Graduated payment mortgage (GPM): A mortgage on which the payment rises by a constant percentage for a specified number of periods, after which it levels out over the remaining term and amortizes fully. For example, the payment might increase by 7.5% every 12 months for 60 months, after which it is constant for the remaining term at a fully amortizing level.

Homeowner's Insurance: insurance covering your home and its contents in the event of a disaster such as: fire, theft, tornado, etc. Homeowners' insurance is required by law for homes with mortgage loans.

HUD Settlement Statement: a document providing an itemized listing of the funds paid at closing. Items on the statement include: real estate commissions, and initial escrow amounts. This statement defines the seller's net proceeds and the buyer's net payment due at closing.

Hazard insurance: Insurance purchased by the borrower, and required by the lender, to protect the property against loss from fire and other hazards. It is the second "I" in PITI.

Housing expense ratio: The ratio of housing expense to borrower income, which is used (along with the total expense ratio and other factors) in qualifying borrowers.