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Understanding Real Estate Terminology
Purchasing a home can be a complicated and confusing process, especially for
first-time buyers. Throughout the process, first-time home buyers will encounter
a variety of unfamiliar real state terms. There are several key terms associates
with purchasing real estate that are helpful to learn.
For example, many buyers confuse the terms broker
and salesperson.
A broker is a properly licensed individual, or corporation, who serves as a
special agent in the purchase and sale of real estate, a salesperson is an
individual employed or associated by written agreement by the broker as an
independent contractor. The salesperson facilitates the purchase or sale of real
estate.
Once you decide to purchase, a salesperson will prepare
a sales contract to present to the seller along with your
earnest money
deposit. The sales contract is the document through which the seller agrees to
give possession and title of property to the buyer upon full payment of the
purchase price and performance of agreed-upon conditions. The earnest money is a
buyer’s partial payment, as a show of good faith, to make the contract binding.
Often, the earnest money is held in an escrow account. Escrow is
the process by which money is held by a disinterested party until the terms of
the escrow instructions are fulfilled. There is no fixed amount or percentage
amount that is required to be held in the escrow account. Often sellers would
like 10% of the offered price, but that amount is not a fixed amount. Just like
many other parts of the contract, the escrow amount is whatever the involved
parties can agree upon.
After the buyer and seller have signed the contract, the buyer must obtain a
mortgage note by presenting the contract to a mortgage lender. The
note is the buyer’s promise to pay the purchase price of the real estate in
addition to a stated interest rate over a specified period of time. A mortgage
lender places a lien on the property, or mortgage, and this
secures the mortgage note.
The buyer pays interest money to the lender exchange for the
use of money borrowed. Interest is usually referred to as APR or annual
percentage rate. Interest is paid on the principle, the capital
sum the buyer owes. Interest payments may be disguised in the form of points.
Points are an up-front cost which may be paid by either the buyer or seller or
both in conventional loans.
In general, there are two types of conventional loans that a buyer can
obtain. A fixed rate loan has the same rate of interest for the
life of the loan, usually 14 to 30 years. An adjustable rate loan
or adjustable rate mortgage (ARM) provides a discounted initial rate, which
changes after a set period of time. The rate can’t exceed the interest rate cap
or ceiling allowed on such loans for any one adjustment period. Some ARMs have a
lifetime cap on interest. The buyer makes the loan and interest payments to the
lender through amortization, the systematic payment and
retirement of debt over a set period of time.
Once the contract has been signed and a mortgage note obtained, the buyer and
seller must legally close the real estate transaction. The closing is a meeting
where the buyer, seller and their attorneys review, sign and exchange the final
documents. At the closing, the buyer receives the appraisal report, an estimate
of the property’s value with the appraiser’s signature, certification and
sporting documents. The buyer also receives the title and the deed. The title
shows evidence of the buyer’s ownership of the property while the deed legally
transfers the title from the seller to the buyer. The final document the buyer
receives at closing is a title insurance policy, insurance against the loss of
the title if it’s found to be imperfect.
Buyers should plan on a least four to twelve weeks for a typical real
estate transaction. The process is difficult and at times, intimidating. A
general understanding of real estate terminology and chronology of the
transaction, however, will help any real estate novice to confidently buy his or
her first home.
Have more real estate questions? Just ask me by sending me an email
with your question! karent@remax.net
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Buying and
selling a home can be a scary experience, even if it isn't your
first one. Use this glossary to make yourself more prepared for
the professionals and documents you'll encounter in your real
estate experiences.
A
abstract of title
A condensed version of the title history to a piece of land or
property. Lists any transfers in ownership and any liabilities
attached to it, such as mortgages.
abutting
Bordering upon or next to; the joining or touching of adjoining
land; sharing a common boundary.
acceleration clause
Allows the lender (mortgage company) to demand immediate payment
of the outstanding loan balance (interest and principal) if the
borrower (mortgager) defaults, misses payment(s), or when/if the
home is sold (in this case, also know as the due-on-sale
clause).
accretion
An addition to or expansion of land through natural causes. An
increase of land along the shore of a body of water through
water-borne sediment.
acre
A measurement of land equal to 4,840 square yards or 43,560
square feet.
additional principal payment
Monies paid by the borrower in addition to the principal amount
due, usually monthly. If you have extra money occasional months,
it's a good idea to make additional principal payments in order
to more quickly reduce your remaining balance.
adjustable rate mortgage (ARM)
Mortgage loans in which the interest rate is adjusted
periodically based on predetermined factors such as an assigned
index or designated market factor (such as the weekly average of
US Treasury Bills over a one-year period). There is typically a
limit to how often and by how much the interest rate can
fluctuate. Also known as renegotiable rate mortgages or
variable rate mortgages. The adjustment date is the
date the interest rate changes. The adjustment interval
(or
adjustment period) is the time between changes in the
interest rate and/or the monthly payment (typically one, three
or five years).
adjusted basis
Original cost of the property plus capital expenditures for
improvements minus depreciation.
adjustments
Any money that the buyer and seller "credit" each other at
closing, such as taxes, down payments, etc.
ad
valorem
In proportion to the value, according to value.
amortization
The loan payment is made up of two parts: one portion will be
applied to pay the accruing interest on a loan and the other
portion is applied to the principal. Over time, the interest
portion decreases as the loan balance decreases, and the amount
applied to principal increases so that the loan is paid off
(amortized) in the specified time. Typical amortization periods
are 15 or 30 years. Therefore, an amortized mortgage is
one that requires periodic payments that include both interest
and principal. An amortization schedule is a table that
provides a breakdown of the principal and interest payments and
the amount owed at any given point during the amortization
period.
annual
percentage rate (APR)
An interest rate reflecting the cost of a mortgage as a yearly
rate. Because it takes into account points and other credit
costs, the APR is likely to be higher than the mortgage rate. It
is a basis of comparison for mortgage loan costs.
affordability analysis
A detailed analysis of the borrower's ability to buy a home,
made up of factors such as: income, holdings, debts, the type of
mortgage that will be used, the location of the home, and
closing costs.
amenity
A feature of a home (like a pool or a garage) which isn't
crucial to the home's existence. Things like a roof and doors
are not amenities.
appraisal, appraised value
An appraiser's estimate of the value of the property. Banks
require appraisals to determine how much money it will lend you.
appreciation
An increase in the value of a property due to changes in market
conditions or for other reasons, such as additions and
renovations. Opposite of depreciation.
assessment
A local tax levied against a property for a specific purpose,
such as a sewer or streetlights. An assessor is a public
official who establishes the value of a property for taxation.
asset
Anything with a dollar value that you own. Banks consider your
assets when determining how much you can borrow.
assignment
The transfer of a mortgage from one person to another.
assumable mortgage
A mortgage that can be taken over by the next buyer of the home.
The agreement between buyer and seller in which the buyer takes
over the payments on an existing mortgage from the seller is
called an assumption. Assuming a loan is usually
beneficial to both seller and buyer. Because it is an existing
mortgage debt, it lessens the costs and red tape involved,
unlike a new mortgage where closing costs and new (possibly
higher) interest rates may apply. However, the lender usually
charges the buyer an assumption fee if the buyer assumes
an existing mortgage.
B
back-end ratio, or debt ratio
The amount you pay in monthly debt (car payments, credit cards,
student loans, etc.) divided by your gross monthly income.
balloon payment mortgage, term mortgage
A short-term fixed-rate loan which involves small payments for a
certain time period and then one large payment (the balloon
payment, for the remainder of the loan) at a predetermined
date.
betterment
An improvement (such as renovations and additions) that
increases a property's value, different from routine home
maintenance and repairs.
bill
of sale
A written document that attests the transfer of the ownership
(title) of personal property.
biweekly payment mortgage
A mortgage in which you make payments every two weeks instead of
once a month. The result is that instead of making 12 monthly
payments during the year, you make 13. The total amount you pay
equals the amount of 13 payments, because you pay a total of 26
half-payments (one every other week) rather than 12 whole
payments (one every four weeks or so, depending on the month).
The extra payment helps you reduce the principal, substantially
reducing the time it takes to pay off a 30-year mortgage.
blanket mortgage
A mortgage covering two or more pieces of real estate.
blended payments
A repayment method by which the same amount is paid each month,
but the composition of the interest and principal changes with
each payment. With each payment, the amount allocated to the
principal increases as the amount allocated to interest
decreases. Most mortgages use blended payments because it
provides a consistent monthly payment amount for the borrower.
bona fide
Authentic; made or carried out in good faith; real; sincere;
genuine.
borrower (mortgager)
One that mortgages property; a person who applies for and
receives a mortgage loan.
breach
To break or violate an agreement.
broker
A mortgage broker is an individual whose business is to
help arrange funds or negotiate contracts for a client but who
doesn't loan money himself. A real estate broker (real
estate agent) helps you find a house. See realtor.
building codes
Local regulations regarding the design and construction
buildings.
buy
down
A fixed-rate mortgage where the interest rate is "bought down"
for a temporary period, usually one to three years. After that
time, the borrower's payment is calculated at the note rate. In
order to temporarily buy down the initial rate, a lump sum is
paid to the lender and held in an account used to supplement the
borrower's monthly payment. These funds usually come from the
seller as an incentive to induce someone to buy their property.
C
call
option
A clause in the mortgage that gives the lender the right to
"call" the mortgage due and payable at the end of a given length
of time, for whatever reason.
capital expenditure
The cost of an improvement made either to extend the life of a
property or to increase its value.
capital improvement
Any item, structure or addition which is a permanent improvement
to the property.
caps
(interest)
Limits on the amount that the interest rate on an ARM can change
per year and/or during the life of the loan. Payment caps limit
the amount that monthly payments for an ARM may change.
cash
flow
The amount of cash gained over a period of time from an
income-producing property. It should be enough to pay the
expenses for that property (mortgage payment , maintenance,
utilities, etc.)
certificate of deposit
A certificate from a bank stating that the named party has a
specified sum on deposit, usually for a given period of time at
a fixed rate of interest.
certificate of eligibility
A document given to qualified veterans entitling them to VA
loans for homes or businesses.
certificate of reasonable value (CRV)
An appraisal issued by the VA showing a property's current
market value.
certificate of title
A document which confirms that the title to a property is
legally held by the current owner.
certificate of veteran status
The document given to veterans or reservists who have served 90
days of continuous active duty (including training time). This
document enables veterans to obtain lower down payments on
certain FHA-insured loans.
chain
of title
The history of all of the title transfers (conveyances and
encumbrances) to a piece of real estate.
change
frequency
The frequency of payment and/or interest rate changes in an ARM,
usually expressed in months.
chattel
Personal property.
clear
title
A title that is free of liens and mortgages.
closing
The final meeting between the buyer, seller and lender (or their
agents) at which the property and funds legally change hands.
closing costs
Expenses incurred by buyers and sellers in transferring
ownership of a property, such as an origination fee, taxes,
title insurance, transfer fees , points, title charges, credit
report fee, document preparation fee, mortgage insurance
premium, inspections, appraisals, prepayments for property
taxes, deed recording fee, and homeowners insurance.
closing statement
A detailed written summary of the financial settlement of a real
estate transaction, showing all charges and credits made, all
cash received and paid.
cloud
on title
Anything found by the title search which indicates that a
property is not owned free and clear by the purported owner.
collateral
Something of value (such as a car or a home) deposited with a
lender to guarantee the repayment of a loan. The borrower risks
losing the asset if the loan is not repaid properly.
collection
Forcing a borrower to pay what he owes on a loan.
commission
The compensation paid to a real estate broker (or by the broker
to the salesman) for services rendered. It is usually a
predetermined percentage of the selling price.
commitment
A promise by a lender to make a loan to a borrower or builder,
or a promise by an investor to purchase mortgages from a lender.
comps,
comparables
Comparable properties; properties in close proximity which have
sold recently that are about the same size with similar
amenities, used to determine value of a property by comparison.
compound interest
Interest computed on the principal and the unpaid accumulated
interest of a loan.
condominium
A building (or group of buildings) in which individuals own
separate portions of the building(s) and possibly share common
areas.
construction loan (interim loan)
A loan to provide the funds necessary to pay for the
construction of buildings or homes. The lender advances funds to
the builder at periodic intervals as the work progresses.
contingency
A specific condition that must be met before a contract is
legally binding. Usually that the house must pass the home
inspection and the borrower must get a loan.
contract for deed (conditional sales contract, installment
contract)
A contract for the sale of real estate where the deed (title) of
the property is transferred only after all payments have been
made. This is a risky contract, because buyers can lose their
entire investment if the owner declares bankruptcy before the
deed has been transferred.
contract of sale
Agreement between the buyer and seller which conveys title after
certain conditions are met, outlining purchase price, terms,
etc.
conventional loan
A mortgage loan not insured by the FHA or guaranteed by the VA.
convertibility clause
A clause in some ARMs which allows the buyer (borrower) to
change to a fixed-rate mortgage at a specified time.
conveyance
A written document (such as a deed or lease) that transfers
ownership interest in a property from one person to another.
cooperative (co-op)
Residents of co-op housing complexes own shares in the
cooperative corporation that owns the property. Each resident
has the right to occupy a specific dwelling, but they don't
actually own it--they own shares in the corporation that owns
it.
creditor
A person or entity (a bank or other lender) who funded the loan
and to whom a debt is owed.
cul-de-sac
A dead-end street with a turn-around space at the end. These are
attractive to some homeowners because the ending street cuts
down on 'thru' traffic, speeding, etc.
D
debt-to-income ratio
The ratio (expressed as a percentage) which describes a
borrower's monthly payments on long-term debts divided by their
"net effective income" (for FHA and VA loans) or gross monthly
income (for conventional loans).
deed
of trust
Used in place of a mortgage to secure the payment of a note (not
in every state).
default
Failure to make your monthly payments.
deferred interest
Unpaid interest added to the loan balance.
delinquency
Failure to make payments on time.
Department of Veterans Affairs (VA)
An independent governmental agency which guarantees long-term,
low- or no-money-down mortgages to eligible veterans.
depreciation
A decline in a property's value.
discrimination in advertising
HUD does not allow the use of words of a discriminatory nature
in any printed or published material. For example, adult
building, Jewish home, restricted, private, integrated and
traditional.
down
payment
Usually 10-20 percent of the sales price (on conventional loans)
paid by the buyer at the time of purchase. Comprises the
difference between the purchase price and the mortgaged amount.
due-on-interest
A mortgage clause that allows a lender to call a loan due and
payable upon the transfer of the property. Known as "paragraph
17" in FNMA/FHLMC mortgages.
due-on-sale clause
A provision that allows a lender to demand the immediate
repayment of the mortgage balance if the borrower sells the
home.
E
earnest money
Money given by a buyer to a seller as a form of deposit (part of
the purchase price) in order to bind a transaction or to ensure
payment.
easement
A right of way which gives people other than the owner
access to a property.
encroachment
An illegal intrusion on someone else's property.
encumbrance
A lien or claim on a property.
entitlement
VA home loan benefit are known as entitlement and/or
eligibility.
Equal
Credit Opportunity Act (ECOA)
A federal law that requires lenders and other creditors to make
credit equally available without discrimination based on race,
color, religion, national origin, age, sex, marital status, or
receipt of income from public assistance programs.
equity
The value an owner has in real estate over and above the debt of
the property. For example, if a homeowner owns a house valued at
$100,000 and has a mortgage balance of $20,000, the homeowner's
equity is $80,000 (the value minus the mortgage balance). The
homeowner's equity increases or decreases accordingly as the
value of the house increases or decreases. The lender's equity
is equal to the value of the outstanding loan.
escrow
Funds that are set aside and held in trust. Usually used for
payment of taxes, insurance, etc.
F
Fannie
Mae, Federal National Mortgage Association (FNMA)
A corporation created by Congress that purchases and sells
conventional, FHA and VA residential mortgages. Makes mortgage
money more available and affordable.
Farmers Home Administration (FmHA)
An organization that finances loans for farmers and other
qualified borrowers who are unable to obtain loans elsewhere.
Federal Housing Administration (FHA)
A division of the Department of Housing and Urban Development
(HUD) which insures residential mortgage loans made by private
lenders and sets standards for underwriting mortgages. FHA
loans are insured by the FHA and open to all qualified
homebuyers for moderately priced homes almost anywhere in the
country. Borrowers need to be able to put 3-4 percent down, and
higher qualifying ratios make it easier to qualify for FHA
loans. FHA mortgage insurance is a way of insuring an FHA
loan. It requires a small fee (up to 3.8 percent of the loan
amount ) paid at closing or a portion of the fee added to each
monthly payment. Also requires an annual fee of 0.5 percent of
the current loan amount, paid in monthly installments . The
lower the down payment, the more years the fee must be paid.
first
mortgage
The mortgage which is the primary lien against a property.
fixed-rate mortgage
A mortgage with a set interest rate for the entire loan,
regardless of interest rate fluctuations. This creates
consistent, predictable payments, but it's not always the
cheapest option.
foreclosure
A legal process through which the lender forces the sale (or
repossession ) of a mortgaged property because the borrower has
defaulted on (not met the terms of) the mortgage.
Freddie Mac, Federal Home Loan Mortgage Corporation (FHLMC)
A quasi-governmental agency that purchases conventional mortgage
loans from insured depository institutions (savings and loans)
and HUD-approved mortgage bankers.
front-end ratio
Your prospective monthly mortgage payments divided by your gross
monthly income. This comes out to a percentage, and a lender
uses this percentage to get an idea of how much of your income
will be going to pay your loan. If they like the number (say,
below 29%) then they will be more inclined to sell you the loan.
G
Ginnie
Mae, Government National Mortgage Association (GNMA)
A governmental agency that provides sources of funds for
residential FHA-insured or VA-guaranteed mortgages.
government mortgage
A mortgage insured by the FHA or guaranteed by the VA or the
Rural Housing Service (RHS).
graduated payment mortgage (GPM)
A type of flexible-payment mortgage where the payments increase
for a period of time and then level off.
guaranteed mortgage, guaranteed loan
A mortgage guaranteed by a third party.
guaranty
An agreement by which one person assumes responsibility of
assuring payment or fulfillment of another's debts or
obligations, or something given as security for the execution,
completion, or existence (or payment) of something else.
H
hazard
insurance
A form of insurance that protects the insured from specified
losses due to hazards such as fire, flood, wind damage, etc.
home
equity line of credit
A loan against the amount of equity you have in a property. The
equity serves as security for the new loan.
home
inspection
A complete and thorough inspection of the physical condition of
a property, including all major systems and structural elements,
conducted by someone who knows what to look for and who will
disclose the findings to you.
homeowner's insurance
An insurance policy required by many lenders when you take
ownership that combines personal liability insurance and hazard
insurance for the home as well as its contents.
homeowner's warranty
A warranty provided by the seller (or the builder on new homes)
as a condition of the sale. Covers repairs to specified parts of
a house for a specific period of time.
hot
market
A market in which houses are selling fast. Also known as a
seller's market, because the seller will benefit by selling
their house at or above their asking price because,
theoretically, high demand drives the price up.
housing expenses-to-income ratio
A borrower's housing expenses divided by his /her net effective
income (for FHA/VA loans) or gross monthly income (for
conventional loans). Expressed as a percentage.
HUD-1
statement, closing statement, settlement sheet
An itemized listing of whatever costs must be paid at closing,
such as real estate commissions, loan fees, points, and initial
escrow amounts.
I
impound, reserves
A portion of the monthly payment held by the lender to pay for
things like taxes, hazard insurance and mortgage insurance as
they become due.
index
A published interest rate against which lenders measure the
difference between the current interest rate on an ARM and that
earned by other investments (such as one-, three-, and five-year
U.S. Treasury security yields, the monthly average interest rate
on loans closed by savings and loan institutions, and the
monthly average costs-of-funds incurred by savings and loans).
initial interest rate, start rate, teaser
The interest rate of the mortgage at the time of closing.
interest
The amount of money charged for the use of the money borrowed.
interest adjustment
If the closing (the date on which the buyer takes possession of
the property) occurs at a time of the month other than the date
on which the mortgage payment is due, the borrower will pay an
amount to cover interest from the interest adjustment date.
interest rate ceiling
The maximum interest rate for an ARM loan.
interest rate floor
The minimum interest rate for an ARM loan.
interim financing
A construction loan made during completion of a building or a
project which is replaced by a permanent loan once the building
is completed.
investor
A source of money for a lender to loan.
J
jumbo
loan
A loan which is larger than the limits set by the FNMA and the
FHLMC.
K
key
lot
The one property
in a development that is key to the entire development 's
success.
kicker, equity kicker, lender participation
A lender or
investor's right to share any income from a property, in
addition to loan payments.
L
lease-purchase mortgage loan
A way for homebuyers to lease a home with an option to buy from
a nonprofit organization. A portion of each month's rent payment
goes toward principal, interest, taxes, insurance and a down
payment.
lien
A claim upon real or personal property for the satisfaction of
some debt or obligation.
listing price
The price at which a house is listed for sale; the asking price.
loan-to-value ratio
The relationship between the amount of the mortgage loan and the
appraised value of the property.
lock-in
A written agreement from the lender to offer a specified
interest rate if the mortgage closes in a certain time period.
M
margin
The amount a lender adds to the index on an ARM to establish the
adjusted interest rate.
market
value
The amount that a seller may expect to obtain in the open market
.
maturity
The date at which a note or bond is due.
mortgage
A conveyance of or lien against property until it is paid or
until other stipulated terms are met.
mortgage banker
An individual who originates mortgages for resale in the
secondary mortgage market.
mortgage broker
An individual or company that offers loans to borrowers from
numerous sources and is paid a commission for their services.
mortgage insurance
Money paid to insure the mortgage when the down payment is less
than 20 percent.
mortgage insurance premium (MIP)
The 0.5 percent borrowers pay each month on FHA-insured mortgage
loans. It is insurance from the FHA to the lender against
incurring a loss on account of the borrower's default.
mortgagee
The lender; one who holds a mortgage.
mortgagor
The borrower or homeowner; one who mortgages.
N
negative amortization
When your monthly payments are not large enough to pay all the
interest due on the loan, the unpaid interest is added to the
unpaid balance of the loan. The homebuyer ends up owing more
than the original amount of the loan.
negotiable rate mortgage
A loan in which the interest rate is adjusted periodically .
net
effective income
Gross income minus federal income taxes.
no-doc
loan
A loan requiring very little loan documentation. These loans
usually require large (25%) down payments.
non-assumption clause
A statement in a mortgage contract forbidding the assumption of
the mortgage without the lender's approval.
note
A signed obligation to pay a debt.
O
origination fee
The fee (usually a percentage of the loan) a lender charges to
prepare loan documents, make credit checks, inspect and
sometimes appraise a property , etc.
P
permanent loan
A long-term mortgage (10 years or more).
PITI
Principal, interest, taxes and insurance.
pledged account mortgage (PAM)
When the borrower places money in a pledged savings account, and
these funds, plus interest earned, are gradually used to reduce
mortgage payments.
points
Prepaid interest assessed at closing by the lender. Each point
equals 1 percent of the loan amount. (2 points on a $100,000
mortgage would cost $2,000 )
power
of attorney
A legal document authorizing one person to act on behalf of
another.
prepaid expenses
Money necessary to create an escrow account or to adjust the
seller's existing escrow account. Can include taxes, hazard
insurance, private mortgage insurance and special assessments.
prepayment
A privilege in a mortgage which allows the borrower to make
payments before they are due.
prepayment penalty
Fees for early repayment of debt, allowed in 36 states and the
District of Columbia.
primary mortgage market
Lenders making mortgage loans directly to borrowers such as
savings and loan associations, commercial banks, and mortgage
companies. These lenders sometimes sell their mortgages into the
secondary mortgage markets such as FNMA or GNMA, etc.
principal
The amount of debt, not counting interest, left on a loan.
private mortgage insurance (PMI)
Default insurance for conventional loans, normally required with
smaller down-payment loans.
Q
qualification rate
Rate of interest
used to calculate whether or not a borrower qualifies for a
mortgage.
qualification requirements
guidelines used
by lenders to decide whether to loan money to an applicant.
qualified acceptance, conditional acceptance
acceptance for a
loan (or other contract) provided that certain conditions are
met.
qualified buyer
A person who has been pre-approved for a mortgage loan .
quantum
A quantity or
amount, a specified portion.
quit
claim deed
A document that
transfers a title, right or claim to another person, giving up
all claims to a possession.
R
radon
A radioactive gas which seeps up from the ground and can cause
health problems. A radon test is often part of the home
inspection.
realtor
A real estate broker or an associate holding active membership
in a local real estate board affiliated with the National
Association of Realtors.
recision
The cancellation of a contract.
recording fees
Money paid to the lender for recording a home sale with local
authorities, making it public record.
refinance
Obtaining a new mortgage loan on a property already owned, often
to replace existing loans.
Real
Estate Settlement Procedures Act (RESPA)
A federal law that allows consumers to review information on
known or estimated settlement costs once after
application and once prior to (or at) settlement.
reverse annuity mortgage (RAM)
A mortgage in which the lender makes periodic payments to the
borrower using the borrower's equity in the home as collateral.
right
of first refusal
A portion of an agreement that requires a property owner to give
one party the opportunity to buy or lease the property before
the property is made available to other potential buyers.
S
sale
price
The price at which the house actually sold. The difference
between a home's sale price and the listing price is useful for
buyers in making offers on comparable homes.
satisfaction of mortgage, release of mortgage
The document issued by the mortgagee when the mortgage loan is
paid in full.
second
mortgage
A mortgage made subsequent to the primary mortgage.
secondary mortgage market
The market in which primary mortgage lenders sell their loans to
obtain more funds to originate more new loans.
security interest
Interest that a lender takes in the borrower's property to
assure repayment of a debt.
servicing
The operations a lender performs to keep a loan in good
standing, such as collection of payments and payment of taxes,
insurance, property inspections, etc.
shared
appreciation mortgage (SAM)
A mortgage in which a borrower receives a below-market interest
rate and, in return, the lender (or other investor) receives a
portion of the future appreciation in the value of the property.
simple
interest
Interest which is computed only on the principal balance.
soft
market
A market where houses aren't selling much or quickly, so the
sales price is likely to be significantly lower than the asking
(listing) price. It's a good time for buyers to buy, but not the
best time for prospective sellers to sell.
survey
A detailed measurement of a property, including the location of
the land in reference to known points, its dimensions, and the
location and dimensions of any structures on the land. Prepared
by a registered land surveyor.
sweat
equity
Equity created by a purchaser performing work on a property
being mortgaged.
T
term
The lifespan of the contract to repay a loan.
title
A document that gives evidence of an individual's ownership of
property .
title
insurance
Insurance, usually issued by a title insurance company, which
insures a homebuyer against errors in the title search. The cost
of the policy is usually a percentage of the property value.
title
search
The examination of municipal records by a title company to
determine the legal ownership of property.
truth-in-lending
A federal law requiring disclosure of the APR to homebuyers
shortly after they apply for the loan.
two-step mortgage, premier mortgage
A mortgage in which the borrower receives a below-market
interest rate for a specified number of years (7-10) and then
receives a new interest rate adjusted (within limits) to market
conditions at that time.
U
underwriting
The decision whether to make a loan to a potential homebuyer
based on credit, employment, assets, and other factors, and the
matching of this risk to an appropriate rate and term or loan
amount.
usury
Interest charged in excess of the legal rate established by law.
V
VA
loan
A long-term, low- or no-down-payment loan guaranteed by the
Department of Veterans Affairs restricted to those qualified by
military service or other entitlements .
VA
mortgage funding fee
A premium of up to 1-7/8 percent (depending on the size of the
down payment) paid on a VA-backed loan.
W
waive
To give up a
claim or right voluntarily, to relinquish. A waiver is a
document that evidences that relinquishment.
walk-through inspection
A final
walk-through immediately prior to closing to verify that no
changes have taken place and no new damage has occurred.
wear
and tear
Normal use and
the resulting reduction in value of a property .
wraparound mortgage
A mortgage that
encompasses the balance of one mortgage plus an additional
mortgage loan. Payments are then made to the mortgagee of the
wraparound mortgage, who forwards appropriate portions of that
money to the mortgagee of the first mortgage.
Z
zoning
City regulations determining the character or use of property.
Zoning laws divide cities into different areas according to
use, from single-family residences to industrial plants.
Zoning ordinances control the size, location , and use of
buildings within these different areas.
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Our search on the left
called "South Florida Listings" includes real estate in the following
cities: Alachua, Alafaya, Alford, Allandale, Alligator Point, Aloma, Altamonte
Springs, Altha, Altoona, Alturas, Alva, Amelia Island, Anna Maria,
Anthony, Apalachicola, Apollo Beach, Apopka, Arcadia, Archer, Argyle,
Aripeka, Astatula, Astor, Atlantic Bch, Atlantic Beach,Atlantis, Auburndale, Aventura, Aviation, Avon Park, Azalea Park, Babson
Park, Bagdad, Baker, Bal Harbour, Baldwin, Balm, Barberville,
Barefoot Bay, Bartow, Bascom, Basinger, Bay Harbor Islands, Bay Pines,
Bayonet Point, Bell, Belle Glade, Belle Isle,Belleair, Belleair Beach, Belleair Bluffs, Belleair Shores, Belleview,
Bellview, Beverly Hills, Big Coppitt Key, Big Pine Key, Big Torch Key,
Biscayne Park, Blountstown, Boca Grande, Boca Raton, Bokeelia, Bonifay,
Bonita Springs, Bostwick, Bowling Green, Boynton Beach, Braden River,
Bradenton, Bradenton Beach, Bradley, Brandon, Branford, Brent, Briny
Breezes, Bristol, Bronson, Brooker, Brooksville, Bruce, Bryant,
Bryceville, Buena Ventura Lakes, Bunnell, Bushnell, Callahan,
Campbellton, Canal Point, Canaveral Air Station, Candler, Cantonment,
Cape Canaveral, Cape Coral, Cape Haze, Cape San Blas, Captiva, Carl
Fisher, Carol City, Carrabelle, Carrollwood, Caryville, Cassadaga,
Casselberry, Cedar Key, Celebration, Center Hill, Century,
Champions Gate, Chattahoochee, Chiefland, Chipley, Chokoloskee,
Christmas, Chuluota, Citra, Citrus Springs, City Of Sunrise, Clair Mel
City, Clarksville, Clearwater, Clearwater Beach, Clermont, Clewiston,
Cloud Lake, Cocoa, Cocoa Beach, Coconut Creek, Coconut Grove, Coleman,
Conch Key, Cooper City, Copeland, Coral Gables, Coral Springs, Cortez,
Cottondale,Country Lakes, Crawfordville, Crescent Beach, Crescent City, Crestview,
Cross City, Cross Creek, Crystal Beach, Crystal River,Crystal Springs, Cudjoe Key, Cutler Bay, Cypress, Cypress Gardens, Dade
City, Dania, Dania Beach, Davenport, Davie, Day,Daytona Beach, Daytona Beach Shores, De Leon Springs, Debary, Deer
Island, Deerfield Beach, Defuniak Springs, Deland, Delray Beach,Deltona,
Destin, Dinsmore, Doctors Inlet, Dona Vista, Doral, Dover, Dowling Park,
Downtown, Duck Key, Duette, Dundee, Dunedin, Dunnellon, Durant, E
Rockland Key, Eagle Lake, Earleton, East Palatka, Eastlake Weir,
Eastpoint, Eaton Park, Eatonville, Eau Gallie, Ebro, Edgar, Edgewater,
Edgewood, El Jobean, El Portal, Elfers, Elkton, Ellenton, Eloise,
Englewood, Enterprise, Estero, Eustis, Everglades City, Evinston,
Fairfield, Fanning Springs, Fedhaven, Felda, Fellsmere, Fern Park,
Fernandina Beach, Ferndale, Flagler Beach, Flamingo Lodge,
Fleming Island, Florahome, Floral City, Florence Villa, Florida City,
Florida State University, Forest City, Forest Lakes, Fort Lauderdale,
Fort Mc Coy, Fort Meade, Fort Myers,Fort Myers Beach, Fort Ogden, Fort Pierce, Fort Walton Beach, Fort
White, Fountain, Freeport, Frostproof, Fruit Cove, Fruitland Park,
Fruitville, Gainesville, Geneva, Georgetown, Gibsonton, Glen Ridge, Glen
Saint Mary, Glenwood, Golden Beach, Golden Gate, Golden Isles Postal
Store, Gonzalez, Goodland, Gotha, Goulds, Graceville, Graham, Grand
Island, Grand Ridge, Grandin,Grant, Grassy Key, Green Cove Springs, Greenacres, Greensboro,
Greenville, Greenwood, Grenelefe, Gretna, Grove City, Groveland, Gulf
Breeze, Gulf Gate Branch, Gulf Hammock, Gulf Stream, Gulfport, Haines
City, Haines Creek, Hallandale, Hallandale Beach, Hampton, Harmony,
Harold, Hastings, Havana, Haverhill, Hawthorne, Heathrow, Hernando,
Hernando Beach, Hialeah, Hialeah Gardens, Hiawassee, High Springs,
Highland Beach, Highland City, Hilliard, Hillsboro Beach, Hobe Sound,Holder, Holiday, Hollister, Holly Hill, Hollywood, Holmes Beach, Holt,
Homeland, Homestead, Homosassa, Homosassa Springs, Horseshoe Bch,
Horseshoe Beach, Hosford, Howey In The Hills, Hudson,
Hutchinson Island, Hypoluxo, Indialantic, Indian Creek, Indian Creek
Village, Indian Harbor Beach, Indian Harbour Beach, Indian Lake Estates,
Indian River Shores, Indian Rocks Beach, Indian Shores, Indiantown,
Inglis, Intercession City, Interchange Square, Interlachen,
Inverness,
Islamorada,
Island Grove, Island Walk,
Istachatta,
Jacksonville,
Jacksonville Beach,
Jacob,
Jasper,
Jay,
Jennings,
Jensen Beach,
Jonesville,
Juno Beach,
Jupiter,
Jupiter Inlet Colony,
Kathleen,
Kenansville,
Kendall,
Kenneth City,
Key Biscayne,
Key Colony Beach,
Key Largo,
Key West,
Keystone Heights,
Kinard,
Kissimmee,
La Crosse,
Labelle,
Lacoochee,
Lady Lake,
Lake Alfred,
Lake Buena Vista,
Lake Butler,
Lake City,
Lake Clarke Shores,
Lake Como,
Lake Geneva,
Lake Hamilton,
Lake Helen,
Lake Jackson Branch,
Lake Mary,
Lake Monroe,
Lake Panasoffkee,
Lake Park,
Lake Placid,
Lake Suzy,
Lake Wales,
Lake Worth,
Lakeland,
Lakeshore,
Lakewood Park,
Lakewood Ranch,
Lamont,
Lanark Village,
Land O Lakes,
Lantana,
Largo,
Lauderdale By The Sea,
Lauderdale Lakes,
Lauderhill,
Laurel,
Laurel Hill,
Lawtey,
Lazy Lake,
Lecanto,
Lee,
Leesburg,
Lehigh Acres,
Lighthouse Point,
Lithia,
Little Torch Key,
Live Oak,
Lk Forest,
Lloyd,
Lochloosa,
Lockhart,
Long Key,
Longboat Key,
Longwood,
Lorida,
Loughman,
Lowell,
Loxahatchee,
Lutz,
Lynn Haven,
Macclenny,
Macdill Afb,
Madeira Beach,
Madison,
Maitland,
Malabar,
Malone,
Manalapan,
Manatee Contract Branch,
Mango,
Marathon,
Marco Island,
Margate,
Marianna,
Maricamp,
Mary Esther,
Masaryktown,
Mascotte,
Matlacha,
Matlacha Isles,
Maxville,
Mayo,
Mc Alpin,
Mc David,
Mc Intosh,
Medley,
Melbourne,
Melbourne Beach,
Melbourne Village,
Melrose,
Melrose Vista,
Merritt Island,
Mexico Beach,
Miami,
Miami Beach,
Miami Gardens,
Miami Lakes,
Miami Shores,
Miami Springs,
Micanopy,
Micco,
Miccosukee,
Mid Florida,
Mid Venice,
Middleburg,
Midway,
Milligan,
Milton,
Mims,
Minneola,
Miramar,
Miramar Beach,
Miromar Lakes,
Molino,
Monticello,
Montverde,
Moore Haven,
Morriston,
Mossy Head,
Mount Dora,
Mount Pleasant,
Mount Plymouth,
Mt Pleasant,
Mulberry,
Murdock,
Myakka City,
N Fort Myers,
Naples,
Naranja,
Navarre,
Neptune Beach,
New Port Richey,
New Smyrna Beach,
Newberry,
Niceville,
Nichols,
Nobleton,
Nocatee,
Nokomis,
Noma,
North Bay Village,
North Cleveland,
North Fort Myers,
North Lauderdale,
North Miami,
North Miami Beach,
North Palm Beach,
North Port,
North Redington Beach,
North Venice,
Northdale,
O Brien,
Oak Hill,
Oakland,
Oakland Park,
Ocala,
Ocean Ridge,
Ochlockonee Bay,
Ochopee,
Ocklawaha,
Ocoee,
Odessa,
Ojus,
Okahumpka,
Okeechobee,
Old Town,
Oldsmar,
Olustee,
Olympia Heights,
Ona,
Oneco,
Opa Locka,
Orange City,
Orange Lake,
Orange Park,
Orange Springs,
Orchid,
Orlando,
Ormond Beach,
Osprey,
Osteen,
Otter Creek,
Overstreet,
Oviedo,
Oxford,
Ozona,
Pace,
Pahokee,
Paisley,
Palatka,
Palm Bay,
Palm Beach,
Palm Beach Gardens,
Palm Beach Shores,
Palm City,
Palm Coast,
Palm Harbor,
Palm Springs,
Palma Ceia,
Palmdale,
Palmetto,
Panacea,
Panama City,
Panama City Beach,
Parkland,
Parrish,
Pass A Grille Beach,
Paxton,
Pembroke Park,
Pembroke Pines,
Penney Farms,
Pensacola,
Pensacola Beach,
Perrine,
Perry,
Pierson,
Pine Hills,
Pinecraft,
Pinecrest,
Pineland,
Pinellas Park,
Pinetta,
Placida,
Plant City,
Plantation,
Plymouth,
Poinciana,
Point Washington,
Polk City,
Pomona Park,
Pompano Beach,
Ponce De Leon,
Ponce Inlet,
Ponte Vedra,
Ponte Vedra Beach,
Port Canaveral,
Port Charlotte,
Port Orange,
Port Richey,
Port Saint Joe,
Port Saint John,
Port Saint Lucie,
Port Salerno,
Princeton,
Pt Orange,
Punta Gorda,
Putnam Hall,
Quincy,
Raiford,
Ramrod Key,
Red Bay,
Reddick,
Redington Beach,
Redington Shores,
Redland,
Renaissance,
Reunion,
Richland,
Ridge Manor,
Ridge Manor Estates,
River Ranch,
Riverview,
Riviera Beach,
Rockledge,
Roseland,
Rosemary Beach,
Rotonda West,
Royal Palm Beach,
Royal Plm Beach,
Rubonia,
Ruskin,
Safety Harbor,
Saint Augustine,
Saint Cloud,
Saint George Island,
Saint James City,
Saint Leo,
Saint Lucie West,
Saint Marks,
Saint Pete Beach,
Saint Petersburg,
Saint Teresa,
Salt Springs,
San Antonio,
San Mateo,
Sanderson,
Sandestin,
Sanford,
Sanibel,
Santa Rosa Beach,
Sarasota,
Satellite Beach,
Satsuma,
Scottsmoor,
Se Central Contract Branch,
Sea Ranch Lakes,
Sebastian,
Sebring,
Seffner,
Seminole,
Seville,
Sewalls Point,
Shady Grove,
Shady Hills,
Shalimar,
Sidell,
Siesta Key,
Silver Springs,
Singer Island,
Sneads,
Sopchoppy,
Sorrento,
South Bay,
South Daytona,
South Florida,
South Miami,
South Palm Beach,
South Pasadena,
South Venice,
Southport,
Southwest Ranches,
Sparr,
Spring Hill,
Starke,
Steinhatchee,
Stock Island,
Stuart,
Sugarloaf,
Sumatra,
Summerfield,
Summerland Key,
Sumterville,
Sun City,
Sun City Center,
Sunny Hills,
Sunny Isles Beach,
Sunrise,
Suntree,
Surfside,
Suwannee,
Switzerland,
Sydney,
Tallahassee,
Tallevast,
Tamarac,
Tampa,
Tampa Palms,
Tangerine,
Tarpon Springs,
Tavares,
Tavernier,
Telogia,
Temple Terrace,
Tequesta,
Terra Ceia,
Terra Ceia Island,
The Villages,
Thonotosassa,
Tierra Verde,
Tiger Point,
Titusville,
Town N Country,
Treasure Island,
Trenton,
Trilby,
Trinity,
Tropic,
Uleta,
Umatilla,
Union Park,
University,
University Of Miami,
University Of Tampa,
University Park,
Valparaiso,
Valrico,
Venice,
Venus,
Vernon,
Vero Beach,
Viera,
Village Of Golf,
Village Of Palmetto Bay,
Virginia Gardens,
Wabasso,
Wachula,
Wacissa,
Wahneta,
Wakulla Springs,
Waldo,
Walnut Hill,
Warm Mineral Springs,
Watersound,
Wauchula,
Wausau,
Waverly,
Webster,
Weeki Wachee,
Weirsdale,
Welaka,
Wellborn,
Wellington,
Wesley Chapel,
West Beach Station,
West Hollywood,
West Melbourne,
West Miami,
West Palm Beach,
Westchase,
Weston,
Westville,
Wewahitchka,
White Springs,
Wilbur By The Sea,
Wildwood,
Williston,
Wilton Manors,
Wimauma,
Windermere,
Winter Beach,
Winter Garden,
Winter Haven,
Winter Park,
Winter Springs,
Woodville,
Worthington Springs,
Yalaha,
Yankeetown,
Ybor City,
Yeehaw Junction,
Youngstown,
Yulee,
Zellwood,
Zephyrhills,
Zolfo Springs,
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