Nj Principles Of Real Estate - 14: Mortgages And Financing

Front 1

A MORTGAGE is:

Back 1

The grant of an interest in real or personal property with a provision for the release
of that property upon repayment of the debt in
full.

Front 2

The MORTGAGOR is:

Back 2

A borrower who gives the mortgage.

Front 3

The MORTGAGEE is:

Back 3

The lender who receives the mortgage.

Front 4

The PROMISSORY NOTE or BOND is:

Back 4

The primary financing obligation and
makes the mortgagor personally liable for the
debt.

Front 5

A PERSONAL JUDGEMENT is also called:

Back 5

A deficiency judgment.

Front 6

LIEN THEORY hols that:

Back 6

The mortgage is not a conveyance of land but only a
security.

Front 7

HYPOTHECATE means to:

Back 7

Pledge property as
security for a loan without giving possession of
the property to the lender.

Front 8

A JUNIOR MORTGAGE is:

Back 8

Any mortgage that is subordinate to another.

Front 9

The ACCELERATION CLAUSE allows the lender to:

Back 9

Demand immediate payment of the entire loan if
the borrower defaults.

Front 10

ALIENATION CLAUSE or DUE ON SALE CLAUSE is a type of:

Back 10

Acceleration
clause that makes all future payments due when
a property is sold.

Front 11

The DEFEASANCE CLAUSE:

Back 11

Provides that the rights of the mortgagee will
come to an end, if and when the debt is repaid in
full.

Front 12

A RELEASE or DISCHARGE OF MORTGAGE or SATISFACTION PIECE:

Back 12

Is given to the
mortgagor, stating that the obligation to the mortgagee
has been fulfilled.

Front 13

A SUBORDINATION CLAUSE:

Back 13

May be included in a mortgage agreement in
which the lender agrees to allow a subsequently
acquired mortgage to have legal priority.

Front 14

An ASSIGNMENT is:

Back 14

The transfer of a mortgage to a third party called an ASSIGNEE.

Front 15

When buying "SUBJECT TO THE MORTGAGE":

Back 15

The buyer agrees to take over
the seller's remaining mortgage payments, after
having paid him the equity in the property.

Front 16

EQUITY is:

Back 16

The difference between the value of a property and anything owed on it.

Front 17

A "REDUCTION CERTIFICATE" should be obtained by the buyer from:

Back 17

The mortgagee verifying the
amount due and the terms of the mortgage when taking title "SUBJECT TO" an existing mortgage.

Front 18

When "ASSUMPTION OF THE MORTGAGE" occurs, the buyer:

Back 18

Personally obligates himself to payment of
the entire outstanding debt and becomes a cosigner
on the seller's note.

Front 19

Novation is:

Back 19

a three-party agreement under which one party is release from an obligation and another party is substituted.

Front 20

A MORTGAGE COMMITMENT is:

Back 20

A contractual promise by the lender to
the buyer promising to provide the funds necessary
to complete settlement, if the conditions
named in the commitment are met.

Front 21

A REGULATION Z STATEMENT is:

Back 21

Accompanied by the MORTGAGE COMMITMENT and is required by
the TRUTH IN LENDING ACT to advise borrowers of
the true cost of borrowing by listing loan costs
and disclosing the ANNUAL PERCENTAGE RATE (APR) of the
loan.

Front 22

The LOAN-TO-VALUE RATIO is:

Back 22

The ratio between the amount borrowed
and the sales price or appraised value of the
property, whichever is lower.

Front 23

PRIVATE MORTGAGE INSURANCE (PMI) is:

Back 23

An insurance
that mortgage lenders require from most homebuyers
who take out a mortgage loan in an
amount in excess of 80% of a home's appraised
value.

Front 24

HOMEOWNERS PROTECTION ACT OF 1998:

Back 24

Which
became effective in 1999, establishes rules for
automatic termination and borrower cancellation
of PRIVATE MORTGAGE INSURANCE (PMI) on home mortgages when home equity reaches 22% of the home's value.

Front 25

A PREPAYMENT PENALTY is:

Back 25

A special charge or
penalty demanded of a mortgagor when a mortgage
is repaid before it becomes due.

Front 26

USURY RATE:

Back 26

is an interest rate in excess of the legally
permitted rate.