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Loan Guarantee Agency

A government agency that provides guarantees for home loans, meaning if a borrower defaults, the agency covers a portion of the loss to the lender. Examples include the Federal Housing Administration (FHA) and the Rural Housing Service (RHS).

First-time Homebuyer

An individual who has not owned a home in the past three years.

First-generation Homebuyer

An individual whose parents or legal guardians do not own a home or did not own a home at any point while the individual was a minor.

Covered Mortgage Loans

Home loans that meet the specific eligibility and pricing criteria established by the LIFT Homebuyers Act of 2025 and are part of the new program.

Securities

Financial assets, such as bonds, that can be bought and sold. In this context, they refer to investment products backed by a pool of mortgage loans.

Credit Subsidy

The estimated long-term cost to the government for guaranteeing loans, including potential losses from defaults.

Principal and Interest (P&I)

The two main components of a mortgage payment. Principal is the amount that reduces the loan balance, and interest is the cost of borrowing money.