Home Loan Glossary – M

Margin: A margin is a feature of an Adjustable-Rate Mortgage (ARM) or home equity line of credit. It is the amount added to the index to calculate the interest rate on each adjustment date. The margin remains fixed throughout the life of the home loan.
Master Homeowners Association: A master association is a homeowner's organization in a large planned unit development (PUD) or condominium project. The people in this organization are members from organizations serving certain areas within the project. Essentially, it is a "second-level" association that deals with matters which concern the whole project, whereas "first-level" associations handle matters that affect only their specific portion of the development.
Maturity: This is the date when the principal balance of a bond, loan or other financial vehicle is due and payable. When a 30-year loan reaches maturity, the principal balance is paid in full.
Maximum Financing: Maximum financing is the maximum amount of money a home lender will offer on any given loan program.
Maximum Rate: A maximum rate is a protective feature of a Variable Rate Loan, and is the maximum interest rate that can be charged on the loan.
Merged Credit Report: A merged credit report is used by lenders to help make loan decisions. It combines information from a number of credit reporting agencies (also called credit bureaus). The information is checked for errors and duplicate entries, creating a summary of your credit.
Minimum Payment: This is the minimum monthly amount that is to be paid on a loan account. During the draw period of a home equity line of credit (HELOC), the minimum payment usually equals interest only. On fixed rate second mortgage loans, the minimum payment includes both principal and interest payments.
Modification: Modification involves the alteration of any of the terms of a home loan.
Money Market Account: A money market account is a savings fund that offers depositors several of the advantages of a money market fund, but in an insured account. In order to maintain these advantages, the withdrawal of cash from a money market account is regulated by certain conditions.
Money Market Fund: A money market fund is a mutual fund that permits people to take part in managed, short-term debt security investments, such as certificates of deposit and Treasury bills. Unlike money market accounts, these funds are not FDIC insured.
Monthly Debt: Monthly debt refers to all the payments a borrower must make on a monthly basis. These include such expenses as credit cards, student loan payments, installment loans, child support and alimony payments, as well as housing expenses.
Monthly Mortgage Insurance (MI) Payment: The part of monthly payments that goes to pay for Private Mortgage Insurance.
Monthly Principal & Interest (P&I) Payment: The part of monthly payments that covers both the principal and interest due on the home loan.
Monthly Taxes & Insurance (T&I) Payment: The part of monthly payments covering the escrow or impound account for taxes and homeowner insurance.
Monthly Payment: This is the amount paid monthly by the borrower to the lender or servicer of a loan.
Mortgage: Technically, a mortgage is a legal document that guarantees a property to a lender as collateral for a debt. More commonly, "mortgage" is used to refer to a home loan.
Mortgage Banker: A mortgage banker is a company that creates, sells and services mortgages solely for resale to investors in the secondary mortgage market. Contrast to Portfolio Lender.
Mortgage Broker: A mortgage broker acts as a third party or mediator between borrowers and lenders, for the purpose of matching their clients with suitable home loans. Mortgage brokers usually request a commission or a fee for their consultation and other professional services.
Mortgage Insurance: Mortgage insurance is a contractual agreement that insures the home loan lender against loss resulting from a borrower's default on a government or conventional mortgage. Mortgage insurance can be issued by private firms or government agencies, such as the Federal Housing Administration (FHA). The insurance may cover a percentage of the mortgage loan, or nearly all of it, depending on the type of insurance. See Private Mortgage Insurance (PMI).
Mortgage Insurance Premium (MIP): A mortgage insurance premium is the amount that a borrower must pay for mortgage insurance. This amount is payable either to a government agency, such as the Federal Housing Administration (FHA), or to a private mortgage insurance firm.
Mortgage Life Insurance: This is a type of term life insurance that is sometimes purchased by home loan borrowers. As the loan's principal balance decreases, so does the amount of coverage. If the borrower dies while the policy is in existence, the debt is automatically covered by the proceeds of the insurance policy. See Credit Life Insurance.
Mortgagee: In a mortgage agreement, the mortgagee is the lender.
Mortgagor: In a mortgage agreement, the mortgagor is the borrower.
Multi-Dwelling Units: These properties offer separate housing units for a number of families, but are under a single mortgage. These are generally 2-4 unit properties.