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Partnership: A common form of joint ownership of a business.
Payee: Person or business that has the right to receive a payment or series of payments and is interested in selling that income stream for cash. (Also called the seller or client.)

Payment Cap: Consumer safeguards which limit the amount monthly payments on an adjustable-rate mortgage may change. Since they do not limit the amount of interest the lender is earning, they may cause negative amortization.

Payor: The person, company, or government responsible for making payments on an income stream.
Partial: Any part of a payment stream that is less than the full amount due.

Per Diem Interest: Interest calculated per day. (Depending on the day of the month on which closing takes place, you will have to pay interest from the date of closing to the end of the month. Your first mortgage payment will probably be due the first day of the following month.)

Personal guaranty: A contractual agreement between a funding source and a seller, whereby the seller assumes personal responsibility and liability for the obligations of the income stream.

PITI: Abbreviation for Principal, Interest, Taxes and Insurance, the components of a monthly mortgage payment.

Points (or Discount Points): Points are an up-front fee paid to the lender at the time that you get your loan. Each point equals one percent of your total loan amount. Points and interest rates are inherently connected: in general, the more points you pay, the lower the interest rate you get. However, the more points you pay, the more cash you need up front since points are paid in cash at closing.

Portfolio: A group or package of income streams of the same type.

Power of Attorney: Legal document authorizing one person to act on behalf of another.

Prepaid Expenses: Taxes, insurance and assessments paid in advance of their due dates. These expenses are included at closing.

Prepaid Interest: Interest that is paid in advance of when it is due. Typically charged to a borrower at closing to cover interest on the loan between the closing date and the first payment date.

Prepayment: Full or partial repayment of the principal before the contractual due date.

Prepayment Penalty: Fee charged by a lender for a loan paid off in advance of the contractual due date.

Pre-qualification: The process of determining how much money a prospective homebuyer will be eligible to borrow prior to application for a loan. Information submitted during pre-qualification is subject to verification at application.

Principal: The amount of debt, not counting interest, left on a loan.

Privately held: Owed to a private individual or business rather than to a bank or other financial institution.

Private Mortgage Insurance (PMI): Insurance to protect the lender in case you default on your loan. With conventional loans, mortgage insurance is not required if you make a down payment of at least 20% of the home's purchase price. (Note, however, that FHA and VA loans have different insurance guidelines.)

Profit and loss statement: A financial statement that shows a historical record of a business' income and expenses.
Promissory note: A written promise to pay a specified amount to a specified party over a certain period of time.

Purchase Agreement: Contract signed by buyer and seller stating the terms and conditions under which a property will be sold.