A

Adjustable Rate Mortgage
A mortgage in which the loan rate changes during the life of the loan, usually at one, three, or five-year intervals. Changes are governed by the movement of an index, such as the treasury bill, treasury securities index, or a national or regional average cost of funds index.

Advance
Additional funds loaned to a mortgagor by the mortgagee.

Amortization
A payment plan by which the borrower reduces his or her debt gradually through monthly payments of principal.

Annual Percentage Rate
The cost of your credit as a yearly rate. This includes interest and certain additional costs and fees associated with the loan. It is often referred to as the APR.

Appraisal
An evaluation of a specific property to determine its current market value based on recent sales of similar homes in a given market, in addition to other factors.

Approval
Grant of loan based on proof of good title, proof of actual income/employment, and the actual appraised value of the property being mortgaged.

Assumable mortgage
A mortgage that can be assumed, or taken over, by the buyer from the seller.