Private Mortgage insurance (PMI): Insurance provided by a nongovernmental insurer that protects lenders against a loss if a borrower defaults. Usually required on all loans with an "LTV" of more than 80%.

Purchase and sale agreement: A written contract signed by the buyer and seller stating the terms and conditions under which a property will be sold.

Qualifying ratios: Guidelines applied by lenders to determine how large a loan to grant the homebuyer. The debt-to-income ratio is your current monthly debt on loans and credit cards divided by your gross income.  The housing-to-income ratio is your new housing payment divided by your gross income.

Radon: A radioactive gas found in some homes that in sufficient concentrations can cause health problems. Your lender may require a radon check on your home.

Real estate agent: A person licensed to negotiate and transact the sale of real estate on behalf of either the borrower or seller, or in some cases both parties.

Real Estate Settlement Procedures Act(RESPA): A consumer protection law that requires lenders to give borrowers advance notice of closing costs, including an "APR".

Refinancing: The process of paying off one loan with the proceeds from a new loan secured by the same property. This is most often done to get the better interest rate offered by the new loan or to pull cash out.

Regulation Z: Federal regulation issued by the Fed to implement the Truth-in-Lending Law.

Second mortgage: A mortgage that has rights that are subordinate to the rights of the first mortgage.  As such, these loans are often less secure and may demand a slightly higher interest rate.

Secondary mortgage market: A market where  existing mortgages are bought and sold.  Mortgages are originated in the primary mortgage market.

Seller carry-back: An agreement in which the owner of a property provides financing, often in combination with an assumed mortgage.

Settlement sheet: The computation of costs payable at closing that determines the seller's net proceeds and the buyer's net payment.

Stated income loan: A loan that the borrowers tell the lender what their income is with no verification by the lender.

Sub-prime loans: Loans not able to be delivered and sold on the secondary market, normally because of high ratios, credit problems or unusual loan circumstances.

Survey: A drawing showing the legal boundaries of a property, it's fixtures, and any easements or encroachments.

Tenancy by entirety: A type of joint ownership of a property available only to a husband and wife.

Tenancy in common: A type of joint ownership in a property without right of survivorship.

Title: A legal document establishing the right of ownership.

Title company: A company that specializes in title searches and insuring title to property.

Title insurance: Insurance to protect the lender (lender's policy) or the buyer (buyer's policy) against loss arising from disputes over ownership of a property.

Title search: A check of the title records to ensure that the seller is the legal owner of the property and that there are no liens or other claims outstanding.

Transfer tax: State or local tax payable when title passes from one owner to another.

Truth-in-Lending: A federal law that requires lenders to fully disclose, in writing, the terms and conditions of a mortgage, including the APR and other charges.

Underwriting: The process of evaluating a loan application to determine the risk involved for the lender.

Uniform settlement statement (HUD-1): A form required by RESPA to be used at closings that details financial information of the transactions.

VA loan: A loan that is guaranteed by the Veterans Administration.