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Glossary of Mortgage Related Terms
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Amount Financed The amount financed is the amount of credit provided to you or on your behalf. It is calculated by determining the principal loan amount or the cash price (subtracting any down payment); adding any other amounts that are financed by the creditor and are not part of the finance charge; and subtracting any prepaid finance charge.
Appraisal A certified opinion or estimate of value.
Closing In real estate transactions, the final set of procedures in which documents are executed and the transaction is finalized.
Closing Cost Expenses incidental to closing a Manufactured home loan such as loan fees, title fees, appraisal fees, closing fees, points, etc.
Debt A loan that consolidates other outstanding debts into one consolidation loan facility for the purpose of reducing payments or interest expense cost.
Deed A conveyance instrument given to transfer title to real property upon sale.
Deed of Trust An instrument used in many states in place of a mortgage. Title to property is transferred to a trustee by the borrower (trustor) in favor of the lender (beneficiary) and reconveyed upon payment in full.
Default A breach or nonperformance of the terms of a note or covenants of a mortgage.
Delinquency Failure of a borrower to make timely payments under a loan agreement.
Disclosure Information relevant to specific transactions that is required by law.
Disbursement Actual payment of moneys. One time or multiple loan funding.
Equity The market value of real property, less the amount of existing liens.
Fee Simple The maximum possible estate or right of ownership of real property, containing forever.
Finance Charge Fee for the cost of a loan including interest and points.
Lien A legal hold or claim of a creditor on the property of another as security for a debt.
Mortgage To hypothecate (pledge) as security real property for the payment of debt. The borrower (mortgagor) retains a possession and use of the property, provided he/she continues to pay the debt. Also, the instrument by which real estate is hypothecated (pledged) as security for the repayment of a loan.
Mortgagor The party lending the money and receiving the mortgage. Some states treat the mortgagee as the "legal" owner, entitled to rents from the property. Other states treat the mortgagee as a secured creditor, the mortgagor being the owner. The latter is the more modern and accepted view.
Recording Filing documents affecting real property as a matter of public record, thereby giving notice to future purchasers, creditors, or other interest parties. Recording is controlled by statute and usually requires the witnessing and/or notarizing of an instrument to be recorded. Recording requirement vary from state to state.
Satisfaction Discharge of an obligation by payment of the amount due, such as on a mortgage, deed of trust or contract; or payment of debt, such as satisfaction of a judgment. Also the recorded instrument stating such payment has been made.
Staged Funding A payment process that allows the dealer to be paid at predetermined intervals throughout the construction phase.
Title Insurance Insurance against loss resulting from defects of title to a specifically described parcel of real property. Defects may run to fee (chain of title) or to encumbrances.
Title Opinion In counties where attorneys examine abstracts or chains of title, a written opinion, executed by the examining attorney, stating that title is vested as stated in the abstract.
Title Search A review of all recorded documents affecting a specific piece of property to determine the present condition of title. A title search is usually completed by a title company rather than an attorney.
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21st Mortgage Corp. is an Equal Housing Lender
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All Rights Reserved
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