Common Mortgage Abbreviations

There are so many abbreviations and acronyms in the mortgage process. As mortgage professionals, we’re so used to hearing these terms that some of us may not realize that not everyone may be aware what a DTI, AUS or MBS means.

Here’s a list of common mortgage abbreviations you may find useful. I’m sure I’ll be updating this as I come along other often used abbreviations. 🤓

By the way, if your mortgage professional talks in a language that’s difficult to understand, ask them to explain or maybe, find a different mortgage professional. I strongly believe that you should be able to make informed decisions about what is probably your largest debt on your greatest asset (your home) and your mortgage professional should be assisting in providing clarity.

• ADU – Accessory Dwelling Unit
• APR – Annual Percentage Interest Rate
• ARM – Adjustable Rate Mortgage
• AUS – Automated Underwriting System
• BK – Bankruptcy
• CD – Closing Disclosure
• CFPB – Consumer Financial Protection Bureau
• CLTV – Combined loan-to-value (when there is more than one mortgage and the value of the home)
• COE – Certificate of Eligibility (for VA loans)
• DADU – Detached Accessory Dwelling Unit
• DOT: Deed of Trust (document that is commonly recorded disclosing the mortgage)
• DPA – Down Payment Assistance
• DSCR – Debt Service Coverage Ratio (mortgage program used for investment properties that allows people to qualify based on the property’s cash flow)
• DTI – Debt-to-income ratio
• FHFA – Federal Housing Finance Agency (governs Fannie Mae & Freddie Mac)
• FHA – Federal Housing Administration
• FHLMC – Freddie Mac (Conforming Loan)
• FICO – Fair Isaac Corporation (Credit score model)
• FNMA – Fannie Mae (Conforming Loan)
• FRM – Fixed Rate Mortgage
• LTV – Loan-to-value ratio (loan amount and value of home)
• LOE or LOX – Letter of Explanation
• HELOC – Home equity line of credit
• HOA – Home Owners Association
• HOI – Home Owners Insurance
• HUD – U.S. Department of Housing and Urban Development
• IO – Interest Only
• Jumbo Loan – Loan amount over the conforming loan limits
• LE – Loan Estimate
• LO – Loan Officer
• MIP – Mortgage insurance premium (typically referring to an FHA loan)
• MBS – Mortgage-Backed Securities (bonds – that mortgage interest rates are based on)
• MLO – Mortgage Loan Officer
• NMLS – Nationwide Mortgage Licensing System
• P&I – Principal and Interest
• PITI – Principal, interest, taxes and insurance (mortgage payment)
• PIW – Property Inspection Waiver
• PMI – Private mortgage insurance
• Refi – Refinance (a new mortgage loan that replaces your existing mortgage – most often to reduce the interest rate/payment, change the term or obtain cash out from the home).
• USDA – U.S. Department of Agriculture (Rural Housing Loans)
• VA – Veterans Affairs (VA loans)
• VOE – Verification of Employment
• WSHFC – Washington State Housing Finance Commission

Am I missing anything? Please let me know and I’ll update this list!