-A-
Abstract
(Of Title)
A
summary of the public records relating to the title to a particular
piece of land. An attorney or title insurance company reviews
an abstract of title to determine whether there are any title
defects which must be cleared before a buyer can purchase clear,
marketable, and insurable title.
Acceleration
Clause
Condition
in a mortgage that may require the balance of the loan to become
due immediately, if regular mortgage payments are not made or
for breach of other conditions of the mortgage.
Acceptance
An
offeree’s consent to enter into a contract and be bound by the
terms of the offer.
Additional
principal payment
A
payment by a borrower of more than the scheduled principal amount
due in order to reduce the remaining balance on the loan.
Adjustable
Mortgage Loan
Any
mortgage that does not have a fixed interest rate and a fixed
payment for the term of the loan, or does not amortize to zero
at the end of the set term, when required payments are made on
time.
Adjustable
Rate Mortgage
A
mortgage in which the interest rate is adjusted periodically according
to the movement in a pre-selected index.
Adjusted
basis
The
original cost of a property plus the value of any capital expenditures
for improvements to the property minus any depreciation taken
Adjustment
date
The
date on which the interest rate changes for an adjustable-rate
mortgage (ARM).
Adjustment
Interval
For
an adjustable rate mortgage, the time between changes in the interest
rate charged. The most common adjustment intervals are one, three
or five years.
Adjustment
period
The
period that elapses between the adjustment dates for an adjustable-rate
mortgage (ARM).
Administrator
A
person appointed by a probate court to administer the estate of
a person who died intestate.
Agreement
of Sale
Known
by various names, such as contract of purchase, purchase agreement,
or sales agreement according to location or jurisdiction. A contract
in which a seller agrees to sell and a buyer agrees to buy, under
certain specific terms and conditions spelled out in writing and
signed by both parties.
Amenity
A
feature of real property that enhances its attractiveness and
increases the occupant’s or user’s satisfaction although the feature
is not essential to the property’s use. Natural amenities include
a pleasant or desirable location near water, scenic views of the
surrounding area, etc. Human-made amenities include swimming pools,
tennis courts, community buildings, and other recreational facilities.
Amortization
A
payment plan, which enables the borrower to reduce his debt gradually
through monthly payments of principal.
Amortization
schedule
A
timetable for payment of a mortgage loan. An amortization schedule
shows the amount of each payment applied to interest and principal
and shows the remaining balance after each payment is made.
Amortization
term
The
amount of time required to amortize the mortgage loan. The amortization
term is expressed as a number of months.
Amortize
Reduce
a debt by regular payments of both principal and interest.
Amortization
Schedule
A
timetable for payment of a mortgage showing the amount of each
payment applied to interest and principal and the remaining balance.
Annual
Percentage Rate (APR)
The
total yearly cost of a mortgage stated as a percentage of the
loan amount: includes the base interest rate, primary mortgage
insurance, and loan origination fee (points)
Annuity
An
amount paid yearly or at other regular intervals, often on a guaranteed
dollar basis.
Application
A
form used to apply for a mortgage loan and to record pertinent
information concerning a prospective mortgagor and the proposed
security.
Application
Fee
The
fee charged by the lender to the borrower for applying for a loan.
Appraised
value
An
opinion of a property's fair market value, based on an appraiser's
knowledge, experience, and analysis of the property.
Appraiser
A
person qualified by education, training, and experience to estimate
the value of real property and personal property.
Appraisal
A
professional opinion of the market value of a property.
Appreciation
An
increase in the value of a house due to changes in market conditions
or other causes.
Assessed
Value
The
valuation placed upon property by a public tax assessor for purposes
of taxation.
Assessment
The
process of placing a value on property for the strict purpose
of taxation. May also refer to a levy against property for a special
purpose, such as a sewer assessment.
Assessor
A
public official who establishes the value of a property for taxation
purposes.
Asset
Anything
of monetary value that is owned by a person. Assets include real
property, personal property, and enforceable claims against others
(including bank accounts, stocks, mutual funds, and so on).
Assignment
The
transfer of a mortgage from one person to another.
Assumable
Loan
These
loans may be passed on from a seller of a home to the buyer. The
buyer "assumes" all outstanding payments.
Assumption
clause
A
provision in an assumable mortgage that allows a buyer to assume
responsibility for the mortgage from the seller. The loan does
not need to be paid in full by the original borrower upon sale
or transfer of the property.
Assumption
fee
The
fee paid to a lender (usually by the purchaser of real property)
resulting from the assumption of an existing mortgage.
Assumption
of Mortgage
An
obligation undertaken by the purchaser of property to be personally
liable for payment of an existing mortgage. In an assumption,
the purchaser is substituted for the original mortgagor in the
mortgage instrument and the original mortgagor is to be released
from further liability in the assumption, the mortgagee's consent
is usually required.
Attorney-in-fact
One
who holds a power of attorney from another to execute documents
on behalf of the grantor of the power. The original mortgagor
should always obtain a written release from further liability
if he desires to be fully released under the assumption. Failure
to obtain such a release renders the original mortgagor liable
if the person assuming the mortgage fails to make the monthly
payments. An "Assumption of Mortgage" is often confused with "purchasing
subject to a mortgage." When one purchases subject to a mortgage,
the purchaser agrees to make the monthly mortgage payments on
an existing mortgage, but the original mortgagor remains personally
liable if the purchaser fails to make the monthly payments. Since
the original mortgagor remains liable in the event of default,
the mortgagee's consent is not required to a sale subject to a
mortgage. Both "Assumption of Mortgage" and "Purchasing Subject
to a Mortgage" are used to finance the sale of property. They
may also be used when a mortgagor is in financial difficulty and
desires to sell the property to avoid foreclosure.
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- B -
Balance
sheet
A
financial statement that shows assets, liabilities, and net worth
as of a specific date.
Bankrupt
A
person, firm, or corporation that, through a court proceeding,
is relieved from the payment of all debts after the surrender
of all assets to a court-appointed trustee.
Bankruptcy
A
proceeding in a federal court in which a debtor who owes more
than his or her assets can relieve the debts by transferring his
or her assets to a trustee.
Before-tax
income
Income
before taxes are deducted.
Beneficiary
The
person designated to receive the income from a trust, estate,
or a deed of trust.
Bill
of sale
A
written document that transfers title to personal property.
Binder
or "Offer to Purchase"
A
preliminary agreement, secured by the payment of earnest money,
between a buyer and seller as an offer to purchase real estate.
A binder secures the right to purchase real estate upon agreed
terms for a limited period of time. If the buyer changes his mind
or is unable to purchase, the earnest money is forfeited unless
the binder expressly provides that it is to be refunded. Broker
(See Real Estate Broker)
Blanket
insurance policy
A
single policy that covers more than one piece of property (or
more than one person).
Bond
An
interest-bearing certificate of debt with a maturity date. An
obligation of a government or business corporation. A real estate
bond is a written obligation usually secured by a mortgage or
a deed of trust.
Borrower
One
who receives funds with the expressed or implied intention of
repaying the loan in full.
Bridge
loan
A
form of second trust that is collateralized by the borrower's
present home (which is usually for sale) in a manner that allows
the proceeds to be used for closing on a new house before the
present home is sold.
Broker
An
individual in the business of assisting in arranging funding or
negotiating contracts for a client but who does not loan the money
himself. Brokers usually charge a fee or receive a commission
for their services.
Building
code
Local
regulations that control design, construction, and materials used
in construction. Building codes are based on safety and health
standards.
Building
Line or Setback
Distances
from the ends and/or sides of the lot beyond which construction
may not extend. The building line may be established by a filed
plat of subdivision, by restrictive covenants in deeds or leases,
by building codes, or by zoning ordinances.
Buy
down
Money
advanced by an individual (seller, builder, etc.) to reduce monthly
payments for a home mortgage either during the entire term or
for an initial period of years.
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- C -
Call
option
A
provision in the mortgage that gives the mortgagee the right to
call the mortgage due and payable at the end of a specified period
for whatever reason.
Capital
expenditure
The
cost of an improvement made to extend the useful life of a property
or to add to its value.
Capital
improvement
Any
structure or component erected as a permanent improvement to real
property that adds to its value and useful life.
Cap
A
provision of an ARM limiting how much the interest rate or mortgage
payments may increase.
Cash
Out
A
loan transaction in which the borrower receives funds at the time
of closing.
Cash-out
refinance
A
refinance transaction in which the amount of money received from
the new loan exceeds the total of the money needed to repay the
existing first mortgage, closing costs, points, and the amount
required to satisfy any outstanding subordinate mortgage liens.
Certificate
of deposit
A
document written by a bank or other financial institution that
is evidence of a deposit, with the issuer’s promise to return
the deposit plus earnings at a specified interest rate within
a specified time period. Certificate of Eligibility A document
issued by the federal government certifying a veteran’s eligibility
for a Department of Veterans Affairs (VA) mortgage. Certificate
of Reasonable Value (CRV) A document issued by the Department
of Veterans Affairs (VA) that establishes the maximum value and
loan amount for a VA mortgage.
Certificate
of Title
A
certificate issued by a title company or a written opinion rendered
by an attorney that the seller has good marketable and insurable
title to the property, which he is offering for sale. A certificate
of title offers no protection against any hidden defects in the
title, which an examination of the records could not reveal. The
issuer of a certificate of title is liable only for damages due
to negligence. The protection offered a homeowner under a certificate
of title is not as great as that offered in a title insurance
policy.
Chain
of title
The
history of all of the documents that transfer title to a parcel
of real property, starting with the earliest existing document
and ending with the most recent.
Change
frequency
The
frequency (in months) of payment and/or interest rate changes
in an adjustable-rate mortgage (ARM).
Chattel
Another
name for personal property.
Claim
An
amount requested of an insurer, by a policyholder or a claimant,
for an insured loss.
Clear
title
A
title that is free of liens or legal questions as to ownership
of the property
Closing
The
occasion where a sale is finalized; the buyer signs the mortgage,
and closing costs are paid. Also called "settlement."
Closing
Costs
Expenses
(over and above the price of the property) incurred by buyers
and sellers in transferring ownership of a property. Also called
"settlement costs."
Closing
cost item
A
fee or amount that a homebuyer must pay at closing for a single
service, tax, or product.
Closing
Day
The
day on which the formalities of a real estate sale are concluded.
The certificate of title, abstract, and deed are generally prepared
for the closing by an attorney and this cost charged to the buyer.
The buyer signs the mortgage, and closing costs are paid. The
final closing merely confirms the original agreement reached in
the agreement of sale.
Cloud
(On Title)
An
outstanding claim or encumbrance, which adversely affects the
marketability of title.
Co-Borrower
An
additional borrower on a loan. A co-borrower's obligation on a
loan are the same as all other borrowers.
Coinsurance
A
sharing of insurance risk between the insurer and the insured.
Coinsurance depends on the relationship between the amount of
the policy and a specified percentage of the actual value of the
property insured at the time of the loss.
Coinsurance
clause
A
provision in a hazard insurance policy that states the amount
of coverage that must be maintained -- as a percentage of the
total value of the property -- for the insured to collect the
full amount of a loss.
Collateral
An
asset (such as a car or a home) that guarantees the repayment
of a loan. The borrower risks losing the asset if the loan is
not repaid according to the terms of the loan contract.
Collection
The
efforts used to bring a delinquent mortgage current and to file
the necessary notices to proceed with foreclosure when necessary.
Co-maker
A
person who signs a promissory note along with the borrower. A
co-maker's signature guarantees that the loan will be repaid,
because the borrower and the co-maker are equally responsible
for the repayment.
Commission
Money
paid to a real estate agent or broker by the seller as compensation
for finding a buyer and completing the sale.
Commitment
Letter
A
formal offer by a lender stating the terms under which it agrees
to loan money to a homebuyer.
Common
area assessments
Levies
against individual unit owners in a condominium or planned unit
development (PUD) project for additional capital to defray homeowners'
association costs and expenses and to repair, replace, maintain,
improve, or operate the common areas of the project.
Common
areas
Those
portions of a building, land, and amenities owned (or managed)
by a planned unit development (PUD) or condominium project's homeowners'
association (or a cooperative project's cooperative corporation)
that are used by all of the unit owners, who share in the common
expenses of their operation and maintenance. Common areas include
swimming pools, tennis courts, and other recreational facilities,
as well as common corridors of buildings, parking areas, means
of ingress and egress, etc.
Common
law
An
unwritten body of law based on general custom in England and used
to an extent in the United States.
Community
property
In
some western and southwestern states, a form of ownership under
which property acquired during a marriage is presumed to be owned
jointly unless acquired as separate property of either spouse.
Comparables
A
abbreviation for comparable properties used for comparative purposes
in the appraisal process; facilities of reasonably the same size
and location with similar amenities; properties which have been
recently sold, which have characteristics similar to property
under consideration, thereby indicating the approximate fair market
value of the subject property.
Compound
interest
Interest
paid on the original principal balance and on the accrued and
unpaid interest.
Condemnation
The
taking of private property for public use by a government unit,
against the will of the owner, but with payment of just compensation
under the government's power of eminent domain. Condemnation may
also be a determination by a governmental agency that a particular
building is unsafe or unfit for use.
Condominium
Individual
ownership of a dwelling unit and an individual interest in the
common areas and facilities, which serve the multi-unit project.
Condominium
conversion
Changing
the ownership of an existing building (usually a rental project)
to the condominium form of ownership.
Condominium
hotel
A
condominium project that has rental or registration desks, short-term
occupancy, food and telephone services, and daily cleaning services
and that is operated as a commercial hotel even though the units
are individually owned.
Construction
Loan
A
short-term loan for funding the cost of construction. The lender
advances funds to the builder as the work progresses.
Consumer
reporting agency (or bureau)
An
organization that prepares reports that are used by lenders to
determine a potential borrower's credit history. The agency obtains
data for these reports from a credit repository as well as from
other sources.
Contingency
A
condition that must be met before a contract is legally binding.
Contract
An
oral or written agreement to do or not to do a certain thing.
Contractor
In
the construction industry, a contractor is one who contracts to
erect buildings or portions of them. There are also contractors
for each phase of construction: heating, electrical, plumbing,
air conditioning, road building, bridge and dam erection, and
others.
Conventional
Mortgage
Any
mortgage that is not insured or guaranteed by the federal government.
Convertibility
clause
A
provision in some adjustable-rate mortgages (ARMs) that allows
the borrower to change the ARM to a fixed-rate mortgage at specified
time.
Convertible
Arm
An
adjustable-rate mortgage that can be converted to a fixed-rate
mortgage under specified conditions.
Coverage
The
amount of protection, usually expressed in a percentage of the
total claim amount, an insured receives under a certificate.
Cooperative
(co-op)
A
type of multiple ownership in which the residents of a multiunit
housing complex own shares in the cooperative corporation that
owns the property, giving each resident the right to occupy a
specific apartment or unit.
Cooperative
Corporation
A
business trust entity that holds title to a cooperative project
and grants occupancy rights to particular apartments or units
to shareholders through proprietary leases or similar arrangements.
Cooperative
Housing
An
apartment building or a group of dwellings owned by a corporation,
the stockholders of which are the residents of the dwellings.
It is operated for their benefit by their elected board of directors.
In a cooperative, the corporation or association owns title to
the real estate. A resident purchases stock in the corporation,
which entitles him to occupy a unit in the building or property
owned by the cooperative. While the resident does not own his
unit, he has an absolute right to occupy his unit for as long
as he owns the stock.
Cooperative
mortgages
Mortgages
related to a cooperative project.
Cooperative
project
A
residential or mixed-use building wherein a corporation or trust
holds title to the property and sells shares of stock representing
the value of a single apartment unit to individuals who, in turn,
receive a proprietary lease as evidence of title.
Corporate
relocation
Arrangements
under which an employer moves an employee to another area as part
of the employer's normal course of business or under which it
transfers a substantial part or all of its operations and employees
to another area because it is relocating its headquarters or expanding
its office capacity.
Cost
of funds index (COFI)
An
index that is used to determine interest rate changes for certain
adjustable-rate mortgage (ARM) plans. It represents the weighted-average
cost of savings, borrowings, and advances of the 11th District
members of the Federal Home Loan Bank of San Francisco.
Covenant
A
clause in a mortgage that obligates or restricts the borrower
and that, if violated, can result in foreclosure.
Commitment
A
written letter of agreement detailing the terms and conditions
by which the lender will lend and the borrower will borrow funds
to finance a home.
Credit
history
A
record of an individual's open and fully repaid debts. A credit
history helps a lender to determine whether a potential borrower
has a history of repaying debts in a timely manner.
Credit
life insurance
A
type of insurance often bought by mortgagors because it will pay
off the mortgage debt if the mortgagor dies while the policy is
in force.
Creditor
A
person to whom money is owed.
Credit
Report
A
report of an individual's credit history prepared by a credit
bureau and used by a lender in determining a loan applicant's
creditworthiness.
Credit
repository
An
organization that gathers, records, updates, and stores financial
and public records information about the payment records of individuals
who are being considered for credit.
Cure
A
loan that is removed from a delinquency status with no loss to
the insurer.
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Deed-in-lieu
A
deed given by a mortgagor to the mortgagee to satisfy a debt and
avoid foreclosure. Also called a "voluntary conveyance."
Deed
of Trust
Like
a mortgage, a security instrument whereby real property is given
as security for a debt. However, in a deed of trust there are
three parties to the instrument: the borrower, the trustee, and
the lender, (or beneficiary). In such a transaction, the borrower
transfers the legal title for the property to the trustee who
holds the property in trust as security for the payment of the
debt to the lender or beneficiary. If the borrower pays the debt
as agreed, the deed of trust becomes void. If, however, he defaults
in the payment of the debt, the trustee may sell the property
at a public sale, under the terms of the deed of trust. In most
jurisdictions where the deed of trust is in force, the borrower
is subject to having his property sold without benefit of legal
proceedings. A few States have begun in recent years to treat
the deed of trust like a mortgage.
Default
Failure
to make mortgage payments on a timely basis or to comply with
other conditions of a mortgage.
Deficiency
Judgment
A
court order to pay the balance owed on a loan if the proceeds
from the sale of the security are insufficient to pay off the
loan. Deficiency judgments are not allowed in all states.
Delinquency
A
loan in which a payment is overdue but not yet in default.
Deposit
A
sum of money given to bind the sale of real estate, or a sum of
money given to ensure payment or an advance of funds in the processing
of a loan.
Depreciation
A
decline in the value of property; the opposite of "appreciation."
Discount
Points
See
Points.
Documentary
Stamps
A
State tax, in the forms of stamps, required on deeds and mortgages
when real estate title passes from one owner to another. The amount
of stamps required varies with each State.
Dower
The
rights of a widow in the property of her husband at his death.
Down
Payment
The
part of the purchase price, which the buyer pays in cash and does
not finance with a mortgage
Due-on-sale
provision
A
provision in a mortgage that allows the lender to demand repayment
in full if the borrower sells the property that serves as security
for the mortgage.
Due-on-transfer
provision
This
terminology is usually used for second mortgages.
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E -
Earnest
Money
The
deposit money given to the seller or his agent by the potential
buyer upon the signing of the agreement of sale to show that he
is serious about buying the house. If the sale goes through, the
earnest money is applied against the down payment. If the sale
does not go through, the earnest money will be forfeited or lost
unless the binder or offer to purchase expressly provides that
it is refundable.
Easement
Rights
A
right-of-way granted to a person or company authorizing access
to or over the owner's land. An electric company obtaining a right-of-way
across private property is a common example.
Effective
age
An
appraiser’s estimate of the physical condition of a building.
The actual age of a building may be shorter or longer than its
effective age. Effective gross income
Normal
annual income including overtime that is regular or guaranteed.
The income may be from more than one source. Salary is generally
the principal source, but other income may qualify if it is significant
and stable.
Eminent
domain
The
right of a government to take private property for public use
upon payment of its fair market value. Eminent domain is the basis
for condemnation proceedings.
Employer-assisted
housing
A
special Fannie Mae housing initiative that offers several different
ways for employers to work with local lenders to develop plans
to assist their employees in purchasing homes.
Encroachment
An
obstruction, building, or part of a building that intrudes beyond
a legal boundary onto neighboring private or public land, or a
building extending beyond the building line.
Encumbrance
A
legal right or interest in land that affects a good or clear title,
and diminishes the land's value. It can take numerous forms, such
as zoning ordinances, easement rights, claims, mortgages, liens,
charges, a pending legal action, unpaid taxes, or restrictive
covenants. An encumbrance does not legally prevent transfer of
the property to another. A title search is all that is usually
done to reveal the existence of such encumbrances, and it is up
to the buyer to determine whether he wants to purchase with the
encumbrance, or what can be done to remove it.
Endorser
A
person who signs ownership interest over to another party. Contrast
with co-maker.
Equal
Credit Opportunity Act (ECOA)
A
federal law that requires lenders and other creditors to make
credit equally available without discrimination based on race,
color, religion, national origin, age, sex, marital status, or
receipt of income from public assistance programs.
Equity
The
difference between the market value of a property and the homeowner's
outstanding mortgage balance.
Equity
Loan
A
loan based on the borrower's equity in his or her home. Prior
to closing; also, an account held by the lender into which a homeowner
pays money for taxes and insurance.
Escrow
account
The
account in which a mortgage servicer holds the borrower’s escrow
payments prior to paying property expenses.Escrow analysis.
The periodic examination of escrow accounts to determine
if current monthly deposits will provide sufficient funds to pay
taxes, insurance, and other bills when due.
Escrow
collections
Funds
collected by the servicer and set aside in an escrow account to
pay the borrower’s property taxes, mortgage insurance, and hazard
insurance. Escrow disbursements.
The use of escrow funds to pay real estate taxes,
hazard insurance, mortgage insurance, and other property expenses
as they become due.
Escrow
payment
The
portion of a mortgagor’s monthly payment that is held by the servicer
to pay for taxes, hazard insurance, mortgage insurance, lease
payments, and other items as they become due. Estate.
The ownership interest of an individual in real
property. The sum total of all the real property and personal
property owned by an individual at time of death.
Eviction
The
lawful expulsion of an occupant from real property.
Examination
of title
The
report on the title of a property from the public records or an
abstract of the title.
Exclusive
listing
A
written contract that gives a licensed real estate agent the exclusive
right to sell a property for a specified time, but reserving the
owner’s right to sell the property alone without the payment of
a commission.
Executor
A
person named in a will to administer an estate
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F -
Fair
Credit Reporting Act
A
consumer protection law that regulates the disclosure of consumer
credit reports by consumer/credit reporting agencies and establishes
procedures for correcting mistakes on one's credit record.
Fair-market-value
The
highest price that a buyer, willing but not compelled to buy would
pay, and the lowest a seller, willing but not compelled to sell,
would accept.
FDIC
(Federal
Deposit Insurance Corporation). Provides insurance of accounts
for institutions whose deposits were formerly covered by the Federal
Savings & Loan Insurance Corporation. (FSLIC).
Fee
simple
The
greatest possible interest a person can have in real estate.
Fee
simple estate
An
unconditional, unlimited estate of inheritance that represents
the greatest estate and most extensive interest in land that can
be enjoyed. It is of perpetual duration. When the real estate
is in a condominium project, the unit owner is the exclusive owner
only of the air space within his or her portion of the building
(the unit) and is an owner in common with respect to the land
and other common portions of the property.
FHA
(Federal
Housing Administration). A division of the Department of Housing
and Urban Development. The FHA's main activity is the insuring
of residential mortgage loans made by private lenders. It sets
standards for construction and underwriting. FHA neither lends
money, nor plans, nor constructs housing.
FHA
Loan
Government
loans are loans that are guaranteed or purchased by government
organizations. Two of the most popular Government Loans are the
Federal Housing Administration (FHA) and the Department of Veterans
Affairs (VA).
FHFB
(Federal
Housing Finance Board). It oversees the credit functions of the
twelve regional Federal Home Loan Banks.
FHLBB
(Federal
Home Loan Bank Board). A regulatory and supervisory agency for
federally charted savings institutions, which oversees the operations
of the FSLIC and FHLMC. This agency was abolished by the Financial
Institutions Reform, Recovery and Enforcement Act of 1989. (See
FIRREA.)
FHLMC
(Federal
Home Loan Mortgage Corporation, Freddie Mac). A private corporation
authorized by Congress, which became an independent, stockholder-owned
government corporation with the passage of FIRREA. FHLMC promotes
the flow of funds into the housing markets by purchasing conventional
mortgages in the secondary market and selling securities backed
by those mortgages in the capital market.
Finance Charge
The
total dollar amount your loan will cost you. It includes all interest
payments for the life of the loan, any interest paid at closing,
your origination fee and any other charges paid to the lender
and/or broker. Appraisal, credit report and title search fees
are not included in the finance charge calculation.
Finder's
fee
A
fee or commission paid to a mortgage broker for finding a mortgage
loan for a prospective borrower.
FIRE
(Financial
Institutions Reform, Recovery and Enforcement Act of 1989). An
act signed into law in August 1989, by President Bush that restructured
the thrift regulatory an insurance system.
Firm
commitment
A
lender’s agreement to make a loan to a specific borrower on a
specific property.
First
Mortgage
The
mortgage that has first claim in the event of default.
Fixed
installment
The
monthly payment due on a mortgage loan.
Fixed-Rate
Mortgage
(FRM)
A mortgage in which the interest rate does not change during the
entire term of the loan.
FNMA
(Federal
National Mortgage Association, Fannie Mae). A government-sponsored
corporation, owned solely by private investors, created to provide
support to the secondary market for FHA and VA mortgages and conventional
mortgages.
Fixture
Personal
property that becomes real property when attached in a permanent
manner to real estate.
Flood
insurance
Insurance
that compensates for physical property damage resulting from flooding.
It is required for properties located in federally designated
flood areas.
Forfeiture
The
loss of money, property, rights, or privileges due to a breach
of legal obligation.
Foreclosure
The
process by which a mortgage property may be sold when a mortgage
is in default.
Fully
amortized ARM
An
adjustable-rate mortgage (ARM) with a monthly payment that is
sufficient to amortize the remaining balance, at the interest
accrual rate, over the amortization term.
Full
Recasting
Setting
the P&I payments to the level that will fully amortize the
loan's outstanding balance over the remaining term using the fully
indexed accrual rate at the recasting point.
Fully
Indexed Accrual Rate
The
interest (accrual) rate resulting from the index at closing (or
at another point in the loan) plus the lender's full spread, rounded
as prescribed in the loan documents (often to the nearest 1/8th
of 1%).
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General
Warranty Deed
A
deed which conveys not only all the grantor's interests in and
title to the property to the grantee, but also warrants that if
the title is defective or has a "cloud" on it (such as mortgage
claims, tax liens, title claims, judgments, or mechanic's liens
against it) the grantee may hold the grantor liable.
Good
Faith Estimate
An
estimate of charges, which a borrower is likely to incur in connection
with a loan closing.
Graduated
Payment Mortgage
(GPM)
A mortgage where the payments are scheduled to increase, usually
annually, for a set number of years, and then level off. GPM can
be used with either a fixed or adjustable interest rate, and usually
has a 30-year term.
Grantee
That
party in the deed who is the buyer or recipient.
Grantor
That
party in the deed who is the seller or giver.
Gross
Monthly Income
The
total amount the borrower earns per month, not counting any taxes
or expenses. Often used in calculations to determine whether a
borrower qualifies for a particular loan.
Growing
Equity Mortgage
(GEM)
A fixed rate, graduated payment mortgage with small initial payments
that increase each year so that the loan pays off in a shortened
term, usually 15 years.
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Hazard
Insurance
Insurance
to protect the homeowner and the lender against physical damage
to a property from fire, wind, vandalism, or other hazards.
Homeowner's
Insurance
An
insurance policy that combines liability coverage and hazard insurance.
Homeowner's
Warranty
A
type of insurance that covers repairs to specified parts of a
house for a specific period of time.
Housing
Ratio
The
ratio of the monthly housing payment to total gross monthly income.
Also called Payment-to-Income Ratio or Front-End Ratio.
HUD
(Department
of Housing and Urban Development). A cabinet department responsible
for the implementation and administration of government housing
and urban development programs.
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- I -
Income
property
Real
estate developed or improved to produce income.
Index
(Also
called "Rate Index"). A regularly published rate, independent
of the lending institution, that measures the prevailing cost
of funds, and is used periodically with the margin to set AML
accrual rates.
Initial
Borrower Interest Rate
The
rate on which the borrower's first payment is calculated.
Initial
Borrower Payment Rate
The
annual interest rate used to calculate the borrower's initial
cash payment.
Inflation
An
increase in the amount of money or credit available in relation
to the amount of goods or services available, which causes an
increase in the general price level of goods and services. Over
time, inflation reduces the purchasing power of a dollar, making
it worth less.
Initial
interest rate
The
original interest rate of the mortgage at the time of closing.
Installment
The
regular periodic payment that a borrower agrees to make to a lender.
Installment
loan
Borrowed
money that is repaid in equal payments, known as installments.
A furniture loan is often paid for as an installment loan.
Insurable
title
A
property title that a title insurance company agrees to insure
against defects and disputes.
Insurance
A
contract that provides compensation for specific losses in exchange
for a periodic payment. An individual contract is known as an
insurance policy, and the periodic payment is known as an insurance
premium.
Insurance
binder
A
document that states that insurance is temporarily in effect.
Because the coverage will expire by a specified date, a permanent
policy must be obtained before the expiration date.
Insured
mortgage
A
mortgage that is protected by the Federal Housing Administration
(FHA) or by private mortgage insurance (MI). If the borrower defaults
on the loan, the insurer must pay the lender the lesser of the
loss incurred or the insured amount
Interest
The
fee charged for borrowing money.
Interest
accrual rate
The
percentage rate at which interest accrues on the mortgage. In
most cases, it is also the rate used to calculate the monthly
payments, although it is not used for an adjustable-rate mortgage
(ARM) with payment change limitations.
Interest
Rate
The
percentage of an amount of money, which is paid for its use for
a specified time.
Interest
Rate Cap
A
provision of an ARM limiting how much interest rates may increase
per adjustment period.
Interest
rate ceiling
For
an adjustable-rate mortgage (ARM), the maximum interest rate,
as specified in the mortgage note.
Interest
rate floor
For
an adjustable-rate mortgage (ARM), the minimum interest rate,
as specified in the mortgage note.
Investment
property
A
property that is not occupied by the owner.
IRA
(Individual Retirement Account)
A
retirement account that allows individuals to make tax-deferred
contributions to a personal retirement fund. Individuals can place
IRA funds in bank accounts or in other forms of investment such
as stocks, bonds, or mutual funds.
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- J -
Joint
tenancy
A
form of co-ownership that gives each tenant equal interest and
equal rights in the property, including the right of survivorship.
Judgment
A
decision made by a court of law. In judgments that require the
repayment of a debt, the court may place a lien against the debtor's
real property as collateral for the judgment's creditor.
Judgment
lien
A
lien on the property of a debtor resulting from the decree of
a court.
Judicial
foreclosure
A
type of foreclosure proceeding used in some states that is handled
as a civil lawsuit and conducted entirely under the auspices of
a court.
Jumbo
Loans
Jumbo,
or non-conforming, is a term used to describe a loan that does
not conform to Fannie Mae or Freddie Mac guidelines. The typical
Jumbo loan exceeds the maximum loan amounts described above.
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(empty)
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- L -
Late
charge
The
penalty a borrower must pay when a payment is made a stated number
of days (usually 15) after the due date.
Lease
A
written agreement between the property owner and a tenant that
stipulates the conditions under which the tenant may possess the
real estate for a specified period of time and rent.
Leasehold
estate
A
way of holding title to a property wherein the mortgagor does
not actually own the property but rather has a recorded long-term
lease on it.
Legal
description
A
property description, recognized by law that is sufficient to
locate and identify the property without oral testimony.
Lender
An
institution that makes loans to borrowers on real estate.
Liabilities
A
person's financial obligations. Liabilities include long-term
and short-term debt, as well as any other amounts that are owed
to others.
Liability
insurance
Insurance
coverage that offers protection against claims alleging that a
property owner's negligence or inappropriate action resulted in
bodily injury or property damage to another party.
Lien
A
legal claim against a property that must be paid when the property
is sold.
Lifetime
Cap
A
provision of an ARM that limits the total increase in interest
rates over the life of the loan.
Lifetime
payment cap
For
an adjustable-rate mortgage (ARM), a limit on the amount that
payments can increase or decrease over the life of the mortgage.
Line
of credit
An
agreement by a commercial bank or other financial institution
to extend credit up to a certain amount for a certain time to
a specified borrower.
Liquid
asset
A
cash asset or an asset that is easily converted into cash.
Loan
A
sum of borrowed money (principal) that is generally repaid with
interest.
Loan
Commitment
Formal
offer by a lender stating the terms under which it agrees to loan
money to a homebuyer.
Loan
origination
The
process by which a mortgage lender brings into existence a mortgage
secured by real property.
Loan
Servicing
The
collection of mortgage payments from borrowers and related responsibilities
of a loan servicer.
Loan
-To-Value
(LTV).
The loan-to-value ratio (LTV) is the original loan amount divided
by the lower of the sales price or the appraised value.
Lock
The
period, expressed in days, during which a lender will guarantee
a rate.
Lock-in
period
The
time period during which the lender has guaranteed an interest
rate to a borrower.
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- M -
Marketable
Title
A
title that is free and clear of objectionable liens, clouds, or
other title defects. A title which enables an owner to sell his
property freely to others and which others will accept without
objection.
Master
association
A
homeowners' association in a large condominium or planned unit
development (PUD) project that is made up of representatives from
associations covering specific areas within the project. In effect,
it is a "second-level" association that handles matters affecting
the entire development, while the "first-level" associations handle
matters affecting their particular portions of the project.
Maturity
The
date on which the principal balance of a loan, bond, or other
financial instrument becomes due and payable.
Merged
credit report
A
credit report that contains information from three credit repositories.
When the report is created, the information is compared for duplicate
entries. Any duplicates are combined to provide a summary of a
your credit.
Modification
Margin
(Also
called "Spread"). The amount the lender adds to the index to determine
the Fully Indexed Accrual Rate.
Money
market account
A
savings account that provides bank depositors with many of the
advantages of a money market fund. Certain regulatory restrictions
apply to the withdrawal of funds from a money market account.
Money
market fund
A
mutual fund that allows individuals to participate in managed
investments in short-term debt securities, such as certificates
of deposit and Treasury bills.
Monthly
Housing Expense
Total
principal, interest, taxes, and insurance paid by the borrower
on a monthly basis. Used with gross income to determine affordability.
Monthly
payment mortgage
A
mortgage that requires payments to reduce the debt once a month.
Mortgage
A
legal document that pledges a property to the lender as security
for a payment of a debt.
Mortgage
Banker
A
company that originates mortgages exclusively for resale in the
secondary market.
Mortgage
Broker
A
company that for a fee matches borrowers with lenders.
Mortgage
Insurance Premium
(MIP).
The fee paid to FHA or a private insurer for mortgage insurance.
Mortgagee
The
lender in a mortgage agreement.
Mortgage
Commitment
A
written notice from the bank or other lending institution saying
it will advance mortgage funds in a specified amount to enable
a buyer to purchase a house.
Mortgage
Insurance Premium
The
payment made by a borrower to the lender for transmittal to HUD
to help defray the cost of the FHA mortgage insurance program
and to provide a reserve fund to protect lenders against loss
in insured mortgage transactions. In FHA insured mortgages this
represents an annual rate of one-half of one percent paid by the
mortgagor on a monthly basis.
Mortgage
life insurance
A
type of term life insurance often bought by mortgagors. The amount
of coverage decreases as the principal balance declines. In the
event that the borrower dies while the policy is in force, the
debt is automatically satisfied by insurance proceeds.
Mortgage
Note
A
written agreement to repay a loan. The agreement is secured by
a mortgage, serves as proof of indebtedness, and states the manner
in which it shall be paid. The note states the actual amount of
the debt that the mortgage secures and renders the mortgagor personally
responsible for repayment.
Mortgagor
The
borrower in a mortgage agreement.
Multidwelling
units
Properties
that provide separate housing units for more than one family,
although they secure only a single mortgage.
Multifamily
mortgage
A
residential mortgage on a dwelling that is designed to house more
than four families, such as a high-rise apartment complex.
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- N -
Negative
AmortizationA
(Also called "Deferred Interest"). If the payments are too
small to cover the interest due on a loan, the remaining interest
owed is added to the outstanding loan balance, causing negative
amortization.
Net
cash flow
The
income that remains for an investment property after the monthly
operating income is reduced by the monthly housing expense, which
includes principal, interest, taxes, and insurance (PITI) for
the mortgage, homeowners' association dues, leasehold payments,
and subordinate financing payments.
Net
Effective Income
Gross
income less federal income tax.
Negative
amortization
A
gradual increase in mortgage debt that occurs when the monthly
payment is not large enough to cover the entire principal and
interest due. The amount of the shortfall is added to the remaining
balance to create "negative" amortization
Net
Worth
The
value of all assets, including cash, less total liabilities.
No
cash-out refinance
A
refinance transaction in which the new mortgage amount is limited
to the sum of the remaining balance of the existing first mortgage,
closing costs (including prepaid items), points, the amount required
to satisfy any mortgage liens that are more than one year old
(if the borrower chooses to satisfy them), and other funds for
the borrower's use (as long as the amount does not exceed 1 percent
of the principal amount of the new mortgage).
Non-liquid
asset
An
asset that cannot easily be converted into cash.
Note
A
legal document that obligates a borrower to repay a mortgage loan
at a stated interest rate during a specified period of time.
Note
rate
The
interest rate stated on a mortgage note.
Notice
of Default
A
formal written notice to a borrower that a default has occurred
and that legal action may be taken.
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- O -
Original
principal balance
The
total amount of principal owed on a mortgage before any payments
are made.
Origination
Fee
A
fee paid to a lender for processing a loan Application.
OTC
(The
Office of Thrift Supervision). Charters federal thrifts, serves
as the primary federal examiner and regulator of federal and state-chartered
savings associations, and administers laws governing savings and
loan holding companies.
Owner
financing
A
property purchase transaction in which the property seller provides
all or part of the financing.
Owner
Occupied
"Owner
Occupied" means the property is the owner's primary residence.
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Payment
Adjustment Period
The
length of time (typically a year) between changes to the AML borrower's
P&I payment.
Payment
Buy down
Payment
buy downs occur when a third party, typically a builder, pays
part of the initial P&I payments for a year or two, so that
the borrower has smaller payments and can qualify for the loan.
Payment
Cap
A
limit on the amount the payment can be changed at the end of each
Payment Adjustment Period.
Payment
Discount
In
a payment discount, the lender reduces the first year's interest
rate to make the mortgagor more attractive to borrowers.
Periodic
payment cap
A
limit on the amount that payments can increase or decrease during
any one-adjustment period.
Periodic
rate cap
A
limit on the amount that the interest rate can increase or decrease
during any one adjustment period, regardless of how high or low
the index might be.
Personal
property
Any
property that is not real property.
PITI
Principal,
Interest, Taxes and Insurance are components of a mortgage payment.
Plat
A
map or chart of a lot, subdivision or community drawn by a surveyor
showing boundary lines, buildings, improvements on the land, and
easements.
Points
A
one-time charge by the lender to increase the yield of the loan;
a point is 1 percent of the amount of the mortgage.
Power
of attorney
A
legal document that authorizes another person to act on one’s
behalf. A power of attorney can grant complete authority or can
be limited to certain acts and/or certain periods of time.
Prepayment
Payment
of mortgage loan, or part of it, before due date.
Pre-qualification
The
process of determining how much money a prospective homebuyer
will be eligible to borrow before application.
Prime
rate
The
interest rates that banks charge to their preferred customers.
Principal
The
amount borrowed or remaining unpaid, also, that part of the monthly
payment that reduces the outstanding balance of a mortgage.
Private
Mortgage Insurance
Insurance
provided by nongovernmental insurers that protect lenders against
loss if a borrower defaults.
Promissory
note
A
written promise to repay a specified amount over a specified period
of time.
Public
auction
A
meeting in an announced public location to sell property to repay
a mortgage that is in default.
Planned
Unit Development (PUD)
A
project or subdivision that includes common property that is owned
and maintained by a homeowners' association for the benefit and
use of the individual PUD unit owners.
Purchase
Agreement
See
Agreement of Sale.
Purchase
money transaction
The
acquisition of property through the payment of money or its equivalent.
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Qualifying
Ratios
Guidelines
applied by lenders to determine how large a loan to grant a homebuyer.
Quitclaim
Deed
A
deed, which transfers whatever interest, the maker of the deed
may have in the particular parcel of land. A quitclaim deed is
often given to clear the title when the grantor's interest in
a property is questionable. By accepting such a deed the buyer
assumes all the risks. Such a deed makes no warranties as to the
title, but simply transfers to the buyer whatever interest the
grantor has. (See Deed.)
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Radon
A
radioactive gas found in some homes that in sufficient concentrations
could cause health problems.
Rate
Caps
(Also
called "Interest Rate Caps"). A limit on the amount of which the
interest rate charged to the borrower can be changed.
Rate
lock
A
commitment issued by a lender to a borrower or other mortgage
originator guaranteeing a specified interest rate for a specified
period of time.
Real
Estate Broker
A
middleman or agent who buys and sells real estate for a company,
firm, or individual on a commission basis. The broker does not
have title to the property, but generally represents the owner.
Real
Estate Owned
(REO).
A term frequently used by lending institution as applied to ownership
of real property acquired for investment or as a result of foreclosure.
RESPA
(Real
Estate Settlement Procedures Act). A Federal law that requires
lenders to provide home mortgage borrowers with information about
known or estimated settlement costs.
Real
property
Land
and appurtenances, including anything of a permanent nature such
as structures, trees, minerals, and the interest, benefits, and
inherent rights thereof.
REALTOR
A
real estate broker or an associate who holds active membership
in a local real estate board that is affiliated with the National
Association of Realtors.
Recission
The
cancellation or annulment of a transaction or contract by the
operation of a law or by mutual consent.
Recorder
The
public official who keeps records of transactions that affects
real property in the area.
Recording
The
noting in the registrar’s office of the details of a properly
executed legal document, such as a deed, a mortgage note, a satisfaction
of mortgage, or an extension of mortgage, thereby making it a
part of the public record. Refinancing The
process of the same mortgagor paying off one loan with the proceeds
from another loan.
Rehabilitation
mortgage
A
mortgage created to cover the costs of repairing, improving, and
sometimes acquiring an existing property.
Remaining
balance
The
amount of principal that has not yet been repaid.
Remaining
term
The
original amortization term minus the number of payments that have
been applied.
Repayment
plan
An
arrangement made to repay delinquent installments or advances.
Lenders' formal repayment plans are called "relief provisions."
Replacement
reserve fund
A
fund set aside for replacement of common property in a condominium,
PUD, or cooperative project -- particularly that which has a short
life expectancy, such as carpeting, furniture, etc.
Restrictive
Covenants
Private
restrictions limiting the use of real property. Restrictive covenants
are created by deed and may "run with the land," binding all subsequent
purchasers of the land, or may be "personal" and binding only
between the original seller and buyer. The determination whether
a covenant runs with the land or is personal is governed by the
language of the covenant, the intent of the parties, and the law
in the State where the land is situated. Restrictive covenants
that run with the land are encumbrances and may affect the value
and marketability of title. Restrictive covenants may limit the
density of buildings per acre, regulate size, style or price range
of buildings to be erected, or prevent particular businesses from
operating or minority groups from owning or occupying homes in
a given area. (This latter discriminatory covenant is unconstitutional
and has been declared unenforceable by the U.S. Supreme Court.)
Revolving
liability
A
credit arrangement, such as a credit card, that allows a customer
to borrow against a pre-approved line of credit when purchasing
goods and services. The borrower is billed for the amount that
is actually borrowed plus any interest due.
Right
of first refusal
A
provision in an agreement that requires the owner of a property
to give another party the first opportunity to purchase or lease
the property before he or she offers it for sale or lease to others.
Right
of ingress or egress
The
right to enter or leave designated premises.
Right
of survivorship
In
joint tenancy, the right of survivors to acquire the interest
of a deceased joint tenant.
RTC
(Resolution
Trust Corporation). Formed to resolve thrift failures over the
next three years and dispose of their assets and liabilities.
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- S -
Sales
Agreement
See
Agreement of sale.
Second
Mortgage
A
mortgage that has rights that are subordinate to the rights of
the first mortgage holders.
Secondary
Mortgage Market
The
buying and selling of existing mortgages.
Seller-Provided
Funds
(Also
called "Seller Contributions"). Seller-provided funds include
all transaction cost paid by the seller except the real estate
agent's (or brokers) fee.
Servicer
The
party who has entered into an agreement with the insured to service
a loan.
Settlement
Costs
See
Closing Costs.
Single
Premium
A
premium, which provides coverage for more than a year. empty)
Special
Assessments
A
special tax imposed on property, individual lots or all property
in the immediate area, for road construction, sidewalks, sewers,
streetlights, etc.
Special
Lien
A
lien that binds a specified piece of property, unlike a general
lien, which is levied against all one's assets. It creates a right
to retain something of value belonging to another person as compensation
for labor, material, or money expended in that person's behalf.
In some localities it is called "particular" lien or "specific"
lien. (See Lien.)
Special
Warranty Deed
A
deed in which the grantor conveys title to the grantee and agrees
to protect the grantee against title defects or claims asserted
by the grantor and those persons whose right to assert a claim
against the title arose during the period the grantor held title
to the property. In a special warranty deed the grantor guarantees
to the grantee that he has done nothing during the time he held
title to the property which has, or which might in the future,
impair the grantee's title.
Survey
A
map or plat made by a licensed surveyor showing the results of
measuring the land with its elevations, improvements, boundaries,
and its relationship to surrounding tracts of land. A survey is
often required by the lender to assure him that a building is
actually sited on the land according to its legal description.
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Tax
As
applied to real estate, an enforced charge imposed on persons,
property or income, to be used to support the State. The governing
body in turn utilizes the funds in the best interest of the general
public.
Tax
Lien
A
claim against real estate for the amount of its unpaid taxes.
Teaser
Rate
Similar
to a Payment Discount, but implies either an unusually large initial
rate discount or an attempt by the lender to lure an otherwise
unqualified borrower into the mortgage.
Tenancy
by the entirety
A
type of joint tenancy of property that provides right of survivorship
and is available only to a husband and wife. Contrast with tenancy
in common.
Tenancy
in common
A
type of joint tenancy in a property without right of survivorship.
Contrast with tenancy by the entirety and with joint tenancy.
Tenant-stockholder
The
obligee for a cooperative share loan, who is both a stockholder
in a cooperative corporation and a tenant of the unit under a
proprietary lease or occupancy agreement.
Third-party
origination
A
process by which a lender uses another party to completely or
partially originate, process, underwrite, close, fund, or package
the mortgages it plans to deliver to the secondary mortgage market.
Title
As
generally used, the rights of ownership and possession of particular
property. In real estate usage, title may refer to the instruments
or documents by which a right of ownership is established (title
documents), or it may refer to the ownership interest one has
in the real estate.
Title
Company
A
company that specializes in examining and insuring titles to real
estate.
Title
Insurance
Protects
lenders or homeowners against loss of their interest in property
due to legal defects in title. Title insurance may be issued to
a "mortgagee's title policy." Insurance benefits will be paid
only to the "named insured" in the title policy, so it is important
that an owner purchase an "owner's title policy", if he desires
the protection of title insurance.
Title
Search or Examination
A
check of the title records, generally at the local courthouse,
to make sure the buyer is purchasing a house from the legal owner
and there are no liens, overdue special assessments, or other
claims or outstanding restrictive covenants filed in the record,
which would adversely affect the marketability or value of title.
Total
Debt Ratio
Monthly
debt and housing payments divided by gross monthly income. Also
known as Back-End Ratio.
Total
expense ratio
Total
obligations as a percentage of gross monthly income. The total
expense ratio includes monthly housing expenses plus other monthly
debts.
Trade
equity
Equity
that results from a property purchaser giving his or her existing
property (or an asset other than real estate) as trade as all
or part of the down payment for the property that is being purchased.
Transfer
of ownership
Any
means by which the ownership of a property changes hands. Lenders
consider all of the following situations to be a transfer of ownership:
the purchase of a property "subject to" the mortgage, the assumption
of the mortgage debt by the property purchaser, and any exchange
of possession of the property under a land sales contract or any
other land trust device. In cases in which an inter vivos revocable
trust is the borrower, lenders also consider any transfer of a
beneficial interest in the trust to be a transfer of ownership.
Transfer
tax
State
or local tax payable when title passes from one owner to another.
Treasury
index
An
index that is used to determine interest rate changes for certain
adjustable-rate mortgage (ARM) plans.
Trustee
A
party who is given legal responsibility to hold property in the
best interest of or "for the benefit of" another. The trustee
is one placed in a position of responsibility for another, a responsibility
enforceable in a court of law.
Truth-In-Lending
(TIL).
A federal law that requires lenders to fully disclose, in writing,
the terms and conditions of a mortgage, including the APR and
other charges.
Two-
to four-family property
A
property that consists of a structure that provides living space
(dwelling units) for two to four families, although ownership
of the structure is evidenced by a single deed.
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Underwriting
The
process of evaluating a loan application to determine the risk
involved for the lender. Underwriting involves an analysis of
the borrower's creditworthiness and the quality of the property
itself.
Unsecured-loan
A
loan that is not backed by collateral.
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Government
Loans FHA / VA
Government
loans are loans that are guaranteed or purchased by government
organizations. Two of the most popular Government Loans are the
Federal Housing Administration (FHA) and the Department of Veterans
Affairs (VA).
Vested
Having
the right to use a portion of a fund such as an individual retirement
fund.
Department
of Veterans Affairs (VA)
An
agency of the federal government that guarantees residential mortgages
made to eligible veterans of the military services. The guarantee
protects the lender against loss and thus encourages lenders to
make mortgages to veterans.
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- W -
Wraparound
mortgage
A
mortgage that includes the remaining balance on an existing first
mortgage plus an additional amount requested by the mortgagor.
Full payments on both mortgages are made to the wraparound mortgagee,
who then forwards the payments on the first mortgage to the first
mortgagee.
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- X -
(empty)
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- Y -
(empty)
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- Z -
Zoning
Ordinances
The
acts of an authorized local government establishing building codes,
and setting forth
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