| Term | Definition |
|---|
| 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. |
| property taxes | Taxes that are paid yearly on real property. Property taxes are ad valorem, based on the assessed value of the real property. Each taxing authority multiplies this appraised value by its annual tax rate. Taxing authorities include local school districts, counties, cities, water districts, and other special tax districts. |
| PUD | Acronym - planned unit development. |
| puffing | Non-factual or extravagant statements and opinions made to enhance the perceived desirability of a property. The is a fine line between legal puffing and illegal misrepresentation, and puffing is best avoided. An example of puffing would be, "This home has the best view in the city". Also known as puffery. |
| purchase offer | A document that lists the price, terms and conditions under which a buyer is willing to purchase a property. |
| qualify | To meet a mortgage lender's approval requirements. |
