Term
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Definition
| A salesperson at a wholesale mortgage lender whose job it is to solicit loans from mortgage brokers |
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Term
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Definition
| An employee of a wholesale mortgage lender who acts as a liaison between the mortgage broker representatives (Loan Officer, Loan Processor) and the wholesale lender representatives (Account Executive, Account Manager, Underwriter) |
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Term
| Adjustable Rate Mortgage (ARM) |
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Definition
| A mortgage loan where the interest rate is periodically adjusted in accordance with terms agreed upon at the inception of the loan |
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Term
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Definition
| Notice to a potential borrower of a denial of credit |
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Term
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Definition
| The systematic, periodic, and continuous payments on a loan until it is paid in full |
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Term
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Definition
| A timetable showing how much of each payment will be applied toward principal and how much toward interest over the life of a loan until the loan balance reaches zero. |
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Term
| Annual Percentage Rate (APR) |
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Definition
| A term used in the TIL to represent the percentage relationship of the total finance charge to the amount of the loan, reflecting the cost of the mortgage loan as a yearly rate (it could be higher than the rate on the Note because it includes loan discount points, miscellaneous fees, and mortgage insurance, in addition to the interest rate) |
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Term
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Definition
| A report that sets forth an expert opinion, or estimate of value, primarily based on an analysis of comparable sales of similar homes nearby |
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Term
| Appraisal Management Company (AMC) |
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Definition
| A company through which mortgage lenders order residential real estate valuation services (appraisals) for properties on which they are considering extending loans against |
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Term
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Definition
| An opinion of a property's fair market value based on an appraiser's knowledge, experience, and analysis of the property as indicated on an appraisal |
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Term
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Definition
| An individual who, by education, training, and experience, estimates the value of real property and records the findings on industry accepted appraisal forms and reports |
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Term
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Definition
| The increase in the value of a property due to changes in market conditions, inflation, upgrades, or other causes |
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Term
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Definition
| The valuation placed on property by a public tax assessor for purposes of taxation |
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Term
| Automated Underwriting System (AUS) |
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Definition
| A system that retrieves relevant borrower data and arrives at a logic-based loan decision |
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Term
| Automated Valuation Model (AVM) |
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Definition
| Statistically based computer programs that use real estate information, such as comparable sales, property characteristics, tax assessments, and price trends to provide an estimate of value for a specific property |
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Term
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Definition
| A legal proceeding in federal court in which a debtor seeks to discharge/restructure his/her obligations to creditors pursuant to the Bankruptcy Code |
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Term
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Definition
| One one-hundredth of one percent (1/100 of 1%). Ex., 7.5 basis points is .075% |
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Term
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Definition
| A refinance loan for the purpose of accessing equity in a home and converting it to cash, thereby increasing the original loan's outstanding balance |
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Term
| Certificate of Eligibility (COE) |
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Definition
| A document issued by the Veterans Administration that certifies a veteran's eligibility for a VA loan |
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Term
| Certificate of Reasonable Value (CRV) |
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Definition
| A certificate issued by the Veterans Administration once the appraisal on a property being bought with a VA Loan has been performed |
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Term
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Definition
| A document provided by a qualified source (such as a title company) that shows the property legally belongs to the current owner |
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Term
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Definition
| An analysis of the transfer of title to a piece of property over the years |
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Term
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Definition
| The portion of principal and interest due on a loan that is written off when deemed uncollectible |
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Term
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Definition
| A title that is free of liens or legal questions as to ownership of the property |
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Term
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Definition
| A term used to indicate that a lender has cleared all the conditions of a loan and is now ready to go to closing |
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Term
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Definition
| A meeting where loan documents are signed and money changes hands, representing the finalization of the process of purchasing or refinancing real estate |
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Term
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Definition
| Costs associated with closing on a mortgage loan (i.e., origination fees, discount points, attorney's fees, title fees, etc.) |
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Term
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Definition
| A 5-page document that provides the final details about a mortgage loan, including loan terms, projected monthly payments, and list of all fees and other costs (this replaced the TIL and final HUD-1 in October 2015) |
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Term
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Definition
| See Closing Disclosure - A 5-page document that provides the final details about a mortgage loan, including loan terms, projected monthly payments, and list of all fees and other costs (this replaced the TIL and final HUD-1 in October 2015) |
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Term
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Definition
| A party who signs the mortgage note along with the primary borrower, and who also shares title to the subject real estate |
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Term
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Definition
| The property that is pledged as security for the satisfaction of a debt, which can be repossessed if the loan is not repaid |
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Term
| Combined Loan to Value (CLTV) |
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Definition
| A ratio that is used for a mortgage loan that is subject to subordinate financing, which is calculated by dividing the sum of (1) the original loan amount of the first mortgage, (2) the drawn portion (outstanding principal balance) of any HELOC from which the borrower has withdrawn funds, and (3) the unpaid principal balance of all other subordinate financing, by the lower of the property’s sales price or appraised value |
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Term
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Definition
| Property that is either used for commercial purposes (i.e., office building, shopping center), or contains more than 4 residential dwelling units |
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Term
| Computerized Homes Underwriting Management System (CHUMS) |
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Definition
| The computerized system that HUD uses to track applications for single family mortgages from assignment to endorsement for FHA mortgage insurance |
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Term
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Definition
| Additional information or documentation required by an underwriter prior to full approval of a mortgage loan |
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Term
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Definition
| A real estate project where each unit owner has title to his/her individual unit, an individual interest in the project's common areas, and in some cases, the exclusive use of certain limited common areas. |
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Term
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Definition
| A mortgage loan that meets all requirements (size and type) of government agency guidelines and can be sold to a GSE (Fannie Mae, Freddie Mac, or Ginnie Mae) |
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Term
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Definition
| A mortgage that is not insured or guaranteed by a federal government agency (i.e., FHA, HUD, or VA) |
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Term
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Definition
| 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 |
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Term
| Correspondent Origination |
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Definition
| An individual institution or organization that may originate and underwrite a mortgage loan. The correspondent closes the loan in its own name with its own funds and sells it to a lender, which in turn may sell the loan to an investor |
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Term
| Correspondent Origination |
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Definition
| The process where a lender provides the credit decision as well as the funding of a mortgage loan that was originated by a mortgage broker |
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Term
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Definition
| A party who signs the mortgage note along with the borrower, but who does not own or have any interest in the title to the property |
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Term
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Definition
| See credit score - A numeric value that ranks an individual's credit worthiness at given point in time, based on present financial condition, experience, and past credit history as compiled in the individual's credit file (the credit score is proven to be predictive of loan performance) |
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Term
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Definition
| A report provided to a lender containing a borrower's Credit Score and credit history (credit cards, previous mortgages, bank loans, and financial-related public records), which aids in the determination of the borrower's credit worthiness |
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Term
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Definition
| A Credit Report pulled from 2 or more of the major credit repositories (bureaus) |
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Term
| Credit Repository (or Bureau) |
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Definition
| An organization providing credit reporting to prospective lenders (there are 3: Equifax, Experian, and TransUnion) |
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Term
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Definition
| A numeric value that ranks an individual's credit worthiness at given point in time, based on present financial condition, experience, and past credit history as compiled in the individual's credit file (the credit score is proven to be predictive of loan performance) |
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Term
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Definition
| A person or entity to whom a debt is owed by another person or entity |
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Term
| Debt to Income Ratio (DTI) |
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Definition
| A ratio derived by dividing the borrower's total monthly obligations by his/her monthly gross income that is used to determine his/her capacity to repay the debt (there are 2, front-end/housing and back-end; front-end/housing only takes into account housing obligations such as PITIA, and the back-end includes ALL obligations). |
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Term
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Definition
| A person or entity who owes a debt to another person or entity |
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Term
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Definition
| See Mortgage - A security instrument or legal document that borrowers sign pledging real property as a security for repayment of a debt (some states use a Trust Deed or Deed of Trust); also a term used to refers to the actual loan itself |
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Term
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Definition
| Failure to comply with the terms of a mortgage agreement (most often, failure to make payments) |
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Term
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Definition
| A web-based application that gives originators access to DU through a sponsoring lender |
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Term
| Desktop Underwriter (Fannie Mae) (DU) |
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Definition
| An automated underwriting system provided by Fannie Mae that is designed to help lenders make credit decisions by analyzing borrower and property data collected on the 1003 loan application |
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Term
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Definition
| The authority designated by HUD that grants a lender the approval to underwrite and close FHA loans without prior review by HUD |
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Term
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Definition
| Any "points" paid in addition to the 1% loan origination fee (a point is 1%) on a mortgage loan |
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Term
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Definition
| The part of the purchase price of a property that the buyer pays in cash and does not finance with a mortgage |
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Term
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Definition
| Money put down by a potential home buyer, in good faith, to show their seriousness about the purchase (it becomes part of the down payment if the offer is accepted, or returned if the offer is rejected, or is forfeited if the buyer declines to continue the transaction after the agreed-upon time period) |
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Term
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Definition
| A legal right to use another's property for a specific limited purpose |
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Term
| Employer Identification Number (EIN) |
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Definition
| A unique 9-digit number assigned by the IRS to business entities operating in the U.S. for purposes of identification (also known as a Tax Identification Number, it's much like a social security number is assigned to an individual) |
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Term
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Definition
| Anything (not necessarily monetary) that affects or limits the title to a property, such as a mortgage, lease, easements, or restrictions |
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Term
| Equal Credit Opportunity Act (ECOA) |
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Definition
| A federal law that prohibits a lender from discriminating on the basis of race, color, religion, national origin, sex, marital status, age, income derived from public assistance programs, or previous exercise of Consumer Credit Protection Act rights (aka, Reg B) |
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Term
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Definition
| The difference between the fair market value of a property and the principal balance of all outstanding mortgage(s) and any other liens |
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Term
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Definition
| An item of value, money, or document deposited with a third party to be delivered upon the fulfillment of a condition |
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Term
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Definition
| An account held by the lending institution to which the borrower pays monthly installments for property taxes, property insurance, and special assessments, and from which the lender disburses these sums as they become due |
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Term
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Definition
| The portion of a mortgagor's monthly payments held by the lender or servicer to pay for property taxes, property insurance, flood insurance, and mortgage insurance as they become due |
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Term
| Fair Credit Reporting Act |
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Definition
| A government act that regulates the collection and distribution of information by the consumer credit reporting industry and affects how financial institutions collect and convey credit information about loan applicants and borrowers |
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Term
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Definition
| A government act that prohibits the denial or variance of the terms of real estate related transactions based on race, color, religion, sex, national origin, disability, or familiar status of the credit applicant |
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Term
| Fair Isaac Corporation (FICO) |
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Definition
| The company that created the FICO Score |
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Term
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Definition
| The highest price that a buyer, willing but not compelled to buy, would pay and the lowest a seller, willing but not compelled to sell, would accept |
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Term
| Fannie Mae (Federal National Mortgage Association) (FNMA) |
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Definition
| A government sponsored private corporation created by Congress to support the secondary mortgage market by investing in home loans throughout the country |
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Term
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Definition
| An FHA-to-FHA loan approval process designed to allow homeowners to refinance with less stringent underwriting requirements based on the previous FHA loan approval and payment history |
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Term
| Federal Deposit Insurance Corporation (FDIC) |
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Definition
| An organization that preserves and promotes public confidence in the U.S. financial system by insuring deposits in banks and thrift institutions for at least $250,000 |
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Term
| Federal Emergency Management Agency (FEMA) |
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Definition
| A federal agency that provides assistance in areas that have suffered a major disaster or other emergency and maintains flood insurance rate maps that identify the special flood hazard areas in which Fannie Mae requires flood insurance |
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Term
| Federal Housing Administration (FHA) |
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Definition
| A government agency that is part of HUD which provides mortgage insurance on loans made by FHA-approved lenders |
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Term
| Federal Housing Finance Agency (FHFA) |
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Definition
| A government agency that regulates the safety, soundness, and mission of Fannie Mae |
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Term
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Definition
| See Credit Score - A numeric value that ranks an individual's credit worthiness at given point in time, based on present financial condition, experience, and past credit history as compiled in the individual's credit file (the credit score is proven to be predictive of loan performance) |
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Term
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Definition
| The cost of credit as a dollar amount (i.e., total amount of interest and other loan charges, including origination fees, discount points, mortgage insurance, and other applicable charges) |
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Term
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Definition
| A summary of facts showing an individual's financial condition (includes assets and liabilities) |
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Term
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Definition
| A mortgage that is the primary lien against a property |
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Term
| First Time Home Buyer (FTHB) |
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Definition
| An individual who is 1) purchasing the security property and 2) will reside in the security property, and 3) who had no ownership interest (sole or joint) in a residential property during the 3-year period preceding the date of the purchase (a displaced homemaker or single parent also qualifies if he/she had no ownership interest in a principal residence other than a joint ownership interest with a spouse during the preceding 3-year time period) |
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Term
| Fixed Rate Mortgage (FRM) |
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Definition
| A mortgage loan where the interest rate on the note remains the same throughout the term of the loan |
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Term
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Definition
| Insurance that compensates for direct physical damage by or from flood to the insured property which is required for mortgages on properties located in federally designated flood areas |
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Term
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Definition
| The legal process by which a borrower who defaults on a mortgage is deprived of his/her interest in the mortgaged property, usually by forced sale, and in which the proceeds of sale are applied to the mortgage debt |
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Term
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Definition
| The intentional perversion of truth in order to induce another to part with something of value or to surrender a legal right |
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Term
| Freddie Mac (Federal Home Loan Mortgage Corporation) (FHLMC) |
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Definition
| A congressionally chartered corporation that purchases and sells mortgage loans in the secondary mortgage market |
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Term
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Definition
| A letter or affidavit that indicates that part of a borrower's down payment is supplied by relatives or friends in the form of a gift that does not have to be repaid |
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Term
| Ginnie Mae (Government National Mortgage Association) (GNMA) |
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Definition
| A U.S. government corporation within HUD which aims to ensure liquidity for government-insured mortgages guaranteed by FHA and VA, and brings investors' capital into the market for these types of loans so that the issuers have the means to issue more (it simply guarantees (insures) the timely payment of principal and interest from approved issuers of qualifying loans) |
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Term
| Good Faith Estimate (GFE) |
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Definition
| An estimate of interest rate, monthly payment, and all closing fees including pre-paid and escrow items as well as lender charges that must be given to the borrower within 3 days after submission of a loan application (this has been replaced by the LE as a result of TRID, effective October 2015) |
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Term
| Government Sponsored Enterprise (GSE) |
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Definition
| A financial services corporation created by Congress whose intended function is to enhance the flow of credit to targeted sectors of the economy and to make those segments of the capital market more efficient and transparent, and to reduce the risk to investors and other suppliers of capital (enhance the availability and reduce the cost of credit by reducing the risk of capital losses to investors) |
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Term
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Definition
| A person's income before deduction for income taxes and other withholdings |
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Term
| Guaranteed Underwriting System (GUS) |
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Definition
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Term
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Definition
| See Property Insurance - Insurance coverage, usually included with Homeowners Insurance, for the event of physical damage to a property from fire, wind, vandalism, or other hazards |
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Term
| Home Affordable Modification Program (HAMP) |
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Definition
| A government program introduced in 2009 to respond to the financial crisis which offers homeowners at risk of foreclosure reduced monthly mortgage payments that are affordable and sustainable in the long-term |
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Term
| Home Equity Line of Credit (HELOC) |
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Definition
| A mortgage loan, usually in 2nd position (much like a 2nd mortgage), that allows the borrower to obtain cash by drawing against the equity of his/her home, up to a predetermined limit (unlike a mortgage, this is a Revolving Credit vs. Installment Credit) |
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Term
| Home Mortgage Disclosure Act (HMDA) |
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Definition
| A government act that prevents lending discrimination and redlining by requiring public disclosure of certain pieces of information about mortgage loan applications (aka, Reg C) |
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Term
| Homeowners' Association (HOA) |
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Definition
| A not-for-profit association that manages the common areas of a planned unit development (PUD) or condominium project. |
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Term
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Definition
| Insurance coverage available for owner-occupied properties to protect against personal liability and physical property damages for a dwelling and its contents |
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Term
| Housing and Urban Development (Dept. of) (HUD) |
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Definition
| A U.S. government agency created in 1965 to support community development and home ownership |
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Term
| HUD-1 Settlement Statement (HUD-1) |
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Definition
| A document that provides an itemized listing of the funds that were paid at closing, including real estate commissions, loan fees, points, and the initial escrow (impound) amounts (this was replaced by the CD in October 2015) |
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Term
| Installment Credit (or Debt) |
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Definition
| A loan for a specific amount and a specified term (generally for big ticket items such as a house or car) which is paid back with scheduled, periodic payments (regular, equal installments) and regular intervals that gradually reduce the principal until paid in full, ultimately ending the credit cycle |
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Term
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Definition
| A financial institution that invests in mortgages and keeps them in its own portfolio |
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Term
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Definition
| The cost of borrowed money expressed as a percentage (fee charged by a lender to a borrower for the right to used borrowed funds) |
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Term
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Definition
| The amount of interest charged on a monthly loan payment expressed as a percentage |
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Term
| Interest Rate Reduction Refinance Loan (IRRRL (VA)) |
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Definition
| A VA-to-VA loan approval process designed to allow homeowners to refinance with less stringent underwriting requirements based on the previous VA loan approval and payment history |
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Term
| Internal Revenue Service (IRS) |
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Definition
| The U.S. tax collection agency that also administers the Internal Revenue Code enacted by Congress |
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Term
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Definition
| A non-owner occupied property that is usually rented to produce income |
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Term
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Definition
| Decree of a court declaring that one individual is indebted to another and fixing the amount of such indebtedness |
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Term
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Definition
| A loan that exceeds Fannie Mae and Freddie Mac's loan limits (currently at $417,000 for a single-family residence) |
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Term
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Definition
| A term which can refer to the institution making the loan or to the individual (or Broker) representing that institution |
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Term
| Lender Appraisal Processing Program (LAPP) |
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Definition
| A VA program available to qualified lenders that allows the lender's Staff Appraisal Reviewer (SAR) to close the loan and expediting the approval process |
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Term
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Definition
| A person's financial obligations (i.e., debts owed) |
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Term
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Definition
| Insurance coverage that offers protection against claims alleging that a property owner's negligence or inappropriate action resulted in bodily injury or property damage to another party |
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Term
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Definition
| A legal claim (monetary encumbrance) against a property that allows the claim holder to keep possession of that property until that monetary claim is paid off (i.e., a mortgage is a lien) |
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Term
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Definition
| Limited Liability Company |
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Term
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Definition
| See Uniform Residential Loan Application (1003) - The form used to apply for a mortgage loan, containing information about a borrower's income, savings, assets, debts, and more. |
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Term
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Definition
| An estimate of interest rate, monthly payment, and all closing fees including pre-paid and escrow items as well as lender charges that must be given to the borrower within 3 days after submission of a loan application (this replaced the GFE as a result of TRID, effective October 2015) |
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Term
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Definition
| Loan Level Price Adjustment |
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Term
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Definition
| Loan Officer (or Originator) |
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Term
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Definition
| See Origination Fee - The fee(s) charged by the lender to prepare loan documents, make credit checks, inspect, and sometimes appraise a property (computed as a percentage of the face value of the mortgage) |
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Term
|
Definition
|
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Term
|
Definition
| The gathering of the loan application and all required supporting documents so that a lender can consider the borrower for a loan |
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Term
|
Definition
| An employee of a retail lender whose responsibility is loan processing |
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Term
| Loan Prospector (Freddie Mac) (LP) |
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Definition
| An automated underwriting system provided by Freddie Mac that is designed to help lenders make credit decisions by analyzing borrower and property data collected on the 1003 loan application |
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Term
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Definition
| See Servicing - The process of collecting payments, sending statements, managing escrow/impound accounts, providing collection efforts on delinquent accounts, ensuring that insurance and property taxes are made on property, and handling pay-offs and assumptions |
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Term
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Definition
| Number of years (or months) a loan is amortized |
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Term
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Definition
| The ratio, expressed as a percentage, of the appraised value or purchase price of the mortgage property, whichever is lower, to the original outstanding principal balance of the mortgage loan |
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Term
|
Definition
| An agreement in which a lender guarantees a specified interest rate for a certain amount of time at a certain cost. |
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Term
|
Definition
| The time period during which the lender has guaranteed an interest rate to a borrower |
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Term
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Definition
| London Interbank Offered Rate |
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Term
|
Definition
|
|
Term
|
Definition
| A security instrument or legal document that borrowers sign pledging real property as a security for repayment of a debt (some states use a Trust Deed or Deed of Trust); also a term used to refers to the actual loan itself |
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Term
|
Definition
| A mortgage company that originates loans then places (brokers) those loans with a variety of other lenders |
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Term
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Definition
| Mortgage Electronic Registrations Systems, Inc. |
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Term
|
Definition
| Mortgage Guaranty Insurance Corporation |
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Term
|
Definition
| Insurance that specifically covers a loss by the lender in the event of default by a borrower (sometimes referred to as PMI - private mortgage insurance) |
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Term
| Mortgage Insurance Premium (MIP) |
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Definition
| The amount paid for mortgage insurance, either to a government agency or to a private mortgage insurance company |
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Term
|
Definition
| See Note - A legal document that obligates a borrower to repay (a written promise to repay) a specified amount on a loan at a stated interest rate during a specified period of time |
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Term
|
Definition
| See Servicing - The process of collecting payments, sending statements, managing escrow/impound accounts, providing collection efforts on delinquent accounts, ensuring that insurance and property taxes are made on property, and handling pay-offs and assumptions |
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Term
|
Definition
| The lender in a mortgage agreement |
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Term
|
Definition
| The borrower in a mortgage agreement |
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Term
|
Definition
| Nationwide Mortgage Licensing System |
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Term
|
Definition
| The income that remains for an investment property after the monthly operating income is reduced by the monthly housing expense (PITIA) |
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Term
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Definition
| The value of all of a company's (or individual's) assets, less its total liabilities (indicates financial strength) |
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Term
|
Definition
| See Rate and Term Refinance - A refinance loan for purpose of obtaining a more favorable rate &/or term which in turn lowers the monthly payment (aka, no cash-out refinance) |
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Term
|
Definition
| A mortgage loan that does not meet all requirements (size and type) of government agency guidelines and are not sold to a GSE (Fannie Mae, Freddie Mac, or Ginnie Mae) |
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Term
|
Definition
| Property purchased by a borrower as an investment with the intent of generating rental income, tax benefits, and profitable resale (i.e., not a primary residence or O/O) |
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Term
|
Definition
|
|
Term
|
Definition
| A legal document that obligates a borrower to repay (a written promise to repay) a specified amount on a loan at a stated interest rate during a specified period of time |
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Term
|
Definition
| The process of obtaining a new loan by a lender, which includes soliciting, preparing, submitting, and evaluating a loan application |
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Term
|
Definition
| The fee(s) charged by the lender to prepare loan documents, make credit checks, inspect, and sometimes appraise a property (computed as a percentage of the face value of the mortgage) |
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Term
|
Definition
| Property purchased by a borrower as a primary residence |
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Term
| Planned Unit Development (PUD) |
|
Definition
| A real estate project in which each unit owner has title to a residential lot and building and a nonexclusive easement on the common areas of the project |
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Term
|
Definition
| One percent of a mortgage |
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Term
|
Definition
|
|
Term
|
Definition
| A process in which a customer provides appropriate information on income, debts, and assets that will be used to make a credit only loan decision on an assumed sales price and loan amount |
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Term
| Prepaids (Prepaid Expenses) |
|
Definition
| Expenses or items that the homebuyer pays at closing, before they are technically due, and generally include taxes, hazard insurance, private mortgage insurance, and special assessments |
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Term
|
Definition
| A process designed to assist a customer in determining a maximum purchase price, loan amount, and PITI payment they are qualified for |
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Term
|
Definition
| The original loan amount, or remaining (outstanding) balance if partially paid off |
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Term
|
Definition
| The original or outstanding balance of a mortgage, excluding interest |
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Term
| Principal and Interest (P&I) |
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Definition
| The portion of the monthly payment that reduces the remaining balance of the mortgage |
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Term
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Definition
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Term
| Principal, Interest, Taxes, and Insurance (PITI) |
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Definition
| The total mortgage payment that includes the escrow impound (property taxes & insurance) |
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Term
| Principal, Interest, Taxes, Insurance, and Assessments (PITIA) |
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Definition
| PITI plus assessments included as an escrow impound |
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Term
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Definition
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Term
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Definition
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Term
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Definition
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Term
| Private Mortgage Insurance (PMI) |
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Definition
| See Mortgage Insurance - Insurance that specifically covers a loss by the lender in the event of default by a borrower (sometimes referred to as PMI - private mortgage insurance) |
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Term
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Definition
| See Loan Processing - The gathering of the loan application and all required supporting documents so that a lender can consider the borrower for a loan |
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Term
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Definition
| See Note - A legal document that obligates a borrower to repay (a written promise to repay) a specified amount on a loan at a stated interest rate during a specified period of time |
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Term
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Definition
| Property Inspection Waiver |
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Term
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Definition
| Insurance coverage, usually included with Homeowners Insurance, for the event of physical damage to a property from fire, wind, vandalism, or other hazards |
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Term
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Definition
| An ad valorem (based on valuation) tax assessed on real estate by local government |
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Term
| Purchase Contract (or Agreement) (PC) |
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Definition
| A written contract for the purchase/sales, exchange, or other conveyance of real estate between parties. |
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Term
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Definition
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Term
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Definition
| See Interest Rate - The amount of interest charged on a monthly loan payment expressed as a percentage |
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Term
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Definition
| A refinance loan for purpose of obtaining a more favorable rate &/or term which in turn lowers the monthly payment (aka, no cash-out refinance) |
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Term
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Definition
| Other real estate owned by the borrower such as investment property |
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Term
| Real Estate Settlement Procedures Act (RESPA) |
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Definition
| A federal consumer protection law that requires lenders to provide home mortgage borrowers with information on known or estimated settlement (closing) costs and regulates escrow (impound) accounting practices. |
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Term
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Definition
| Land and improvements (i.e., buildings and structures) |
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Term
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Definition
| The practice of denying services (credit), either directly or through selectively raising prices, to residents of certain areas based on the racial or ethnic composition of those areas. |
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Term
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Definition
| A loan used to renew or repay an existing loan using the same property as collateral |
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Term
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Definition
| See ECOA - A federal law that prohibits a lender from discriminating on the basis of race, color, religion, national origin, sex, marital status, age, income derived from public assistance programs, or previous exercise of Consumer Credit Protection Act rights (aka, Reg B) |
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Term
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Definition
| See HMDA - A government act that prevents lending discrimination and redlining by requiring public disclosure of certain pieces of information about mortgage loan applications (aka, Reg C) |
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Term
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Definition
| See TIL - Written disclosure of all costs connected with the credit portion of a loan established by TILA (this was replaced by the CD in October 2015) |
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Term
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Definition
| The cancellation or annulment of a transaction by the operation of law or by mutual consent |
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Term
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Definition
| The process of soliciting and qualifying a borrower for a mortgage loan |
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Term
| Revolving Credit (or Debt) |
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Definition
| A loan in which payments are open-ended, and any repaid funds are available to be borrowed (drawn) again, repeatedly as long as the credit remains open (e.g., credit cards) |
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Term
| Staff Appraisal Review (SAR) |
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Definition
| A designation granted by the VA to a lender's qualified underwriter that allows him/her to approve an appraisal without the VA's prior review |
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Term
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Definition
| See Purchase Contract - A written contract for the purchase/sales, exchange, or other conveyance of real estate between parties. |
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Term
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Definition
| A mortgage that has a lien position subordinate (in 2nd position) to the first mortgage |
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Term
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Definition
| An informal market where home loans (mortgages) and servicing rights are bought and sold between lenders and investors |
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Term
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Definition
| A vacation home is an SFR that a borrower must occupy at least 2 weeks per year |
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Term
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Definition
| The process of collecting payments, sending statements, managing escrow/impound accounts, providing collection efforts on delinquent accounts, ensuring that insurance and property taxes are made on property, and handling pay-offs and assumptions |
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Term
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Definition
| See Closing - A meeting where loan documents are signed and money changes hands, representing the finalization of the process of purchasing or refinancing real estate |
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Term
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Definition
| See Closing Costs - Costs associated with closing on a mortgage loan (i.e., origination fees, discount points, attorney's fees, title fees, etc.) |
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Term
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Definition
| See HUD-1 - A document that provides an itemized listing of the funds that were paid at closing, including real estate commissions, loan fees, points, and the initial escrow (impound) amounts (this was replaced by the CD in October 2015) |
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Term
| Single Family Residence (SFR) |
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Definition
| A property that contains 1-4 residential dwelling units |
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Term
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Definition
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Term
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Definition
| Any mortgage (i.e., Second Mortgage) other lien (i.e., HELOC) that has a pay-off priority lower than of the first mortgage |
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Term
| Taxes and Insurance (T&I) |
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Definition
| The portion of the monthly mortgage payment that represents property taxes and hazard insurance (usually the escrow impound) |
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Term
| Taxpayer Identification Number (TIN) |
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Definition
| See EIN - A unique 9-digit number assigned by the IRS to business entities operating in the U.S. for purposes of identification (also known as a Tax Identification Number, it's much like a social security number is assigned to an individual) |
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Term
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Definition
| See Loan Term - Number of years (or months) a loan is amortized |
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Term
| Third Party Origination (or Originator) (TPO) |
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Definition
| A process by which a lender uses another party to completely or partially originate, process, underwriter, close, fund, or package the mortgages it plans to deliver to a GSE or investor |
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Term
| TILA-RESPA Integrated Disclosure (TRID) |
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Definition
| The new disclosure rule, effective October 2015, that combines the disclosures required by both TILA and RESPA (the LE replaces the TIL and GFE, and the CD replaced the final TIL and HUD-1) |
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Term
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Definition
| The evidence to the right to or ownership in property |
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Term
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Definition
| Insurance against loss resulting from clouds, claims, or defects in the title to real property |
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Term
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Definition
| See Mortgage - A security instrument or legal document that borrowers sign pledging real property as a security for repayment of a debt (some states use a Trust Deed or Deed of Trust); also a term used to refers to the actual loan itself |
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Term
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Definition
| Truth in Lending Act of 1968 |
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Term
| Truth in Lending Disclosure (TIL) |
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Definition
| Written disclosure of all costs connected with the credit portion of a loan established by TILA (this was replaced by the CD in October 2015) |
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Term
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Definition
| U.S. Dept. of Agriculture |
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Term
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Definition
| The process of evaluating a loan application to determine the risk involved for the lender |
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Term
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Definition
| An employee of a lender whose responsibility is underwriting |
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Term
| Uniform Residential Loan Application (1003) |
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Definition
| The form used to apply for a mortgage loan, containing information about a borrower's income, savings, assets, debts, and more. |
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Term
| Verification of Deposit (VOD) |
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Definition
| A form used to verify the deposits or assets of a prospective borrower when monthly statements are unavailable or unusable |
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Term
| Verification of Employment (VOE) |
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Definition
| A form used to verify the employment and income of a prospective borrower when pay stubs and W2 forms are unavailable or unusable |
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Term
| Verification of Mortgage (VOM) |
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Definition
| A form used to verify a prospective borrower's existing mortgage balance, monthly payments, and late payments, if any |
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Term
| Verification of Rent (VOR) |
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Definition
| A form used to verify a prospective borrower's monthly rents paid and late payments, if any |
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Term
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Definition
| Veterans Affairs (U.S. Dept. of) |
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Term
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Definition
| The process where a lender provides the credit decision as well as the funding of a mortgage loan that was originated by a mortgage broker |
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