A


• Abandonment: (1) Turning damaged property over to an insurer and claiming its full value. (2) The elimination of an asset or property from use (3) Investments, The refusal of a shipment, because of damage, by the person who is authorized to ship it.
• Abatement: A reduction or decrease. Usually applies to a decrease of assessed valuation of ad valorem taxes after the assessment and levy.
• Absolute Gift: A gift of property by will which carries with it possession of and complete dominion over the property, opposed to a conditional gift.
• Absolute Title: A legal document stating that a person or other legal entity has the unqualified right of ownership to some personal or real property.
• Abstract: A summary; an abridgment. Before the use of photostatic copying, public records were kept by abstracts of recorded documents.
• Abstract of Title: A summary prepared by a licensed abstractor of all documents recorded in the public records of the political subdivision where the land is located.
• Abutting Owner: One whose land is contiguous to (abuts) a public right of way.
• Accelerated Depreciation: A method of asset amortization that attempts to equate the book value of an asset to its market value at any point in time by making larger deductions in the earlier years of the asset's life.
• Acceleration: The right of the mortgagee (lender) to demand the immediate repayment of the mortgage loan balance upon the default of the mortgagor (borrower), or by using the right vested in the Due-on-Sale Clause.
• Acceleration Clause: Clause in a deed of trust or mortgage, which accelerates, or hastens, the time when the indebtedness becomes due. For example, some deeds of trust contain a provision (an acceleration clause) stating that the note shall become due immediately upon the sale of the land or upon failure to pay interest or an installment of principal and interest.
• Access: (1) The ability and means necessary to store or retrieve data, to communicate with, or to make use of any portions of an EDP system. (2) The control of physical movement to or from a sensitive are. (3) The right of authorized parties to ad to, reduce or examine the contents of a safe deposit box.
• Access Right: A right to ingress and egress to and from one's property. May be express or implied.
• Accord and Satisfaction: A substitution of another agreement between the parties in satisfaction of a former one, and execution of the new agreement.
• Account: (1) Credit established under a particular name, usually by deposit, against which withdrawals may be made. (2) A record of the financial transactions affecting a particular phase of business. The financial transactions are dated and entered in the account as debits or credits. (3) As used in the Electronic Fund Transfer Act, account means a demand deposit, savings deposit, or other asset account established primarily for personal, family or household purposes.
• Acknowledgement: A formal declaration before a duly authorized officer (such as a notary public) by a person who has executed an instrument that such execution is his own act and deed. An acknowledgment is necessary to entitle an instrument (with certain specific exceptions) to be recorded, to impart constructive notice of its contents and to entitle the instrument to be used as evidence without further proof. The certificate of acknowledgment is attached to the instrument or incorporated therein.
• Ad Valorem: "According to value." A method of taxation using the value of the thing taxed to determine the amount of tax. Taxes can be either "ad valorem" or "specific." Example: a tax of $5.00 per $1000.00 of value per house is "ad valorem." A tax of $5.00 per house (irrespective of value is specific.
• Addendum: Something added. A list or other material added to a document, letter, contractual agreement, escrow instructions, etc. (see also Amendment).
• Additional Deposit: A buyer of real property will generally give a small deposit with an offer, and a more substantial deposit after the offer has been accepted. The second deposit is the "additional deposit."
• Adjacent: Close to. May or may not be contiguous (touching).
• Adjoining: Touching or contiguous to.
• Adjustable Mortgage Loans (AML'S): Mortgage loans under which the interest rate is periodically adjusted to more closely coincide with current rates. The amounts and times of adjustment are agreed to at the inception of the loan. Also called: Adjustable Rate Loans, Adjustable Rate Mortgages (ARM'S), Flexible Rate Loans, And Variable Rate Loans. (See also: Indexing, Rate Index).
• Adjustable-rate mortgage (ARM): A mortgage whose interest rate changes over time based on an index and a margin. Rate changes are made in prescribed times and within prescribed limits (caps) as defined in the mortgage contract.
• Adjusted Basis: The cost of a property plus the value of any capital expenditures for improvements to the property minus any depreciation taken.
• Adjustment Interval: On an adjustable rate mortgage, the time between changes in the interest rate and/or monthly payment, typically one, three or five years depending on the index.
• Adjustment Period: The period elapsing between adjustment dates for an adjustable-rate mortgage (ARM).
• Administrator: A person appointed by the probate court to carry out the administration of a decedent's estate when the decedent has left no will. If a woman is appointed, she is called an administratrix.
• Administrator's Deed: A conveyancing instrument used by an administrator to transfer property from an estate. (See Administrator).
• Adverse Land Use: A use which causes surrounding property to lose value, such as an industrial development in a residential area.
• Adverse Possession: Method of acquiring real property under certain conditions by possession for a statutory period.
• Affirmative Easement: An easement described from the benefited estate (dominant tenement). Also called a parcel 2 easement. The same easement described from the burdened estate (servient tenement) would be a negative easement.
• Agency: Any relationship in which one party (agent) acts for or represents another (principal) under the authority of the latter agency involving real property should be in writing, such as listings, trusts, powers of attorney, etc.
• Agency Agreement: In some states, the term describing a listing under which the broker's commission is protected against a sale by other agents but not by a sale by the principal. Called a "not-exclusive" listing in some states.
• Agent: One who is authorized to act for or represent another (principal), usually in business matters. Authority may be express or implied.
• Agent for Service of Process: The person or entity that is authorized to receive legal papers on behalf of a corporation.
• Agreement: A general term usually describing a common view of two or more people regarding the rights and obligations of each with regard to a given subject. Not necessarily a contract, although all contracts are agreements.
• Agreement of Sale: A written contract entered into between the seller (vendor) and buyer (vendee) for sale of real property (land) on an installment or deferred payment plan. It is also known as an agreement to convey, a long form Security Agreement, or a real estate installment contract.
• Alan Greenspan: The Federal Reserve Board Chairman since August 11, 1987. Also serves as Chairman of the Federal Open Market Committee. Many credit him with the sustained growth of the U.S. economy.
• Alienation: Transfer of property from one owner to another
• Alienation Clause: A type of acceleration clause, calling for a debt under a mortgage or deed of trust to be due in its entirety upon transfer of ownership of the secured property. Also called a "due-on-sale" clause.
• All-Inclusive Rate: Rate which includes charges for title insurance, searching or abstract fees and examination fees.
• Allocation: A method for appraising a site (land) by comparing other site values as a percentage of total value of a site (including \improvements). Property x has a total (improved) value of $100,000. The land is worth $35,000. The term is often (and incorrectly) used synonymously with abstraction.
• ALTA (American Land Title Association): Organization composed of title insurance firms which sets standards for the industry, including title insurance policy forms used on a national basis.
• Alteration: Changing or making different.
• Amendment: Changes to alter, add to, or correct part of an agreement without changing the principal idea or essence.
• Amortization: Means loan payment by equal periodic payment calculated to pay off the debt at the end of a fixed period, including accrued interest on the outstanding balance.
• Amortization Schedule: A timetable for payment of a mortgage showing the amount of each payment applied to interest and principal and the remaining balance on the loan.
• Amortization Term: The length of time required to amortize the mortgage loan expressed as a number of months. For example, 360 months is the amortization term for a 30-year fixed-rate mortgage.
• Amortized Loan: A loan that is paid off, both interest and principal, by regular payments that are equal or nearly equal.
• Ancillary: A proceeding which is auxiliary or subordinate to another proceeding. In probate, a proceeding in a state where a decedent owned property but was not domiciled.,
• Annotations: Remarks, notes, case summaries, or commentaries following statutes which describe interpretations of the statute.
• Annual Percentage Rate (A.P.R.): APR is a measurement of the full cost of a loan including interest and loan fees expressed as a yearly percentage rate. Because all lenders apply the same rules in calculating the annual percentage rate, it provides consumers with a good basis for comparing the cost of loans.
• Annualized: Translating the figures for a given year into an annual rate.
• Apartment: One or more rooms of a building used as a place to live, in a building containing at least one other unit used for the same purpose. Usually has, at least, cooking facilities, a bathroom, and a place to sleep. Those who live in these units pay rent for their use, usually on a monthly basis.
• Appraisal: An opinion of value based upon a factual analysis. Legally, an estimation of value by two disinterested persons of suitable qualifications.
• Appraisal Methods: Generally, three major methods of appraisal: cost approach, income approach, market value (comparables) approach.
• Appraisal Report: A written report by an appraiser containing his opinion as to the value of a property and the reasoning leading to this opinion. The factual data supporting the opinion, such as comparables, appraisal formulas, and qualifications of the appraiser, will also be set forth.
• Appraised Value: An opinion of the value of a property at a given time, based on facts regarding the location, improvements, etc., of the property and surroundings.
• Appraiser: One who is trained and educated in the methods of determining the value of property through analysis of various factors which determine said value.
• Appreciation: An increased value of property due to either a positive improvement of the area or the elimination of negative factors. Commonly, and incorrectly, used to describe an increase in value through inflation.
• Approved Attorney: An attorney whose opinion is acceptable to a title company as the basis for issuance of a title insurance policy by the insurer. The insurer, rather than the attorney, executes the policy.
• Appurtenance: Something belonging to something else, either attached or not, such as a barn to a house, or an easement to the land. The appurtenance is part of the property and passes with it upon sale or other transfer.
• As Is: A contract clause indicating the seller will not fix any problems with the property.
• Assess: To fix a value; to appraise. Most commonly used in connection with taxes.
• Assessed Value: Value placed upon property for property tax purposes by the tax assessor.
• Assessment: A local tax levied against a property for a specific purpose, such as a sewer or street lights.
• Asset: Anything of value owned by a company or individual. Assets include cash, investments, and physical property
• Assets: Everything owned by a person or corporation which can be used for the payment of debts.
• Assign: To transfer to another to whom property is assigned.
• Assignment: The transfer of a mortgage from one person to another.
• Assumability: An assumable mortgage can be transferred from the seller to the new buyer. Generally requires a credit review of the new borrower and lenders may charge a fee for the assumption. If a mortgage contains a due-on-sale clause, it may not be assumed by a new buyer.
• Assumable Mortgage: A mortgage that can be taken over ("assumed") by the buyer when a home is sold.
• Assumption: The act of conveying real property; taking title to a property with the Buyer assuming liability for paying an existing note secured by a deed of trust against the property.
• Assumption Fee: Lender's charge for paperwork involved in processing records for a new buyer assuming an existing loan.
• Assumption of Mortgage: Agreement by a buyer to assume the liability under an existing note secured by a mortgage or deed of trust. The lender usually must approve the new debtor in order to release the existing debtor (usually the seller) from liability.

B


• Balance Due That dollar amount representing the sum of the previous balance due plus cash advances and merchandise purchases for the billing period less credit for payments and/or merchandise returned plus any appropriate finance charge.
• Balance of Account That amount necessary to equate the total debits and total credits posted to any given account.
• Balance Owing The amount outstanding.
• Balloon (1) The final payment of a balloon note. (2) A landlocked parcel of land.
• Balloon Mortgage A loan which is amortized for a longer period than the term of the loan. Usually this refers to a thirty-year amortization and a five year term. At the end of the term of the loan, the remaining outstanding principal on the loan is due. This final payment is known as a balloon payment.
• Balloon Note A note calling for periodic payments which are insufficient to fully amortize the face amount of the note prior to maturity, so that a principal sum known as a "balloon" is due at maturity.
• Balloon Payment The final lump sum paid at the maturity date of a balloon mortgage.
• Bank Examiner The individual who performs the bank examination.
• Bank Identification A series of digits used to identify a particular bank.
• Base Line (1) A survey line used in the government survey to establish township lines. The base line runs east and west through a principal meridian (line running north and south). (2) A horizontal elevation line used as the centerline in a survey for a highway route.
• Base Map A map having background information, such as state, county, or city boundaries, upon which more detailed data is plotted.
• Base Property Private property owned by a cattle owner required before a permit will be issued to allow the cattle to graze on public land. A union of workers organized to increase group welfare by bargaining as a single force for wages and benefits.
• Base Title The result of an examination of title for the internal use of a title insurance company. Usually covers a large area and is done in anticipation of future sales or subdividing of the area.
• Beneficiary Someone named to receive property or benefits in a will. In a trust, a person who is to receive benefits from the trust.
• Bequeath To give a gift to someone through a will.
• Bequests Gifts made in a will.
• Bias The difference between the expected value of an estimator and the actual value to be estimated.
• Binder (1) A report issued by a title insurance company setting forth the condition of title to certain property as of a certain date, and also setting forth conditions which, if satisfied, will cause a policy of title insurance to be issued. Also called a commitment. (see also preliminary title report). (2) a policy of title insurance (used primarily by investors) calling for a reduced rate for a future policy if the property is sold within a specified period.
• Blanket Mortgage A mortgage covering at least two pieces of real estate as security for the same mortgage.
• Blanket Mortgage or Trust Deed A mortgage or trust deed that covers more than one lot or parcel of real property, and often an entire subdivision. As individual lots are sold, a partial reconveyance from the blanket mortgage is ordinarily obtained.
• Bona Fide A legal term which refers to any actions, situations, or persons that are honest, in good faith, and without fraud.
• Bona Fide Purchaser a purchaser in good faith, for valuable consideration, without notice or knowledge of adverse claims of others. Sometimes abbreviated to b.f.p.
• Borrower (Mortgagor) One who applies for and receives a loan in the form of a mortgage with the intention of repaying the loan in full.
• Boundary A separation, natural or artificial, which marks the division of two contiguous properties.
• Branch A subordinate or division office of ABC Company, as opposed to an affiliate, agent, subsidiary or underwritten firm associated with the Company.
• Breach The breaking or violating of a law, right, or duty, either by commission or omission. The failure of one part to carry out any condition of a contract.
• Breach of Contract Failure to perform a contract, in whole or part, without legal excuse.
• Broker, Real Estate One who is licensed by the state to carry on the business of dealing in real estate. A broker may receive a commission for his or her part in bringing together a buyer and seller, landlord and tenant, or parties to an exchange.
• Brokerage The act of bringing together principals (buyer-seller; landlord-tenant; etc.) For a fee or commission, rather than acting as a principal.
• Building Contract An agreement between an owner or lessee and a building contractor, setting forth terms relative to the construction of a proposed structure.
• Buy-Down When the lender and/or the home builder subsidized the mortgage by lowering the interest rate during the first few years of the loan. While the payments are initially low, they will increase when the subsidy expires.
• Buyer The purchaser; one who buys real estate.
• Buyer's Market A market condition favoring the buyer. In real estate, when more homes are for sale than thee are interested buyers.
• Buyer's Option A contract giving the buyer the right to specify a later date on which to settle the trade. The specified date must be from six business days to sixty calendar days after the trade date.
• Buy-Sell Offer An offer by one owner of a business or real estate (a partner or other shareholder), or to sell the offeror's interest at the same price or proportionate price if unequal ownership. Example: A and B each own a ½ interest in lot 1. A offers to buy B's interest for $10,000, or to sell A's interest to b for $10,000. Theoretically very fair, since B has the option to buy or sell. However, B's interest may be worth $12,000, but B is financially unable to buy A's interest (also worth $12,000).

C


• Cable Transfer/Payments: The instruction to effect a payment or transfer which is transmitted by telecommunication.
• Cancellation Clause: A clause in a lease or other contract, setting forth the conditions under which each party may cancel or terminate the agreement. The conditions may be as simples as giving notice or complex and require payment by the party desiring to cancel.
• Cap: A provision of an ARM limiting how much the interest rate or mortgage payments may increase.
• Capacity: Having legal authority or mental ability. Being of sound mind.
• Capital Losses: Losses resulting from selling at a loss.
• Capitalization Rate: The percentage (acceptable to an average buyer) used to determine the value of income property through capitalization.
• Caps (interest): Consumer safeguards which limit the amount the interest rate on an adjustable rate mortgage which may change per year and/or the life of the loan. 19% down payment will require PMI.) This type of loan is subject to the qualifying guidelines set forth by FNMA (Fannie Mae) or FHLMC (Freddy Mac).
• Caps (payment): Consumer safeguards which limit the amount monthly payments on an adjustable rate mortgage may change.
• Cash Flow: The amount of cash derived over a certain period of time from an income-producing property. The cash flow should be large enough to pay the expenses of the income producing property (mortgage payment, maintenance, utilities, etc.).
• Cash Reserve: A requirement of some lenders that buyers have sufficient cash remaining after closing to make the first two mortgage payments.
• Cashier: An officer of the bank.
• CD: Certificate of deposit.
• Certificate of Deposit: A document certifying an unsecured time deposit with a bank, usually known as a CD. To be negotiable, it must be for $100,000 or more.
• Certificate of Eligibility: The document given to qualified veterans which entitles them to VA guaranteed loans for homes, business and mobile homes. Certificates of eligibility may be obtained by sending form DD-214 (Separation Paper) to the local VA office with VA form 1880 (request for Certificate of Eligibility)
• Certificate of Occupancy: A certificate issued by a local building department to a builder or renovator, stating that the building is in proper condition to be occupied.
• Certificate of Reasonable Value (CRV): An appraisal issued by the Veterans Administration showing the property's current market value
• Certificate of Title Document: issued by Registrar of Titles for real estate registered under the Torrens System, which is considered conclusive evidence of the present ownership and state of the title to the property described therein.
• Certification: 1. Written attestation. 2. Authorized declaration verifying that an instrument is a true and correct copy of the original.
• Certified Check: A personal check drawn by an individual which is certified (guaranteed) to be good. The bank holds the funds to pay the certified check and will not pay any other checks drawn on the account if such payment would impede payment of the certified check. The bank also will not honor a stop payment of a certified check.
• Certified Copy: A true copy, attested to be true by the officer holding the original.
• Change Frequency: The frequency (in months) of payment and/or interest rate changes in an adjustable-rate mortgage (ARM).
• Change of Name: When there is a name change of a party appearing on a document (deed, etc.), it may be reflected in several ways, such as: (1) Mary Smith, a married woman, w.a.t.a. (who acquired title as) Mary Jones, an unmarried woman. (2) Mary Smith, AKA (also known as) Mary Jones. (3) Mary Smith, formerly Mary Jones. (4) Mary Smith, alias Mary Jones. Each may be applicable in different circumstances (how and why the name was changed).
• Chattel: Personal property.
• Claim: An assertion of some right or demand.
• Clear Title: A title that is free of liens and legal questions as to ownership of the property.
• Clerk of Court: Administrator or chief clerical officer of the court.
• Close of Escrow: The date the documents are recorded and title passes from Seller to Buyer. On this date, the Buyer becomes the legal owner, and title insurance becomes effective.
• Closing: The occasion where a sale is finalized; the buyer signs the mortgage, and closing costs are paid. Also called "settlement."
• Closing Costs: Expenses incidental to the purchase, sale, and financing of real estate, including, but not limited to land fees, title fees, and appraisal fees.
• Closing Service Letter: Also known as Closing Protection Letter. A letter of authorization from a Title Company, for an individual or agency conducting a settlement on behalf of the Title Company and Lender which includes the execution of all documents and disbursements of funds.
• Closing Statement: The statement which lists the financial settlement between buyer and seller, and also the costs each must pay. A separate statement for buyer and seller is sometimes prepared.
• Cloud: (See Cloud on Title).
• Cloud on Title: An invalid encumbrance on real property, which, if valid, would affect the rights of the owner. For example: a sells lot 1, tract 1, to b. The deed is mistakenly drawn to read lot 2, tract 1. A cloud is created on lot 2 by the recording of the erroneous deed. The cloud may be removed by quitclaim deed, or, if necessary, by court action. COFI Adjustable-rate mortgage with rate that adjusts based on a cost-of-funds index, often the 11th District Cost of Funds.
• Coinsurance: Ordinary coinsurance is defined as a transaction under which each of two or more insurers assumes a designated portion of the liability for the total risk and is liable for only such portion of any loss beginning at the first dollar of loss.
• Collate: To arrange in order; verify arrangement of pages before binding or fastening; put together.
• Collateral: Securities or other assets that a borrower pledges to a lender to secure repayment of a loan. If the borrower does not make payments as promised, the lender may legally seize the collateral and use the proceeds from its sale to pay off the loan.
• Collateral Security: Most commonly used to mean some security in addition to the personal obligation of the borrower.
• Collateralized Mortgage Obligations (CMOs): Bonds secured with GNMA, FNMA, and FHLMC mortgage-backed securities. Also known as REMICs.
• Commitment: A binding contract with a title company to issue a specific title policy, showing only those exceptions contained in the commitment and any intervening matters after the date of the commitment and prior to the effective date of the policy. The commitment contains all information included in the preliminary title report, plus a list of the title company's requirements to insure the transaction. It also includes the standard exceptions from coverage that will appear in the policy.
• Commitment Fee: A fee paid for a loan commitment.
• Commitment Letter: A formal offer by a lender stating the terms under which it agrees to loan money to a home buyer.
• Common Area: The area owned in common by the owners of condominiums or planned unit development homes in a subdivision.
• Common Law: The body of laws, originated and developed in England, which was adopted by most states and still prevails if not superseded by statutes. Also referred to as case law.
• Common Wall: (See Party Wall).
• Comparable Sales: Sales that have similar characteristics as the subject property, used for analysis in the appraisal. Commonly called "comps".
• Comparables: Properties used in an appraisal report that are substantially equivalent to the subject property.
• Competitive Market Analysis (CMA): A comparison approach used by real estate professionals to help sellers set a likely selling price for property.
• Condemnation: The legal process by which the government takes private land for public use, paying the owners a fair price. (See eminent domain.)
• Condominium: A form of property ownership in which each occupant of a multiunit building owns his or her dwelling unit separately and an undivided interest with other owners in the property's common elements (lobbies, hallways, etc.).
• Condominium Bylaws: Rules passed by the condominium owners' association that are used to administer the property.
• Condominium Conversion: The changing of rental property (two or more units) to condominium ownership. Physical changes, as well as paperwork, may be necessary to conform to building and safety codes.
• Condominium Map (Plan): A recorded map showing the condominium units and common area. The map includes both horizontal and vertical measurements of the units. It is important that the map agree with the declaration of restrictions (recorded at the same time).
• Condominium Owners' Association: An association of all the owners in a condominium. They may elect a Board of Directors to oversee the administration and management of the condominium.
• Conformed Copy: An exact copy of a document on which has been written things that could not or were not copied, i.e., a written signature is replaced on the conformed copy with a notation that it was signed by the parties.
• Consent: Agreement; voluntary acceptance of the wish of another.
• Consent to Service of Process: Legal document used by the state administrator to simplify filing of complaints under state securities laws. The person or entity signing it (such as the issuer of a security, or a securities registrant with the state) agrees that, for noncriminal complaints, any legal papers regarding the signee that are served on the state administrator in lieu of the signee have the same force and validity as if they were served directly on the signee.
• Conservator: A person appointed by the court to care for the person and/or property of an incompetent adult or an adult unable to care for their person or property because of health.
• Conservatorship: Legal right given to a person to manage the property and financial affairs of a person deemed incapable of doing that for himself or herself. (See also guardianship.)
• Consideration: The price bargained for and paid for a promise, goods, or real estate.
• Construction Loan: A short term interim loan to pay for the construction of buildings or homes. These are usually designed to provide periodic disbursements to the builder as he or she progresses.
• Constructive Notice: Notice imparted by the public records of the county when documents entitled to recording are recorded.
• Consumer Price Index: The gauge of US inflation.
• Consumer Reporting Agency (or Bureau): An organization that handles the preparation of reports used by lenders to determine a potential borrower's credit history. The agency gets data for these reports from a credit repository and from other sources.
• Contiguous: Near or close to, whether actually touching or not. Generally refers to actual touching or bordering on.
• Contingency : Commonly, the dependence upon a stated event which must occur before a contract is binding. For example: the sale of a house, contingent upon the buyer obtaining financing.
• Continuance: Postponement of a legal proceeding to a later date.
• Contract: An agreement between two or more persons which creates an obligation to do or not to do a particular thing. A legally enforceable agreement between two or more competent parties made either orally or in writing.
• Contract Sale or Deed: A contract between purchaser and a seller of real estate to convey title after certain conditions have been met. It is a form of installment sale.
• Conventional Loan: A mortgage not insured by FHA or guaranteed by the VA.
• Conventional Mortgage: Any mortgage that is not insured or guaranteed by the federal government.
• Conversion Clause: A provision in an ARM allowing the loan to be converted to a fixed-rate at some point during the term. Usually conversion is allowed at the end of the first adjustment period. The conversion feature may cost extra.
• Convertible ARM: An adjustable-rate mortgage that can be converted to a fixed rate mortgage under specified conditions.
• Cooperatives (Co-ops): A form of property ownership in which a corporation owns the building and the tenants purchase shares in the corporation that give them a right to occupy a unit in the building.
• Covenant: (1) A formal agreement or contract between two parties in which one party gives the other certain promises and assurances, such as the covenant of warranty in a warranty deed. (2) Agreements or promises contained in deeds and other instruments for performance or nonperformance of certain acts, or use or nonuse of property in a certain manner.
• Covenants, Conditions and Restrictions: Commonly called CC & R's the term usually refers to a written recorded declaration which sets forth certain covenants, conditions, restrictions, rules or regulations established by a subdivider or other landowner to create uniformity of buildings and use within tracts of land or groups of lots. The restrictions also can be established by deed. CC & R's are sometimes referred to as private zoning.
• Credit: (1) The financial worthiness of a borrower. The history of whether this borrower has met financial obligations on time in the past. (2) an accounting term designating money received or receivable, as opposed to debit which is money paid or payable.
• Credit Balance: Money on deposit in a customer's account.
• Credit History: This is a "snap-shot" of your past and present debt, current available credit, and a rating of your debt repayment history. This is very important to a lender so that they can know if you are a good credit risk.
• Credit Report: A report on the past ability of a loan applicant to pay installment payments. Several national and local companies make such reports.
• Credit Risk Score: A credit risk score is a statistical summary of the information contained in a consumer's credit report. The most well known type of credit risk score is the Fair Isaac or FICO score. This form of credit scoring is a mathematical summary calculation that assigns numerical values to various pieces of information in the credit report. The overall credit risk score is highly relative in the credit underwriting process for a mortgage loan.
• Creditor: A person to whom a debt is owed by another.
• Current Assets: Assets that are converted to cash within one year.
• Current Liabilities: Obligations that must be paid within one year.
• Customer Agreement: A basic agreement between customer and broker, incorporating the margin agreement, the credit agreement and the loan consent.

D


• Debentures: Bonds not secured by any specific property, based on the full faith and credit of the issuer.
• Debt: Money owing from one person to another.
• Debt: Financing A method of financing where the company receives a loan and gives its promise to repay the loan
• Debt to Equity Ratio: Long-term debt divided by shareholders' equity, showing relationship between long-term funds provided by creditors and funds provided by shareholders; high ratio may indicate high risk, low ratio may indicate low risk.
• Debtor: One who owes a debt to another; a person filing for relief under theBankruptcy Code.
• Debt-to-Income Ratio: The ratio, expressed as a percentage, which results when a borrower's monthly payment obligation on long-term debts is divided by his or her gross monthly income. See housing expenses-to-income ratio.
• Declaration of Trust: A written acknowledgement by one holding legal title to property that the property is held in trust for the benefit of another.
• Deed: Written document by which an estate or interest in real property is transferred from one person to another. The person who transfers the interest is called the "grantor." The one who acquires the interest is called the "grantee." Examples of deeds are grant deeds, administrator's deeds, executor's deeds, quitclaim deeds, etc. The deed to use depends on the language of the deed, the legal capacity of the grantor and other circumstances.
• Deed in Lieu: A deed from the owner (debtor) to a lender to prevent foreclosure. There are usually statutory provisions as to fairness of value and absence of coercion which must be recited on the deed.
• Deed in Lieu of Foreclosure: A deed given by an owner/borrower of a lender to prevent the lender from bringing foreclosure proceedings. The validity of the deed depends to some degree on "fairness" under the circumstances, and adequacy of consideration will be considered.
• Deed of Reconveyance: (See Reconveyance).
• Deed of Trust or Trust Deed: A written document by which the title to land is conveyed as security for the repayment of a loan or other obligation. It is a form of mortgage. The landowner or debtor is called the "trustor." The party to whom the legal title is conveyed (and who may be called on to conduct a sale thereof if the loan is not paid) is the "trustee." The lender is the "beneficiary." When the loan is paid off, the trustee is asked by the beneficiary to issue a "recon" or reconveyance. This reconveyance corresponds to the release that the holder of a mortgage executes when the mortgage is paid off.
• Deed Restrictions: Limitations on the use of property placed in the conveyancing deed by the grantor, which bind all future owners.
• Default: Failure to meet legal obligations in a contract, specifically, failure to make the monthly payments on a mortgage.
• Defective Title: (1) Title to a negotiable instrument obtained by fraud. (2) Title to real property which lacks some of the elements necessary to transfer good title.
• Deferred Interest: When a mortgage is written with a monthly payment that is less than required to satisfy the note rate, the unpaid interest is deferred by adding it to the loan balance. See negative amortization.
• Deferred Maintenance: Repairs necessary to put a property in good condition. A concern of a purchaser. An owner may have an account for such maintenance.
• Deficient: Incomplete; defective; not sufficient in quantity or force.
• Deflation: A decline in the prices of goods and services.
• Delinquency: Failure to make payments on time. This can lead to foreclosure.
• Demise: A lease or conveyance for life or years. Loosely used to describe any conveyance, whether in fee, for life, or for years.
• Demographics: Statistics. Commonly refers to statistical information required by certain businesses (especially chain stores) regarding a possible new location.
• Depreciation: A noncash expense reflecting wear and tear of property used as part of a trade or business or held for the production of income. Usually, the cost of an asset, less an appropriate salvage value, is "written off" over its useful life by periodically reducing the book value of the asset with an increase to accumulated depreciation and charging an equal and offsetting amount as depreciation expense. Depreciation used for book purposes may be different from the amounts allowed on tax statements.
• Depression: A stage of the business cycle characterized by high unemployment and low levels of business activity.
• Developer: (1) A builder. (2) one who prepares the raw land for construction and then sells lots to a builder.
• Development: A planned construction project, rather than simply the building of unrelated buildings.
• Discount Point: A unit of measurement used for various loan charges; one point equals one percent of the amount of the loan.
• Discount Rate: The interest rate at which eligible depository institutions may borrow funds directly from the Federal Reserve Banks. This rate is controlled by the Federal Reserve and is not subject to trading
• Discretionary Account:
• Discretionary Income: The amount of income the individual has left after covering his or her essentials such as food, housing, utilities, clothes, and payment of obligations.
• Dissolution: A cancellation or annulment of a contract or business associate, such as a partnership or corporation.
• Division Wall: (1) A wall between two buildings, but not a part of either. (2) a wall which divides a building into rooms. Differs from a partition in that it is load-bearing.
• Donee: One who receives a gift.
• Double Escrow: Two concurrent escrows on the same property, having the same party as buyer and seller of the property. Example: escrow 1-A buys from B. Escrow 2-A sells the same property to C, A is using C's money to buy B's property. The process is illegal in many states unless full disclosure is made.
• Down Payment: The difference between the sales price of real estate and the mortgage amount.
• Dwelling Unit: The living quarters occupied, or intended for occupancy, by one household.

E


• Earnest Money: Money given by a buyer to a seller as part of the purchase price to bind a transaction or assure payment.
• Earnest Money Deposit: Down payment made by a purchaser of real estate as evidence of good faith; a deposit or partial payment.
• Earnings Estimates: The estimated earnings projected for a company for a fiscal year.
• Easement: A right created by grant, reservation, agreement, prescription, or necessary implication, which one has in the land of another. It is either for the benefit of land (appurtenant), such as right to cross a to get to b, or "in gross," such as a pubic utility easement.
• Easement Appurtenant: An easement for the benefit of another parcel of land, such as the right to cross parcel a to reach b. The easement will pass with the transfer of property to a new owner.
• Easement by Prescription: (See Prescriptive Easement).
• Easement in Gross: An easement for the benefit of a person or company, rather than for the benefit of another parcel of land. Commonly, such easements as for public utilities.
• Easement of Necessity: An easement granted by a court when it is determined that said easement is absolutely necessary for the use and enjoyment of the land. Commonly given to landlocked parcels.
• Easy Money: A phenomenon occurring when new money is injected into the economy by the Federal Reserve System. The new money stimulates demand for existing goods, thus making it simple to make more money.
• EBITDA (Earnings before interest, taxes, depreciation, and amortization): A financial measure defined as revenues less cost of goods sold and selling, general, and administrative expenses. In other words, operating and nonoperating profit before the deduction of interest and income taxes. Depreciation and amortization expenses are not included in the costs.
• Effective Annualized Seven-Day Yield: Yield for 7 day period including the day reported, calculated by adding 1 to the base period return used in calculating the standard 7 day yield raising the total to the power of 365 divided by 7 and subtracting 1 (NOTE: To be reported on Wednesday only).
• Efficiency: An apartment consisting of one room, sectioned into areas for a kitchen, bedroom, etc.
• Egress: A term concerning a right to come and go across the land (public or private) of another. Usually part of the term ingress and egress.
• Eminent: Domain The power of the government to take private property for public use through condemnation.
• Encroachment: The presence of an improvement such as a building, a wall, a fence or other fixture which overlaps onto the property of an adjoining owner.
• Entitlement: The VA home loan benefit is called an entitlement (i.e. entitlement for a VA guaranteed home loan). This is also known as eligibility.
• Entity: A person or legally recognized organization.
• Environment: The conditions, influences, or forces which affect the desirability and value of property, as well as the effect on people's lives.
• Equal Credit Opportunity Act (ECOA): Is 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.
• Equifax: Equifax provides consumers access to their personal credit report, FICO credit score and protects them with early warning of identity theft.
• Equilibrium Market: A price region that represents a balance between demand and supply.
• Equity: The difference between the fair market value and current indebtedness, also referred to as the owner's interest. The value an owner has in real estate over and above the obligation against the property.
• Equity Build-up: The reduction of principal on a mortgage or deed of trust by periodic payments, which increases (builds-up) the difference (equity) between the property value and amount of the lien.
• Equity Line of Credit: A combination of a line of credit and equity loan. A maximum loan amount is established based on credit and equity. A mortgage (deed of trust) is recorded against the potential borrower's property for said maximum loan amount. The potential borrower has the right to borrow, as needed, up to the amount of the mortgage.
• Equity Loan: A loan based upon the equity in a property. The credit of the borrower is not a major factor. (See also Personal Property Loan).
• Equity Participation: Offer of an ownership position to induce the loan or can be a note that has an option to convert from debt to equity
• Equity Trader: Category of registration both for market makers, agency traders, and proprietary traders in Nasdaq® and other OTC market equity or convertible debt securities and for supervisors of those activities. Does not include traders who primarily execute orders for a registered investment company. Equity traders must pass the test for limited representative-equity trader (Series 55) and, in addition, either Series 7 or Series 62.
• Erosion : The wearing away, over a prolonged period, of rock, earth, or other portions of land.
• Errors and Omissions Insurance: Insurance covering losses caused by errors and omissions of professions other than medicine. Used by banks, real estate companies, escrow companies, etc.
• Escheat: The process by which a deceased person's property goes to the state if no heir can be found.
• Escrow: Money or a written instrument such as a deed that, by agreement between two parties, is held by a neutral third party (held in escrow) until all conditions of the agreement are met.
• Escrow Disbursements: The use of escrow funds to pay real estate taxes, hazard insurance, mortgage insurance, and other property expenses as they become due.
• Escrow Instructions: Instructions which are signed by both buyer and seller, and which enable an escrow agent to carry out the procedures necessary to transfer real property, a business, or other assignable interest.
• Escrow Officer: An escrow agent. In some sates, one who has, through experience and education, gained a certain degree of expertise in escrow matters.
• Escrow Payment: The part of a mortgagor's monthly payment that is held by the servicer to pay for taxes, hazard insurance, mortgage insurance, lease payments, and other items as they become due.
• Estate: (1) The interest or nature of the interest which one has in property, such as a life estate, the estate of a deceased, real estate, etc. (2) a large house with substantial grounds surrounding it, giving the connotation of belonging to a wealthy person.
• Estate Tax: Generally, a tax on the privilege of transferring property to others after a person's death. In addition to federal estate taxes, many states have their own estate taxes.
• Examination: An inspection. In title, an inspection of the chain of title from the beginning of time to the present.
• Execute: To complete; to sign; to carry out according to its terms.
• Execution Sale: Sale of real property under a writ of execution by a court. A judicial mortgage foreclosure sale is in this category.
• Executor: A personal representative, named in a will, who administers an estate.
• Executor's Deed: A deed issued by the executor of an estate. (see Executor).
• Exempt Property: All the property of a debtor which is not attachable under the Bankruptcy Code or the state statute.
• Extension: A continuing under the same conditions, as opposed to a renewal, which implies new terms or conditions.
• Extension of Credit: The granting of credit in any form.

F


• F.H.A. (Federal Housing Administration): A federal agency which insures first mortgages, enabling lenders to loan a very high percentage of the sale price.
• Facsimile: An exact copy of a thing, such as a signature or document, by a duplicating process.
• Fair Market Price: The price a willing buyer would pay a willing seller for an asset, where both are acting rationally with full knowledge.
• Fair Market Value: Price that probably would be negotiated between a willing seller and willing buyer in a reasonable time. Usually arrived at by comparable sales in the area.
• Fannie Mae: see Federal National Mortgage Association.
• Federal Deposit Insurance (FDIC): An agency which insures deposits in banking institutions in Corporation the event of financial failure.
• Federal Deposit Insurance Corporation: A self-sustaining, independent executive agency established to insure deposits of all US banks entitled to federal deposit insurance, as stated by the Federal Reserve Act.
• Federal Funds: Very short-term loans (usually overnight) between banks, without any collateral.
• Federal Home Loan Bank Board (FHLBB): The former name for the regulatory and supervisory agency for federally chartered savings institutions. Agency is now called the Office of Thrift Supervision
• Federal Home Loan Mortgage Corporation (FHLMC or "Freddie Mac"): Purchases conventional mortgages from federally chartered savings and loans.
• Federal Housing Administration (FHA): A division of the Department of Housing and Urban Development. Its main activity is the insuring of residential mortgage loans made by private lenders. FHA also sets standards for underwriting mortgages.
• Federal Mediation and Conciliation Service: An agency which provides mediators to assist in labormanagement disputes.
• Federal National Mortgage Association (FNMA): also know as "Fannie Mae". A tax-paying corporation created by Congress that purchases and sells conventional residential mortgages as well as those insured by FHA or guaranteed by VA. This institution, which provides funds for one in seven mortgages, makes mortgage money more available and more affordable.
• Federal Open Market Committee: The Federal Open Market Committee, or FOMC, is the Fed's monetary policy committee. It meets eight times a year in Washington (the schedule is on the Fed's Web site) to set the fed funds rate. Announcements of changes in monetary policy are at 2:15 p.m. Eastern Time (on the second day if it's a two-day meeting), and the minutes of the meetings are released within a few days of having been approved by the committee at its subsequent meeting.
• Federal Reserve Bank: The governing central bank of the US.
• Federal Reserve Board: Commonly referred to as the Fed or "the Board," it manages the Federal Reserve System.
• Federal Tax Lien: A lien attaching to property for nonpayment of a federal tax (estate, income, etc.). A federal tax lien differs from other liens in that it is not automatically wiped out by foreclosing o a mortgage or trust deed recoded before the tax lien (except by judicial foreclosure).
• Federal Trust Corporation: Savings and loan holding company with subsidiary which performs savings bank operations, mortgage banking and other related financial activities. (NASDAQ: FDTR).
• Fedwire: An automated communications and settlement system linking the Federal Reserve banks with other banks and with depository institutions Fee (1) Fixed amount which a trust institutions receives as compensation for its services; to be distinguished from allowance, charge, and commission. (2) An estate of inheritance in real property sometimes referred to as an estate in fee, or fee simple estate.
• Fee Simple: An estate under which the owner is entitled to unrestricted powers to dispose of the property, and which can be left by will or inherited. Commonly, a synonym for ownership.
• Fee Simple Absolute: A term now used synonymously with fee simple.
• Fee Simple Conditional: (See Defeasible Title).
• Fee Simple Defeasible: (See Defeasible Title).
• Fee Tail: An estate of inheritance which specifies the descendants or classes or heirs of the devisee who may succeed to the said estate.
• FHA Loan: A loan insured by the Federal Housing Administration open to all qualified home purchasers. While there are limits to the size of FHA loans ($155,250 as of 1/1/96), they are generous enough to handle moderately-priced homes almost anywhere in the country.
• FHA Mortgage Insurance: Requires a fee (up to 2.25 percent of the loan amount) paid at closing to insure the loan with FHA. In addition, FHA mortgage insurance requires an annual fee of up to 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.
• FHLMC (Freddie Mac): Federal Home Loan Mortgage Corporation. A federal agency purchasing first mortgages, both conventional and federally insured, from members of the Federal Reserve System, and the Federal Home Loan Bank System.
• Fiduciary: Someone who manages an account for the beneficiary of the account.
• Fiduciary Relationship: A special relationship in which one party owes heightened duties of good faith and responsibility to the other party
• File: A collection of related records treated as a unit. Synonymous with data bank.
• Filing Fee: The fee required for filing various documents.
• Firm Commitment: A promise by FHA to insure a mortgage loan for a specified property and borrower. A promise from a lender to make a mortgage loan.
• First Mortgage: The mortgage that has first claim (or "lien") in the event of a default.
• First Refusal Right: A right, usually given by an owner to a lessee, which gives the lessee a first chance to buy the property if the owner decides to sell. The owner must have a legitimate offer which the lessee can match or refuse. If the lessee refuses, the property can then be sold to the offeror.
• First User: A tax term signifying the one who builds or buys property and is the first one to put the buildings to use. Certain tax (depreciation) advantages are given to a first user. The term concerns only depreciable property (improvements) and prior use of the land only (farming) would not be considered.
• Fixed Installment: The monthly payment due on a mortgage loan including payment of both principal and interest.
• Fixed Rate Mortgage: The mortgage interest rate will remain the same on these mortgages throughout the term of the mortgage for the original borrower.
• FNMA (Fannie Mae): A private corporation dealing in the purchase of first mortgages, at discounts.
• Forbearance: The waiting for payment of a debt by a creditor after the debt becomes due.
• Foreclosure: A court proceeding upon default in a mortgage to vest title in the mortgagee.
• Foreclosure Sale: A sale of property used as security for a debt, to satisfy said debt.
• Forfeiture: A cancellation. A legal action whereby a contract purchaser following default loses all his interest in the property.
• Forfeiture: The taking of an individual's property by a government, because the individual has committed a crime. IN the United States, private property cannot be taken, except by eminent domain upon payment of just compensation, or for nonpayment of taxes.
• Forfeiture Of Title: A common penalty for the violation of conditions or restrictions imposed by the seller upon the buyer in a deed or other proper document. For example, a deed may be granted upon the condition that if liquor is sold on the land, the title to the land will be forfeited (that is, lost) by the buyer (or some later owner) and will revert to the seller.
• Forgery: A false signature or material alteration with intent to defraud. The forged signature of the grantor will not pass title regardless of recording or lack of knowledge by the grantee or future grantees. Title insurance will insure against forgery. The word may extend beyond signatures (forged paintings, documents, etc.).
• FRB: See Federal Reserve Board.
• Freddie Mac: see Federal Home Loan Mortgage Corporation
• Free and Clear: Real property against which there are not liens, especially voluntary liens (mortgages).
• Free Credit Balances: A credit balance in a customer's account that the customer can withdraw upon request. Not all credits are free credits. For example, the credit balance related to a short sale in a margin account is not a free credit, since the customer cannot withdraw that credit until the short sale is covered. The firm must send customers statements concerning any existing credit balances at least quarterly.
• Free Reserves: Funds held on deposit with the Federal Reserve by commercial banks which are in excess of legal requirements.
• Full Disclosure: A builder must give to a potential buyer the facts of his new development (are there adequate school facilities? sewer facilities? an airport nearby? etc.). A broker cannot charge a commission to buyer and seller unless both know (disclosure) and agree. In real estate, revealing all the known facts which may affect the decision of a buyer or tenant. A broker must disclose known defects in the property for sale or lease.
• Full Payment: The amount of money owed on a single account that, if paid, will reduce the account to a zero balance.
• Fully Amortized ARM: An adjustable-rate mortgage (ARM) with a monthly payment that is sufficient to amortize the remaining balance, at the interest accrual rate, over the amortization term.
• Funds: Money available for a qualified purpose, such as loan funds for F.H.A. insured loans, conventional loan funds, etc.

G


• Gain: A profit, or pecuniary benefit as opposed to a loss.
• Gain-Profit: Important for tax purposes when realized from the sale of a capital asset.
• Garnishment: A legal proceeding in which a debtor's money, in the possession of another (called the garnishee) is applied to the debts of the debtor, such as when an employer garnishes a debtor's wages.
• Garnishment: A legal proceeding under which a person's money in control of another (such as salary) is taken for payment of a debt. The amount which may be taken is set by statute (usually as a percentage), and, in most states, a judgment is necessary before garnishment.
• General Index (G.I.): A title insurance company term for the books used to find liens against individuals which may effect real property, but which are not recorded against the property being insured, such as liens against a buyer.
• General Lien: (1) A lien such as a tax lien or judgment lien which attaches to all property of the debtor rather than the lien of, for example, a trust deed, which attaches only to specific property. (2) The right of a creditor to hold personal property of a debtor for payment of a debt not associated with the property being held. Must be done under an agreement since against general precepts of law.
• General Partnership: A partnership made up of general partners, without special (limited) partners. (See also Limited Partnership; Partnership).
• General Property Taxes: Taxes levied on real estate and personal property.
• General Securities Firms: Brokers or dealers who carry customer or other broker/dealer accounts and receive and hold securities and funds for those accounts. Also called carrying, clearing firms.
• Gift Deed: A deed for nominal consideration.
• Gift Letter: A letter to HUD from the donor (giver) stating that a gift of money has been made to the buyer in order to purchase specific property The relationship of the donor and donee is stated, as well as the amount of the gift.
• Gift Tax: A federal and sometimes a state tax on inter vivos transfers without consideration.
• Ginnie Mae: see Government National Mortgage Association.
• GNMA (Ginnie Mae): Government National Mortgage Association. A federal association, working with F.H.A., which offers special assistance in obtaining mortgages, and purchases mortgages in a secondary capacity.
• Government National Mortgage Association: A government owned corporation that is backed by the full faith and credit of the U.S. government, creating pools of mortgages insured by either the Department of Veterans Affairs or the Federal Housing Administration and are sold to investors, commonly referred to as GNMA. Also called Ginnie Mae.
• Government: Survey The survey from which our present system of townships, sections, etc., was developed.
• Graded: Tax A property tax designed to promote local development by increasing the tax rate on land and decreasing it on improvements.
• Graduated Payment Mortgage (GPM): A type of flexible-payment mortgage where the payments increase for a specified period of time and then level off. This type of mortgage has negative amortization built into it.
• Grandfather: Clause The clause in a law permitting the continuation of a use, business, etc., which, when established, was permissible but, because of a change in the law, is now not permissible. (See also Nonconforming Use).
• Grant: A transfer of real estate, between individuals, by deed. A transfer of real estate from a sovereign is accomplished by patent or royal decree.
• Grant Deed: One of the many types of deeds used to transfer real property. Contains warranties against prior conveyances or encumbrances. When title insurance is purchased, warranties in a deed are of little practical significance.
• Grantee: One to whom a grant is made. Generally, the buyer. See Deed.
• Grantor: The person who sets up a trust. Also referred to as settlor.
• Grantor: One who grants property or property rights. See Deed.
• Grantor-Grantee Index: The record of the passing of title to all the properties in a county as kept by the county recorder's office. Property is checked by tracing the names of the sellers and buyers (chain of title). Title companies usually have more efficient methods by keeping records according to property description, rather than people's names. as low as 3 percent in some cases. With the smaller down payment loans, however, borrowers are usually required to carry private mortgage insurance. Private mortgage insurance will usually require an initial premium payment and may require an additional monthly fee depending on your loan's structure.
• Ground Lease: A contract for the rental of land on a long term basis.
• Group Net Order: In a municipal bond underwriting, an order in which the compensation is shared proportionately among the syndicate members.
• Group Sales: Sales in an underwriting made to institutional customers, such as banks and insurance companies, and for which all of the members of the underwriting group share in the commissions proportionate to their takedown in the offering.
• Growing-Equity Mortgage (GEM): A fixed-rate mortgage that provides scheduled payment increases over an established period of time. The increased amount of the monthly payment is applied directly toward reducing the remaining balance of the mortgage.
• Guarantee Mortgage: A mortgage that is guaranteed by a third party.
• Guaranteed Investment Contracts (GICs): A single lump-sum deposit that earns a guaranteed interest until a known maturity date. GICs are issued by insurance companies.
• Guaranty: A promise by one party to pay a debt or perform an obligation contracted by another if the original party fails to pay or perform according to a contract.
• Guardian: A person appointed by will or by law to assume responsibility for incompetent adults or minor children. If a parent dies, this will usually be the other parent. If both die, it probably will be a close relative.
• Guardianship: Legal right given to a person to be responsible for the food, housing, health care, and other necessities of a person deemed incapable of providing these necessities for himself or herself.

H


• Heir: A person who inherits real property; to be distinguished from next of kin and from distibutee. An heir of the body is an heir in the direct line of the decedent. A son, for example, is the heir of the body of his father or mother.
• Holographic Will: A will entirely in the handwriting of the testator.
• Home Equity Loan: A loan under which a property owner uses his or her residence as collateral and can then drew funds up to a prearranged amount against the property.
• Homestead: The land and buildings thereon occupied by the owner as a home for himself or herself and family, if any, and in most states protected to some extent by statute against the claims of creditors.
• HUD: The Department of Housing and Urban Development. It is responsible for the implementation and administration of government housing and urban development programs.
• HUD-1 Statement: A document that provides an itemized listing of the funds that are payable at closing. Items that appear on the statement include real estate commissions, loan fees, points, and initial escrow amounts. Each item on the statement is represented by a separate number within a standardized numbering system. The totals at the bottom of the HUD-1 statement define the seller's net proceeds and the buyer's net payment at closing.
• Hyperinflation: A rise in the prices of goods and services at rates of 100% or more per year.

I


• Implied Contract: A contract not created or evidenced by the explicit agreement of the parties but one inferred by law; as the use of electric power in your home implies a contract with the light company.
• Independent Executor: A special kind of executor, permitted by the laws of certain states, who performs the duties of an executor without intervention by the court.
• IndyMac Bank Home: Features current CD rates, mortgage rates, and banking services for individuals, brokers and lenders, investors and home builders Infirmity Any omission in detail whose effect is to invalidate a transfer of title. Infirmities include; lack of endorsement, conflicting written and numerical amounts and signature not present.
• Inflation: A rise in the prices of goods and services.
• Inflation Rate: The rate of increase in the price of goods and services. Commonly used measures of the rate of inflation are the Consumer Price Index, the Producer Price Index, and the GNP deflator.
• Inheritance Tax: A state tax on property that an heir or beneficiary under a will receives from a deceased person's estate. The heir or beneficiary pays this tax.
• Initial Interest Rate: This refers to the original interest rate of the mortgage at the time of closing. This rate changes for an adjustable-rate mortgage (ARM). It's also known as "start rate" or "teaser."
• Installment: The regular periodic payment that a borrower agrees to make to a lender.
• Insured Mortgage: A mortgage that is protected by the Federal Housing Administration (FHA) or by private mortgage insurance (MI).
• Interest: The cost of borrowing money. Since bonds represent a loan to a company, they receive interest, while stocks represent ownership, thus receiving a share of earnings.
• Interest Rate: Another important economic indicator. The price, calculated as a percentage of the money loaned, that banks are charging borrowers for the use of the banks’ money.
• Interest Rate Buy Down Plan: An arrangement that allows the property seller to deposit money to an account. That money is then released each month to reduce the mortgagor's monthly payments during the early years of a mortgage.
• Interest Rate Cap: A provision of an ARM limiting how much interest rates may be increased in a given adjustment period. See also "Lifetime cap."
• Interest Rate Ceiling: For an adjustable-rate mortgage (ARM), the maximum interest rate, as specified in the mortgage note.
• Interest Rate Floor: An agreement which provides the buyer of the floor with a minimum interest rate for future lending requirements
• Interim Financing: A construction loan made during completion of a building or a project. A permanent loan usually replaces this loan after completion.
• Internal Revenue Service (IRS): The federal agency which administers the tax laws of the United States.
• Intrastate Offering: A solicitation to sell stock made only to residents of the state in which it originates. Also known as a Rule 147 offering.

J


• Joint Account: An account that is owned by two or more people.
• Joint Ownership: The common ownership of real or personal property by two or more persons. The persons involved are either joint tenants or tenants in common.
• Joint: Tenancy A form of legal coownership of property (also known as survivorship). At the death of one co
• Judgment: The official and authentic decision of a court of justice upon the rights and claims of parties to an action or suit submitted to the court for determination. (See also summary judgment.)
• Judgment Debt: A debt proven valid by legal test.
• Judgment Debtor: One who owes money as a result of a judgment in favor of a creditor.
• Judgment Lien: A lien against the property of a judgment debtor. An involuntary lien.
• Judicial Dissolution: The forced dissolution of a corporation by a court at the request of a state attorney general or shareholder or creditor
• Judicial Lien: A lien obtained by judgment or other judicial process against a debtor.
• Jumbo Certificate of Deposit: A CD worth at least $100,000.
• Jumbo Loan: A loan which is larger (more than $240,000 as of 1/1/99) than the limits set by the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation. Because jumbo loans cannot be funded by these two agencies, they usually carry a higher interest rate.
• Junk Fees: Fees that are outside of the normal lender fees that may have official sounding names that pad the loan price.

K


• Kin: Persons of the same blood or members of the same family.
• Kindred: Persons related by blood.

L


• Land Contract: An installment contract for the sale of land whereby the seller (vendor) holds legal title and the buyer (vendee) has equitable title until the sales price is paid in full.
• Lapsed Gift: A gift made in a will to a person who has died prior to the willmakers death.
• Lease Rental Bond: A municipal revenue bond that is supported by lease payments on a building, usually a building leased to a government agency.
• Lease-Purchase Mortgage Loan: An alternative financing option that allows low- and moderate-income home buyers to lease a home with an option to buy. Each month's rent payment consists of principal, interest, taxes and insurance (PITI) payments on the first mortgage plus an extra amount that accumulates in a savings account for a down payment.
• Legitimate: That which is legal, lawful, recognized by law or according to law.
• Lessor: The person, Corporation, or other legal entity that leases property to a lessee.
• Liabilities: All claims on the assets of an individual or corporation. Includes accrued payable amounts, long-and short-term debt, debentures, and notes. Does not include the ownership equity.
• Liable: Legally responsible.
• LIBOR: The London Interbank Offered Rate, the rate charged by one bank to another for lending money
• Lien: An encumbrance against property for money, either voluntary or involuntary. All liens are encumbrances but all encumbrances are not liens.
• Lifetime Cap: A provision of an ARM that limits the total increase in interest rates over the life of the loan.
• Lifetime Payment Cap: For an adjustable-rate mortgage (ARM), a limit on the amount that payments can increase or decrease over the life of the mortgage.
• Lifetime Rate Cap: For an adjustable-rate mortgage (ARM), a limit on the amount that the interest rate can increase or decrease over the life of the loan.
• Liquid Assets: Cash or assets easily convertible to cash, such as Treasury bills, money market fund shares, or demand deposits.
• Liquidation: Any transaction that offsets or closes out a previously established position
• Loan: A business contract by which a borrower and lender enter into an agreement. Loans are classified according to the lender or borrower involved, whether or not collateral is required, the time to maturity, conditions of repayment, and other variables.
• Loan Consent Form: A customer document that allows the broker/dealer to pledge customer stock to the bank to borrow the money for the margin account. It allows the firm to hypothecate the stock.
• Loan Policy: A title insurance policy insuring a mortgage, or beneficiary under a deed of trust, against loss caused by invalid title in the borrower, or loss of priority of the mortgage or deed of trust.
• Loan Servicing: The collection of mortgage payments from borrowers and the related responsibilities of a loan servicer, such as foreclosure, tax and insurance escrow, etc.
• Loan-to-Value Ratio: The relationship between the amount of the mortgage loan and the appraised value of the property expressed as a percentage.
• Lock-In: A written agreement guaranteeing the homebuyer a specified interest rate provided the loan closes with that buyer within a set period of time.

M


• Markup: Premium.
• Maturity: The date on which the principal balance of a loan becomes due and payable.
• Mezzanine Financing: Company progress makes positioning for an initial public offering viable and investment funds are used to support the IPO
• Mid-Price or Middle Rate: The price half-way between the two prices, or the average of both buying and selling prices offered by the market makers
• MIP (Mortgage Insurance Premium): It is insurance from FHA to the lender against incurring a loss on account of the borrower's default.
• Monetary Easing: A modest loosening of monetary constraint by changing interest rate, money supply, deposit ratios
• Monetary Policy: A central bank's management of a country's money supply. Economic theory underlying monetary policy suggests that controlling the growth of the amount of money in the economy is the key to controlling prices and therefore inflation. However, central banks' monetary capability is severely limited by global money movements. This forces them to use the indirect tool of exchange rate manipulation.
• Money Market Account: An account with a bank or broker/dealer where the funds are invested in short-term interest-bearing securities. Similar to checking accounts, except that they have limits on checks written per month and pay interest. Accounts with banks are insured by the FDIC.
• Monthly Fixed Installment: That portion of the total monthly payment that is applied toward principal and interest. When a mortgage negatively amortizes, the monthly fixed installment does not include any amount for principal reduction and doesn't cover all of the interest. The loan balance therefore increases instead of decreasing.
• Mortgage: A legal document that pledges a property to the lender as security for payment of a debt.
• Mortgage Banker: A company that originates mortgages exclusively for resale in the secondary market (such as to GNMA, FNMA and FHMLC).
• Mortgage Bond: A bond secured by a lien on real property.
• Mortgage Broker: An individual or company that charges a service fee to bring borrowers and lenders together for the purpose of loan origination.
• Mortgage Insurance: Money paid to insure the mortgage when the down payment is less than 20 percent. See private mortgage insurance, FHA mortgage insurance.
• Mortgage Insurance Premium (MIP): Fee paid by a borrower to FHA or a private insurer for mortgage insurance.
• Mortgage Life Insurance: A type of term life insurance In the event that the borrower dies while the policy is in force, the debt is automatically paid by insurance proceeds.
• Mortgage Note: A legal document obliging a borrower to repay a loan at a stated interest rate during a specified period of time.
• Mortgage-Backed Security: The most common type of pass-through security, secured by homeowners' mortgages and sometimes guaranteed by the Veteran's Administration, the Farmer's Home Administration, or the Federal Housing Administration.
• Mortgagee: The party lending the money and receiving the mortgage (Lender).
• Mortgagee's Title Insurance: See Loan Policy
• Mortgagor: The party who borrows the money and gives the mortgage (Borrower).

N


• Negative Amortization: Payment terms under which the borrower's monthly payments do not cover the interest due
• Negotiation: The process of submission and consideration of offers until an acceptable offer is made and accepted.
• Net Income: Income after all expenses and taxes have been deducted, and used in calculating a variety of profitability and stock performance measures.
• Net Worth: Owners' equity of the firm, or all assets less all liabilities. For a corporation, net worth is equal to the total of capital stock, paid-in capital, and retained earnings.
• No-Document Loan: A loan in which the borrower does not have to prove income or assets.
• Non-Conforming Loan: A mortgage not eligible for sale and delivery on the secondary market for various reasons, including the loan amount, loan characteristics or underwriting guidelines.
• Non-Conforming Use: A property which does not conform to the zoning of the area. Usually, the property was built in conformity and then the zoning was changed.
• Nonrecourse Loan: In a limited partnership, a loan for which the limited partners are not personally liable.
• Note: A legal document that obligates a borrower to repay a mortgage loan at a stated interest rate during a specified period of time.

O


• Obligee: One to whom an obligation (promise) is owned.
• Obligor: One who legally binds (obligates) oneself, such as the maker of a promissory note.
• Ordinary Income: For tax purposes, income from wages, salaries, and self-employment, demagogically called " earned income."
• Original Cost: The purchase price of property, paid by the present owner. The present owner may or may not be the first owner.
• Origination Fee: A fee paid to a lender for processing a loan application; it is stated as a percentage of the loan amount. (1% is generally known as one point).
• Owner's Policy: A policy of title insurance usually insuring an owner of real estate against loss occasioned by defects in, liens against or unmarketability of the owner's title.
• Owner's Title Insurance: Title insurance for the owner of property, rather than a lien holder.

P


• P.I.Q.: A title term referring to Property In Question.
• Party Wall: A wall generally erected on a property boundary or between two lots for the common benefit and use of the property owners on either side.
• Periodic Rate Cap: A limit on the amount that the interest rate can increase or decrease during any one adjustment period, regardless of how high or low the index might be.
• Permanent Loan: A long term mortgage, usually ten years or more. Also called an "end loan."
• Personal Property: Anything a person owns other than real estate.
• Personal Property (movable): Any property that is not designated by law as real property (i.e., money, goods, evidences of debt, rights of action, furniture, automobiles).
• Personal Property Loan: A loan which is secured by both real and personal property. The minimum ratio of personal to real property is set by law. The credit of the borrower is a major consideration in making the loan. (See also Equity Loan).
• Personal Representative: The person who administers an estate. If named in a will, that person's title is an executor. If there is no valid will, that person's title is an administrator.
• Pledged Account Mortgage (PAM): Money is placed in a pledged savings account and this fund plus earned interest is gradually used to reduce mortgage payments.
• Points: Are interest, usually paid at closing. A point is 1% of the loan amounts.
• Points (loan discount points): Prepaid interest assessed at closing by the lender. Each point is equal to 1 percent of the loan amount (e.g., two points on a $100,000 mortgage would cost $2,000).
• Power of Attorney: A written statement executed by a customer to give someone else the right to enter orders in the customer's account. Must be witnessed by a notary public or other public official.
• Pre, "Prelim" or Preliminary Report: A written report issued by a title company, preliminary to issuing title insurance, which shows the recorded condition of title of the property in question. See Commitment.
• Pre-Approval: The process of determining how much money you will be eligible to borrow before you apply for a loan.
• Predatory Loans: High interest, excessive fee loans.
• Prepaid Costs: These are the costs that cover your escrow account for the future payment of interest, property taxes and homeowners insurance. Property taxes are set by the appropriate government taxing authority and, unfortunately, are not negotiable. Depending on the regulatory agency, (FHA, Fannie Mae, etc.) you will be required to pre-pay anywhere from 2 to 11 months of property taxes at closing. Premiums for homeowners insurance are set by the insurance company you select, and you are required to pay your first year homeowners' insurance plus two additional months at closing. You can usually figure on your pre-paid costs being approximately one to one & a half percent of your loan amount.
• Prepaid Expenses: 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 permitting the borrower to make payments in advance of their due date.
• Prepayment Penalty: Money charged for an early repayment of debt. Prepayment penalties are allowed in some form (but not necessarily imposed) in many states.
• Pre-Qualification: The process before the borrower is pre-approved or the loan applied for, how much home a borrower is able to afford.
• Prescriptive Easement: The granting of an easement by a court, based on the presumption that a written easement was given (although none existed), after a period of open and continuous use of land.
• Prime Rate: The rate from which lending rates by banks are calculated in the US.
• Principal: 1) In a loan, the amount of the loan, not including interest; 2) in a brokerage firm, a person in an ownership and/or supervisory capacity; and 3) in a trade, a firm acting as dealer.
• Principal Balance: The outstanding balance of principal on a mortgage not including interest or any other charges.
• Principal, Interest, Taxes, and Insurance (PITI): The four components of a monthly mortgage payment. Principal refers to the part of the monthly payment that reduces the remaining balance of the mortgage. Interest is the fee charged for borrowing money. Taxes and insurance refer to the monthly cost of property taxes and homeowners insurance, whether these amounts that are paid into an escrow account each month or not.
• Priority Inspection: A title term referring to the type of inspection made in connection with insuring a new construction loan. In making the inspection of the property, the Title Company must be assured that the work of improvement had not yet begun when the lender's deed of trust was recorded.
• Private Mortgage Insurance (PMI): In the event that you do not have a 20 percent down payment, lenders will allow a smaller down payment
• Processor: One who prepares documents to facilitate closing.
• Public Domain: Land owned by the government and belonging to the community at large.
• Public Housing Authority Bonds: Municipal bonds that provide long-term financing (mortgages) for low income housing projects, commonly referred to as PHA bonds, and guaranteed by the U.S. government. Sometimes they are called New Housing Authority Bonds, or NHAs.
• Public Records: The transcriptions in a recorder's office of instruments which have been recorded, including the indexes pertaining to them. Purchase and Sale Agreement A written contract signed by the buyer and seller stating the terms and conditions under which a property will be sold.

Q


• Quiet Title: To free the title to a piece of land from the claims of other persons by means of a court action called a "quiet title" action. The court decree obtained is a "quiet title" decree.
• Quiet Title Action: A court proceeding to remove a cloud on the title to real property.
• Quitclaim Deed: A deed operating as a release; intended to pass any title, interest, or claim which the grantor may have in the property, but not containing any warranty of a valid interest or title in the grantor.

R


• Rate: The price of one currency in terms of another, normally against USD.
• Rate Lock: A commitment issued by a lender to a borrower or other mortgage originator guaranteeing a specified interest rate and lender costs for a specified period of time.
• Real Estate Agent: A person licensed to negotiate and transact the sale of real estate on behalf of either the borrower or seller, or in some cases both parties.
• Real Estate Investment Trust: A closed-end investment company that invests in real estate, either directly or through real estate loans, commonly referred to as a REIT.
• Real Estate Mortgage Investment Conduit: Mortgages pooled to sell to investors, commonly called a REMIC.
• Real Estate Settlement Procedures Act (RESPA): A consumer protection law that requires lenders to give borrowers advance notice of closing costs, including an "APR".
• Real Property (immovable): Land, from the center of the earth and extending above the surface indefinitely, including all inherent natural attributes and any man-made improvements of a permanent nature place thereon. For example: minerals, trees, buildings, appurtenant rights.
• Real Property: Land buildings and whatever is attached or affixed to the land. Generally synonymous with the words real estate.
• Realtor: A real estate broker or an associate holding active membership in a local real estate board affiliated with the National Association of Realtors.
• Reconveyance: An instrument used to transfer title from a trustee to the equitable owner of real estate, when title is held as collateral security for a debt. Most commonly used upon payment in full of a trust deed. Also called a deed of reconveyance or release.
• Record: All the documents and evidence plus transcripts of oral proceedings in a case.
• Recording: Filing documents affecting real property as a matter of public record, giving notice to future purchasers, creditors, or other interested parties. Recording is controlled by statute and usually requires the witnessing and notarizing of an instrument to be recorded.
• Recording Fees: Money paid to the lender for recording a home sale with the local authorities, thereby making it part of the public records.
• Recourse Loan: In a limited partnership, a loan for which the limited partners are personally liable.
• Refinance: Obtaining a new mortgage loan on a property already owned. Often to replace existing loans on the property.
• Refinancing: The process of paying off one loan with the proceeds from a new loan secured by the same property. This is most often done to get the better interest rate offered by the new loan or to pull cash out.
• Reinvestment Rate: The rate at which interest earned on a loan can be reinvested. The rate may not attract the same level of interest as the principal amount.
• REIT: See Real Estate Investment Trust.
• Renegotiable Rate Mortgage: A loan in which the interest rate is adjusted periodically. See adjustable rate mortgage.
• Requirement: A demand or need; in title insurance a requirement is listed on the commitment and must be satisfied before closing.
• Rescission: The cancellation of a contract. With respect to mortgage refinancing, the law that gives the homeowner three days to cancel a contract in some cases once it is signed if the transaction uses equity in the home as security.
• Research: A careful hunting for facts or truth about a subject; inquiry; investigation.
• Reserve Requirement: The ratio of reserves to deposits, expressed as a fraction prescribed by national banking authorities, including the United States.
• RESPA: Short for the Real Estate Settlement Procedures Act. RESPA is a federal law that allows consumers to review information on known or estimated settlement cost once after application and once prior to or at a settlement. The law requires lenders to furnish the information after application only.
• Reverse Annuity Mortgage (RAM): A form of mortgage in which the lender makes periodic payments to the borrower using the borrower's equity in the home as collateral for and repayment of the loan.
• Risk-Adjusted Return on Capital (RAROC): Another measure of risk-adjusted profitability, derived as the ratio between P/L and value at risk.
• Riskless Transaction: A transaction by a broker/dealer who, upon a customer's request, buys a security for its own account first, then sells it to the customer as a dealer, and charges a markup. Riskless transactions are also known as simultaneous transactions.
• Rollover Credit: Medium term credit with a variable interest rate, which is governed by the currently prevailing rates on the Euromarket.

S


• Satisfaction of Mortgage: The document issued by the mortgagee when the mortgage loan is paid in full. Also called a "release of mortgage."
• Second Mortgage: A mortgage that has rights that are subordinate to the rights of the first mortgage. As such, these loans are often less secured and may demand a slightly higher interest rate.
• Secondary Mortgage Market: The place where primary mortgage lenders sell the mortgages they make to obtain more funds to originate more new loans. It provides liquidity for the lenders.
• Seller: One who sells real estate.
• Seller Carry-Back: An agreement in which the owner of a property provides financing, often in combination with an assumable mortgage. See owner financing.
• Servicer: An organization that collects principal and interest payments from borrowers and manages borrowers' escrow accounts. The servicer often services mortgages that have been purchased by an investor in the secondary mortgage market.
• Servicing: All the steps and operations a lender performs to keep a loan in good standing, such as collection of payments, payment of taxes, insurance, property inspections and the like.
• Seven-Day Yield: Yield for seven day period including the day reported.
• Short-Term Interest Rates: Normally the 90 day rate.
• Simple Interest: Interest which is computed only on the principle balance.
• SIPC: See Securities Investors Protection Corporation.
• Special Assessment Bond: A municipal bond that is backed by tax assessments levied on the property of residents who benefit from the facility being financed, such as an improved sewer system.
• Squatter: One who settles upon unoccupied land without legal claim or authority. (See Adverse Possession.)
• Squawk Box: A speaker connected to a phone often used in broker trading desks.
• Stagflation: Recession or low growth in conjunction with high inflation rates.
• Standard Payment Calculation: The method used to determine the monthly payment required to repay the remaining balance of a mortgage in substantially equal installments over the remaining term of the mortgage at the current interest rate.
• Step-Rate Mortgage: A mortgage that allows for the interest rate to increase according to a specified schedule (i.e., seven years), resulting in increased payments as well. At the end of the specified period, the rate and payments will remain constant for the remainder of the loan.
• Subdivision: An area of land laid out and divided into lots, blocks, and building sites, and in which public facilities are laid out, such as streets, alleys, parks, and easements for public utilities.
• Survey: A drawing showing the legal boundaries of a property, its fixtures, and any easements or encroachments.

T


• Tax Deed: A deed executed by the tax collector to the state, county or city when no redemption is made from a tax sale.
• Tax Sale: Property on which current county taxes have not been paid is "sold to the state." No actual sale takes place
• Taxable Income: The income against which tax rates are applied to compute tax paid; gross income of businesses or adjusted gross income of individuals less deductions and exemptions.
• Tenancy by the Entirety: A form of ownership by husband and wife whereby each owns the entire property. In the event of the death of one, the survivor owns the property without probate.
• Tenancy in Common: A type of joint ownership in a property without right of survivorship.
• Tenant at Will: One who holds possession of premises by permission of the owner or landlord, but without agreement for a fixed term of possession.
• THDA Funding: The Tennessee Housing Development Agency is a state subsidized program funded by proceeds of federal tax exempt bonds, otherwise known as Mortgage Revenue Bonds. Recipients are first time homebuyers with a limited income, looking for modest housing.
• Title: (1) A combination of all the elements that constitute a legal right to own, possess, use, control, enjoy and dispose of real estate or a right or interest therein. (2) The rights of ownership recognized and protected by the law.
• Title Company: A company that specializes in title searches and insuring title to property.
• Title Insurance: A policy, usually issued by a title insurance company, which insures a home buyer against errors in the title search. The cost of the policy is usually a function of the value of the property, and is often borne by the purchaser and/or seller. Policies are also available to protect the lender's interests.
• Title Plants: A filing of all recorded information to real property, paralleling the records of the county recorder's office, although the filing system may be different.
• Title Search: A check of the title records to ensure that the seller is the legal owner of the property and that there are no liens or other claims outstanding.
• Tranche: A portion of, specifically used for borrowings from the IMF.
• Trust: A legal device used to manage real or personal property, established by one person (grantor or settlor) for the benefit of another (beneficiary). (See trustee.)
• Trust Agreement or Declaration: The legal document that sets up a living trust. Testamentary trusts are set up in a will.
• Trustee: The person or institution that manages the property put in trust.
• Trustor: See Deed of Trust.
• Truth-In-Lending: A federal law requiring disclosure of the Annual Percentage Rate to home buyers shortly after they apply for the loan. Also known as Regulation Z.

U


• Underwriting: The process of evaluating a loan application to determine the risk involved for the lender.
• Unlawful Detainer: A detention of real estate without the consent of the owner or other person entitled to its possession.
• Unliquidated Debt: Remaining not determined; unassessed or unsettled; in dispute as to the proper amount.
• Unsecured Liabilities: Loans or other obligations not collateralized by either fixed assets such as real estate or by the firm's securities. Could be payable to customers, banks or other lenders, suppliers, other broker/dealers, employees or anyone else having a business relationship with the firm.
• Urban: A city or town.
• Usury: Extraction of interest on a loan above the maximum rate permitted by statute.

V

• VA Loan: A long-term, low- or no-down payment loan guaranteed by the Department of Veterans Affairs. Restricted to individuals 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. On a $75,000 fixed-rate mortgage with no down payment, this would amount to $1,406 either paid at closing or added to the amount financed.
• Verification of Deposit (VOD): A document signed by the borrower's financial institution verifying the status and balance of his/her financial accounts.
• Verification of Employment (VOE): A document signed by the borrower's employer verifying his/her position and salary.
• Veterans' Administration (VA): The federal agency which administers a system of benefits for veterans and their dependents.
• Void: Invalid; a void agreement is one for which there is no remedy.
• Voidable: Capable of being declared invalid; a voidable contract is one where a person may avoid his obligation, as a contract between an adult and a minor.

W


• Warranty Deed: A deed which guarantees that the title conveyed is good and its transfer rightful.

X

Y

Z