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Real Estate Definitions

PARGING
The cement coat applied to block foundations.

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PARTIAL INTEREST
A shared ownership in a piece of property. May be divided among two or more parties.

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PARTIAL PAYMENT
A payment of less than the regular monthly amount. Usually, a lender will not accept partial payments.

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PERIODIC PAYMENT CAP
The limit on how much regular monthly payments on an Adjustable Rate Mortgage can change during one adjustment period.

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PERIODIC RATE CAP
The limit on how much the interest rate on an Adjustable Rate Mortgage can change during any one adjustment period.

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PERSONAL PROPERTY
Owned items which are not permanently affixed to the land.

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PERSONAL RESIDENCE
The primary domicile of a person or family.

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PLANNED UNIT DEVELOPMENT (PUD)
A coordinated, real estate development where common areas are shared and maintained by an owner's association or other entity.

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PLAT
A plan or chart of a piece of land which lays out existing or planned streets, lots or other improvements.

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POINT
A percentage of a mortgage amount (one point = 1 percent).

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PRE-APPROVAL
The process of applying for a mortgage loan and becoming approved for a certain amount at a certain interest rate before a property has been chosen. Pre-approval allows the borrower greater freedom in negotiations with sellers.

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PREFABRICATED
Any building or portion thereof which is manufactured and assembled off site, then erected on a property.

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PREPAYMENT
Payment made that reduces the principal balance of a loan before the due date and before the loan has become fully amortized.

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PREPAYMENT PENALTY
A fee that may be charged to a borrower who pays off a loan before it is due.

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PRE-QUALIFICATION
Less formal that pre-approval, pre-qualification usually means a written statement from a loan officer indicating his or her opinion that the borrower will be able to become approved for a mortgage loan.

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PRIME RATE
The interest rate that banks and other lending institutions charge other banks or preferred customers.

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PRINCIPAL
The amount owed on a mortgage which does not include interest or other fees.

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PRINCIPAL BALANCE
The outstanding balance of principal on a mortgage. Does not included interest due.
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PRINCIPAL, INTEREST, TAXES, AND INSURANCE (PITI)
The most common constituents of a monthly mortgage payment.

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PRIVATE MORTGAGE INSURANCE (PMI)
A form of mortgage insurance provided by private, non-government entities. Normally required when the LOAN TO VALUE RATIO is less that 20%.

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PROPERTY
Any item which is owned or possessed.

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PURCHASE AGREEMENT
A written contract signed by the buyer and seller stating the terms and conditions under which a property will be sold.

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