Glossary of Real Estate Terms
||The gradual repayment of a mortgage loan by installments.
||An estimate of value based upon an analysis of information.
||The Annual Percentage Rate is the borrower's actual cost of a loan.
It includes the interest rate and other loan origination charges, and is expressed as a
yearly rate and calculated over the life of the loan.
||Value placed on a property as the basis for taxation.
||A public official who establishes the value of a property
for taxation purposes.
||A mortgage that can be taken over ("assumed") by the buyer
when a home is sold.
||The final lump sum payment that is made at the maturity date
of a balloon mortgage.
||A wall supporting a vertical load in addition to its own weight.
||One who acts as an agent for others in Real Estate transactions
for a fee.
||Local regulations that control design, construction, and materials
used in construction. Building codes are based on safety and health standards.
||Income from the sale of an asset.
||Covenants, conditions and restrictions
||An accounting of funds made to the buyer and seller separately
at the completion of a Real Estate transaction.
||An agents compensation for performing the duties of his agency.
||Sales which have similar characteristics to the subject property,
used for analysis by the appraiser.
||A loan that meets all eligibility requirements of federal agencies
other than FHA and VA, and is under $300,700. If the loan amount is over $300,700, it would
be considered a non-conforming or "jumbo" loan.
||A condition that must be met before a contract is legally binding.
||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.
||Certificate of reasonable value - The federal Veterans
Administration appraisal of property value.
||A written instrument which conveys title.
||Discount points are often used to describe a type of fee
that lenders charge. Discount points are additional funds you pay the lender at closing
to get a lower interest rate on your mortgage.
||Down payment made by a purchaser of Real Estate as evidence
of good faith.
||A right, privelage or interest which one party has in the land
of another such as a right of way.
||Construction of any improvements on the property of another.
||The difference between the current market value of a property
and the total amount still owed against that property.
||The deposit of instruments, funds and instructions with a neutral
party who will carry out the provisions of a contract or agreement.
|Exclusive Right to Sell.
||A type of written listing agreement between agent and owner
giving agent the right to collect a commission if the property is sold by anyone during
the term of the agreement.
||Federal Housing Administration - a government agency that
insures mortgage loans
||With FHA insurance, you can purchase a home with a low down
payment from 3 percent to 5 percent of the FHA appraised value or the purchase price,
whichever is lower.
||A legal procedure in which a mortgaged property is sold to
pay the outstanding debt in case of default.
||Insurance coverage that provides compensation to the insured
in case of property loss or damage.
||A home upon which the owner has recorded a Declaration of
Homestead, this protects the home against judgements up to an amount specified in the statutes.
||U.S. Department of Housing and Urban Development. The Office of
Housing/Federal Housing Administration within HUD insures home mortgage loans made by l
enders and sets minimum standards for such homes.
||The HUD-1 Settlement Statement itemizes the amounts to be paid
by the buyer and the seller at closing.
||A trust account set up by lenders to accumulate funds to pay
taxes and insurance. They are usually collected along with the mortgage payment.
|Income to Debt Ratio.
||A qualifying ratio used in underwriting a residential mortgage
loan, which computes the percentage of monthly income, required to meet the monthly
||The percentage of a sum of money which is charged for its use.
||Joint ownership by two or more people with the right of
survivorship. All tenants have equal rights and own an equal interest.
||A contract between property owner and tenant specifying
the conditions under which the tenant may occupy and use the property.
||The London Interbank Offer Rate. An interest rate charged
among banks in London for short term loans denominated in a specific currency.
A common index for debt securities.
||A legal claim against a property that must be paid off when
the property is sold.
||An agreed upon amount of damages to apply if a certain event occurs.
||An employment contract between property owner and agent
authorizing the agent to perform services for the owner in order to secure a buyer
for that property.
||The price at which a willing buyer would buy and a willing
seller would sell when neither are subject to undue pressure.
||The Multiple Listing Service where members post their
clients properties for sale so that other members have the opportunity to find buyers.
||A legal instrument wherein property is used to secure
the payment of a debt.
||An officer who is authorized to take the acknowledgement
of persons executing documents, to sign the certificate and affix his seal.
||A right given (in exchange for a fee) to purchase or lease
a property according to specified terms and conditions.
||The fee lenders charge to borrowers to prepare documents,
process and close the loan. Usually stated as a percentage of the loan.
||Acronym for items included in a monthly mortgage payment:
principal, interest, taxes and insurance.
||Private Mortgage Insurance is provided to protect lenders
against loss if a borrower defaults. Most lenders generally require PMI for a loan
with a loan-to-value ratio in excess of 80%.
||A fee that may be charged to a borrower who pays off a loan
before it is due.
|Proration of Taxes.
||To divide the taxes in proportion to the time in use.
||A commitment issued by a lender to a borrower guaranteeing
specified interest rate for a specified period of time.
||A member of the National Association of Realtors. realtors
subscribe to a higher code of ethics.
||An additional loan secured by a second mortgage or trust
deed on real property, could apply to any loan other than the first one.
||An underground tank in which sewage from the house is
reduced to liquid by bacterial action and then drained away.
||A charge by a public authority against Real Estate to pay
the cost of public works such as street lighting and improvements.
||A housing development that is created by dividing a tract
of land into individual lots for sale or lease.
|Tenancy in Common.
||Ownership by two or more people who hold undivided
interests (not necessarily equal). There is no right of survivorship.
||Wood eating insects.
||An instrument which provides evidence of ownership
||Insurance written by a title company to protect property
owner against loss in the event that title is found to be flawed.
||Fees charged by a municipality to defray the cost of
recording a transfer of ownership.
||A legal document wherin a buyer pledges real property as
a guarantee for the repayment of a loan.
||One who analyzes a potential borrowers ability to repay a loan.
||An act by a city or county which specifies the type of use
to which a property may be put.