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Application
Fee - Top
Funds
required by a lender in advance of processing a loan request. Generally
a deposit is collected to cover the costs of an appraisal and credit
report and may or may not be refundable.
Abandonment
- Top
The
voluntary surrender of property, owned or leased, without naming
a successor as owner or tenant.
Absentee
Owner - Top
An
owner who does not personally manage or reside at property owned.
Absolute
Auction - Top
An
auction in which the subject property is sold to the highest bidder
regardless of the amount of the winning bid.
Absorption
Rate - Top
An
estimate of the expected annual sales or new occupancy of a particular
type of land use.
Abstract
Exam - Top
A
fee related to the title insurance required by the lender. A public
record search exam is done to insure that both you and the lender
are aware of any liens or encumbrances that could affect the property.
For our comparison purposes, an abstract exam fee is considered
to be a third party fee and may be included in the title insurance
fee by some lenders.
Acceleration
Clause - Top
A
provision in a mortgage that gives the lender the right to demand
payment of the entire principal balance if a monthly payment is
missed.
Acceptance
- Top
A
party’s consent to enter into a contract and be bound by the
terms of the offer.
Accepted
Contract - Top
A
sales contract signed by both seller and buyer that defines the
terms of the sale.
Additional
Principal Payment - Top
A
payment by a borrower of more than the scheduled principal amount
due, in order to reduce the remaining balance of the loan.
Adjustable
Rate Mortgage - Top
An
adjustable rate mortgage, commonly referred to as an ARM, is a loan
type that allows the lender to adjust the interest rate during the
term of the loan. Generally, these changes are determined by a margin
and an index so that the interest rate changes, up or down, are
based on market conditions at the time of the change. Most often
these interest rate changes are limited by a rate change cap and
a lifetime cap. If you apply for an adjustable rate mortgage, the
lender is required to provide you with an ARM Program Disclosure
which spells out the terms of the loan.
Adjusted
Basis - Top
The
original cost of a property, plus the value of any capital expenditures
for improvements to the property, minus any depreciation taken.
Adjustment
Date - Top
The
date on which the interest rate changes for an adjustable-rate mortgage
(ARM).
Adjustment
Period - Top
The
period that elapses between the adjustment dates for an adjustable
rate mortgage (ARM).
Administrative
Fee - Top
A
fee charged by a lender to cover the administrative costs of processing
your loan request. For our comparison purposes, this fee is typically
a lender fee.
Administrator
- Top
A
person appointed by a probate court to administer the estate of
a person who died intestate.
Affordability
Analysis - Top
A
detailed analysis of your ability to afford the purchase of a home.
An affordability analysis takes into consideration your income,
liabilities, and available funds, along with the type of mortgage
you plan to use, the area where you want to purchase a home and
the closing costs that you might expect to pay.
Amenity
- Top
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. Man-made amenities include swimming pools, tennis courts,
community buildings and other recreational facilities.
Amortization
- Top
A
loan repayment plan, which enables the borrower to reduce his debt
gradually through monthly payments of principal and interest.
Amortization
Schedule - Top
A
timetable for payment of a mortgage loan. An amortization schedule
shows the amount of each payment applied to interest and principals
and shows the remaining balance after each payment is made.
Amortization
Term - Top
The
amount of time required to amortize the mortgage loan. The amortization
is expressed as a number of months. For example, for a 30 year fixed
rate mortgage, the amortization term is 360 months.
Amortize
- Top
To
repay a mortgage with regular payments that cover both principal
and interest.
Annual
Fee - Top
An
annual fee for a line of credit is sometimes required. If an annual
fee is shown you will be billed for that amount, annually, until
the loan is paid in full.
Annual
Mortgagor Statement - Top
A
report sent to the mortgagor each year. The report shows how much
was paid in taxes and interest during the year, as well as the remaining
mortgage loan balance at the end of the year.
Annual
Percentage Rate (APR) - Top
To
make it easier for consumers to compare mortgage loan interest rates,
the federal government developed a standard format called an "Annual
Percentage Rate" or APR to provide an effective interest rate
for comparison shopping purposes. Some of the costs that you pay
at closing are factored into the APR for ease of comparison. Your
actual monthly payments are based on the periodic interest rate,
not the APR.
Annuity
- Top
A
specified income paid yearly or at other regular intervals, often
on a guaranteed dollar basis.
Application
- Top
The
process of applying for a mortgage. The term "application"
generally refers to a form that is used to collect financial information
from a borrower by a lender.
Appraisal
- Top
An
analysis performed by a qualified individual to determine the estimated
value of a home.
Appraisal
Fee - Top
In
order to verify that the value of your home supports the loan amount
you request, an appraisal will be ordered by the lender. The appraisal
is generally performed by a professional who is familiar with home
values in the area and may require an interior inspection of the
home. The fee for the appraisal is commonly passed on to the borrower
by the lender. For our comparison purposes, the appraisal fee is
a third party fee.
Appraised
Value - Top
An
opinion of a property’s fair market value, based on an appraiser’s
knowledge, experience and analysis of the property.
Appraiser
- Top
A
person qualified by education, training, and experience to estimate
the value of real property and personal property.
Appreciation
- Top
An
increase in the value of a property due to changes in market conditions
and other causes. The opposite of depreciation.
APR
- Top
To
make it easier for consumers to compare mortgage loan interest rates
the federal government developed a standard format, called an "Annual
Percentage Rate" or APR, to provide an effective interest rate
for comparison shopping purposes. Some of the costs that you pay
at closing are factored into the APR for ease of comparison. Your
actual monthly payments are based on the periodic interest rate,
not the APR.
ARM
- Top
An
ARM (adjustable rate mortgage) is a loan type that allows the lender
to adjust the interest rate during the term of the loan. Generally,
these changes are determined by a margin and an index so that the
interest rate changes, up or down, are based on market conditions
at the time of the change. Most often these interest rate changes
are limited by a rate change cap and a lifetime cap. If you apply
for an adjustable rate mortgage, the lender is required to provide
you with an ARM Program Disclosure which spells out the terms of
the loan.
Assessed
Value - Top
The
valuation placed on property by a public tax assessor for purposes
of taxation.
Assessment
- Top
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.
Assessment
Rolls - Top
The
public record of taxable property.
Assessor
- Top
A
public official who establishes the value of a property for taxation
purposes.
Asset
- Top
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
- Top
The
transfer of a mortgage from one person to another.
Assumable
Mortgage - Top
A
loan that does not have to be paid in full if the home is sold.
Instead, the new owner can take over payments on the existing loan
and pay the seller the difference between the sales price and the
balance on the loan.
Assumption
- Top
The
transfer of the seller’s existing mortgage to the buyer. See
assumable mortgage.
Assumption
Clause - Top
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 - Top
The
fee paid to a lender (usually by the purchaser of real property)
resulting from the assumption of an existing mortgage.
Attorney
Opinion - Top
Commonly
referred to as a "title opinion". This fee is related
to the title insurance required by the lender. It is a document
issued by an attorney listing any liens or encumbrances that could
affect the property that are a matter of public record. For our
comparison purposes, the attorney opinion fee is considered to be
a third party fee and may be included in the title insurance or
closing fee by some lenders.
Attorney
Witness - Top
Related
to the settlement/closing fee. This fee is standard in some states
and is the closing attorney's fee for witnessing the signing of
the closing documents. For our comparison purposes, an attorney
witness fee is considered to be a third party fee and may be included
in the title insurance or closing fee by some lenders.
Attorney-in-fact
- Top
One
who holds a power of attorney from another to execute documents
on behalf of the grantor of the power.
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