| Package Mortgage | Mortgage covering both real and personal property. |
| Paper | A mortgage, deed of trust or land contract which is given instead of cash. |
| Parole Evidence | The legal rule which prevents previous oral or written negotiations to a signed contract from changing the contract. |
| Partial Release | A release of a portion of property covered by a mortgage. |
| Payment Adjustment Period | The length of time (typically a year) between changes to the AML borrower's P&I payment. |
| Payment Buy Down | Payment buy downs occur when a third party, typically a builder, pays part of the initial P&I payments for a year or two, so that the borrower has smaller payments and can qualify for the loan. |
| Payment Cap | A limit on the amount the payment can be changed at the end of each Payment Adjustment Period. |
| Payment Discount | In a payment discount, the lender reduces the first year's interest rate to make the mortgagor more attractive to borrowers. |
| Periodic Payment Cap | A limit on the amount that payments can increase or decrease during any one-adjustment period. |
| Periodic Rate Cap | A limit on the amount that the interest rate can increase or decrease during any one adjustment period, regardless of how high or low the index might be. |
| Permanent Mortgage | A mortgage on completed construction on the same property under one mortgage or trust deed. |
| Perorations | The allocation of expenses, such as taxes between buyer and seller at closing based on the number of days the property is owned during the month of closing. |
| Personal Property | Any property that is not real property. |
| Personality | Property which is movable. All property is either personality, realty or mixed. |
| Physical Depreciation | A term that is frequently used when physical deterioration is intended. In a broad concept it may relate to those elements contributing to depreciation that are existent or inherent in the physical property itself, as distinguished from other and external circumstances that may influence its utilization. Not a clear or proper them without qualification and explanation. |
| PITI | Abbreviation for principal, interest, taxes and insurance, often combined in a single monthly mortgage payment. |
| Planned Unit Development (PUD) | A housing development where there is a homeowners association and common areas owned by the homeowners. |
| Plat | A map or chart of a lot, subdivision or community, showing boundary lines, buildings and easements. |
| PMI | Abbreviation for private mortgage insurance: insurance issued by a company, which insures the lender against loss in the event that the borrower defaults on the mortgage. |
| Points | Origination fees charged by the originating lender or broker and/or discount fees charge by lenders to increase the overall yield. A point is equal to one percent of the principal amount of your mortgage. |
| Portfolio Loan | Loans held as an investment by a bank, savings and loan or credit union. |
| Power of Attorney | A written instrument authorizing a person to act as the agent of the person granting it, and a general power authorizing the agent to act generally in behalf of the principle. A special power limits the agent to a particular or specific act as: a landowner may grant an agent special power of attorney to convey a single and specific parcel of property. Under the provisions of a general power of attorney, the agent having the power may convey any or all property of the principal granting the general power of attorney.. |
| Prepaid Interest | Prepaid interest is the interest charged to borrowers at loan closing to pay for the cost of borrowing for a partial month. For example, if a loan closes on the 15th of the month and the first payment is due 45 days later, the lender will charge 15 days of prepaid interest. |
| Prepaid Items of Expense | Perorations of prepaid items of expense which are credited to the seller in the closing statement. |
| Prepaymen | Payment of mortgage loan, or part of it, before due date. |
| Prepayment | Full payment of the principal before the due date; occurs when a property is sold or the borrower refinances the existing loan. |
| Prepayment Penalty | Charge levied by the lender for paying off a mortgage loan before its maturity date. |
| Primary Mortgage Market | The process of obtaining a real estate loan, including the consumer's completion of a loan application form, validation of the credit and property information, loan underwriting by the lender and closing of the mortgage loan. |
| Primary Residence | Considered the permanent location of residency. |
| Prime Rate | The interest rates that banks charge to their preferred customers. |
| Principal | 1) The outstanding balance of a loan. 2) A party to a real estate transaction. 3) The head of a real estate firm. The amount borrowed or remaining unpaid, also, that part of the monthly payment that reduces the outstanding balance of a mortgage. |
| Private Mortgage Insurance (PMI) | Insurance which covers the portion of a mortgage loan above 80% thereby reducing the lenders risk to principal loss in the event of a borrowers default. The insurance coverage allows lenders to make higher loan-to-value ratios (95% LTV). |
| Promissory Note | A written promise to repay a specified amount over a specified period of time. |
| Property | The rights of ownership. The right to use, possess, enjoy, and dispose of a thing in every legal way and to exclude everyone else from interfering with these rights. Property is generally classified into two groups, personal property and real property. |
| Property Tax | A tax levied by the local municipality or county on real and personal property. |
| Prorate | To divide in proportionate shares, such as taxes, insurance, rent, or other items. |
| Public Auction | A meeting in an announced public location to sell property to repay a mortgage that is in default. |
| Purchase Agreement | See Agreement of Sale. |
| Purchase Money Mortgage | A mortgage used to finance the purchase of real property. |
| Purchase Money Transaction | The acquisition of property through the payment of money or its equivalent. |
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