| Term | Definition |
|---|
| power of attorney (POA) | A written authorization by a person to another person to act for him on his behalf. |
| prepayment | Paying off all or part of the mortgage before the scheduled date. |
| prepayment clause in a mortgage | Statement of the terms upon which the mortgagor (borrower) may pay the entire or stated amount on the mortgage principal at some time prior to the due date. |
| prepayment penalty | A fee paid to the lending institution for paying a loan prior to the scheduled maturity date. |
| primary mortgage market | Lenders who originate loans and makes funds available directly to the borrowers. Contrast with secondary mortgage market. |
| prime rate | The interest, or discount rate charged by a commercial bank to its largest and strongest customers. |
| principal | The amount of money owed to the lender not including interest. |
| principle of conformity | An appraisal principle which holds that the maximum value is realized when a reasonable degree of homogeneity (sameness) exists in a neighborhood. |
| private mortgage insurance (PMI) | Default insurance on conventional loans, normally insuring the top 20%-25% of the loan and not the whole loan. |
| pro-rate | To divide or distribute proportionally. At closing, various expenses such as taxes, insurance, interest, rents, etc. are prorated between the seller and buyer. |
