Genesis Associates Mortgage Definitions "P" (866) 410.4410

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Definitions of Mortgage Terms

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Par - An expression used when a mortgage is sold or purchased for the outstanding balance without premium or discount.

Pari Passu - On an equal basis. When mortgages are syndicated, the lenders participate equally. No one party has preferential access to gains or is able to opt out of losses. In company stock, it refers to equal ranking of a company's preferred shares.

Partial Discharge - A release from the mortgage of a definite portion of the mortgaged lands usually given after the mortgagor has prepaid a specific portion of the mortgage debt.

Partially Amortized Mortgage -A mortgage in which the amortization period exceeds the term, thereby leaving a balance (balloon payment) payable at the end of the term, e.g., 25 year amortization and a five year term.

Perfecting Title - The elimination of any claims against title.

Performance Bond - A bond issued by a duly incorporated surety company covering the faithful performance of the contract and the payment of all obligations arising under the contract.

Permanent Loan - An amortizing loan on completed property which is intended to remain on that property over the full amortization period. The terms and conditions of the loan usually change during that period.

Personal Liability - The borrower's assets are pledged or subject to claim in addition to a primary security.

Personal Property -All property, except land and the improvements thereon.

Physical Deterioration -Depreciation resulting from an improvements physical condition due to wear and tear, decay, and structural defects.

Plot Plan - A drawing showing a layout of improvements on a site, including their location, dimensions and landscapes. It is generally a part of the architectural plans.

Plottage - The increase in value of a plot of land created by the assembling of small parcels into one ownership.

Police Power - The right of government to limit property rights without compensation provided the limitation is not specific to one parcel.

Postponement - The deferment of a prior charge on title to another.

Power of Attorney - A written instrument duly signed and executed by an owner of property that authorizes someone to act on behalf of the owner, to the extent indicated in the instrument.

Power of Sale - A clause generally inserted in mortgages giving the mortgagee the right and power, on default by the mortgagor of moneys due, to sell the mortgaged property by public auction, private contract or tender.

Pre-Authorized Cheques - Direct withdrawals of due payments from a borrower's bank account in accordance with authority granted by the borrower.

Premium - The amount, often stated as a percentage, paid in addition to the face value of a mortgage when the mortgage is being purchased.

Prepayment Clause - A clause inserted in a mortgage that gives the mortgagor the privilege of paying all or part of the mortgage debt in advance of the maturity date.

Prepayment Penalty - The sum of money (usually equal to an amount of interest) a mortgagee may require from a mortgagor to repay all or part of any outstanding principal.

Prime Rate - The rate at which financial institutions lend to their best customers.

Principal Amount -The debt owed, i.e., principal amount of a mortgage, as distinct from interest.

Prior Charge - An encumbrance ranking in priority to the mortgage in question.

Privacy Disclosure -Disclosures pursuant to federal legislation concerning the collection and use of personal information.

Profit a Prendre -The right to enter and take something from the land.

Promissee - The person who can enforce the promise in a contract is called the promissee.

Promissor - The person who makes the promise in a contract is called the promissory.

Probate - Letters probate are issued by the Surrogate Court or the Court of Probate certifying that the Will has been approved and that the executor has been duly appointed

Progress Advance Loan - A loan made, usually to a builder, where moneys are advanced from time to time as construction progresses.

Purchase Financing -Mortgage financing obtained specifically for the acquisition of real estate, as distinct from switch financing (at point of renewal) or equity take outs (refinancing).

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