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GLOSSARY
Phishing
Phishing is a scam that's designed to lure consumers into voluntarily providing confidential information. The consumer will receive an email that appears to be from a bank or online service provider (such as PayPal). The email will explain that the consumer needs to update account information or remedy an account problem. A link will be provided where the consumer can sign on and perform the requested tasks. The link directs the consumer to a phony website, where the confidential information provided by the consumer is recorded.
Pick-up tax
Pick-up tax is a state-imposed assessment that's based on the federal estate tax. Pick-up taxes are used by states that don't have their own estate tax legislation; rather than developing separate legislation, these states collect estate taxes by "picking up" an amount derived from the estate's federal tax liability.
Piggyback loan
A piggyback loan is a second mortgage that's taken out to avoid mortgage insurance. Mortgage insurance is typically required on mortgages that finance more than 80 percent of the home's purchase price. A homebuyer who doesn't have a 20 percent cash down payment can fund a first mortgage for 80 percent and use a piggyback loan to cover the remainder of the purchase price.
Piggyback mortgage
A type of second mortgage typically used to avoid paying for mortgage insurance, which is required on mortgages with less than 20 percent down. The borrower takes out a primary mortgage for 80 percent of the purchase price and then a second "piggyback" mortgage to cover all or part of the down payment.
PIN
An Acronym for Personal Identification Number. This number is used to access bank accounts at ATM's or sometimes online and should be kept a secret.
PIP
PIP, also called personal injury protection, is an optional coverage available on auto insurance policies that pays the medical expenses incurred by you and your passengers that result from a qualified accident.
PITI
These are the four components of the monthly payments to the lender, i.e. the principle, interest, taxes and insurance. Debt to income ratio is calculated by the lender from this amount. Sometimes mortgage insurance is also included in an impounded loan.
PITI reserves
An amount of cash that a homebuyer must have on hand after all of the closing costs and down payments have been made. This amount is generally equal to a specified amount of mortgage payments including principal, taxes, and insurance.
Planned unit development (PUD)
A type of ownership where a unit or the whole building is owned by an individual who lives in it and where the ownership of common spaces is shared by other members of the homeowner's association for the benefit of all owners.
Planned urban development - PUD
Planned urban development, or PUD, is a zoning class that allows for residential and commercial buildings. The PUD classification allows builders to develop residential, retail, and professional buildings into one community, so that residents can live, work, and play locally.
Plat
A map showing the way a parcel of land has been divided into individual lots. This map will also show the streets and easements.
Pledged asset
Pledged asset is property that secures debt and remains in possession of the lender until the debt requirements have been met. While the asset owner/borrower has to transfer the pledged asset to the lender, the lender has no ownership rights to the pledged asset unless the borrower defaults.
Pledging
Pledging is the process of providing assets to a lender for use as loan collateral. Pledged assets are held by the lender until all debt conditions have been met, but the lender doesn't own those assets unless the borrower defaults.
PLUS loan
Loans that are not need based that the parents of the student may take out. These loans are offered by the college and the government and are determined by the FAFSA.
PMI
PMI, or private mortgage insurance, is coverage that protects the lender from costs associated with foreclosing on a mortgage loan. Lenders require PMI coverage when the mortgage loan finances more than 80 percent of the property's value. PMI premiums are paid by the borrower.