Glossary (N-O)

Terms commonly used in the real estate and mortgage marketplace.

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Negative Amortization

An increase in the balance of a loan caused by adding unpaid interest to the loan balance; this occurs when the payment does not cover the interest due.

Net Monthly Income

Your take-home pay after taxes. It is the amount of money that you actually receive in your paycheck.

Net Worth

The value of a company or individual’s assets, including cash, less total liabilities.

Non-Liquid Asset

An asset that cannot easily be converted into cash.

Note

A written promise to pay a specified amount under the agreed upon conditions.

Note Rate

The interest rate stated on a mortgage note, or other loan agreement.


Offer

A formal bid from the home buyer to the home seller to purchase a home.

Open House

When the seller’s real estate agent opens the seller’s house to the public. You don’t need a real estate agent to attend an open house.

Original Principal Balance

The total amount of principal owed on a mortgage before any payments are made.

Origination Fee

A fee paid to a lender or broker to cover the administrative costs of processing a loan application. The origination fee typically is stated in the form of points. One point is one percent of the mortgage amount.

Owner Financing

A transaction in which the property seller provides all or part of the financing for the buyer’s purchase of the property.

Owner-Occupied Property

A property that serves as the borrower’s primary residence.