專有名詞

Adjustable-Rate Mortgage (ARM)
An adjustable-rate mortgage (ARM) with a monthly payment that is sufficient to amortize the remaining balance, at the interest accrual rate, over the amortization term.

Amortization
The periodic principal pay down of a loan.

Amortization
The periodic principal pay down of a loan.

Annual Percentage Rate (APR)
The cost of credit, expressed as a yearly rate including interest, mortgage insurance, and loan origination fees. The annual percentage rate (APR) is an interest rate that is different from the note rate. The APR does not affect your monthly payments. Your monthly payments are a function of the interest rate and the length of the loan. The APR is designed to measure the "true cost of a loan." It prevents lenders from advertising a low rate and hiding fees.

Appraised Value
An opinion of a property's fair market value, based on an appraiser's knowledge, experience, and analysis of the property.

Ballon Payment
Usually a short-term fixed-rate loan which involves small payments for a certain period of time and one large payment for the remaining amount of the principal at a time specified in the contract.

Buydown
When the seller, builder or buyer pays an amount of money up front to the lender to reduce monthly payments during the first few years of a mortgage.Buydowns can occur in both fixed and adjustable rate mortgages.

Caps (interest)
Limits how much the interest rate can increase, either at each adjustment or during the life of the mortgage. This is an safeguards to the consumer.

Caps (payment)
Limits how much the monthly payment can increase, either at each adjustment or during the life of the mortgage. This is an safeguards to the consumer.

Closing
The meeting between the buyer, seller and lender or their agents where the property and funds legally change hands. Also called settlement. Closing costs usually include an origination fee, discount points, appraisal fee, title search and insurance, property taxes, deed recording fee, credit report charge, escrow costs , etc. The cost of closing usually is about 3 percent to 6 percent of the mortgage amount. The actual closing costs will vary according to the area county and the lenders.

Conforming loans
Refer to loan amounts that conform to government service standards as determined by Fannie Mae & Freddie Mac. Most of the lenders are considering the loan amount equal or below $322,700 as conforming loans.

Credit Report
A report documenting a borrower's credit history that is prepared by a credit bureau and current status of a borrower's redit standing. This report is used by a lender to determine a loan applican'ts creditworthiness.

Down Payment
Part of the purchase price of a property that is paid in cash. It is to make up the difference between the purchase price and the mortgage amount. Down payments usually are 5 percent to 20 percent of the sales price on conventional loans.

Escrow
Funds that are set aside and held in trust, usually for payment of taxes and insurance on real property. Also earnest deposits held pending loan closing. For example, the deposit of funds or documents into an escrow account to be disbursed upon the closing of a sale of real estate.

FICO Score
FICO® scores are the most widely used credit score in U.S. mortgage loan underwriting. This 3-digit number, ranging from 300 to 850, is calculated by a mathematical equation that evaluates many types of information that are on your credit report. Higher FICO® scores represent lower credit risks, which typically equate to better loan terms.

Hazard Insurance
A form of insurance in which the insurance company protects the insured from specified losses, such as fire, windstorm and the like.

Home Equity Loan
A loan that uses the equity in your home as collateral. Equity is the difference between what you owe on your home and what your home is worth.

Impound
That portion of a borrower's monthly payments held by the lender or servicer to pay for taxes, hazard insurance, mortgage insurance, lease payments, and other items as they become due. Also known as reserves.

Joint Tenancy
Two or more persons own a property. Joint tenants with the common law right of survivorship means the survivor inherits the property without reference to the decedent's will. Creditors may sue to have the property divided to settle claims against one of the owners.

Jumbo Loan (Non-Conforming)
A loan which is larger than the limits set by the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corporation (Freddie Mac). Because jumbo loans cannot be funded by these two agencies, they usually carry a higher interest rate. It usually referes to the loan amount outside of the "conforming" range.

Lien
A claim or charge against property. Property is said to be encumbered by a lien and the lien must be removed to clear title.

Loan-To-Value Ratio
The relationship between the amount of the mortgage loan and the appraised value of the property expressed as a percentage.

Margin
The amount a lender adds to the index on an adjustable rate mortgage to establish the adjusted interest rate.

Note
A written promise to pay a certain sum of money at a certain time. A negotiable note starts "Pay to the order of" and is transferable by endorsement similar to a check.

Origination Fee
The fee charged by a lender to prepare loan documents, perform credit checks, inspect and sometimes appraise a property; usually computed as a percentage of the face value of the loan.

PITI
Principal, Interest, Taxes and Insurance. Also called monthly housing expense.

Points
Prepaid interest assessed at closing by the lender. Each point is equal to 1 percent of the loan amount (e.g., two points on a $100,000 mortgage would cost $2,000).

Power of Attorney
A written document authorizing another to act on his or her behalf as an Attorney in Fact. One does not need to be a licensed attorney to act as an attorney in fact but, power of attorney forms are powerful legal documents that should be used only under advice of a licensed attorney at law.

Pre-payment
A privilege in a mortgage permitting the borrower to make payments in advance of their due date.

Pre-payment Penalty
An additional charge imposed by the lender for paying off a loan before the due date.

Principal
The amount of debt, not counting interest, left on a loan.

Quickclaim Deed
A deed releasing whatever interest you may hold in a property but making no warranty whatsoever.

Recording Fees
Money paid to the lender for recording a home sale with the local authorities, thereby making it part of the public records.

Second Mortgage
A mortgage made subsequent to another mortgage and subordinate to the first one.

Subordination
With a loan subordination your Home Equity line/loan will remain open because the lenders involved acknowledge that one loan is junior (inferior) to the interest of another on the same property.

Title
Document that gives evidence of an individual's ownership of the property.

Title Insurance
Insurance that provides an indemnity against loss or damage as a result of defect in title ownership to a particular piece of property. Title insurance covers mistakes made during a Title Search as well as matters which could not be found or discovered in the public records such as missing heirs, mistakes, fraud and forgery.