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Terminology
Here Are Some Helpful Terms Used Throughout The Real Estate,
Mortgage, and Title Processes.
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Sales Agreement |
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See Agreement of Sale
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Second Home (or Vacation Home) |
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This home is not rented and is occupied occasionally by the owners. It is typically in a resort area not in close proximity to the borrowers primary residence.
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Second mortgage |
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A mortgage in addition to the first mortgage. Home equity loans, credit lines, home improvement loans are second mortgage loans. Second mortgages are subordinate to the first one. Second mortgage loans are non-conforming loans, so they usually carry a higher interest rate, and they often are for a shorter time.
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Secondary (subordinate) financing |
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Borrowing additional money toward the down payment. If it is acceptable, usually subject to a maximum combined LTV. Secondary financing is used as an alternative to obtaining Private Mortgage Insurance and to avoid Jumbo loan rates.
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Security |
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This refers to the address of the property being pledged as security for your loan. |
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Servicing |
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The collection of payments, handling your escrow accounts and management of operational procedures that a lender performs.
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Set Back Ordinance |
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Regulates the distance from the lot line to the point where improvements may be constructed.
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Settlement (Closing) |
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The meeting between the related parties of the mortgage where the mortgage documents are executed. Here the property ownership is transferred to the buyer on a purchase transaction.
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Shared Appreciation Mortgage |
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Residential loan in which a borrower receives a below-market interest rate in return for which the lender receives a specified share of the future appreciation in the value of the property.
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Single Family Residence |
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A residence that houses one family. |
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Site Condominium |
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A single family residence that is a detached dwelling which is characterized as a site condominium by the way it is platted by the builder. |
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Special Assessments |
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A special tax imposed on property, individual lots or all property in the immediate area, for road construction, sidewalks, sewers, street lights, etc.
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Special Lien |
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A lien that binds a specified piece of property, unlike a general lien, which is levied against all one's assets. It creates a right to retain something of value belonging to another person as compensation for labor, material, or money expended in that person's behalf. In some localities it is called "particular" lien or "specific" lien. (See lien.)
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Special Warranty Deed |
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A deed in which the grantor conveys title to the grantee and agrees to protect the grantee against title defects or claims asserted by the grantor and those persons whose right to assert a claim against the title arose during the period the grantor held title to the property. In a special warranty deed the grantor guarantees to the grantee that he has done nothing during the time he held title to the property which has, or which might in the future, impair the grantee's title.
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Subject Property |
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The home that you intend to obtain the mortgage on is called the subject property. If you are doing a refinance, the subject property is typically the address of the home you are living in now. If you want to refinance your second home, list the address of that home as the subject property. If you are purchasing a home, the subject property is the address of the home you are buying. |
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Sub-prime loan |
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A mortgage for someone who does not meet conventional guidelines. The borrower may have damaged credit, own too many properties, of have a debt-to-income ratio that exceeds the conforming loan guidelines. These loans are considered to have a higher risk of default and hence carry a higher interest rate than conforming loans. |
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Survey |
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A map or plat made by a licensed surveyor showing the results of measuring the land with its elevations, improvements, boundaries, and its relationship to surrounding tracts of land. A survey is often required by the lender for construction loans to assure them that a building is actually sited on the land according to its legal description.
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Survey Fee |
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A survey is a bird's eye sketch of your property which shows the boundary lines of your lot, and details any encroachments between you and your neighbors. The survey fee covers the cost of the survey. |
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