A property purchase transaction in which the property seller provides all or part of the financing. Mortgage A legal document that pledges property to a creditor for the repayment of the loan, and is the term used to describe the loan itself. As a result the APR is invariably higher for the rate of interest that the lender quotes for the mortgage but gives a more accurate picture of the likely cost of the loan. Second mortgage. This significantly reduces the time a principal is paid off. Reverse Annuity Mortgage (RAM) – A system developed for an elderly property owner in which regular monthly payments can be received from a lender. Personal property can be intangible, as in the case of stocks and bonds. Interest Rate Swap – A transaction between two parties, in which each agrees to exchange payments tied to different interest rates or indices for a specified period of time. Hazard Insurance – A form of insurance in which the insurance company protects the insured from certain losses, such as fire, vandalism, storms and certain other natural causes. The possible options are as follows…. Discount – Difference between the face amount of a note or mortgage and the price at which the instrument is sold in the secondary market. 11th District Cost of Funds –A monthly cost-of-funds index (COFI) reflecting the weighted-average interest rate paid by 11th Federal Home Loan Bank District savings institutions for savings and checking accounts. PITI Reserves – A cash amount that a borrower must have on hand after making a down payment and paying all closing costs for the purchase of a home. Carryback Loan – A loan in which a seller agrees to finance a buyer in order to complete a property sale. Callable Debt – A debt security in where the issuer has the right to redeem the security at a specified price on or after a specified date, but prior to its stated final maturity date. Loans against these plans are an acceptable source of down payment for most types of other loans. Often used in calculations to determine whether a borrower qualifies for a particular loan. Payment of this fee does not guarantee that a loan will be approved. The Conversion Option column on Moving.com balloon tables indicates the right of a borrower to convert this balloon loan. Bankruptcy – A tactic that individuals use to relieve themselves of debts and/or liabilities when they are no longer able to repay. Measure content performance. It says if you don't pay back the loan, plus all fees and interest, then your private lender can foreclose on your property … 4 Ways to Build Equity Faster. Liability Insurance – Insurance that protects property owners against claims that alleges negligence or inappropriate action that resulted in bodily injury or property damage to another party. Real property refers to land and things that are permanently attached to the land. Forbearance – The postponement for a limited time of a portion or all the payments on a loan when a borrower is delinquent. Equity – The difference between the current market value of a property and the principal balance of all outstanding loans. Loans like the 3/1 and 5/1 adjustable which have an initial fixed period are quoted with 3 numbers as in 3/2/6 which would mean that the first adjustment may be as much as 3%, subsequent adjustments are capped at 2% each, and the lifetime cap is 6%. Mortgages that have an 80% LTV that do not require mortgage insurance have higher interest rates. Origination Fee – The fee imposed by a lender to cover certain processing expenses in connection with making a loan. Apply market research to generate audience insights. The place where primary mortgage lenders sell the mortgages they make to obtain more funds to originate more new loans. Pre-Foreclosure Sale – A procedure in which the borrower is allowed to sell his or her property for an amount less that what is owed on it to avoid foreclosure, fully satisfying the borrower’s debt. Mortgagee – The lender in a mortgage agreement. Personal property can be insured for its current, possibly depreciated, value or for what it would cost to replace with a similar new item. Zoning – The right of a community, under its police power, to dictate the use of property within its boundaries. Purchase Agreement – A written contract signed by the buyer and seller stating the terms and conditions under which a property will be sold. Foreclosure – A legal procedure in which real estate is sold by the lender to pay a defaulting borrower’s debt . In mortgage and real estate terms, this is called the “earnest money deposit.”. These limits are set by the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation. The index is published on the last day of the month and reflects the cost of funds for the prior month. Sinking Fund – Monies deposited in advance in anticipation of satisfying a debt in the future. The distinguishing factor between personal property and real estate, or real property, is that personal property is movable; that is, it isn't fixed permanently to one particular location. Times provided are all Eastern Standard Time. After the property has been appraised, the Veterans Administration issues a CRV. Annual Percentage Rate (APR) – A figure that states the total yearly cost of a mortgage as expressed by the actual rate of interest paid. Credit Report – A report to a prospective lender on the credit standing of a prospective borrower. Balloon Mortgage – Behaves like a fixed-rate mortgage for a set number of years (usually five or seven) and then must be paid off in full in a single “balloon” payment. A chattel mortgage is a loan arrangement in which an item of the movable personal property acts as security for a loan. A LTV ratio of 90 means that a borrower is borrowing 90% of the value of the property and paying 10% as a down payment. Depreciation – In real estate and mortgage terms, the decline in the property value. Mortgage Banker. A rider is an insurance policy provision that adds benefits to or amends the coverage or terms of a basic insurance policy. Gross Monthly Income – The total amount the borrower earns per month, not counting any taxes or expenses. homeowner’s warranty – An insurance policy that is purchased by a buyer that covers certain repairs, should they be necessary over a certain period. Bill of Sale – A written document that transfers a title to personal property. Personal property is also known as movable property, movables, and chattels. If your property is in such a poor condition that no one could live in it, … 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. Personal property example. Sale-Buyback – A financing arrangement in which an investor buys property from a developer and immediately sells it back under a long-term sales agreement, wherein the investor retains legal title. The servicer often services mortgages that have been purchased by an investor in the secondary mortgage market. Credit-Loss Ratio – The ratio of credit-related losses to the dollar amount of MBS outstanding and total mortgages owned by the corporation. Transfer Tax – State or local tax payable when the title passes from one owner to another. HUD – Department of Housing and Urban Development; regulates Fannie Mae and Ginny Mae. Examples of tangible personal property include vehicles, furniture, boats, and collectibles. Application – A mortgage application requires borrowers to submit information regarding their income, savings, assets, debts, and more. Vested – Means that one has a right to use a portion of a fund, such as an individual’s retirement fund. Partial Entitlement – Under VA loans, the amount of guarantee still available to an eligible veteran who has used his previous entitlement. The reason it is referred to as a second mortgage is because it is secured against your home, sitting in ‘second position’ behind your existing, first mortgage. Add our Mortgage Terms Glossary to your Favorites for quick look-ups throughout your mortgage application process. Refinancing – The process of paying off one loan with the proceeds from a new loan, using the same property as security. Variable Rate Mortgage – See Adjustable Rate Mortgage. The standard loss payable provisions endorsement (CP … Borrowers who have undergone bankruptcy usually cannot qualify for “A” paper loans until after two years after declaration and a re-establishment of credit. A deed of trust or mortgage is obtained, depending on the state in which the borrower will reside. This is usually required on all loans that have a loan-to-value higher than eighty percent. It’s one way for homeowners or landowners interested in selling their real property to diversify their investments and streams of income. Pledge Account Mortgage (PAM) – Combines GPM (graduated payment mortgage) with a subsidizing savings account to provide the borrower with a low payment plan, the lender with amortizing payments and the seller with cash. Certificate of Reasonable Value (CRV) – An appraisal that has been performed on a property that is being paid for a VA loan. The cost of title insurance is usually a set value per thousand of dollars of the total loan amount. Please note that qualifying ratios are only a rough guideline in determining a potential borrower’s credit-worthiness. Title Search – A check of the title records to make sure that the seller is the actual legal owner of the property, and that there are no liens or other claims outstanding. Adjustment_date – The date the interest rate changes on an ARM (adjustable rate mortgage). Zero Percent Financing – A loan with no interest in the contract. Estate – The ownership interest an individual holds in real property. An individual, firm, or corporation that originates, sells, and/or services loans secured by mortgages on real property. Fair Credit Reporting Act – A law that protects consumer that regulates the reporting of consumer credit by agencies and establishes procedures for correcting errors on an individual record. Quitclaim Deed – A deed that transfers, without warranty, whatever interest or title a grantor may have at the time the conveyance is made. Biweekly Mortgage – Mortgage loan payments that requires a payment twice monthly, yielding thirteen payments per year instead of twelve. Credit-Related Losses – The sum of foreclosed property expenses plus charge-offs. Prime Rate – Interest charged by financial institutions to top-rate borrowers. Real property and personal property are covered. This requires borrowers to pay more than the principal and interest each month. The most common form of individual bankruptcy is a Chapter 7, when an individual frees himself from most of his/her debts. The ratio of the total mortgage liens against the subject property to the lesser of either the appraised value or the sales price. Credit Rating – Borrowers are rated by lenders according to the borrower’s credit-worthiness or risk profile. The payment change date occurs the month immediately after the interest rate adjustment date. Revolving Debt – A credit arrangement that allows a customer to borrow against a pre-approved line of credit used to purchase goods and services. "to mortgage a property, an estate, a shop" Servicing Under section 59A, a person deriving title under the original mortgagor is included in the term mortgagor too. List of Partners (vendors). Reconciliation – Determining the final estimate of value by weighing the results of the various approaches in an appraisal. Debt-to-Income Ratio (DTI) – The ratio of aggregate monthly debt to aggregate monthly income. The pledging of more than the principal, interest, left on a loan will you. The insurer would be obligated to replace a destroyed item with a lender, known as the work progresses servicing. Points – a mortgage of property within its boundaries Clause – the factor used for rapid of. 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