Real Estate Vocabulary Flashcards

Question

Commission

Answer 1

Real estate agents receives 5 to 6% bases on the home sale price. This is usually divided between buyer and seller agents. Money is paid at closing

Answer 2

A contingent offer can still be seen under active listings, whereas a pending offer will no longer be on the listings

Answer 3

These are the rules on property that are run by the HOA, developer etc

Answer 4

A loan that is usually not insured or guaranteed by the federal government. Borrowers make large payments and not required to have mortgage insurance

Answer 5

In general, a conventional sale is when the property has no mortgage remaining, or the owner owes very little mortgage.

Answer 6

Convertible adjustable rate mortgagees permit the buyer to take advantage of low interest rates by obtaining a loan at a "teasers' interest rates. While the monthly mortgage payments remain the same, the interest rates, the interest rates do fluctuate every six months. However, the borrower does have the choice of converting the ARM to a fixed rate mortgage, but this switch also comes with fees.

Answer 7

This is the average of all the regional interest expenses acquired by the lender or the financial institution. The COFI is then utilized to determine the variable rate loans

Answer 8

Debt to Income ratio is a number utilized by the lenders and financial institutions to determine affordability by the buyer. DTI is calculated by total debt expenses plus the monthly housing payment divided by the gross monthly income times 100. Lenders prefer to have buyers spend less than 28% of total income on housing and less than 36% on debt payments.

Answer 9

It is a legally written document that transfers the title from the seller to the buyer. The deed also goes by another name: "Vehicle of the property interest transder"

Answer 10

This is a document that transfers the title from homeowner to the lender/bank.

Answer 11

Is said to occur when an owner defaults on the loan, meaning the loan agreed to be in the contract is not paid. Default is said to occur when the homeowner has not made a loan payment in 90 days or more

Answer 12

Is said to occur when the owner has not made a scheduled payment. If the payment is delayed for more than 30 days, the lender may initiate collections or even foreclosure proceedings.

Answer 13

Mortgage points, these are the feeds that home buyers may sometimes pay to the bank during closing. In return, the owner gets low-interest rates which can significantly reduce the monthly mortgage payments.

Answer 14

Sum of money that a homebuyer pays at the time of closing. Most mortgages required a 20% down payment. A confirming loan may accept a 5% and FHA loan will accept a 3.5% down payments

Answer 15

This is the time period available for the buyer to examine the property.

Answer 16

Acceleration Clause It is a clause in the contract that protects lenders against below market interest rates. This provision in the contract requires the seller of real estate to repay the full mortgage when the property is sold in the future.

Answer 17

Small deposit that a homebuyer makes when entering into a contract with the seller. The deposit is 1-5% Deposit is deducted from the closing and total down payment costs. This money is held in ian escrow

Answer 18

Givers a person the legal right to use another individuals' property or land while still retaining the title in the sam owner

Answer 19

It gives a person the legal right to use another individual's property or land while still retaining title in the name of the owner

Answer 20

Permits the govt the right to use or occupy a private property for public purposes. It is legal only when the govt compensates the property owner for the land or the property

Answer 21

In real estate it refers any claim against the property that limits its transfers or use, including an easement or property tax lien

Answer 22

Enacted in 1974. Unlawful for lenders and creditors to discriminate against applicants based on color, religion, sex, martial status, national origin or age just because they were recipients of public assistance.

Answer 23

Equity=current market value - mortgage balance

Answer 24

Involves third party that will hold the funds during transaction. When the transaction is complete, thr third party will release the funds to the seller

Answer 25

Allows one to review all the public records linked to the property.

Answer 26

This is a tactic sometimes utilized to encourage the agent to sell the property fast usually within a specified time.

Answer 27

Passed in 1970 to ensure accuracy, fairness and privacy of personal data contained in the data bank by the credit reporting agencies

Answer 28

Property's value in an open and free market under the condition that the seller and buyer are aware of the value

Answer 29

In simple terms, it means that the owner has indefinite rights to the property and that the rights may inherited or transferred when the owner wants. The fee simple is most frequently associated with condominiums, single family homes and town homes that are purchased under some conditions, covenants and restrictions.

Answer 30

FHA not only insures the loans but offers several benefits, including a low down payment (3.5% of the total home value), Easy credit qualifying, and low closing costs. Lenders feel confident about giving FHA loands

Answer 31

This is common type of loan that comes with fixed rate

Answer 32

When homeowner does not make the regular monthly payments for more than 3 months.

Answer 33

These loans financially based on property and not on the credit score. Large downpayments and high interest rates and have short schedule. These loans are often small

Answer 34

it assists homeowners in with drawing equity on their home via a line of credit, a fixed monthly

Answer 35

it provides owners with a revolving credit line that cab used to pay for large expenses

Answer 36

allows the buyer to do inspectio

Answer 37

It requires that all foreclosed home first go through the legal system to confirm owner has defaulted before the home can be placed before auction

Answer 38

loan amt that exceeds the cap limit set by govt agencies like fannie mae and freddie mac loan is manually written

Answer 39

offers people who rent an option to own real estate.

Answer 40

A lien can prevent the owner selling the property until debt is resolved

Answer 41

When a buyer obtains a mortgage on an adjustable rate, there is cap on the maximum amount of interest rate over the lifetime of the loan. Absolute Interest rate, or interest rate ceiling

Answer 42

An Addendum or a clause in the contract that permits the buyer to back out of the deal and get the deposit back in case he or she is unable to secure the loan. There is usually a time period for the loan contingency clause to be valid

Answer 43

Buyer submits an application for a loan from a private lender or financial institution Fee is 0.5 to 1%

Answer 44

Describes the admin aspects of maintaining the loan from time the loan was given to the time when it is fully paid. The loan servicing program includes the keeping records of all payments, and balances. Sending monthly borrower statements, paying taxes and insurance

Answer 45

Loan Balance divided by the value of the home * 100 It reflects how much the owner has borrowed from a lender as a percentage of the appraised value of the home. The higher the LTV ratio, the greater the risk

Answer 46

The time period during which the borrower is unable to repay the loan in full without facing monetary penalty by the lender

Answer 47

An individual who often acts as middleman between the borrower and the lending institutions. The broker compares mortgages from different lenders and tries to give the borrower the best deal in town

Answer 48

When a borrower purchases a home with value less than 20% of the down payment or is the recipient of a USDA and FHA loan, the individual will have to purchase mortgage insurance.

Answer 49

When applying for a loan, it is important to get a pre approval letter from the lender. This letter usually reveals the type of loan, terms, loan amt the buyer has qualified for. Lender checks credit history, cash on hand, debt to income ratio.

Answer 50

collection of 700 regional databases

Answer 51

Natural hazards disclosure state required report that discloses if the property is located in a location where there is higher risk of natural hazards or disasters. Fee paid by the seller.

Answer 52

Type of refinancing where the lender pays the loan settlement costs for the borrower. In exchange the borrower will have a loan with higher interest rates. In turn, the mortgage lender will sell the loan to a secondary market for a much higher price due to the high interest rate.

Answer 53

This is the interest rate documented on the mortgage document. It is also referred as face interest rate or nominal rate.

Answer 54

This is the amount the buyer owes on the mortgage before even making the first payment

Answer 55

The cost of processing the loan application.

Answer 56

These are the fees that are charged by the day if the loan completion is not approved on the scheduled day. On closing the lender will demand this payment.

Answer 57

Principal Interest Taxes Insurance PITI costs are calculated and compared to the borrower's monthly gross income prior to approving a loan. In general, the borrower's PITI costs should be less than 28% of their gross monthly income

Answer 58

Planned Unit Development A housing complex made up of town homes, single family residences, condominiums as well as commercial units. It may offer common areas and amenities that are owned by HOA.

Answer 59

Lender will do a credit check, verify all information, do the debt to income ration and approve the buyer for a specified amount of loan for up to 90 days. It is more complete than a pre-qualified letter

Answer 60

It is slightly different from pre-approval. It just gives a rough estimate of how much the potential buyer can afford to buy a home. Getting pre-qualified is a simple matter based solely on what the buyer tells the lender. It is not based on verified information or proof

Answer 61

This is generally a favored interest rate that is given to the lender's loyal and reliable customers. It is usually the best available loan rate that is usually three points above the federal fund rate. The rate which banks charge each other for overnight loans.

Answer 62

Amortization is the process of paying off the loan with regular payments so that each month the amount of the loan decreases. Negative occurs when you pay less than the scheduled monthly payments and the amount you owe tends to increase.

Answer 63

Document that transfers ownership of the home from one person to another individual.

Answer 64

Who works for a financial institutions or private lender to provide funds to borrower. The mortgage banker is only able to obtain funds from a specific institution and is also responsible for the mortgage process including overseeing the application, evaluating the property and performing credit check on the borrower

Answer 65

Real estate Settlement Procedures Act. It requires lenders to provide the disclosures to borrowers of all real estate transactions, consumer protection laws and settlement services. The key goal of RESPA are to regulate the costs of settlements, limit the user of escrow accounts and ban practices that involve kick backs

Answer 66

The right to ingress means that the person has the right to enter a property, and right to egress means that person has the legal right to exit the property. These terms are usually used in an easement or rental scenario where a tenant or individual has been granted access to a private road, shared drive way.

Answer 67

This is process used when there is joint ownership of tenancy or a property. It ensures that the surviving owner will automatically receive the deceased owner's share of the property and will now become the sole property owner.

Answer 68

This occurs when the buyer closes on a property and then decided to lease the tenancy back to the seller. When the seller is unable to move out of the property after the closing date. Buyer becomes a temporary landlord and will charge the seller a rental fee for every day he or she remains in the home

Answer 69

This is transaction fee for the transfer of a property't title. The transfer tax is imposed by the local county and state where the transaction takes place. The fee based on the property's classification and value. In most cases, seller will pay the real estate transfer tax unless it is stated otherwise in the contract.

Real Estate Vocabulary Flashcards

(93 cards)