimated value of a property prepared by a qualified appraiser.


Appreciation – An increase in a home’s market value due to changing market conditions and/or home improvements.

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