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Acceleration Clause
A provision in a mortgage that gives the lender
the right to demand payment of the entire principal balance if a
monthly payment is missed.
Acceptance
An offeree's consent to
enter into a contract and be bound by the terms of the offer.
Additional Principal Payment
A payment by a borrower of more than the scheduled
principal amount due in order to reduce the remaining balance on the
loan.
Adjustable-Rate Mortgage (ARM)
A mortgage that permits the lender to adjust its
interest rate periodically on the basis of changes in a specified
index.
Adjusted Basis
The original cost of a property plus the value of any
capital expenditures for improvements to the property minus any
depreciation taken.
Adjustment Date
The date on which the interest rate changes for an
adjustable-rate mortgage (ARM).
Adjustment Period
The period that elapses between the adjustment dates
for an adjustable-rate mortgage (ARM).
Administrator
A person appointed by a probate court to
administer the estate of a person who died intestate.
Affidavits
As part of the closing process, you're likely to
sign numerous affidavits. You may be required, for example, to sign an
affidavit of occupancy. It states that you will use the property as a
principal residence. Or, you and the seller may have to sign an
affidavit stating all of the improvements to the property required in
the sales contract were completed before closing.Your
lender can provide additional information regarding any of these
documents you will sign.
Affordability Analysis
A detailed analysis of your ability to afford the
purchase of a home. An affordability analysis takes into consideration
your income, liabilities, and available funds, along with the type of
mortgage you plan to use, the area where you want to purchase a home,
and the closing costs that you might expect to pay.
Amenity
A feature of real property that enhances its attractiveness
and increases the occupant's or user's satisfaction although the
feature is not essential to the property's use. Natural amenities
include a pleasant or desirable location near water, scenic views of
the surrounding area, etc. Human-made amenities include swimming pools,
tennis courts, community buildings, and other recreational facilities.
Amortization
The gradual repayment of a mortgage loan by
installments.
Amortization Schedule
A timetable for payment of a mortgage loan. An
amortization schedule shows the amount of each payment applied to
interest and principal and shows the remaining balance after each
payment is made.
Amortization Term
The amount of time required to amortize the mortgage
loan. The amortization term is expressed as a number of months. For
example, for a 30-year fixed-rate mortgage, the amortization term is
360 months.
Amortize
To repay a mortgage with regular payments that
cover both principal and interest.
Annual Mortgagor Statement
A report sent to the mortgagor each year. The
report shows how much was paid in taxes and interest during the year,
as well as the remaining mortgage loan balance at the end of the year.
Annual Percentage Rate (APR)
The cost of a mortgage stated as a yearly rate;
includes such items as interest, mortgage insurance, and loan
origination fee (points).
Annuity
An amount paid yearly or at other regular
intervals, often on a guaranteed dollar basis.
Application
A form used to apply for a mortgage loan and to
record pertinent information concerning a prospective mortgagor and the
proposed security.
Appraisal
A written analysis of the estimated value of a
property prepared by a qualified appraiser. Contrast with home
inspection.
Appraised Value
An opinion of a property's fair market value,
based on an appraiser's knowledge, experience, and analysis of the
property.
Appraiser
A person qualified by education, training, and
experience to estimate the value of real property and personal
property.
Appreciation
An increase in the value of a property due to
changes in market conditions or other causes. The opposite of
depreciation.
Assessed Value
The valuation placed on property by a public tax
assessor for purposes of taxation.
Assessment
The process of placing a value on property for the
strict purpose of taxation. May also refer to a levy against property
for a special purpose, such as a sewer assessment.
Assessment Rolls
The public record of taxable property.
Assessor
A public official who establishes the value of a
property for taxation purposes.
Asset
Anything of monetary value that is owned by a
person. Assets include real property, personal property, and
enforceable claims against others (including bank accounts, stocks,
mutual funds, and so on).
Assignment
The transfer of a mortgage from one person to
another.
Assumable Mortgage
A mortgage that can be taken over
("assumed") by the buyer when a home is sold.
A provision in an assumable mortgage allows a buyer
to assume responsibility for the mortgage from the seller. The loan
does not need to be paid in full by the original borrower upon the sale
or transfer of the property.
Assumption
The transfer of the seller's existing mortgage to
the buyer.
See also Assumable
Mortgage entry
Assumption Clause
A provision in an assumable mortgage that allows a
buyer to assume responsibility for the mortgage from the seller. The
loan does not need to be paid in full by the original borrower upon
sale or transfer of the property.
Assumption Fee
The fee paid to a lender (usually by the purchaser
of real property) resulting from the assumption of an existing
mortgage.
Attorney-in-fact
One who holds a power of attorney from another to
execute documents on behalf of the grantor of the power.
Automated Underwriting
After you complete your loan application with a
lender, it is sent to "underwriting" for review. In short,
underwriting is the process used to analyze how you have managed credit
obligations in the past, whether you have the ability to repay the
mortgage loan you are applying for (i.e., your income and assets), and
whether the price you are willing to pay for the home is supported by
the price of the property.
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Balance Sheet
A financial statement that shows assets,
liabilities, and net worth as of a specific date.
Balloon Mortgage
A mortgage that has level monthly payments that
will amortize it over a stated term but that provides for a lump sum
payment to be due at the end of an earlier specified term.
Balloon Payment
The final lump sum payment that is made at the
maturity date of a balloon mortgage.
Bankrupt
A person, firm, or corporation that, through a court
proceeding, is relieved from the payment of all debts after the
surrender of all assets to a court-appointed trustee.
Bankruptcy
A proceeding in a federal court in which a debtor
who owes more than his or her assets can relieve the debts by transferring
his or her assets to a trustee.
Before-Tax Income
Income before taxes are deducted.
Beneficiary
The person designated to receive the income from a
trust, estate, or a deed of trust.
Bequeath
To transfer personal property through a will.
Betterment
An improvement that increases property value as
distinguished from repairs or replacements that simply maintain value.
Bill of Sale
A written document that transfers title to
personal property.
Binder
A preliminary agreement, secured by the payment of
an earnest money deposit, under which a buyer offers to purchase real
estate.
Biweekly Mortgages
Your lender will probably tell you that a biweekly
mortgage is structured just like a traditional fixed-rate,
level-payment, fully amortizing mortgage. However, you make your
payments every 14 days instead of once a month. The monthly payment is
split in half, resulting in the same total monthly mortgage, but the
resulting 26 and sometimes 27 biweekly payments a year translate into
13 monthly payments, or one extra monthly payment per year.
Borrowers can qualify for a 30-year monthly
payment amount, but get a loan that pays off in approximately 22 years
at current interest rates. At higher rates, the actual term declines.
If you are looking to build up equity in your home
faster without the higher mortgage payments that come with a
shorter-term mortgage, you may want to consider the biweekly mortgage.
Payments can be deducted from your bank account and scheduled to
coincide with your payroll deposits to simplify budgeting. Lenders may
charge an initial set-up fee to automatically debit your checking
account.
Biweekly Payment Mortgage
A mortgage that requires payments to reduce the
debt every two weeks (instead of the standard monthly payment
schedule). The 26 (or possibly 27) biweekly payments are each equal to
one-half of the monthly payment that would be required if the loan were
a standard 30-year fixed-rate mortgage, and they are usually drafted
from the borrower's bank account. The result for the borrower is a
substantial savings in interest.
Blanket Insurance Policy
A single policy that covers more than one piece of
property (or more than one person).
Blanket Mortgage
The mortgage that is secured by a cooperative
project, as opposed to the share loans on individual units within the
project.
Bona fide
In good faith, without fraud.
Bond
An interest-bearing certificate of debt with a
maturity date. An obligation of a government or business corporation. A
real estate bond is a written obligation usually secured by a mortgage
or a deed of trust.
Breach
A violation of any legal obligation.
Bridge Loan
A form of second trust that is collateralized by
the borrower's present home (which is usually for sale) in a manner
that allows the proceeds to be used for closing on a new house before
the present home is sold. Also known as "swing loan."
Broker
A person who, for a commission or a fee, brings
parties together and assists in negotiating contracts between them.
Budget
A detailed plan of income and expenses expected
over a certain period of time. A budget can provide guidelines for
managing future investments and expenses.
Budget Category
A category of income or expense data that you can
use in a budget. You can also define your own budget categories and add
them to some or all of the budgets you create. "Rent" is an
example of an expense category. "Salary" is a typical income
category.
Building Code
Local regulations that control design,
construction, and materials used in construction. Building codes are
based on safety and health standards.
Buydown Account
An account in which funds are held so that they
can be applied as part of the monthly mortgage payment as each payment
comes due during the period that an interest rate buydown
plan is in effect.
Buydown Mortgage
A temporary buydown is a
mortgage on which an initial lump sum payment is made by any party to
reduce a borrower's monthly payments during the first few years of a
mortgage. A permanent buydown reduces the
interest rate over the entire life of a mortgage.
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Call Option
A provision in the mortgage that gives the
mortgagee the right to call the mortgage due and payable at the end of
a specified period for whatever reason.
Cap
A provision of an adjustable-rate mortgage (ARM) that limits
how much the interest rate or mortgage payments may increase or
decrease. See lifetime payment cap, lifetime rate cap, periodic payment
cap, and periodic rate cap.
Capacity
Lenders will want to know if you can repay the
mortgage debt you incur -- this is known as your capacity. Lenders will
base their evaluation on employment information, how long you've
worked, and how much you are paid. Lenders will also review your
expenses and any other debt obligations you have. This means they'll
want to know how many dependents you have and whether you pay any
alimony or child support, for example.
Capital
(1) Money used to create income, either as an
investment in a business or an income property. (2) The money or
property comprising the wealth owned or used by a person or business
enterprise. (3) The accumulated wealth of a person or business. (4) The
net worth of a business represented by the amount by which its assets
exceed liabilities.
Capital Expenditure
The cost of an improvement made to extend the
useful life of a property or to add to its value.
Capital Improvement
Any structure or component erected as a permanent
improvement to real property that adds to its value and useful life.
Cash-out Refinance
A refinance transaction in which the amount of
money received from the new loan exceeds the total of the money needed
to repay the existing first mortgage, closing costs, points, and the
amount required to satisfy any outstanding subordinate mortgage liens.
In other words, a refinance transaction in which the borrower receives
additional cash that can be used for any purpose.
CD-Indexed (Certificate of Deposit) ARMs
The Certificate of Deposit index represents the
weekly average of secondary market interest rates on six-month
negotiable CDs. The initial interest rate and payments adjust every six
months after an initial six-month period.
ARMs with this
index typically come with a per-adjustment cap of 1 percent and a
lifetime rate cap of 6 percent.
Certificate of Deposit
A document written by a bank or other financial
institution that is evidence of a deposit, with the issuer's promise to
return the deposit plus earnings at a specified interest rate within a
specified time period.
Also see "Adjustable-Rate Mortgage"
entry.
Certificate of Deposit Index
An index that is used to determine interest rate
changes for certain ARM plans. It
represents the weekly average of secondary market interest rates on
six-month negotiable certificates of deposit.
Also see "Adjustable-Rate
Mortgage" entry.
Certificate of Eligibility
A document issued by the federal government
certifying a veteran's eligibility for a Department of Veterans Affairs
(VA) mortgage.
Certificate of Reasonable Value (CRV)
A document issued by the Department of Veterans
Affairs (VA) that establishes the maximum value and loan amount for a
VA mortgage.
Certificate of Title
A statement provided by an abstract company, title
company, or attorney stating that the title to real estate is legally
held by the current owner.
Chain of Title
The history of all of the documents that transfer
title to a parcel of real property, starting with the earliest existing
document and ending with the most recent.
Change Frequency
The frequency (in months) of payment and/or
interest rate changes in an adjustable-rate mortgage (ARM).
Change Orders
After construction begins, you may discover that
you need to make unplanned and necessary changes to the work. The
contingency reserve covers unforeseen repairs or deficiencies found
during renovation. Unnecessary additions or changes are treated
differently.
These change orders are considered discretionary
and must first be approved by your lender. You must deposit additional
funds to pay for the work in the escrow account before work on the
changes begins. These change orders -- as well as any that result from
unforeseen repairs -- must be added as amendments to your construction
contract.
Chattel
Another name for personal property.
Clear Title
A title that is free of liens or legal questions
as to ownership of the property.
Closing
A meeting at which a sale of a property is
finalized by the buyer signing the mortgage documents and paying
closing costs. Also called "settlement."
Closing Agent
As a potential home buyer, you will need a closing
(or "settlement") agent to coordinate the various closing
activities. These can include but are not limited to preparing and
recording the closing documents and disbursing funds.
The types of services provided by a closing agent
depend on the person you hire, but typically the closing is conducted
by title companies, escrow companies or attorneys. It is usually held
at the lender's or real estate sales professional's office.
Closing Cost Item
A fee or amount that a home buyer must pay at
closing for a single service, tax, or product. Closing costs are made
up of individual closing cost items such as origination fees and attorney's
fees. Many closing cost items are included as numbered items on the
HUD-1 statement.
Closing Costs
Expenses (over and above the price of the
property) incurred by buyers and sellers in transferring ownership of a
property. Closing costs normally include an origination fee, an
attorney's fee, taxes, an amount placed in escrow, and charges for
obtaining title insurance and a survey. Closing costs percentage will
vary according to the area of the country; lenders or realtors® often
provide estimates of closing costs to prospective homebuyers.
Closing Date
After your lender has approved your mortgage and
you accept the commitment letter, the next step is to set a closing
date. Many times, your real estate sales professional coordinates the
setting of this date with you, the seller, the closing agent, and your
lender.
You may be able to move up the time frame for your
closing by working with a lender who uses Desktop Underwriter® -- our
advanced automated underwriting system -- because it can cut the time
it takes to process your mortgage.
Remember, you need to ensure that the closing
occurs before your lender's commitment letter -- and the rate lock-in,
if there is one -- expire. You can now finalize your moving plans.
Closing Statement
see "HUD-1 Settlement Statement" entry
Cloud on Title
Any conditions revealed by a title search that
adversely affect the title to real estate. Usually clouds on title
cannot be removed except by a quitclaim deed, release, or court action.
Co-maker
A person who signs a promissory note along with
the borrower. A co-maker's signature guarantees that the loan will be
repaid, because the borrower and the co-maker are equally responsible
for the repayment.
Coinsurance
A sharing of insurance risk between the insurer
and the insured. Coinsurance depends on the relationship between the
amount of the policy and a specified percentage of the actual value of
the property insured at the time of the loss.
Coinsurance Clause
A provision in a hazard insurance policy that
states the amount of coverage that must be maintained -- as a
percentage of the total value of the property -- for the insured to
collect the full amount of a loss.
Collateral
An asset (such as a car or a home) that guarantees
the repayment of a loan. The borrower risks losing the asset if the
loan is not repaid according to the terms of the loan contract.
Collection
The efforts used to bring a delinquent mortgage
current and to file the necessary notices to proceed with foreclosure when
necessary.
Commercial Banks
Commercial banks, like thrifts, originate and
service mortgage loans. In some cases, commercial banks may have
mortgage banking subsidiaries that perform this function. Banks may
choose to hold a loan in their own portfolio or sell the loan to an
investor.
Commission
The fee charged by a broker or agent for
negotiating a real estate or loan transaction. A commission is
generally a percentage of the price of the property or loan.
Commitment Letter
A formal offer by a lender stating the terms under
which it agrees to lend money to a home buyer. Also known as a
"loan commitment."
Common Area Assessments
Levies against individual unit owners in a
condominium or planned unit development (PUD) project for additional capital
to defray homeowners' association costs and expenses and to repair,
replace, maintain, improve, or operate the common areas of the project.
Common Areas
Those portions of a building, land, and amenities
owned (or managed) by a planned unit development (PUD) or condominium
project's homeowners' association (or a cooperative project's
cooperative corporation) that are used by all of the unit owners, who
share in the common expenses of their operation and maintenance. Common
areas include swimming pools, tennis courts, and other recreational
facilities, as well as common corridors of buildings, parking areas,
means of ingress and egress, etc.
Common Law
An unwritten body of law based on general custom
in England and used to an
extent in the United States.
Community Land Trust Mortgage
Option
An alternative financing option that enables low-
and moderate-income home buyers to purchase housing that has been
improved by a nonprofit Community Land Trust and to lease the land on
which the property stands.
Community Property
In some western and southwestern states, a form of
ownership under which property acquired during a marriage is presumed
to be owned jointly unless acquired as separate property of either
spouse.
Community Seconds
An alternative financing option for low- and
moderate-income households under which an investor purchases a first
mortgage that has a subsidized second mortgage behind it. The second
mortgage may be issued by a state, county, or local housing agency,
foundation, or nonprofit organization. Payment on the second mortgage
is often deferred and carries a very low interest rate (or no interest
rate at all). Part of the debt may be forgiven incrementally for each
year the buyer remains in the home.
Comparables
An abbreviation for "comparable
properties"; used for comparative purposes in the appraisal
process. Comparables are properties like the property under
consideration; they have reasonably the same size, location, and
amenities and have recently been sold. Comparables help the appraiser
determine the approximate fair market value of the subject property.
Compound Interest
Interest paid on the original principal balance
and on the accrued and unpaid interest.
Condemnation
The determination that a building is not fit for
use or is dangerous and must be destroyed; the taking of private
property for a public purpose through an exercise of the right of
eminent domain.
Condition of the Home
Potential homeowners should know of major problems
in a home before they make an offer. As a potential buyer, you should
carefully examine all elements of the home. Ask questions to the seller
and the real estate sales professional about any concerns you may have.
Both the seller and the real estate agent can be held liable if they do
not disclose any defects they know about in the home.
Condominium
A real estate project in which each unit owner has
title to a unit in a building, an undivided interest in the common
areas of the project, and sometimes the exclusive use of certain
limited common areas.
Condominium Conversion
Changing the ownership of an existing building
(usually a rental project) to the condominium form of ownership.
Condominium Hotel
A condominium project that has rental or
registration desks, short-term occupancy, food and telephone services,
and daily cleaning services and that is operated as a commercial hotel
even though the units are individually owned.
Construction Contract
The terms and conditions of any major renovation
job should be part of a formal, legally binding contract between you
and your contractor -- this is called the construction contract. The
lender you choose will likely want to review this contract before you
sign it.
Construction Loan
A short-term, interim loan for financing the cost
of construction. The lender makes payments to the builder at periodic
intervals as the work progresses.
Contingencies for Repairs
In your purchase offer, you may consider stating
that the seller must make sure the electrical systems, heating and
cooling, plumbing, and mechanical systems are functioning properly at
the closing. You may also state that your purchase is contingent upon
the satisfactory completion of a professional home inspection, which
will check these systems and other elements more completely. These are
both ways to ensure that surprises don't arise when your moving day
arrives. If you do not include this clause in your contract, you are
essentially accepting the house "as is."
Contingency
A condition that must be met before a contract is
legally binding. For example, home purchasers often include a
contingency that specifies that the contract is not binding until the
purchaser obtains a satisfactory home inspection report from a
qualified home inspector.
Contingency for Clear Title
Your purchase contract should include a
contingency that the purchase is subject to your receiving clear title
to the property. This process includes a title search and title
insurance.
Contingency for Financing
When you make a formal offer on a house, your
contract should include a financing contingency. It specifies if you
don't get the money you need to purchase the house at the terms you
want, the offer is void and you will be refunded your deposit. Don't be
surprised if the seller includes a clause in the contract that states
you must make a "good-faith effort" to get the mortgage. This
is the seller's way to ensure that you explore all options to get a
mortgage loan.
Contingency for Personal Property
Your purchase contract should specify appliances,
fixtures, and other personal property that must remain in the home. You
can avoid any surprises by listing in your contract everything that is
to be left behind when the seller moves out.
Contingency Reserve
Most mortgages for purchase-renovation require an
additional 10 percent of the total cost of the project to be put aside
into a reserve account. This contingency reserve is only used when
unforeseen repairs or deficiencies are found during renovation.
Contract
An oral or written agreement to do or not to do a
certain thing.
Contractor
A general contractor is a person who oversees a
construction project and handles aspects such as scheduling workers and
ordering supplies.
Conventional Mortgage
A mortgage that is not insured or guaranteed by
the federal government. Contrast with government mortgage.
Convertibility Clause
A provision in some adjustable-rate mortgages (ARMs) that allows the borrower to change the ARM to a
fixed-rate mortgage at specified timeframes after loan origination.
Convertible ARM
An adjustable-rate mortgage (ARM) that can be
converted to a fixed-rate mortgage under specified conditions.
Cooperative (co-op)
A type of multiple ownership in which the
residents of a multiunit housing complex own shares in the cooperative
corporation that owns the property, giving each resident the right to
occupy a specific apartment or unit.
Cooperative Corporation
A business trust entity that holds title to a cooperative
project and grants occupancy rights to particular apartments or units
to shareholders through proprietary leases or similar arrangements.
Cooperative Mortgages
Mortgages related to a cooperative project. This
usually refers to the multifamily mortgage covering the entire project
but occasionally describes the share loans on the individual units.
Cooperative Project
A residential or mixed-use building wherein a
corporation or trust holds title to the property and sells shares of
stock representing the value of a single apartment unit to individuals
who, in turn, receive a proprietary lease as evidence of title.
Corporate Relocation
Arrangements under which an employer moves an
employee to another area as part of the employer's normal course of business
or under which it transfers a substantial part or all of its operations
and employees to another area because it is relocating its headquarters
or expanding its office capacity.
Cost of Funds Index (COFI)
An index that is used to determine interest rate
changes for certain adjustable-rate mortgage (ARM) plans. It
represents the weighted-average cost of savings, borrowings, and
advances of the 11th District members of the Federal Home Loan Bank of San Francisco. See
adjustable-rate mortgage (ARM).
Costs for Settling Into Your Home
When figuring out how much home you can afford,
you need to account for the costs associated with getting into your
home.
These can include the cost for repairs that need
to be made before you can occupy your residence. There may also be the
cost of purchasing appliances, such as a washer and dryer,
refrigerator, or stove.
The bottom line is you do not want to spend all
your money on purchasing the home and not have any left to pay these
types of costs.
Covenant
A clause in a mortgage that obligates or restricts
the borrower and that, if violated, can result in foreclosure.
Credit
An agreement in which a borrower receives
something of value in exchange for a promise to repay the lender at a
later date.
Credit Bureau
The three main credit reporting agencies, or
credit bureaus, are Equifax, Experian, and
Trans Union. You can order a copy of your credit report (a nominal fee
may apply) via telephone at:
Equifax: (800) 685-1111
Trans Union: (800) 916-8800
Experian: (800) 682-7654
Credit History
A record of an individual's open and fully repaid
debts. A credit history helps a lender to determine whether a potential
borrower has a history of repaying debts in a timely manner.
Credit Life Insurance
A type of insurance often bought by mortgagors
because it will pay off the mortgage debt if the mortgagor dies while
the policy is in force.
Credit Profile
There are several ways to ensure you have a good
credit report and credit score. One of the most effective is to manage
your existing credit in a positive way.
Ask your lender for suggestions about ways to
control the amount of money you owe. Or, you can choose a credit
counselor from the list provided on this site. Some lenders may view
consumers as a greater risk if they have used most or all of their
available credit. Consumers who are considered "overextended"
may be viewed this way even if they have made all their debt payments
on time.
Missing a payment on a bill should be avoided, as
should late payments on any of your credit obligations. Experiencing a
mortgage foreclosure, filing for bankruptcy, or having your vehicle
repossessed can also affect your credit score and credit report,
limiting your ability to get new credit at a reasonable rate.
Credit Report
A report of an individual's credit history
prepared by a credit bureau and used by a lender in determining a loan
applicant's creditworthiness.
Credit Report Fee
The credit report fee covers the lender's cost for
ordering your credit report from a credit bureau.
This report will verify some of the information
you provided on your loan application as well as additional information
from the credit agency's files and from public records.
When a credit report is received, your lender will
check it against your application and look for any discrepancies. You
may be asked to explain information in your credit report.
Credit Reporting Agency
An organization that prepares reports that are
used by lenders to determine a potential borrower's credit history. The
agency obtains data for these reports from a credit repository as well
as from other sources.
Credit Repository
An organization that gathers, records, updates,
and stores financial and public records information about the payment
records of individuals who are being considered for credit.
Credit Scoring
Your credit score is based on all the information
in your credit report. This information is converted into a number -- a
credit score -- that the lender uses to determine whether you are
likely to repay your loan in a timely manner. The scores used in
mortgage lending are typically in the 300 to 900 range. A general guide
is that the higher your score the better. But you should keep in mind
that your credit score is just one of several factors that will be used
to evaluate your mortgage loan application.
Credit Unions
A credit union is a financial institution that is
owned and run by its members. It is a nonprofit, cooperative
institution that offers members a place to save and borrow. A credit
union often works by having its members pool their funds so additional
loans can be made to other members.
Creditor
A person to whom money is owed.
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Debt
An amount owed to another.
Deed
The legal document conveying title to a property.
The deed is the document that transfers ownership from the seller to
you. Only the seller signs the deed at closing, and you'll receive a
copy of it. The closing agent will record the deed with you listed as
the new property owner. Your name and the names of any other buyers
appear on the deed, and it will be sent to you after it is recorded.
Deed-in-lieu
A deed given by a mortgagor to the mortgagee to
satisfy a debt and avoid foreclosure. Also called a "voluntary
conveyance."
Deed of Trust
The document used in some states instead of a
mortgage; title is conveyed to a trustee. In some states, a "deed
of trust" is used instead of a mortgage. When homeowners sign a
deed of trust, they receive title to the property but convey title to a
neutral third party -- called a trustee -- until the loan balance is
paid in full.
Default
Failure to make mortgage payments on a timely
basis or to comply with other requirements of a mortgage.
Delinquency
Failure to make mortgage payments when mortgage
payments are due.
Department of Veterans Affairs (VA)
An agency of the federal government that
guarantees residential mortgages made to eligible veterans of the
military services. The guarantee protects the lender against loss and
thus encourages lenders to make mortgages to veterans.
The Veterans Administration is a federal
government agency authorized to guarantee loans made to eligible
veterans under certain conditions. To obtain more information, you can contact
the U.S. Department of Veterans Affairs.
The VA guarantee allows qualified veterans to buy
a house costing up to $203,000 with no down payment. Moreover, the
qualification guidelines for VA loans are more flexible than those for
either the Federal Housing Administration (FHA) or conventional loans.
If you are a qualified veteran, this can be an
attractive mortgage program. T | 
