Mortgage Glossary – Plain-English Terms
Understand Mortgage Jargon with Dorota at SNMC
Mortgages don’t have to feel complicated. That’s why Dorota Tyminski (NMLS #2459696) at Security National Mortgage Company (SNMC) created this plain-English mortgage glossary — an easy guide to help Texas homebuyers, first-time buyers, and refinancers cut through the jargon. Whether it’s “PMI” or “DTI,” you’ll find clear explanations here, so you feel confident from pre-approval to closing day.
Amortization
How your loan is paid off over time, through monthly payments split between principal and interest.
Annual Percentage Rate (APR)
The true yearly cost of a loan, including interest and fees, shown as a percentage.
Appraisal
A professional estimate of a home’s value, used by lenders to confirm the price is fair.
Closing Costs
The fees and expenses (besides the home price) you pay at closing — such as title fees, taxes, and lender charges.
Closing Disclosure (CD)
A final breakdown of your loan terms and closing costs, provided before your closing appointment.
Collateral
The property pledged to secure the mortgage loan. If the loan isn’t repaid, the lender may take the property.
Conventional Loan
A mortgage not backed by the government. Popular with buyers who have good credit and stable income.
Credit Score
A number that shows your credit history and repayment behavior. Higher scores may qualify you for better loan terms.
Debt-to-Income Ratio (DTI)
The percentage of your monthly income that goes toward debt payments. Lenders use this to check affordability.
Down Payment
The cash you pay upfront toward the home’s purchase price, usually between 3%–20%.
Earnest Money
A deposit from the buyer showing good faith in purchasing the home, applied toward closing.
Equity
The difference between your home’s market value and the amount you still owe on the mortgage.
Escrow
A neutral account used to hold funds for taxes, insurance, or earnest money until closing.
FHA Loan
A loan backed by the Federal Housing Administration with lower down payment and credit requirements.
Fixed-Rate Mortgage
A loan with an interest rate that stays the same for the life of the loan.
Foreclosure
The legal process where a lender takes back the property when the borrower doesn’t make mortgage payments.
Good Faith Estimate (GFE)
An estimate of your loan costs given early in the process. (Now replaced by the Loan Estimate form.)
Home Inspection
An examination of the home’s condition, typically done before closing, to identify repairs or issues.
Homeowners Insurance
An insurance policy protecting your home and belongings against damage or loss. Required by most lenders.
Jumbo Loan
A loan above standard lending limits, used for high-value homes.
Loan Estimate (LE)
A form showing your loan’s estimated terms and costs, provided early in the application process.
Loan-to-Value Ratio (LTV)
LoThe loan amount compared to the home’s value. Higher LTV often requires PMI.
Mortgage Broker
A licensed professional who connects borrowers with lenders to find suitable loan products.
Mortgage Insurance (PMI/MIP)
Insurance that protects the lender if you default. FHA loans use MIP; conventional loans may require PMI.
Pre-Approval
A lender’s written estimate of how much you can borrow, based on income, credit, and financials.
Pre-Qualification
A less formal estimate of what you may qualify for, based on self-reported information.
Principal
The actual amount you borrow from the lender, excluding interest.
Refinancing
Replacing an existing mortgage with a new one, often to get better rates or terms.
Title Insurance
Insurance that protects against issues with property ownership or title disputes.
Underwriting
The lender’s review process to decide if you qualify for a loan.
VA Loan
LA loan backed by the U.S. Department of Veterans Affairs, with no down payment and no PMI, for eligible veterans and service members.
Variable/Adjustable-Rate Mortgage (ARM)
A loan with an interest rate that can change after an initial fixed period.
Still unsure about a term?
Dorota is here to explain how each one applies to your personal mortgage journey. With SNMC / Team B1, you’ll never be left in the dark.
Contact Dorota Tyminski today for expert, plain-English mortgage guidance.