Assumable mortgage: A mortgage that can be transferred from a seller to a buyer. The buyer then takes over payment of an existing loan.

Size: px
Start display at page:

Download "Assumable mortgage: A mortgage that can be transferred from a seller to a buyer. The buyer then takes over payment of an existing loan."

Transcription

1 MORTGAGE GLOSSARY Adjustable Rate Mortgage (ARM): A mortgage loan with payments usually lower than a fixed rate initially, but is subject to changes in interest rates. There are a variety of ARMs that can have an initial interest rate that lasts three to 10 years, adjusting annually thereafter. They are described as 3/1, 5/1, 7/1 and 10/1. A 3/1 ARM starts out with a low rate that lasts three years, then is adjusted annually. A 5/1 ARM has an introductory rate that lasts five years, and 7/1 and 10/1 ARMs have intro rates that last seven and 10 years. The monthly payment amount is usually subject to a cap. Amortization: Repayment of a mortgage loan through regular monthly installments of principal and interest. At the end of the scheduled payments (e.g., monthly payments for 15 or 30 years), you will own your home. Annual Percentage Rate (APR): Calculated by using a standard formula, the APR is expressed as a yearly rate (e.g., 8.107% APR) and includes the interest, points (discount and origination), mortgage insurance, and other fees. The APR on a mortgage will usually be higher than the stated interest rate because the APR includes fees and the interest rate doesn't. Assets: Assets are anything of financial value that can be converted into cash (i.e., stocks and bonds, automobiles, real estate, retirement funds, and savings). Assumable mortgage: A mortgage that can be transferred from a seller to a buyer. The buyer then takes over payment of an existing loan. Automated Underwriting System: A computerized system used to assess information provided by a borrower, plus public information about the borrower, to quickly determine whether a loan should be pre-approved. Balloon mortgage: A mortgage that typically offers low rates for the first 3 to 10 years, at which point the principal balance needs to be paid in full. Borrowers usually sell before the balance is due or refinance the loan. Bankruptcy: Bankruptcy is the legal process in which a person declares their inability to pay off their debts. Bankruptcy does not mean you cannot get a loan, but the terms of your loan may not be as favorable. Borrower: A person who has been approved to receive a loan and is then obligated to repay it and any additional fees according to the loan terms.

2 Bridge loan: A loan that "bridges" the gap between the purchase of a new home and the sale of the borrower's current home. Usually up to 6 months long. Cap: A limit, such as that placed on an adjustable rate mortgage, on how much a monthly payment or interest rate can increase or decrease. COFI: Acronym for 11th District Cost of Funds Index, a common index to which loans are tied. The COFI is tied to interest paid on savings accounts. Collateral: In real estate, property offered to secure [or offered as security for] repayment of a loan, though not with the intention of transferring property ownership. Credit report: A detailed history of an individual's credit worthiness. This is used by lenders to gauge a potential borrower's ability to repay a loan. Default: The inability to pay monthly mortgage payments in a timely manner or to otherwise meet the mortgage terms. Delinquency: A borrower's failure to make mortgage payments when they are due. Discount point: Discount points are paid to a lender (usually at closing) to reduce the interest rate on a loan. Each point is equal to 1% of the total loan amount. (Also see: Points) Equity: Calculated by subtracting the amount still owed on the mortgage loan and any liens from the fair market value of the property. Equity grows as the mortgage is paid down and the property appreciates in value. Fannie Mae: A private, shareholder-owned company that purchases residential mortgages and converts them into securities for sale to investors. Fannie Mae supplies funds that lenders may loan to potential homebuyers. Its original name was Federal National Mortgage Association (FNMA), started by the federal government in The Fed: The Federal Reserve System, a network of twelve Federal Reserve Banks and affiliated branches that serves as the central bank of the United States. "The Fed" also often refers to the Board of Governors of the Federal Reserve System. The Fed Board sets overnight lending rates for banks. This is what banks charge each other for borrowing money overnight, which they do when they need to replenish their reserves. The Fed uses these rates to control inflation: if it lowers these rates, more money flows in the form of loans to consumers and businesses; if it raises rates, there are fewer loans. Mortgage rates are not tied to the Fed's rates, but they are influenced by it. Federal Housing Administration (FHA): The FHA was established in 1934 to advance homeownership opportunities for all Americans. It provides mortgage insurance on loans made by FHA-approved lenders throughout the United States and its territories.

3 FICO: An acronym for the Fair Isaac Corporation, the company that developed the most commonly used credit scoring system. Credit reporting agencies issue FICO scores to lenders who in turn use them to calculate the risk on a loan. Fixed-rate mortgage: A mortgage with payments that remain the same throughout the life of the loan because the interest rate and other terms do not change. Foreclosure: The legal process by which a bank or lender sells or repossesses a mortgaged property because the borrower could not pay the loan. Freddie Mac: Created in 1970 by the federal government as the Federal Home Loan Mortgage Corporation, it is a stockholder-owned corporation chartered by Congress to increase the supply of funds that mortgage lenders, such as commercial banks, mortgage bankers, savings institutions and credit unions, can make available to homebuyers and multifamily investors. Fully amortized loan: If the payment schedule on a loan is met, the loan principal will be entirely paid off at the end of the term. Ginnie Mae: A government-owned corporation overseen by the U.S. Department of Housing and Urban Development, Ginnie Mae pools FHA-insured and VA-guaranteed loans to back securities for private investment. Like Fannie Mae and Freddie Mac, the investment income provides funding that may then be lent to eligible borrowers by lenders. Ginnie Mae stands for Government National Mortgage Association (GNMA). Good faith estimate (GFE): A written estimate of all expected closing fees including pre-paid and escrow items as well as lender charges. It must be given to the borrower, by a potential lender, within three days after submission of a mortgage loan application. By law, brokers and lenders are required to make as accurate an estimate as possible. Homeowner's insurance: Provides damage protection for your home and personal property from a variety of events, including fire, lightning, burglary, vandalism, storms, explosions, and more. All homeowner's insurance policies contain personal liability coverage, which protects against lawsuits involving injuries that occur on and off your property. It is required by most lenders. HUD: The U.S. Department of Housing and Urban Development. Established in 1965, HUD works to create a decent home and suitable living environment for all Americans by addressing housing needs, improving and developing American communities, and enforcing fair laws. HUD-1 Statement: Also known as the "settlement sheet," it is an itemized listing of closing costs. The closing costs can include a commission, loan fees and points, and sums set aside for escrow payments, taxes and insurance. It is signed by both the buyer and the seller, who may share closing costs.

4 Index: A measurement used by lenders to determine changes to the interest rate charged on an adjustable rate mortgage. Interest: A rate or fee charged for the use of borrowed money. Interest rate: Usually expressed as a percentage, it is the amount of interest charged that determines a monthly loan payment. Lender: An institution, such as a bank or broker, which loans money to be repaid with interest. Learn more about lenders. Loan: Money borrowed that is usually repaid with interest. Loan application: The first step in the official loan approval process; this form is used to record important information about the potential borrower necessary to the underwriting process. Loan-To-Value ratio (LTV): The loan amount divided by either the lesser of the sales price of a property, or its appraised value. The LTV ratio is used during the loan approval period to gauge risk: the higher the LTV ratio, the higher the interest rate, and vice versa. Lock-in: A guarantee of an interest rate if a loan is closed within a specific time. Margin: Expressed in percentage points, the amount a lender adds to an index to determine the interest rate on an adjustable rate mortgage. Mortgage: A lien against real estate given by a buyer or property owner to the lender as security for money borrowed. Essentially, it is a legal agreement that means if the borrower stops making payments, the lender can take possession of the house. (Note: Literal translation is "death pledge." It comes from Latin: mort ["death"] + gage ["pledge"]). Mortgage banker: One who originates, sells, and services mortgage loans and resells them to secondary mortgage lenders such as Fannie Mae or Freddie Mac. Mortgage broker: A firm that originates and processes loans for a number of lenders. Mortgage insurance: A policy protecting lenders against some or most of the losses that can occur when a borrower defaults on a mortgage loan; mortgage insurance is required primarily for borrowers with a down payment of less than 20% of the home's purchase price. Also known as PMI (Private Mortgage Insurance). Mortgage Insurance Premium (MIP): Also known as Private Mortgage Insurance (PMI), a monthly payment by a borrower for mortgage insurance. This protects the lender by paying the costs of foreclosing on a house if the borrower stops paying the loan.

5 Mortgage insurance usually is required if the down payment is less than 20 percent of the sale price. Negative amortization: When the payment on a loan is less than the interest that accrues on the principal. The balance of interest owed is added to the total loan. Origination: The process of preparing, submitting, and evaluating a loan application; generally includes a credit check, verification of employment, and a property appraisal. Origination fee: The fee a lender charges for processing a loan. This includes the cost to prepare loan documents, check a borrower's credit history, and inspect the property. Par rate: A rate of interest on a loan for which the lender does not charge (nor pay) points. An interest rate lower than the par rate would cost the broker money; an interest rate higher than the par rate would pay the broker a commission. [The par rate can vary, depending on the qualifications of a particular borrower.] Points: A point equals 1 percent of a mortgage. Lenders sometimes charge "origination points" to cover expenses of making a loan. Also, borrowers sometimes pay "discount points" to reduce the loan's interest rate. Pre-Approval: A commitment in writing from a lender that a borrower would qualify for a particular loan amount based on income and credit information. Pre-Payment Penalty: A pre-payment penalty means that if you pay off your mortgage loan earlier than agreed, you will pay a penalty. However, if you agree to pay a prepayment penalty, you will usually get a better interest rate. Pre-qualify: When a lender informally evaluates a borrower's finances to determine how much he or she can afford to borrow and on what terms. Prime Rate: The published interest rate at which banks make short-term unsecured loans to their best customers. The rate generally is the same across all major banks, and adjusts at the same time. Principal: The original amount of a debt; a sum of money agreed to by the borrower and the lender to be repaid on a schedule. Interest is calculated as a percentage of principal. Principal, Interest, Taxes, and Insurance (PITI): The four elements that make up a monthly mortgage payment. The principal and interest payments go towards repaying the loan, while taxes and insurance (homeowner's and mortgage, if applicable) goes into an escrow account to cover the fees when they are due. Principal: The amount of money borrowed from a lender, not including interest or additional fees.

6 Refinancing: The act of paying off one loan by obtaining another. Refinancing is generally done to secure better loan terms, such as a lower interest rate. RESPA: The Real Estate Settlement Procedures Act is a 1974 law aimed at protecting consumers by requiring disclosures (including a Good Faith Estimate) and forbidding kickbacks for referrals among the service providers involved in the sale of a home. For example, a real estate agent may not receive a payment for referring the client to a particular title insurance company. Seller's market: When the demand for homes in a given marketplace exceeds the supply of properties on the market. Title insurance: Insurance protecting the lender (or a homeowner) against any claims that could arise from arguments about ownership of the property. Should a problem arise, the title insurer pays any legal damages. Truth-in-Lending: A federal law obligating a lender to give full written disclosure of all fees, terms, and conditions associated with the loan's initial period and any adjustments to the remaining term of the loan. Underwriting: The process of analyzing a loan application to determine the amount of risk involved in making the loan. It includes a review of the potential borrower's credit history and a judgment of the property value. Yield Spread Premium: A percentage of the loan amount, the YSP is what a lender pays a broker for a loan with a higher interest rate, and lower fees. Zillow, Inc Originally posted - Mortgage Glossary

Mortgage Terms Glossary

Mortgage Terms Glossary Mortgage Terms Glossary Adjustable-Rate Mortgage (ARM) A mortgage where the interest rate is not fixed, but changes during the life of the loan in line with movements in an index rate. You may also see

More information

Appraiser: a qualified individual who uses his or her experience and knowledge to prepare the appraisal estimate.

Appraiser: a qualified individual who uses his or her experience and knowledge to prepare the appraisal estimate. Mortgage Glossary 203(b): FHA program which provides mortgage insurance to protect lenders from default; used to finance the purchase of new or existing one- to four family housing; characterized by low

More information

MORTGAGE TERMS. Assignment of Mortgage A document used to transfer ownership of a mortgage from one party to another.

MORTGAGE TERMS. Assignment of Mortgage A document used to transfer ownership of a mortgage from one party to another. MORTGAGE TERMS Acceleration Clause This is a clause used in a mortgage that can be enforced to make the entire amount of the loan and any interest due immediately. This is usually stipulated if you default

More information

Appraiser: a qualified individual who uses his or her experience and knowledge to prepare the appraisal estimate.

Appraiser: a qualified individual who uses his or her experience and knowledge to prepare the appraisal estimate. Glossary of Terms 203(b): FHA program which provides mortgage insurance to protect lenders from default; used to finance the purchase of new or existing one- to four family housing; characterized by low

More information

Adjustment Date - The date on which the interest rate changes for an adjustable-rate mortgage (ARM).

Adjustment Date - The date on which the interest rate changes for an adjustable-rate mortgage (ARM). Glossary A Adjustable Rate Mortgage - An adjustable rate mortgage, commonly referred to as an ARM, is a loan type that allows the lender to adjust the interest rate during the term of the loan. Generally,

More information

Acceleration Clause Provision in a mortgage that allows the lender to demand payment of the entire principal balance if a monthly payment is missed

Acceleration Clause Provision in a mortgage that allows the lender to demand payment of the entire principal balance if a monthly payment is missed Acceleration Clause Provision in a mortgage that allows the lender to demand payment of the entire principal balance if a monthly payment is missed or some other default occurs. Additional Principal Payment

More information

Financing Glossary. A mortgage loan subject to changes in interest rates; when rates change, ARM monthly

Financing Glossary. A mortgage loan subject to changes in interest rates; when rates change, ARM monthly 203(b) 203(k) Adjustable Rate Mortgage (ARM) Adjustment Date Adjustment Period Amenity Amortization FHA program which provides mortgage insurance to protect lenders from default; used to finance the purchase

More information

HOME BUYING101. 701.255.0042 www.capcu.org i

HOME BUYING101. 701.255.0042 www.capcu.org i HOME BUYING101 701.255.0042 www.capcu.org i This book is intended as a general guide to the topics discussed, and it does not deliver accounting, personal finance, or legal advice. It is not intended,

More information

Sales Associate Course

Sales Associate Course Sales Associate Course Chapter Thirteen Types of Mortgages & Sources of Finance Copyright Gold Coast Schools 1 Types of Mortgages FHA - Federal Housing Administration VA - Veterans Administration Conventional

More information

Adjustable Rate Mortgage (ARM) a mortgage with a variable interest rate, which adjusts monthly, biannually or annually.

Adjustable Rate Mortgage (ARM) a mortgage with a variable interest rate, which adjusts monthly, biannually or annually. Glossary Adjustable Rate Mortgage (ARM) a mortgage with a variable interest rate, which adjusts monthly, biannually or annually. Amortization the way a loan is paid off over time in installments, detailing

More information

HOME BUYING101 TM %*'9 [[[ EPXEREJGY SVK i

HOME BUYING101 TM %*'9 [[[ EPXEREJGY SVK i HOME BUYING101 TM i This book is intended as a general guide to the topics discussed, and it does not deliver accounting, personal finance, or legal advice. It is not intended, and should not be used,

More information

Chapter 13: Residential and Commercial Property Financing

Chapter 13: Residential and Commercial Property Financing Chapter 13 Outline / Page 1 Chapter 13: Residential and Commercial Property Financing Understanding the Mortgage Concept - secured vs. unsecured debt - mortgage pledge of property to secure a debt (See

More information

Appraisal A written analysis prepared by a qualified appraiser and estimating the value of a property

Appraisal A written analysis prepared by a qualified appraiser and estimating the value of a property REAL ESTATE BASICS Affordability Analysis An analysis of a buyer s ability to afford the purchase of a home, reviews income, liabilities, and available funds, and considers the type of mortgage a buyer

More information

First Time Home Buyer Glossary

First Time Home Buyer Glossary First Time Home Buyer Glossary For first time home buyers, knowing and understanding the following terms are very important when purchasing your first home. By understanding these terms, you will make

More information

Presented by Concorde Mortgage Co.

Presented by Concorde Mortgage Co. Presented by Concorde Mortgage Co. Zanesville Office (740) 454-8876 Coshocton Office (740) 623-2995 Toll Free (800) 579-1291 Website: www.concorde-mortgage.com 1) Are You Ready to Buy? 2) Important Financing

More information

GLOSSARY COMMONLY USED REAL ESTATE TERMS

GLOSSARY COMMONLY USED REAL ESTATE TERMS GLOSSARY COMMONLY USED REAL ESTATE TERMS Adjustable-Rate Mortgage (ARM): a mortgage loan with an interest rate that is subject to change and is not fixed at the same level for the life of the loan. These

More information

RESIDENTIAL MORTGAGE PRODUCT INFORMATION DISCLOSURE

RESIDENTIAL MORTGAGE PRODUCT INFORMATION DISCLOSURE RESIDENTIAL MORTGAGE PRODUCT INFORMATION DISCLOSURE Whether you are buying a house or refinancing an existing mortgage, this information can help you decide what type of mortgage is right for you. You

More information

Mortgage Terms. Accrued interest Interest that is earned but not paid, adding to the amount owed.

Mortgage Terms. Accrued interest Interest that is earned but not paid, adding to the amount owed. Mortgage Terms Accrued interest Interest that is earned but not paid, adding to the amount owed. Negative amortization A rise in the loan balance when the mortgage payment is less than the interest due.

More information

MORTGAGE DICTIONARY. Amortization - Amortization is a decrease in the value of assets with time, which is normally the useful life of tangible assets.

MORTGAGE DICTIONARY. Amortization - Amortization is a decrease in the value of assets with time, which is normally the useful life of tangible assets. MORTGAGE DICTIONARY Adjustable-Rate Mortgage An adjustable-rate mortgage (ARM) is a product with a floating or variable rate that adjusts based on some index. Amortization - Amortization is a decrease

More information

Broker. Financing Real Estate. Chapter 12. Copyright Gold Coast Schools 1

Broker. Financing Real Estate. Chapter 12. Copyright Gold Coast Schools 1 Broker Chapter 12 Financing Real Estate Copyright Gold Coast Schools 1 Learning Objectives Describe the difference between a note and a mortgage Explain the benefits of having the first recorded lien on

More information

Definitions. In some cases a survey rather than an ILC is required.

Definitions. In some cases a survey rather than an ILC is required. Definitions 1. What is the closing? The closing is a formal meeting at which both the buyer and seller meet to sign all the final documentation required for the buyer's mortgage loan. Once the closing

More information

Lesson 13: Applying for a Mortgage Loan

Lesson 13: Applying for a Mortgage Loan 1 Real Estate Principles of Georgia Lesson 13: Applying for a Mortgage Loan 2 Choosing a Lender Types of lenders Types of lenders include: savings and loans commercial banks savings banks credit unions

More information

Glossary of Lending Terms

Glossary of Lending Terms Glossary of Lending Terms Adjustable Rate Loan or Adjustable Rate Mortgage (ARM) A loan with an interest rate that changes during the term of the loan. The payments generally increase or decrease with

More information

Glossary of Foreclosure Fairness Mediation Terminology

Glossary of Foreclosure Fairness Mediation Terminology Glossary of Foreclosure Fairness Mediation Terminology Adjustable-Rate Mortgage (ARM) Mortgage repaid at the rate of interest that increases or decreases over the life of the loan based on market conditions.

More information

Mortgage Terms. Appraisal An estimate of the value of property, made by a qualified professional called an "appraiser".

Mortgage Terms. Appraisal An estimate of the value of property, made by a qualified professional called an appraiser. Mortgage Terms Acceleration The right of the mortgagee (lender) to demand the immediate repayment of the mortgage loan balance upon the default of the mortgagor (borrower), or by using the right vested

More information

Mortgage Glossary. Mortgage loans under which the interest rate is periodically adjusted based upon terms agreed to at the inception of the loan.

Mortgage Glossary. Mortgage loans under which the interest rate is periodically adjusted based upon terms agreed to at the inception of the loan. Adjustable Rate Mortgage (ARM): Alternative Documentation: Amortization: Annual Percentage Rate (APR): Appraisal: Appraisal Amount or Appraised Value: Appreciation: Balloon Mortgage: Bankruptcy: Cap: Cash-out

More information

Glossary of Terms. Here are some helpful definitions to common terms.

Glossary of Terms. Here are some helpful definitions to common terms. Glossary of Terms Here are some helpful definitions to common terms. 1003 Loan application 4506 IRS form requesting copy of tax return Abstract of title A historical summary provided by a title insurance

More information

A mortgage is a loan that is used to finance the purchase of your home. It consists of 5 parts: collateral, principal, interest, taxes, and insurance.

A mortgage is a loan that is used to finance the purchase of your home. It consists of 5 parts: collateral, principal, interest, taxes, and insurance. A mortgage is a loan that is used to finance the purchase of your home. It consists of 5 parts: collateral, principal, interest, taxes, and insurance. When you agree to a mortgage, you enter into a legal

More information

HOMEBUYER S MORTGAGE GUIDE

HOMEBUYER S MORTGAGE GUIDE WWW.WINTRUSTMORTGAGE.COM WINTRUST.COM/MYHOME HOMEBUYER S MORTGAGE GUIDE HELPFUL INFORMATION ABOUT THE MORTGAGE PROCESS TO GUIDE YOU AS YOU PURCHASE YOUR NEW HOME. www.wintrust.com/myhome WHY WINTRUST?

More information

Different Types of Loans

Different Types of Loans Different Types of Loans All loans, no matter what they are, are either secured or unsecured. Knowing the difference can better help you understand how they work and what to expect when applying for one.

More information

MORTGAGE BANKING TERMS

MORTGAGE BANKING TERMS MORTGAGE BANKING TERMS Acquisition cost: Add-on interest: In a HUD/FHA transaction, the price the borrower paid for the property plus any of the following costs: closing, repairs, or financing (except

More information

Your Reverse Mortgage Guide. Reaping The Rewards Of A Lifetime Investment In Homeownership

Your Reverse Mortgage Guide. Reaping The Rewards Of A Lifetime Investment In Homeownership Your Reverse Mortgage Guide Reaping The Rewards Of A Lifetime Investment In Homeownership Contents Make The Most Of Retirement!...3 Program Overview...3 4 What Is A Reverse Mortgage? Why Get A Reverse

More information

QUICK MORTGAGE GUIDE

QUICK MORTGAGE GUIDE QUICK MORTGAGE GUIDE TABLE OF CONTENTS FNMA CONVENTIONAL LOANS - Page 3 FHA LOANS - Page 7 VA LOANS - Page 11 ADJUSTABLE RATE MORTGAGES - Page 15 CONTACT INFORMATION - Page 16 FNMA CONVENTIONAL LOANS The

More information

Chapter 10 6/16/2010. Mortgage Types and Borrower Decisions: Overview Role of the secondary market. Mortgage types:

Chapter 10 6/16/2010. Mortgage Types and Borrower Decisions: Overview Role of the secondary market. Mortgage types: Mortgage Types and Borrower Decisions: Overview Role of the secondary market Chapter 10 Residential Mortgage Types and Borrower Decisions Mortgage types: Conventional mortgages FHA mortgages VA mortgages

More information

GLOSSARY OF TERMS. Adjustment Date: The date that the interest rate changes on an adjustable-rate mortgage.

GLOSSARY OF TERMS. Adjustment Date: The date that the interest rate changes on an adjustable-rate mortgage. GLOSSARY OF TERMS A Acceleration: The right of the mortgagee (lender) to demand the immediate repayment of the mortgage loan balance upon the default of the mortgager (borrower), or by using the right

More information

Conventional Financing

Conventional Financing Chapter 6 Conventional Financing 1 Chapter Objectives Identify the characteristics of a conventional loan. Define amortization. Identify different types of conventional loans. Discuss the use of private

More information

MORTGAGE TERMINOLOGY DEFINED

MORTGAGE TERMINOLOGY DEFINED MORTGAGE TERMINOLOGY DEFINED 1-year Adjustable Rate Mortgage Mortgage where the annual rate changes yearly. The rate is usually based on movements of a published index plus a specified margin, chosen by

More information

Principal Lending Manager Education Curriculum Outline 40 Hours

Principal Lending Manager Education Curriculum Outline 40 Hours Principal Lending Manager Education Curriculum Outline 40 Hours Utah Division of Real Estate PO Box 146711 Salt Lake City, UT 84114-6711 Subject Matter Number of Hours 1. General Mortgage Industry Knowledge

More information

HOME FINANCING GUIDE

HOME FINANCING GUIDE HOME FINANCING GUIDE SECTION 1: Mortgage Loans Available Fixed Rate Mortgages A fixed rate mortgage is a home loan with a rate that remains the same over the entire term of the loan, regardless of how

More information

Real Estate Glossary. Binder. A preliminary agreement, secure by the payment of earnest money, under which a buyer offers to purchase real estate.

Real Estate Glossary. Binder. A preliminary agreement, secure by the payment of earnest money, under which a buyer offers to purchase real estate. ABR. Accredited Buyers Representative. A professional designation awarded by the Real Estate Buyers Agent Council to REALTORS who specialize in representing buyers in real estate transactions. Acceleration

More information

Dr. Debra Sherrill Central Piedmont Community College

Dr. Debra Sherrill Central Piedmont Community College Dr. Debra Sherrill Central Piedmont Community College 1 2 Describe the benefits and pitfalls of renting versus owning a home. List the steps required to obtain a mortgage loan. Identify mortgage options

More information

Reverse Mortgage Glossary of Terms

Reverse Mortgage Glossary of Terms Reverse Mortgage Glossary of Terms Acceleration Clause Adjustable Rate Annuity Appraisal Appreciation Available Principle Limit Change of Circumstance Closing Condemnation Correspondent Cost to Cure Credit

More information

Homebuyer Education: What You Need to Know

Homebuyer Education: What You Need to Know Homebuyer Education: What You Need to Know Today s Objectives Prepare your finances for home ownership Steps to mortgage prequalification Shopping for a home- who are the major players? Choosing the correct

More information

Financing Residential Real Estate: SAFE Comprehensive 20 Hours

Financing Residential Real Estate: SAFE Comprehensive 20 Hours Financing Residential Real Estate: SAFE Comprehensive 20 Hours COURSE ORGANIZATION and DESIGN Roy L. Ponthier, Ph.D., Ed.D., CDEI, DREI Executive Director Module 1: Finance and Investment Mortgage loans

More information

Mortgage 101 For New Home Buyers

Mortgage 101 For New Home Buyers Compliments of Natalie and Randall Filbert Real Estate Pros at Mountain Realty 208-599-1336 208-599-1418 www.buyandsellinidaho.com Mortgage 101 For New Home Buyers Our Commitment Buying a home is probably

More information

Paragon 5. Financial Calculators User Guide

Paragon 5. Financial Calculators User Guide Paragon 5 Financial Calculators User Guide Table of Contents Financial Calculators... 3 Use of Calculators... 3 Mortgage Calculators... 4 15 Yr vs. 30 Year... 4 Adjustable Rate Amortizer... 4 Affordability...

More information

SHOPPING FOR A MORTGAGE

SHOPPING FOR A MORTGAGE SHOPPING FOR A MORTGAGE The Traditional Fixed-Rate Mortgage Key characteristics: Level payments, fixed interest rate, fixed term. This mortgage is the one which most of us know, and it is still the loan

More information

INTERACT WITH CAPITOL FEDERAL

INTERACT WITH CAPITOL FEDERAL TALK with an Associate in Capitol Federal s Customer Service Center 888-8CAPFED. EMAIL your questions to Capitol Federal securely online at capfed.com/contact. VISIT any one of Capitol Federal s convenient

More information

CRMS Exam Study Guide

CRMS Exam Study Guide CRMS Exam Study Guide The following five sections of this study guide provide questions similar to the ones you will encounter in the CRMS exam. The number of questions appearing below is proportional

More information

You ve Applied For Your Mortgage. What Happens Next? A Simple Guide To Help You Through The Mortgage Process

You ve Applied For Your Mortgage. What Happens Next? A Simple Guide To Help You Through The Mortgage Process You ve Applied For Your Mortgage. What Happens Next? A Simple Guide To Help You Through The Mortgage Process Four Easy Steps You have found the right home at the right price in the right location. Now

More information

A Glossary of Bank Terms

A Glossary of Bank Terms A Glossary of Bank Terms Below you will find key words and definitions to help you better understand the terms used in the financial services industry. ABA American Bankers Association. Account Ownership

More information

Welcome. 1. Agenda. 2. Ground Rules. 3. Introductions. Your Own Home 2

Welcome. 1. Agenda. 2. Ground Rules. 3. Introductions. Your Own Home 2 Your Own Home Welcome 1. Agenda 2. Ground Rules 3. Introductions Your Own Home 2 Objectives If you are a pre-homebuyer: Explain the advantages and disadvantages of renting versus owning a home Identify

More information

Student Take Home Guide. Money Smart. Your Own Home

Student Take Home Guide. Money Smart. Your Own Home Student Take Home Guide Money Smart Your Own Home Table of Contents Table of Contents...1 Money Smart...2 Your Own Home...3 Am I Ready to Buy a Home?...4 Components of a Mortgage Loan Payment...5 How Much

More information

Chapter 19. Residential Real Estate Finance: Mortgage Choices, Pricing and Risks. Residential Financing: Loans

Chapter 19. Residential Real Estate Finance: Mortgage Choices, Pricing and Risks. Residential Financing: Loans Chapter 19 Residential Real Estate Finance: Mortgage Choices, Pricing and Risks 10/25/2005 FIN4777 - Special Topics in Real Estate - Professor Rui Yao 1 Residential Financing: Loans Loans are classified

More information

What s s New With FHA?

What s s New With FHA? What s s New With FHA? Presented By: Bill Ladewig 866.204.9733 http://www.mortgage- FHA Calculator Calculates everything needed to quote or qualify FHA loans Click to Open: http://www.themtgmentor.com/fha_mortgage_calculator.html

More information

Variable Names & Descriptions

Variable Names & Descriptions Variable Names & Descriptions Freddie Mac provides loan-level information at PC issuance and on a monthly basis for all newly issued fixed-rate and adjustable-rate mortgage (ARM) PC securities issued after

More information

HOME LENDING TERMS. A payment by a borrower in excess of the scheduled principal amount due, in order to reduce the remaining balance of the loan.

HOME LENDING TERMS. A payment by a borrower in excess of the scheduled principal amount due, in order to reduce the remaining balance of the loan. Additional Principal Payment A payment by a borrower in excess of the scheduled principal amount due, in order to reduce the remaining balance of the loan. Adjustable-Rate Mortgage (ARM) An ARM is a type

More information

Eight Mistakes Borrowers make when applying for a mortgage

Eight Mistakes Borrowers make when applying for a mortgage Report 4 Eight Mistakes Borrowers make when applying for a mortgage Free Mortgage Information Copyright 1997 2007 - vlender.com Licensed Content Eight Mistakes Borrowers make when applying for a mortgage

More information

MSHDA's Down Payment Assistance and Mortgage Credit Certificate. May 21, 2010 (3:30 5:00 p.m.) Facilitated by: Carol Brito (MSHDA) Sponsored by:

MSHDA's Down Payment Assistance and Mortgage Credit Certificate. May 21, 2010 (3:30 5:00 p.m.) Facilitated by: Carol Brito (MSHDA) Sponsored by: MSHDA's Down Payment Assistance and Mortgage Credit Certificate May 21, 2010 (3:30 5:00 p.m.) Facilitated by: Carol Brito (MSHDA) Sponsored by: CREDIT UNIONS A DRIVING FORCE OF COMMUNITIES MSHDA Overview

More information

Mortgage Glossary A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Mortgage Glossary A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Mortgage Glossary A B C D E F G H I J K L M N O P Q R S T U V W X Y Z adjustable-rate mortgage (ARM) A mortgage that changes interest rate periodically based upon the changes in a specified index. adjustment

More information

V600 Introduction to Mortgage Lending. Robin J Wybenga, CFO, TBA Credit Union robinw@tbacu.com 231.946.7090

V600 Introduction to Mortgage Lending. Robin J Wybenga, CFO, TBA Credit Union robinw@tbacu.com 231.946.7090 V600 Introduction to Mortgage Lending Robin J Wybenga, CFO, TBA Credit Union robinw@tbacu.com 231.946.7090 Introduction Objectives 1. Identify the key benefits your CU gains by offering real estate lending

More information

Homebuyers Dictionary

Homebuyers Dictionary 2935 Breezewood Avenue Suite 100 Fayetteville, NC 28303 www.fayhba.org Homebuyers Dictionary ARM? GPM? PITI? You d have to be a cryptologist to figure out some of the terms buyers encounter during the

More information

Mortgage-Related Securities

Mortgage-Related Securities Raymond James Michael West, CFP, WMS Vice President Investments 101 West Camperdown Way Suite 600 Greenville, SC 29601 864-370-2050 x 4544 864-884-3455 michael.west@raymondjames.com www.westwealthmanagement.com

More information

The Guide to Single Family Home Mortgage Insurance

The Guide to Single Family Home Mortgage Insurance U.S. Department of Housing and Urban Development Office of Housing Office of Single Family Housing The Guide to Single Family Home Mortgage Insurance www.hud.gov espanol.hud.gov Becoming a Homeowner Many

More information

GLOSSARY OF TERMS. Amortization Repayment of a debt in regular installments of principal and interest, rather than interest only payments

GLOSSARY OF TERMS. Amortization Repayment of a debt in regular installments of principal and interest, rather than interest only payments GLOSSARY OF TERMS Ability to Repay (ATR) The Ability to Repay rule protects consumers from taking on mortgages that exceed their financial means, by mandating the documentation / proof of income and assets.

More information

A GUIDE TO HOME EQUITY LINES OF CREDIT. Call or visit one of our offices today to see what products in this guide we have to offer you!

A GUIDE TO HOME EQUITY LINES OF CREDIT. Call or visit one of our offices today to see what products in this guide we have to offer you! A GUIDE TO HOME EQUITY LINES OF CREDIT Call or visit one of our offices today to see what products in this guide we have to offer you! TABLE OF CONTENTS Introduction What is a home equity line of credit

More information

Bokern Realty serving St. Louis since 1901. Home Buying Educational Seminar The WU Employer Assisted Housing Program

Bokern Realty serving St. Louis since 1901. Home Buying Educational Seminar The WU Employer Assisted Housing Program Home Buying Educational Seminar The WU Employer Assisted Housing Program Agenda WU Employer Assisted Housing Program Program highlights Neighborhoods Home Financing Benefits of homeownership Preparation

More information

BUYING A HOME BUILDING A HOME REFINANCING

BUYING A HOME BUILDING A HOME REFINANCING Guide to Mortgages BUYING A HOME BUILDING A HOME REFINANCING Trust People First For Your Mortgage Needs People First is committed to providing our members with quality mortgage products that are both competitive

More information

Glossary of Real Estate Terms

Glossary of Real Estate Terms Glossary of Real Estate Terms 1099 A tax form that says how much the receiver had classified as income and usually, but not always, must pay taxes on that amount. However if the seller in a short sale

More information

Obtain Information from Several Lenders

Obtain Information from Several Lenders ESPAÑOL Shopping around for a home loan or mortgage will help you to get the best financing deal. A mortgage--whether it s a home purchase, a refinancing, or a home equity loan--is a product, just like

More information

Guide to. Getting Your First Mortgage

Guide to. Getting Your First Mortgage Guide to Getting Your First Mortgage 2040 Deyerle Ave, Suite 207 Harrisonburg, VA 22801 (540) 442-8583 www.vbsmortgage.com info@vbsmortgage.com Thank you for downloading our FREE guide! Feel free to share

More information

Obtain Information from Several Lenders

Obtain Information from Several Lenders Shopping around for a home loan or mortgage will help you to get the best financing deal. A mortgage--whether it s a home purchase, a refinancing, or a home equity loan--is a product, just like a car,

More information

Mortgages and Mortgage -Backed Securiti curi es ti Mortgage ort gage securitized mortgage- backed securities (MBSs) Primary Pri mary Mortgage Market

Mortgages and Mortgage -Backed Securiti curi es ti Mortgage ort gage securitized mortgage- backed securities (MBSs) Primary Pri mary Mortgage Market Mortgages and Mortgage-Backed Securities Mortgage Markets Mortgages are loans to individuals or businesses to purchase homes, land, or other real property Many mortgages are securitized Many mortgages

More information

You Can Buy a Home The keys to Homeownership

You Can Buy a Home The keys to Homeownership You Can Buy a Home The keys to Homeownership The keys to homeownership Buying a home is one of the most important purchases you ll ever make. Owning your own home helps you build wealth, save on taxes

More information

Investor s Guide to HUD and FHA Mortgage Financing. By William Bronchick

Investor s Guide to HUD and FHA Mortgage Financing. By William Bronchick Investor s Guide to HUD and FHA Mortgage Financing By William Bronchick The U.S. Department of Housing and Urban Development (HUD) was founded in 1965, with a mission is to increase homeownership, support

More information

Chapter 15 Questions Real Estate Financing: Practice

Chapter 15 Questions Real Estate Financing: Practice Chapter 15 Questions Real Estate Financing: Practice 1. Kahlid has been making periodic payments of principal and interest on a loan, but the final payment will be larger than the others. This is a(n)

More information

Home Buyers. from application to closing. Derek Haley, Senior Loan Officer SunTrust Mortgage, Inc. 919.426.5023 Derek.Haley@SunTrust.

Home Buyers. from application to closing. Derek Haley, Senior Loan Officer SunTrust Mortgage, Inc. 919.426.5023 Derek.Haley@SunTrust. Information for First-time Home Buyers An overview of the mortgage process, from application to closing. Derek Haley, Senior Loan Officer SunTrust Mortgage, Inc. 919.426.5023 Derek.Haley@SunTrust.com NMLSR#

More information

Assumable Mortgage: A loan that can be taken over, or assumed, by a buyer when the mobile home is sold.

Assumable Mortgage: A loan that can be taken over, or assumed, by a buyer when the mobile home is sold. Actual Rate: The Actual Rate is the annual interest rate you pay on your loan (sometimes referred to as the note rate ), and is the rate used to calculate your monthly payments. Adjustable Rate Mortgage:

More information

CMC Exam Specifications

CMC Exam Specifications CMC Exam Specifications General Industry Knowledge Weighting = 27% Number of items = 54 A. Knowledge of mortgage product pricing as 1. Add-ons 2. Gross vs. net price 3. Service Release Premium-SRP s 4.

More information

VA Refinance Cash Out

VA Refinance Cash Out VA Refinance Cash Out This matrix is intended as an aid to help determine whether a property/loan qualifies for certain financing. It is not intended as a replacement for VA guidelines. Users are expected

More information

Understanding the (GFE) Good Faith Estimate

Understanding the (GFE) Good Faith Estimate A good faith estimate is a document that estimates the total costs to get a loan when you are buying or refinancing a home. The good faith estimate details costs you will incur on all loan related fees

More information

Common Mortgage and Foreclosure Terms

Common Mortgage and Foreclosure Terms H ELP FOR N EW Y ORK S TATE H OMEOWNERS C ONCERNED A BOUT F ORECLOSURE Common Mortgage and Foreclosure Terms Talking about mortgages can feel like speaking a foreign language and is even more confusing

More information

Interest-Only Mortgage Payments and Payment-Option ARMs Are They for You?

Interest-Only Mortgage Payments and Payment-Option ARMs Are They for You? Board of Governors of the Federal Reserve System Federal Deposit Insurance Corporation National Credit Union Administration Office of the Comptroller of the Currency Office of Thrift Supervision Interest-Only

More information

NORTH AMERICAN TITLE COMPANY Like Clockwork. www.nat.com/cfpb

NORTH AMERICAN TITLE COMPANY Like Clockwork. www.nat.com/cfpb NORTH AMERICAN TITLE COMPANY Like Clockwork www.nat.com/cfpb UNDERSTANDING THE NEW LOAN ESTIMATE AND CLOSING DISCLOSURE FORMS American Title, we want to make sure all of our customers have the information

More information

CFPB FINAL RULES SUN WEST IMPLEMENTATION GUIDE

CFPB FINAL RULES SUN WEST IMPLEMENTATION GUIDE CFPB FINAL RULES SUN WEST IMPLEMENTATION GUIDE January 02, 2015 In case of any queries regarding the information available in this guide, please reach us at qmteam@swmc.com. Sun West Mortgage Company,

More information

FHA Home Loans 101 An Easy Reference Guide

FHA Home Loans 101 An Easy Reference Guide FHA Home Loans 101 An Easy Reference Guide Updated for loans on or after January 26, 2015 Congratulations on Starting Your Journey to Home Ownership This guide offers a quick look at vital information

More information

FHA Office of Single Family Housing. Training: Origination Through Post-Closing/ Endorsement

FHA Office of Single Family Housing. Training: Origination Through Post-Closing/ Endorsement Training: Origination Through Post-Closing/ Endorsement 1 Module 8A Programs and Products: Refinance Single Family Housing Policy Handbook 4000.1 Title II Insured Housing Program Forward Mortgages Origination

More information

The Essential Guide to Understanding Your Mortgage. mortgagemoneyman.com (817) 912-4444 1

The Essential Guide to Understanding Your Mortgage. mortgagemoneyman.com (817) 912-4444 1 The Essential Guide to Understanding Your Mortgage mortgagemoneyman.com (817) 912-4444 1 Understanding Types of Mortgages and Eligibility Requirements Whether you are purchasing your first home or your

More information

Homeownership Division

Homeownership Division Michigan Credit Union League & Affiliates Annual Convention and Exposition Helping Credit Unions Serve, Grow and Remain Strong #mculace MSHDA s Homeownership Programs Delivering the Dream to Michigan Families

More information

Chapter 10. The Good Old Days. The New Way. Secondary Markets. Depository Lenders in the Primary Market. Nondepository Lenders in the Primary Market

Chapter 10. The Good Old Days. The New Way. Secondary Markets. Depository Lenders in the Primary Market. Nondepository Lenders in the Primary Market The Good Old Days Chapter 10 The Secondary Mortgage Market Banks and Savings and Loans made loans and held these loans in portfolio The interest paid on the loan was use to pay interest to the depositors

More information

Financing Residential Real Estate

Financing Residential Real Estate Financing Residential Real Estate Chapter 1: Finance and Investment Borrowing Money to Buy a Home Investments and Returns Types of Investments Ownership Investments Debt Investments Securities Investment

More information

Step-by-Step Home Mortgage Steps

Step-by-Step Home Mortgage Steps 1 Applicants with a good credit report will be in a stronger position to negotiate best rate and terms Your credit report is used by banks and other lending institutions to determine your creditworthiness.

More information

Fin 5413: Chapter 8 Mortgage Underwriting

Fin 5413: Chapter 8 Mortgage Underwriting Fin 5413: Chapter 8 Mortgage Underwriting Some Basic Mortgage Underwriting Questions Who should you grant a loan to? How do we determine the appropriate interest rate for a loan? What is the maximum dollar

More information

1-866-667-6724 Where homeownership education takes flight!

1-866-667-6724 Where homeownership education takes flight! 100% Financing Options for CalPERS Members Thank you for attending We will begin in a moment Class Scheduled to begin at 10:00am Homeownership Educator Scott Schang Branch Manager Broadview Mortgage Corporation

More information

1-866-667-6724 Where homeownership education takes flight!

1-866-667-6724 Where homeownership education takes flight! 100% Financing Options for CalPERS Members Thank you for attending We will begin in a moment Class Scheduled to begin at 10:00am Homeownership Educator Scott Schang Branch Manager Broadview Mortgage Corporation

More information

MORTGAGE BACKED SECURITIES

MORTGAGE BACKED SECURITIES MORTGAGE BACKED SECURITIES A Mortgage-Backed Security is created when the issuing Agency purchases a number of investment quality residential home mortgages from various banks, thrifts, or mortgage companies.

More information

May I Increase My Debt Load While I am in Process for My VA Loan?

May I Increase My Debt Load While I am in Process for My VA Loan? What is a VA Loan? During WW II, the U.S. government created a military loan guaranty program to help service men and women purchase homes when they returned from the war. The result was the VA Loan which

More information

Your Mortgage Guide: The Process, Meet Your

Your Mortgage Guide: The Process, Meet Your Your Mortgage Guide: The Process, Meet Your Team, Definitions, and Frequently Asked Questions Getting Started The first step begins by completing your mortgage application. You may hear this referred to

More information

Loan Estimate. Loan Terms. Projected Payments. Costs at Closing. Save this Loan Estimate to compare with your Closing Disclosure.

Loan Estimate. Loan Terms. Projected Payments. Costs at Closing. Save this Loan Estimate to compare with your Closing Disclosure. Loan Estimate DATE ISSUED APPLICANTS PROPERTY SALE PRICE Loan Terms Save this Loan Estimate to compare with your Closing Disclosure. LOAN TERM 30 years PURPOSE Purchase PRODUCT 5 Year Interest Only, 5/3

More information

A Guide to Mortgage Products. A Glossary of Lending Terms and. True. Know Before You Go...To Get A Mortgage. False. Federal Reserve Bank of Boston

A Guide to Mortgage Products. A Glossary of Lending Terms and. True. Know Before You Go...To Get A Mortgage. False. Federal Reserve Bank of Boston A Guide to Mortgage Products A Glossary of Lending Terms and True Know Before You Go...To Get A Mortgage False or? Federal Reserve Bank of Boston The purpose of this guide is to provide general mortgage

More information