..Unless you’re a Realtor. Even complete laymen probably have an understanding of the most basic of real estate terms: equity, closing, and mortgage are all fairly common words. However, when you actually get elbow-deep into the world of home buying, words often pop up that you’ve probably never heard of before: amortization, escrow, principal/interest- not to mention the plethora of actual mortgage types out there. For a great guide, check out this post by Paul Sian at CinCinKy Real Estate:
Amortization-Is the paying off a debt (principal plus interest) in fixed payments over a set period of time.
Escrow-An account setup by the lender to hold money for payment of home insurance and property taxes.
P&I – Principal and Interest- P&I will be your normal monthly mortgage payment excluding escrow account payments if any.