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72 Cards in this Set
- Front
- Back
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Clause contained in your mortgage with allows your lender to speed up the rate of your loan's payment terms.
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Acceleration Clause
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Mortgage loan with an interest rate that moves higher or lower periodically depending on the terms of your loan.
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Adjusted Rate Mortgage
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Part of the equation that is used to determine your gains or losses when your property is sold.
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Adjusted Basis
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Calculated by taking the cost of property + cost of improvements to property - any depreciation
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Adjusted Basis
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The reduction of your debt through monthly payments you make on your loan.
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Amortization
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Measurement used by lenders that allows you to see the total cost of your mortgage, including closing fees and lender points.
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Annual Percentage Rate (APR)
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The increase in a property's value over a period of time.
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Appreciation
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Value that is placed on your property for the purpose of determining the amount of your property taxes.
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Assessment
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Mortgage where payments are usually set on 30 year period, but loan actually becomes due much sooner than that, calling for a large lump-sum payment at end of loan.
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Balloon Mortgage
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Loan that covers more than one property under the same mortgage loan.
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Blanket Mortgage
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Used when developers are dividing and developing land.
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Blanket Mortgage
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Source of funds needed for a down payment when you close on a new property but don't have the funds for down payment.
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Bridge Loan
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Given to you when you purchase a home to insure that it is a legal aquisition.
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Certificate of Title
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When you have been given title to a property that is free of any liens and disputed interests and there are no questions as to the ownership of the property.
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Clear Title
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When you take out a loan, the property that secures the loan is...
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Collateral
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The promise an investor makes when agreeing to purchase a mortgage from a lender.
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Commitment
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When received, it means a lender is agreeing to make a loan to you.
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Commitment
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The interest expense that is calculated on the principal sum of a loan plus the accrued interest of that sum.
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Compound Interest
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An interim loan that is used to pay for the building of a home as it is constructed.
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Construction Loan
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When you take out a mortgage from a commercial, non-governmental lender.
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Conventional Mortgage
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An adjustable rate mortgage that will allow you to convert your loan into a fixed-rate mortgage within a specific timeframe.
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Convertable Arm
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Written agreement between two people where the parties agree to do or not to do certain things.
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Covenant
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Written report of your debt payment history that can be generated by one of the three credit reporting agencies, also known as bureaus.
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Credit Report
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Number that is determined by a statistical analysis of your credit history.
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Credit Score
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What is the range for credit scores?
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365 to 840
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A legal document that gives a third party title of real property
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Deed of Trust
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When you take out a mortgage, your lender may charge you points. Each point costs 1 percent of the loan amount and for each point you pay, you will normally receive an interest rate reduction of ¼ of a percent. For example, if you were to take out a mortgage for $150,000, three points would cost you $4,500 and your loan’s interest rate would be reduced by 0.75 percent. Sometimes when you’re negotiating the purchase of your home, you can get the seller to agree to pay some of your points.
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Discount Point
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Your loan is non-assumable and when you sell your home or transfer your interest in the property, the buyer will not be able to take over your existing mortgage payments and the loan will need to be paid in full at closing.
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Due-On-Sales Clause
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Money given to a seller by a buyer to show the seller that an offer to purchase real estate or other real property is a serious, binding offer.
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Earnest Money Deposit
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There is a legal right or interest in the land that would affect you gaining clear title to the property if you purchased it.
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Encumbrance
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Represents the difference between what you owe to creditors for loans against the property and how much the property is worth.
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Equity
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When a revolving line of credit is issued to you and you will be able to borrow against that line of credit as funds are needed.
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Equity Line of Credit
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The process of utilizing the services of a third party to oversee the exchange of funds and property between a buyer and seller.
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Escrow
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A periodic examination of the balance of an escrow account is conducted to ensure that the monthly payments you are making will be enough to cover the expenses that are paid from the account when they become due.
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Escrow Analysis
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Type of credit score that was developed by the Fair Isaac Company.
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FICO
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This type of credit scoring evaluates only the information contained in your credit file and helps a lender determine the risks associated with extending you credit.
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FICO
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For a home purchase, this is the primary lien against a home.
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First Mortgage
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Document outlining the costs that you will be expected to pay at closing.
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Good Faith Estimate
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A revolving loan secured by a home's value that allows you to borrow money as you need it.
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Home Equity Line of Credit
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Also referred to as a closing statement or settlement sheet
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HUD-1 Settlement
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The itemized statement that you will receive that outlines the costs of obtaining a home loan, payable by you at closing.
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HUD-1 Settlement
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A measurement that is used to determine the interest rate of your adjustable rate mortgage.
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Index
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A loan that has predetermined, equal payments due until the loan has been paid in full.
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Installment Loan
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Means there is a limit as to the amount that your interest rate can go up or down.
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Interest Cap
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When a lender guarantees to loan you money at a set interest rate, protecting you from potential rate increases.
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Interest Rate Lock
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A mortgage that is of a greater amount than the limits set by Freddie Mac or Fannie Mae, but you will pay a higher interest rate
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Jumbo Loan
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A loan type that allows you to lease a home with the option of purchasing it at the end of the lease period.
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Lease Purchase Mortgage Loan
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Means that the property is being used to guarantee or secure a debt.
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Lien
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Fee to cover the costs involved with processing the paperwork of your loan.
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Loan Origination Fee
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When a lender guarantees that the interest rate they have quoted you will remain the same for a specific period of time.
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Lock
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The legal document that pledges to a lender your real property to secure your home loan.
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Mortgage
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This type of insurance protects your family from losing their home by paying off mortgage if you were to die.
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Mortgage Life Insurance
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Term used to refer to the borrower
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Mortgager
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Term used to refer to mortgage lender
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Mortgagee
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The legal document that serves as your written promise to repay your lender the money you have borrowed.
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Note
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The fee you will pay to your lender to cover the costs of processing your loan.
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Origination Fee
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At the time of the closing of the sale of a house or property, the expenses and fees will need to be paid to cover the future cost of items like property taxes, mortgage insurance and hazard insurance are...
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Prepaid Expense Items
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A fee charged to a loan holder for paying off a loan prior to it being due.
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Prepayment Penalty
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The interest rate that is charged by banks to A-credit clientele.
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Prime Rate
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The amount of money that you still owe on your loan.
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Principal Balance
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Insurance meant to protect a lender from financial loss if a loan holder were to default on a home loan.
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Private Mortgage Insurance
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When a lender commits to issuing a specific interest rate to a borrower and guarantees to hold it for a specified period of time.
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Rate Lock
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The costs associated with having a document recorded by a registrar's office in order to make it a part of public record.
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Recording Fees
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A federally mandated law that requires lenders to provide borrowers with the Annual Percentage Rate (APR) of a loan.
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Regulation Z
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A mortgage that puts a lien on a home that is second in position to the lien placed by a first mortgage.
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Second Mortgage
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Whenever you borrow money and the loan is backed by collateral
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Secured Loan
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Insurance that protects a borrower and lender against any defects in a property's title such as title-search errors and against any losses a borrower or lender would incur as a result of property disputes.
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Title Insurance
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The process of confirming the legal ownership of the property to ensure that there are no liens or encumbrances on the property and that the seller is the legal owner of the property.
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Title Search
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A federally mandated law that requires lenders to provide borrowers with a written disclosure of the costs associated with a mortgage including items such as finance charges, the Annual Percentage Rate (APR), the size of the credit line, any annual fees and the length of the grace period.
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Truth in Lending / Truth in Lending Act
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The procedure when a loan application is evaluated to assess a lenders' risk involved with making a loan to a borrower.
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Underwriting
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A type of refinancing that allows you to borrow more money from a second loan while still retaining your original mortgage.
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Wraparound Mortgage
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A warrant, pledge, or formal assurance given as security that another's debt or obligation will be fulfilled.
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Guaranty
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