|
| A |
adjustable-rate mortgage
(ARM)
A mortgage whose interest rate changes periodically
based on the changes in a specified index. |
adjustment
date
The date on which the interest rate
changes for an adjustable-rate mortgage (ARM). |
adjustment
period
The period that elapses between the
adjustment dates for an adjustable-rate mortgage
(ARM). |
amortization
The repayment of a mortgage loan by installments
with regular payments to cover the principal
and interest. |
amortization
term
The amount of time required to amortize the
mortgage loan. The amortization term is expressed
as a number of months. For example, for a 30-year
fixed-rate mortgage, the amortization term is
360 months. |
annual percentage rate
(APR)
The cost of a mortgage stated as a yearly rate;
includes such items as interest, mortgage insurance,
and loan origination fee (points). |
application
A form, commonly referred to as a 1003 form,
used to apply for a mortgage and to provide
information regarding a prospective mortgagor
and the proposed security. |
appraisal
A written analysis of the estimated value of
a property prepared by a qualified appraiser. |
A person qualified by education, training, and
experience to estimate the value of real property
and personal property. |
appreciation
An increase in the value of a property due to
changes in market conditions or other causes.
The opposite of depreciation. |
asset
Anything of monetary value that is owned by
a person. Assets include real property, personal
property, and enforceable claims against others
(including bank accounts, stocks, mutual funds,
and so on). |
assignment
The transfer of a mortgage from one person to
another. |
assumable mortgage
A mortgage that can be taken over ("assumed")
by the buyer when a home is sold. |
assumption
The transfer of the seller's existing
mortgage to the buyer. |
assumption
clause
A provision in an assumable mortgage
that allows a buyer to assume responsibility
for the mortgage from the seller. The loan does
not need to be paid in full by the original
borrower upon sale or transfer of the property. |
assumption
fee
The fee paid to a lender (usually by the purchaser
of real property) resulting from the assumption
of an existing mortgage. |
| B
|
A financial statement that shows assets, liabilities,
and net worth as of a specific date. |
balloon
mortgage
A mortgage that has level monthly payments that
will amortize it over a stated term but that
provides for a lump sum payment to be due at
the end of an earlier specified term. |
balloon payment
The final lump sum payment that is made at the
maturity date of a balloon mortgage. |
bankrupt
A person, firm, or corporation that, through
a court proceeding, is relieved from the payment
of all debts after the surrender of all assets
to a court-appointed trustee. |
bankruptcy
A proceeding in a federal court in which a debtor
who owes more than his or her assets can relieve
the debts by transferring his or her assets
to a trustee. |
basis point
A basis point is 1/100th of a percentage point.
For example, a fee calculated as 50 basis points
of a loan amount of $100,000 would be 0.50%
or $500. |
before-tax income
Income before taxes are deducted. |
beneficiary
The person designated to receive the income
from a trust, estate, or a deed of trust. |
binder
A preliminary agreement, secured by the payment
of an earnest money deposit, under which a buyer
offers to purchase real estate. |
biweekly payment
mortgage
A mortgage that requires payments to reduce
the debt every two weeks (instead of the standard
monthly payment schedule). The 26 (or possibly
27) biweekly payments are each equal to one-half
of the monthly payment that would be required
if the loan were a standard 30-year fixed-rate
mortgage, and they are usually drafted from
the borrower's bank account. The result for
the borrower is a substantial savings in interest. |
blanket mortgage
The mortgage that is secured by a cooperative
project, as opposed to the share loans on individual
units within the project. |
bond
An interest-bearing certificate of debt with
a maturity date. An obligation of a government
or business corporation. A real estate bond
is a written obligation usually secured by a
mortgage or a deed of trust. |
breach
A violation of any legal obligation. |
bridge loan
A form of second trust that is collateralized
by the borrower's present home (which is usually
for sale) in a manner that allows the proceeds
to be used for closing on a new house before
the present home is sold. Also known as "swing
loan." |
broker
A person who, for a commission or a fee, brings
parties together and assists in negotiating
contracts between them. |
buydown mortgage
A temporary buydown is a mortgage on which an
initial lump sum payment is made by any party
to reduce a borrower's monthly payments during
the first few years of a mortgage. A permanent
buydown reduces the interest rate over the entire
life of a mortgage. |
| C
|
call option
A provision in the mortgage that gives the mortgagee
the right to call the mortgage due and payable
at the end of a specified period for whatever
reason. |
cap
A provision of an adjustable-rate mortgage (ARM)
that limits how much the interest rate or mortgage
payments may increase or decrease. |
capital improvement
Any structure or component erected as a permanent
improvement to real property that adds to its
value and useful life. |
cash-out refinance
A refinance transaction in which the amount
of money received from the new loan exceeds
the total of the money needed to repay the existing
first mortgage, closing costs, points, and the
amount required to satisfy any outstanding subordinate
mortgage liens. In other words, a refinance
transaction in which the borrower receives additional
cash that can be used for any purpose. |
Certificate
of Eligibility
A document issued by the federal government
certifying a veteran's eligibility for a Department
of Veterans Affairs (VA) mortgage. |
Certificate of Reasonable
Value (CRV)
A document issued by the Department of Veterans
Affairs (VA) that establishes the maximum value
and loan amount for a VA mortgage. |
certificate of
title
A statement provided by an abstract company,
title company, or attorney stating that the
title to real estate is legally held by the
current owner. |
chain of title
The history of all of the documents that transfer
title to a parcel of real property, starting
with the earliest existing document and ending
with the most recent. |
change frequency
The frequency (in months) of payment and/or
interest rate changes in an adjustable-rate
mortgage (ARM). |
clear title
A title that is free of liens or legal questions
as to ownership of the property. |
closing
A meeting at which a sale of a property is finalized
by the buyer signing the mortgage documents
and paying closing costs. Also called "settlement." |
|
closing
cost item
A fee or amount that a home buyer must pay
at closing for a single service, tax, or product.
Closing costs are made up of individual closing
cost items such as origination fees and attorney's
fees. Many closing cost items are included
as numbered items on the HUD-1 statement.
Click
here to see some closing cost times from
a HUD-1 statement. Expenses (over and above
the price of the property) incurred by buyers
and sellers in transferring ownership of a
property. Closing costs normally include an
origination fee, an attorney's fee, taxes,
an amount placed in escrow, and charges for
obtaining title insurance and a survey. Closing
costs percentage will vary according to the
area of the country.
|
closing
statement
Also referred to as the HUD-1. The final statement
of costs incurred to close on a loan or to purchase
a home. |
cloud on title
Any conditions revealed by a title search that
adversely affect the title to real estate. Usually
clouds on title cannot be removed except by
a quitclaim deed, release, or court action. |
collateral
An asset (such as a car or a home) that guarantees
the repayment of a loan. The borrower risks
losing the asset if the loan is not repaid according
to the terms of the loan contract. |
collection
The efforts used to bring a delinquent mortgage
current and to file the necessary notices to
proceed with foreclosure when necessary. |
combination
loan
With this type of loan, you receive a first
mortgage for 80 percent of the loan amount,
and a second mortgage at the same time for the
remainder of the balance. If avoiding PMI (mortgage
insurance) is important to you, consider combination
loans--known as 80/10/10 loans or 80/20's. |
combined loan-to-value
(CLTV)
The unpaid principal balances of all the mortgages
on a property (first and second usually) divided
by the property's appraised value. |
co-maker
A person who signs a promissory note along with
the borrower. A co-maker's signature guarantees
that the loan will be repaid, because the borrower
and the co-maker are equally responsible for
the repayment. See endorser. |
commission
The fee charged by a broker or agent for negotiating
a real estate or loan transaction. A commission
is generally a percentage of the price of the
property or loan. |
commitment letter
A formal offer by a lender stating the terms
under which it agrees to lend money to a home
buyer. Also known as a "loan commitment." |
common areas
Those portions of a building, land, and amenities
owned (or managed) by a planned unit development
(PUD) or condominium project's homeowners' association
(or a cooperative project's cooperative corporation)
that are used by all of the unit owners, who
share in the common expenses of their operation
and maintenance. Common areas include swimming
pools, tennis courts, and other recreational
facilities, as well as common corridors of buildings,
parking areas, means of ingress and egress,
etc. |
Community
Home Improvement Mortgage Loan
An alternative financing option that allows
low- and moderate-income home buyers to obtain
95 percent financing for the purchase and improvement
of a home in need of modest repairs. The repair
work can account for as much as 30 percent of
the appraised value. |
community
property
In some western and southwestern states, a form
of ownership under which property acquired during
a marriage is presumed to be owned jointly unless
acquired as separate property of either spouse. |
comparables
An abbreviation for "comparable properties";
used for comparative purposes in the appraisal
process. Comparables are properties like the
property under consideration; they have reasonably
the same size, location , and amenities and
have recently been sold. Comparables help the
appraiser determine the approximate fair market
value of the subject property. |
condominium
A real estate project in which each unit owner
has title to a unit in a building, an undivided
interest in the common areas of the project,
and sometimes the exclusive use of certain limited
common areas. |
condominium
conversion
Changing the ownership of an existing building
(usually a rental project) to the condominium
form of ownership. |
conforming loan
The current conforming loan limit is $333,700
and below. Conforming loan limits change annually. |
construction
loan
A short-term, interim loan for financing the
cost of construction. The lender makes payments
to the builder at periodic intervals as the
work progresses. |
consumer reporting
agency (or bureau)
An organization that prepares reports that are
used by lenders to determine a potential borrower's
credit history. The agency obtains data for
these reports from a credit repository as well
as from other sources. |
contingency
A condition that must be met before a contract
is legally binding. For example, home purchasers
often include a contingency that specifies that
the contract is not binding until the purchaser
obtains a satisfactory home inspection report
from a qualified home inspector. |
contract
An oral or written agreement to do or not to
do a certain thing. |
conventional
mortgage
A mortgage that is not insured or guaranteed
by the federal government. |
convertibility
clause
A provision in some adjustable-rate mortgages
(ARMs) that allows the borrower to change the
ARM to a fixed-rate mortgage at specified timeframes
after loan origination. |
convertible ARM
An adjustable-rate mortgage (ARM) that can be
converted to a fixed-rate mortgage under specified
conditions. |
cooperative (co-op)
A type of multiple ownership in which the residents
of a multiunit housing complex own shares in
the cooperative corporation that owns the property,
giving each resident the right to occupy a specific
apartment or unit. |
corporate relocation
Arrangements under which an employer moves an
employee to another area as part of the employer's
normal course of business or under which it
transfers a substantial part or all of its operations
and employees to another area because it is
relocating its headquarters or expanding its
office capacity. |
cost of funds index
(COFI)
An index that is used to determine interest
rate changes for certain adjustable-rate mortgage
(ARM) plans. It represents the weighted-average
cost of savings, borrowings, and advances of
the 11th District members of the Federal Home
Loan Bank of San Francisco. |
covenant
A clause in a mortgage that obligates or restricts
the borrower and that, if violated, can result
in foreclosure. |
credit
An agreement in which a borrower receives something
of value in exchange for a promise to repay
the lender at a later date. |
credit history
A record of an individual's open and fully repaid
debts. A credit history helps a lender to determine
whether a potential borrower has a history of
repaying debts in a timely manner. |
credit report
A report of an individual's credit history prepared
by a credit bureau and used by a lender in determining
a loan applicant's creditworthiness. |
credit repository
An organization that gathers, records, updates,
and stores financial and public records information
about the payment records of individuals who
are being considered for credit. |
| D
|
An amount owed to another. |
deed
The legal document conveying title to a property. |
deed-in-lieu
A deed given by a mortgagor to the mortgagee
to satisfy a debt and avoid foreclosure. |
deed of trust
The document used in some states instead of
a mortgage; title is conveyed to a trustee. |
default
Failure to make mortgage payments on a timely
basis or to comply with other requirements of
a mortgage. |
delinquency
Failure to make mortgage payments when mortgage
payments are due. |
deposit
A sum of money given to bind the sale of real
estate, or a sum of money given to ensure payment
or an advance of funds in the processing of
a loan. |
depreciation
A decline in the value of property; the opposite
of appreciation. |
down payment
The part of the purchase price of a property
that the buyer pays in cash and does not finance
with a mortgage. |
due-on-sale provision
A provision in a mortgage that allows the lender
to demand repayment in full if the borrower
sells the property that serves as security for
the mortgage. |
| E
|
earnest money deposit
A deposit made by the potential home buyer to
show that he or she is serious about buying
the house. |
easement
A right of way giving persons other than the
owner access to or over a property. |
effective age
An appraiser's estimate of the physical condition
of a building. The actual age of a building
may be shorter or longer than its effective
age. |
effective
gross income
Normal annual income including overtime that
is regular or guaranteed. The income may be
from more than one source. Salary is generally
the principal source, but other income may qualify
if it is significant and stable. |
eighty-ten-ten
loan
See "combination loan". |
encumbrance
Anything that affects or limits the fee simple
title to a property, such as mortgages, leases,
easements, or restrictions. |
endorser
A person who signs ownership interest over to
another party. Contrast with co-maker. |
Equal Credit Opportunity
Act (ECOA)
A federal law that requires lenders and other
creditors to make credit equally available without
discrimination based on race, color, religion,
national origin, age, sex, marital status, or
receipt of income from public assistance programs. |
equity
A homeowner's financial interest in a property.
Equity is the difference between the fair market
value of the property and the amount still owed
on its mortgage. |
escrow
An item of value, money, or documents deposited
with a third party to be delivered upon the
fulfillment of a condition. For example, the
deposit by a borrower with the lender of funds
to pay taxes and insurance premiums when they
become due, or the deposit of funds or documents
with an attorney or escrow agent to be disbursed
upon the closing of a sale of real estate. |
escrow account
The account in which a mortgage servicer holds
the borrower's escrow payments prior to paying
property expenses. |
escrow analysis
The periodic examination of escrow accounts
to determine if current monthly deposits will
provide sufficient funds to pay taxes, insurance,
and other bills when due. |
escrow
collections
Funds collected by the servicer and set aside
in an escrow account to pay the borrower's property
taxes, mortgage insurance, and hazard insurance. |
escrow
disbursements
The use of escrow funds to pay real estate taxes,
hazard insurance, mortgage insurance, and other
property expenses as they become due. |
escrow payment
The portion of a mortgagor's monthly payment
that is held by the servicer to pay for taxes,
hazard insurance, mortgage insurance, lease
payments, and other items as they become due.
Known as "impounds" or "reserves"
in some states. |
estate
The ownership interest of an individual in real
property. The sum total of all the real property
and personal property owned by an individual
at time of death. |
eviction
The lawful expulsion of an occupant from real
property. |
examination
of title
The report on the title of a property from the
public records or an abstract of the title. |
| F
|
Fair Credit Reporting
Act
A consumer protection law that regulates the
disclosure of consumer credit reports by consumer/credit
reporting agencies and establishes procedures
for correcting mistakes on one's credit record. |
fair market value
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. |
Fannie Mae
A congressionally chartered, shareholder-owned
company that is the nation's largest supplier
of home mortgage funds. |
Fannie Mae's
Community Home Buyer's Program
An income-based community lending model, under
which mortgage insurers and Fannie Mae offer
flexible underwriting guidelines to increase
a low- or moderate-income family's buying power
and to decrease the total amount of cash needed
to purchase a home. Borrowers who participate
in this model are required to attend pre-purchase
home-buyer education sessions. |
Federal Housing Administration
(FHA)
An agency of the U.S. Department of Housing
and Urban Development (HUD). Its main activity
is the insuring of residential mortgage loans
made by private lenders. The FHA sets standards
for construction and underwriting but does not
lend money or plan or construct housing. |
fee simple
The greatest possible interest a person can
have in real estate. |
FHA mortgage
A mortgage that is insured by the Federal Housing
Administration (FHA). Also known as a government
mortgage. |
finder's fee
A fee or commission paid to a mortgage broker
for finding a mortgage loan for a prospective
borrower. |
first adjustment
When you can expect the first rate adjustment
in your ARM loan. |
first mortgage
A mortgage that is the primary lien against
a property. |
fixed-rate mortgage
(FRM)
A mortgage in which the interest rate does not
change during the entire term of the loan. |
fixed second
mortgage
See home equity loan. |
flood insurance
Insurance that compensates for physical property
damage resulting from flooding. It is required
for properties located in federally designated
flood areas. |
foreclosure
The legal process by which a borrower in default
under a mortgage is deprived of his or her interest
in the mortgaged property. This usually involves
a forced sale of the property at public auction
with the proceeds of the sale being applied
to the mortgage debt. |
An adjustable-rate mortgage (ARM) with a monthly
payment that is sufficient to amortize the remaining
balance, at the interest accrual rate, over
the amortization term. |
| G
|
good faith estimate
An estimate of charges which a borrower is likely
to incur in connection with a settlement. |
| H
|
hazard insurance
Insurance protecting against loss to real estate
caused by fire, some natural causes, vandalism,
etc., depending upon the terms of the policy. |
home equity
line of credit
a credit line that is secured by a second deed
of trust on a house. Equity lines of credit
are revolving accounts that work like a credit
card, which can be paid down or charged up for
the term of the loan. The minimum payment due
each month is interest only. |
home equity
loan
a loan secured by a second deed of trust on
a house, typically used as a home improvement
loan. |
housing ratio
The ratio of the monthly housing payment in
total (PITI - Principal, Interest, Taxes, and
Insurance) divided by the gross monthly income.
This ratio is sometimes referred to as the top
ratio or front end ratio. |
HUD
The U.S. Department of Housing and
Urban Development. |
| I
|
index
A published interest rate to which the interest
rate on an Adjustable Rate Mortgage (ARM) is
tied. Some commonly used indices include the
1 Year Treasury Bill, 6 Month LIBOR, and the
11th District Cost of Funds (COFI). |
Impound Account
An impound account is an account established
by the lender to pay a borrower's tax and insurance
costs. The borrower's monthly mortgage payment
is then increased to cover these costs, with
the additional amount being held in the impound
account and disbursed by the lender when the
payments are due. Lenders typically prefer this
arrangement because it reduces the possibility
of a lapse in tax or insurance payments that
could diminish the value of the lender's investment
(your house). Therefore, while it is often possible
to opt out of an impound account it will result
in additional charges. |
Interest-only
loan option
Loan payments have two components, principal
and interest. An interest-only loan has no principal
component for a specified period of time. These
special loans minimize your monthly payments
by eliminating the need to pay down your balance
during the interest-only period, giving you
greater cash flow control and/or increased purchasing
power. |
| J
|
jumbo mortgage
The current loan limit for a conforming loan
is $333,700. Loan amounts of $333,701 and above
are considered non-conforming or jumbo mortgages
and are usually subject to higher pricing. |
| L
|
An encumbrance against property for money due,
either voluntary or involuntary. |
lender
The bank, mortgage company, or mortgage broker
offering the loan. |
LIBOR
LIBOR stands for London Inter-Bank Offered Rate.
This is a favorable interest rate offered for
U.S. dollar deposits between a group of London
banks. There are several different LIBOR rates,
defined by the maturity of their deposit. The
LIBOR is an international index that follows
world economic conditions. LIBOR-indexed ARMs
offer borrowers aggressive initial rates and
have proven to be competitive with popular ARM
indexes like the Treasury bill. |
lifetime cap
A provision of an ARM that limits the highest
rate that can occur over the life of the loan. |
loan to value ratio
(LTV)
The unpaid principal balance of the mortgage
on a property divided by the property's appraised
value. The LTV will affect programs available
to the borrower and generally, the lower the
LTV the more favorable the terms of the programs
offered by lenders. |
lock period
The amount of time that a lender will guarantee
a loan's interest rate. Once you've locked in
the interest rate on a loan, the lender will
guarantee that rate for a certain period of
time, usually for 30, 45 or 60 days. |
lock-in
A written agreement guaranteeing the home buyer
a specified interest rate provided the loan
is closed within a set period of time. The lock-in
also usually specifies the number of points
to be paid at closing. |
| M
|
The number of percentage points a lender adds
to the index value to calculate the ARM interest
rate at each adjustment period. |
| mortgage
A legal document that pledges a property to
the lender as security for payment of a debt |
mortgage
disability insurance
A disability insurance policy which will pay
the monthly mortgage payment in the event of
a covered disability of an insured borrower
for a specified period of time. |
mortgage insurance (MI)
Insurance written by an independent mortgage
insurance company protecting the mortgage lender
against loss incurred by a mortgage default.
Usually required for loans with an LTV of 80.01%
or higher. |
mortgagee
The person or company who receives the mortgage
as a pledge for repayment of the loan. The mortgage
lender. |
mortgagor
The mortgage borrower who gives the mortgage
as a pledge to repay. |
| N
|
See "stated income". |
non-conforming
loan
Also called a jumbo loan. Conventional home
mortgages not eligible for sale and delivery
to either Fannie Mae (FNMA) or Freddie Mac (FHLMC)
because of various reasons, including loan amount,
loan characteristics or underwriting guidelines.
Non-conforming loans usually incur a rate and
origination fee premium. The current non-conforming
loan limit is $333,701 and above. |
note
A written agreement containing a promise of
the signer to pay to a named person, or order,
or bearer, a definite sum of money at a specified
date or on demand. |
| O
|
A fee imposed by a lender to cover certain processing
expenses in connection with making a real estate
loan. Usually a percentage of the amount loaned,
such as one percent. |
owner financing
A property purchase transaction in which the
property seller provides all or part of the
financing. |
| P
|
The maximum rate increase for a specific period
for a specific loan (ARM) only. |
PITI
Principal, interest, taxes and insurance--the
components of a monthly mortgage payment. |
Planned Unit Developments
(PUD)
A subdivision of five or more individually owned
lots with one or more other parcels owned in
common or with reciprocal rights in one or more
other parcels. |
points
Charges levied by the mortgage lender and usually
payable at closing. One point represents 1%
of the face value of the mortgage loan. |
prepaids
Those expenses of property which are paid in
advance of their due date and will usually be
prorated upon sale, such as taxes, insurance,
rent, etc. |
prepayment penalty
A charge imposed by a mortgage lender on a borrower
who wants to pay off part or all of a mortgage
loan in advance of schedule. |
principal
Amount of debt, not including interest. The
face value of a note or mortgage. |
private mortgage insurance
(PMI)
Insurance provided by nongovernment insurers
that protects lenders against loss if a borrower
defaults. Fannie Mae generally requires private
mortgage insurance for loans with loan-to-value
(LTV) percentages greater than 80%. |
| Q
|
The ratio of your fixed monthly expenses to
your gross monthly income, used to determine
how much you can afford to borrow. The fixed
monthly expenses would include PITI along with
other obligations such as student loans, car
loans, or credit card payments. |
| R
|
The annual rate of interest on a loan, expressed
as a percentage of 100. |
rate cap
A limit on how much the interest rate can change,
either at each adjustment period or over the
life of the loan. |
rate lock-in
A written agreement in which the lender guarantees
the borrower a specified interest rate, provided
the loan closes within a set period of time. |
rebate
Compensation received from a wholesale lender
which can be used to cover closing costs or
as a refund to the borrower. Loans with rebates
often carry higher interest rates than loans
with "points" (see above). |
refinancing
The process of paying off one loan with the
proceeds from a new loan using the same property
as security. |
residential mortgage
credit report (RMCR)
A report requested by your lender that utilizes
information from at least two of the three national
credit bureaus and information provided on your
loan application. |
RGS TITLE, LLC
Northern Virginia's leading residential settlement
company for over 18 years. |
| S |
An agreement in which the owner of a property
provides financing, often in combination with
an assumed mortgage. |
stated/documented
income
Some loan products require only that applicants
"state" the source of their income
without providing supporting documentation such
as tax returns. |
subordination
If you are refinancing your first mortgage and
have an existing second or home equity line,
one option is to "subordinate" the second mortgage:
request that your second mortgage holder go
back into the second lien position when you
replace your existing first mortgage with the
new refinance loan. |
survey
A print showing the measurements of the boundaries
of a parcel of land, together with the location
of all improvements on the land and sometimes
its area and topography. |
| T
|
An undivided interest in property taken by two
or more persons. The interest need not be equal.
Upon death of one or more persons, there is
no right of survivorship. |
term
The period of time which covers the life of
the loan. For example, a 30 year fixed loan
has a term of 30 years. |
title
The evidence one has of right to possession
of land. |
title insurance
Insurance against loss resulting from defects
of title to a specifically described parcel
of real property. |
title search
An investigation into the history of ownership
of a property to check for liens, unpaid claims,
restrictions or problems, to prove that the
seller can transfer free and clear ownership. |
total debt ratio
Monthly debt and housing payments divided by
gross monthly income. Also known as Obligations-to-Income
Ratio or Back-End Ratio. |
| Truth-in-Lending Act |
|
Back to Top |
A federal law requiring a disclosure of credit
terms using a standard format. This is intended
to facilitate comparisons between the lending
terms of different financial institutions. |
Types of Ownership
There are four types of ownership: They are:
a. Sole Ownership - Only one person owns the
property.
b. Tenants in Common - Two or more presons have
an undivided ownership in the property. The
percentage of ownership need not be equal; each
party has a right to sell his/her interest,
and upon the death of any of the owner's that
owner's interest in the property goes to the
deceased's heirs.
c. Jount Tenants - Ownership taken by two or
more persons at the same time in equal percentages
with an undivided right to possession. If one
owner dies, his or her interst automatically
goes to the remaining owners(s).
d. Tenants by the Entireties - Owners are husband
and wife and together they hold title to the
property with a right of survivorship. Upon
the death of either, the survivor takes sole
ownership to the exclusion of the deceased spouse's
heirs. |
| V |
Veterans Administration
(VA)
A government agency guaranteeing mortgage loans
with no down payment to qualified veterans. |
| |
