Mortgage terms and definitions for
home buyers, home sellers, and real estate consumers. Use
the links below to find the word you're looking for.
Behaves like a fixed-rate mortgage for a set number of years
(usually five or seven) and then must be paid off in full
in a single "balloon" payment. Balloon loans are popular
with those expecting to sell or refinance their property
within a definite period of time.
The final lump sum that is paid at the end of the balloon
A tactic that individuals use to relieve themselves of debts
and/or liabilities when they are no longer able to repay.
The most common form of individual bankruptcy is a Chapter
7, when an individual frees himself from most of his/her
debts. Borrowers who have undergone bankruptcy usually cannot
qualify for "A" paper loans until after two years after
declaration and a re-establishment of credit.
Faith Estimate -
An estimate of the total costs for securing a real estate
loan, that is given to borrowers prior to closing.
of Sale -
A written document that transfers a title to personal property.
Mortgage loan payments that requires a payment twice monthly,
yielding thirteen payments per year instead of twelve. This
significantly reduces the time a principal is paid off.
A mortgage secured by the pledging of more than one property
Acquisition costs less any accrued depreciation.
An individual in the business of assisting in arranging
funding or negotiating contracts for a client but who does
not loan the money himself. Brokers usually charge a fee
or receive a commission for their services.
An equity loan secured to solve short-term financing problem.
A mortgage that includes a portion for taxes and insurance
as well as principal and interest.
Allows loans to be made at less-than-market interest rates
by paying front-end discounts. The interest rate is brought
down for a temporary period, usually from one to three years.
In oder to acquire this discount, a lump sum is paid and
held in an account used to supplement the borrower's monthly
payment. After the discount period, the payment is calculated
as the note rate.