Florida Mortgage Glossary
Every mortgage, loan, and home-financing term defined in plain English — from amortization to underwriting, A to Z.
Mortgages come with a lot of acronyms. This A–Z glossary defines every loan and home-financing term in plain English — APR, DTI, escrow, PITI, points, and the rest — with links to the Divito Lending guides and tools that go deeper. Jump to a letter using the bar below.
A
Adjustable-Rate Mortgage (ARM)
A loan with a rate that adjusts after a fixed intro period. See ARMs explained.
Amortization
The schedule by which your loan balance is paid down over time through principal and interest.
Annual Percentage Rate (APR)
The yearly cost of a loan including interest and most fees — useful for comparing offers apples-to-apples.
Appraisal
A licensed valuation of the property, required by most lenders before closing.
B
Bank Statement Loan
A loan that qualifies self-employed borrowers using bank deposits instead of tax returns. See bank statement loans.
C
Cash-Out Refinance
Replacing your mortgage with a larger one and taking the difference in cash. See cash-out refinance.
Closing Costs
The fees due at closing. See our Florida closing cost breakdown.
Conforming Loan
A loan within Fannie Mae / Freddie Mac limits, which earns the best conventional pricing.
Conventional Loan
A non-government loan. Compare conventional vs FHA or see conventional loans.
Credit Score
A number (typically 300–850) summarizing credit risk; higher scores earn better rates.
D
Debt-to-Income Ratio (DTI)
Your monthly debts divided by gross income — a key approval factor. See the 28% rule.
Discount Points
Upfront fees paid to lower your rate, each point costing 1% of the loan amount.
Down Payment
The cash you put toward the purchase price up front.
E
Earnest Money
A buyer’s good-faith deposit when going under contract, separate from the down payment.
Equity
The portion of the home you own outright — its value minus what you still owe.
Escrow Account
A lender-held account that pays your property taxes and insurance from monthly deposits.
F
Fannie Mae / Freddie Mac
Government-sponsored enterprises that buy conforming loans, setting much of the conventional rulebook.
FHA Loan
A government-insured loan with low down payments and flexible credit. See FHA loans.
Fixed-Rate Mortgage
A loan whose interest rate never changes for the life of the loan.
G
Gift Funds
Down-payment money from family, allowed with a documented gift letter.
H
HELOC
A Home Equity Line of Credit — a revolving second loan against your equity. Compare HELOC vs cash-out.
Hometown Heroes
A Florida program offering down-payment help to eligible workers. See Hometown Heroes.
I
Impound Account
Another name for an escrow account holding your taxes and insurance.
Interest Rate
The cost of borrowing the principal, expressed as a yearly percentage.
J
Jumbo Loan
A loan above conforming limits, common on higher-priced Florida homes. See jumbo loans.
L
Loan Estimate
A standardized three-page form showing a loan’s rate, payment, and costs within three days of applying.
Loan-to-Value (LTV)
The loan amount as a percentage of the property’s value.
M
Mortgage Broker
A licensed intermediary who shops many lenders on your behalf. See broker vs banker.
Mortgage Insurance (PMI / MIP)
Coverage protecting the lender on low-down-payment loans — PMI on conventional, MIP on FHA.
Mortgage Pre-Approval
A documented review of your finances showing how much you can borrow. See pre-approval.
N
NMLS
The Nationwide Multistate Licensing System that registers mortgage companies and loan originators.
O
Origination Fee
A lender’s charge for processing and underwriting a new loan.
Owner-Occupied
A property the borrower lives in, which qualifies for the best rates.
P
PITI
The four parts of a mortgage payment: Principal, Interest, Taxes, and Insurance.
Points
See Discount Points — each point is 1% of the loan paid up front to buy down the rate.
Pre-Qualification
A quick, informal estimate of borrowing power, lighter than a full pre-approval.
Principal
The amount you borrow and still owe, separate from interest.
R
Rate Lock
A lender’s commitment to hold your quoted interest rate for a defined window.
Refinance
Replacing your existing mortgage with a new one. See our refinance guide.
Reverse Mortgage
A loan letting homeowners 62+ convert equity to cash with no monthly payment. See reverse mortgages.
S
Seller Concession
Closing-cost help the seller credits the buyer at closing.
Streamline Refinance
A simplified refinance for FHA or VA loans with reduced documentation. See the VA IRRRL.
T
TILA / TRID
Federal disclosure rules requiring the Loan Estimate and Closing Disclosure.
Title Insurance
A policy protecting against ownership defects, ordered at closing.
U
Underwriting
The lender’s full review of credit, income, assets, and the property before approval.
USDA Loan
A zero-down loan for eligible rural and suburban Florida buyers. See USDA loans.
V
VA Loan
A zero-down loan for veterans and service members. See VA loans.
W
W-2
The income form used to verify wages for salaried borrowers; self-employed borrowers may use a bank statement loan instead.