Adjustable Rate Mortgage (ARM) is a mortgage product with an Interest Rate that changes (is adjusted) based on market factors; as a result, the payment can increase.

Deed-In-Lieu of Foreclosure (DIL) allows for the transfer of legal title of the property to the lender in consideration for forgiveness of the debt.

Default or breach is the failure to perform any promise (such as the obligation to make timely monthly payments) made in a contract.

Extension is when the customer has experienced a temporary hardship and is unable to bring the loan current. The customer has the ability to continue making future payments, but does not have the funds to completely reinstate the loan. An extension may re-amortize the loan or defer the interest to the back of the loan. It brings the customer's account current immediately. An extension is generally used in the early stages of delinquency when a customer is one or two payments behind; it is rarely used for serious delinquency of more than 90 days past due or in the foreclosure process.

Deferment is an agreement to make portions of your mortgage payments at a later time. The total amount paid will be the same or more, but a deferment can be a way to assist homeowners experiencing a temporary hardship.

Delinquency Cycle describes the period between the time a homeowner first becomes "delinquent" in paying a mortgage and the foreclosure of a home. That person may break the cycle by seeking counseling, working with lenders and going to seminars to develop a workout option. Just because a homeowner becomes delinquent does not mean that the account will end up in foreclosure.

Fixed Rate Mortgages lock in an interest rate for the life of the loan. The rate does not change (generally for 15 years or 30 years), so the monthly payment remains the same during the life of the loan.

Forbearance or Repayment Plan allows borrowers who have been delinquent on payments to make regularly scheduled payments on a loan, plus a portion of the past due payments (usually on a monthly basis).

Foreclosure occurs when a lender pursues its lien on a property. Foreclosure action generally begins after 90 days of nonpayment. Parties are able to bid on the property as part of the foreclosure sale, and the title will be transferred to the successful bidder, subject to any applicable redemption period.

Hardship Letter is a written description of why a borrower is not or may not be able to make his or her mortgage payments. It is important that the letter include reasons for the hardship and plans for the future.

Home Depreciation occurs when the property value of a home decreases, usually due to market conditions such as an abundance of available homes or an overall weakened economy.

Home Retention is successfully maintaining ownership of a home that has been in danger of foreclosure. It may require counseling from a professional to help determine the best path for keeping a home.

Loss Mitigation is the lenders' and servicers' commitment to working with borrowers to help them avoid foreclosure. Lenders and servicers will look for all reasonable alternatives to establish a workable repayment plan, consistent with legal, contractual or fiduciary agreements. It is important to work with lenders, servicers and even counselors, as needed, to explore possible workout treatments, which may include modifications, repayment plans, extensions, short sales and settlements.

Marketability refers to a home's ability to sell based on its location, size, upkeep and other factors. The overall housing market also affects a home's marketability — for example, if there is an abundance of homes for sale.

Modification is a reworking of a mortgage agreement, sometimes even altering the interest rate. This alternative may accommodate a homeowner's situation that has changed since the original loan agreement was signed.

Partial Claim is an additional one-time loan to assist homeowners in paying what they owe due to missed or partial payments. The existing mortgage loan takes priority for payment going forward, and the partial claim loan is repaid after the original mortgage loan is paid.

Redemption Period is a time during which homeowners cannot be evicted or be forced to surrender their home after the foreclosure sale has occurred. The laws governing redemption periods vary from state to state, but it is essentially a short period that allows homeowners to choose the best path for their individual situations — whether toward homeownership preservation or loss mitigation.

Repayment Plan is a written agreement between the borrower and the lender to implement a payment moratorium due to unforeseen circumstances wherein the property or employment status is affected. At the expiration of the term, the customer pays the total arrearage in a lump sum or elects a further repayment plan. This agreement is typically used when a customer has a short-term reduction of income that severely impacts his or her ability to pay for a short period of time. The repayment plan brings the customer current over time as the payment obligations are met. It can also include a repayment plan under which the customer pays the regular monthly payment and an additional amount each month to catch up to delinquent payments over time.

Settlement is the acceptance of an amount less than the full payoff of a loan to satisfy the terms of the loan. This option is used when the amount owed (minus acceptable closing costs) to sell the property is more than the value of the property, and the customer does not have either the desire or ability to keep the property.

Short Sale or Short Refinance is the acceptance of less than the full payoff of a loan, when the property is being sold to another party. The loan will be considered to be paid in full upon acceptance of a short sale.