Terms starting with the letter M
Manufactured Home
A type of house that is constructed in a factory, delivered to a
property location and set on a foundation.
Margin
For mortgage lending, margin is the amount a lender adds to the base
rate of an adjustable-rate mortgage or other variable-rate loan to set
the loan rate (see Index). For example,
if a one-year ARM loan has a margin of 200 basis points (2%) over the
yield on 1-year Treasury bills and the T-bill yield is 4.5%, the loan
rate is set to 6.5%.
Marketable
or Merchantable Title
A title which is free from reasonable doubt of defect which can be readily
sold or mortgaged to a reasonably prudent purchaser or mortgagee; a
title free from material defects or grave doubts and reasonably free
from possible litigation.
Market
Value
The price, in terms of dollars, which a ready and able buyer, not
forced to buy, would pay and which a ready and willing seller, not forced
to sell, would accept, assuming further that both parties are fully
informed, act reasonably, and have sufficient time to consider the transaction
with due care. see fair market value
Maturity
The termination or due date on which final payment of a loan must be
paid in full.
Maximum
Loan Charges - See Points
Maximum
Monthly Payment
The maximum payment a borrower may qualify for based on their income
and debt. The maximum payment is calculated by using a debt-to-income
ratio.
Mechanic's
Lien
A lien created by statute which exists against real property in
favor of persons who have performed work or furnished materials for
the improvement of the real estate.
Metes
and Bounds
A method of describing or locating real property; metes are measures
of length and bounds are boundaries. This description starts with
a well-marked point of beginning and follows the boundaries of the land
until it returns once more to the point of beginning.
Mill
One-tenth of one cent. A tax rate of one mill on the dollar
is the same as a rate of one-tenth of one percent of the assessed value
of the property.
Mobile
Home
A type of home that is 100% constructed in a factory, delivered to a
property location and set on a lot or foundation. A mobile home
can generally be moved off of the owner's original site.
Monthly
Housing Payment
Typically the total amount of principal, interest, taxes, and insurance
(PITI) paid each month on a mortgage loan. Many lenders and investors
limit the monthly housing payment to 28% of the gross monthly income.
Monthly Payment
The amount of principal and interest paid each month on a loan.
The monthly payment on a mortgage loan may also include an escrow payment
for taxes and insurance.
Monthly Payment Savings
The total monthly payment reduction a borrower may gain by refinancing
their mortgage loan.
Mortgage
A conditional conveyance of property as security for the payment of
a debt or the fulfillment of some obligation. Upon payment of
the debt or performance of the obligation the mortgage becomes void.
Mortgage
Broker
Any entity, engaged in, assisting, arranging funding, or negotiating
mortgage financing, in behalf of a client, in consideration of,
compensation in the form of origination, either by lender or borrower.
Mortgage Insurance
A contract that insures the lender against loss caused by a mortgagor's
default on a mortgage. Mortgage Insurance is generally required
on all First Mortgage Loans that have a down payment of less
than 20% of the purchase price (or until 20% equity is accumulated in
the property).
Mortgage
Insurance Premium (MIP)
MIP is paid on government-insured FHA loans only (VA loans require
a funding fee in most cases) and Conventional loans use PMI (Private
Mortgage Insurance. FHA loans also require an upfront premium. See below.
Mortgage
interest deduction
The mortgage interest tax deduction allows you to deduct the mortgage
interest expense you pay on mortgage and home equity debt, up to certain
limits of debt. The deduction lowers your tax bill by an amount
equal to the amount of interest times your tax rate. To take the
mortgage interest deduction, you must itemize the deduction using Schedule
A of IRS Form 1040.
Mortgage
points - see Points
Mortgagee
The party to whom the property is conveyed under a mortgage as security
for the repayment of a loan or fulfillment of some obligation.
Mortgagor
The party who, by a mortgage, conveys their interest in the property
as security for their obligation to repay a loan or fulfill some obligation.
Multi
Family
A term generally to distinguish a house designed for use by more than
one family (duplex or fourplex).
Mutual
Assent
One of the essential elements of a contract, often called Meeting
of the Minds; the agreement of the parties to the contract, mutually
consenting to be bound by the exact terms thereof.
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