interest rates on this type of mortgage are periodically
adjusted up or down depending on a specified financial index.
a method of equalizing the monthly mortgage payments over
the life of the loan, even though the proportion of principal
to interest changes over time. In the early part of the
loan, the principal repayment is very low, while the interest
payment is very high. At the end of the loan, the relationship
is reversed.
the actual finance charge for a loan, including points and
fees, in addition to the stated interest rate.
an expert opinion of the value or worth of a property.
the value placed on property by a municipality for purposes
of levying taxes. It may differ widely from appraised or
market value.
a large principal payment due all at once at the end of
some loan terms.
a limit on how much the interest rate can change in an adjustable
rate mortgage.
a document, signed by a title examiner, stating that a seller
to buyer and documents are recorded.
the deed to property is legally transferred from seller
to buyer and documents are recorded.
see "Settlement" or refer to "Settlement
- who pays what?" in this guide.
a fee (usually a percentage of the total transaction) paid
to an agent or broker for services performed.
a survey of attributes and selling process of comparable
homes on the market or recently sold; used to help determine
a correct pricing strategy for a seller's property.
a condition in a contract that must be met for the contract
to be binding.
a binding legal agreement between two or more parties that
outlines the conditions for the exchange of value (for example:money
exchanged for title to property).
a legal document that formally conveys ownership of the
property from seller to buyer.
a percentage of the purchase price that the buyer must pay
in cash and may not borrow from a lender.
the value of the property actually owned by the homeowner:
purchase price, plus appreciation, plus improvements, less
mortgage and liens.
a fund or account held by a third-party custodian until
conditions of a contract are met.
interest rates on this type of mortgage remain the same
over the life of the loan. Compare to "adjustable rate
mortgage."
a recognizable entity (such as a kitchen cabinet, drape
or light fixture) that is permanently attached to property
and belongs to the property when it is sold.
compensates for property damage from specified hazards such
as fire and wind.
the cost of borrowing money, usually expressed as a percentage
rate.
a security claim on property until a debt is satisfied.
an agreement whereby an owner engages a real estate company
for a specified period of time to sell property, for which,
upon sale, the agent receives commission.
the price that is established by present economic conditions,
location and general trends.
the actual price at which property is sold.
security claim by a lender against property until the debt
is paid.
a system that provides to its members detailed information
about properties for sale.
an application fee(s) for processing a proposed mortgage
loan.
principle, interest, taxes and insurance, forming the basis
for monthly mortgage payments.
one percent of the loan principle. It's charged in addition
to interest and fees.
a fee paid by a borrower who pays off the loan before it
is due.
one of the parties to a contract; or the amount of money
borrowed, for which interest is charged.
divide or assess proportionately.
see "Contract," or refer tp "Purchase and
sale agreement" in this guide.
all financial transactions required to make the contract
final. See "Settlement - who pays what" in this
guide.
a document that indicates ownership of a specific property.
detailed examination of the entire document history of a
property title to make sure that there are no legal encumbrances.
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