R
Rate Lock See Lock-In.
Ratios See Debt Ratios
Real Estate Owned Property a lender acquires as the result of foreclosure.
(REO)
Real Estate Settlement The act which enforces Regulation X. RESPA requires lenders to
Procedures Act (RESPA) provide customers with information regarding the expenses
involved in the real estate settlement (closing) process.
Real Estate Refers to land, as well as the buildings and other improvements
(Real Property) attached to the land. Specifically it consists of land, anything permanently attached to the land (fixtures), anything incidental or appurtenant to the land, and those things that are immovable by definition of the law.
Real Estate An individual licensed to conduct business in the employ of and
SalespersonOr Agent under the control and supervision of a licensed broker only. They cannot work as an independent agent, and they can only by compensated by their employing broker.
Realtor A real estate broker or an associate holding active membership in a real estate board affiliated with the National Association of Realtors.
Recast Re-calculation of loan payments based on the current principal balance. This occurs when a minimum payment is calculated to yield the amount necessary to pay the loan in full by the maturity date, without regard to the payment change cap.
Reconciliation The final step in the appraisal process; it is a weighing process that takes into account all data found in the appraisal to obtain a final estimate of value.
Reconveyance The transfer of the title of land from one person to the immediately preceding owner. It is used when the debt is satisfied under the terms of a deed of trust.
Recording The noting in the county courthouse of the details of a properly executed legal document, such as a deed, mortgage, or a satisfaction of mortgage, making it a part of the public record.
Redemption Buying back property sold by a judicial sale.
Refinance A real estate loan that pays off an existing loan on the property and rewrites the terms of a loan with the same lender or another lender. In all cases of refinancing, the title to the property used as security (collateral) does no change hands entirely when the new loan replaces the old loan. Occasionally, a refinance will include adding or removing one or more parties from title. The owner of a property can also refinance a property with no existing mortgages if he/she wants to take cash out of the property.
Refinancing The repayment of a debt from the proceeds of a new loan using the same property as security.
Repayment Term The length of time the customer has to repay the loan –usually expressed in years. For example, a loan with a 30-year term must be repaid by the end of the 30th year. Also see Loan Term.
Rescission An action to annul the effect of executing a contract or other document.
Reserves Each month the customer pays 1/12th of their annual real estate taxes and hazard insurance premium to the lender. The funds are set aside in a reserve account to be paid when taxes and insurance are due. If the LTV is less than 80%, the customer has the option of setting up a reserve account or paying taxes and insurance on their own. Also known as impounds or escrow payments.
RESPA Real Estate Settlement Procedures Act.
Restrictions Limitations on use and enjoyment of property; usually referred to in connection with covenants and conditions.
Right of Rescission Under the provisions of Truth-In-Lending, the customer’s right on certain kinds of loans, to change his/her mind and to rescind (cancel) the transaction during a three-day waiting period.
Right of Survivorship Right to acquire the interests of a deceased joint owner; distinguishing feature of a joint tenancy.
Right of Way The right to pass over land owned by another. Also, a strip of land used for a street or railway.
S
Saleable Saleable describes loans and products that meet standards secondary market (specifically FNMA) guidelines. These loans are made with the intention of selling them on the secondary market, and to FNMA in particular, rather than retaining them in a bank’s portfolio. (See Portfolio.)
Sales Contract A written agreement between buyer and seller stating terms and conditions of a sale or exchange of property.
Sales Price The contract purchase price as agreed upon by buyer and seller.
Satisfaction Performance on the terms of an obligation.
Second Deed of Trust A loan made in a second lien position behind a first loan. Also called a junior lien or subordinate loan.
Second Home In a loan transaction, a subject property which will be used exclusively by the customer in addition to his/her primary residence. Considered owner-occupied.
Second Mortgage Mortgage which ranks after a first mortgage in priority. If the loan is not repaid, the first mortgage holder has first right to the property, and the second mortgage holder receives anything left over, up to the payoff of the second mortgage.
Secondary Financing A loan secured by a second, third, fourth, etc. mortgage or trust deed on real property.
Secondary Mortgage An assortment of federal agencies and private investors that buy
Market mortgages in large numbers from primary lenders. The primary lenders obtain cash for the note they hold so they can lend the cash back to other customers.
Security Collateral; property pledged to secure repayment of a debt.
Security Agreement Document used as evidence of lien on personal property. A financing statement may be filed or recorded to give notice of the security agreement.
Seller Concessions Discounts or other incentives given by the seller of a property to a prospective buyer, to induce the buyer to purchase the property.
Seller Contributions On a purchase transaction, a financial donation made to the customer by the seller toward non-recurring closing costs
.
Separate Property Property owned by a husband or wife, which is not community property.
Servant Tenement An estate burdened by an appurtenant easement.
Servicing Supervising and administering a loan after it has been made. This involves such things as collecting the payments, keeping accounting records, computing interest and principal, foreclosing on defaulted loans, etc. Also known as Loan Servicing.
Servitude A right in the nature of an easement.
Single-Family A dwelling unit designed for ownership and occupancy by one
Residence (SFR) individual or family.
Sole Proprietorship Business entity owned by a single individual.
Spec Lending A loan made to a builder for the purpose of constructing either commercial or residential properties for resale.
Special Assessment Legal charge against real estate by a public authority to pay the cost of public improvements such as street lights, sidewalks, street improvements, etc.
Special Flood Hazard A designation used by the National Flood Insurance Program to
Area (SFHA) identify properties at high risk for flood damage.
Specialty Lending Describes loans that are out of standard guidelines governing collateral and/or credit. Saleable loans require the customer to have standard property and credit that ranks in credit class zero; our Specialty Lending program offer options for loans with collateral exceptions and/or substandard credit (classes 2-4).
Specific Liens Liens that attach to only a specific parcel of land or piece of property.
Spread The difference between the average rate at which money can be borrowed and the average rate at which it can be loaned.
Start Rate See Initial Interest Rate.
Statute of Frauds A law requiring certain contracts to be in writing, such as contracts for the sale of real estate or loans secured by real estate.
Subject Property The subject property is the property on which the loan is being made, and which serves as collateral for the loan. In appraisal terminology, the property being appraised.
Subordination The act of a party acknowledging, by a written, recorded instrument, that a debt secured by real property is inferior to the interest of another in the same property.
Subordination An agreement under which a prior lien is made inferior to an
Agreement otherwise junior lien.
Supplemental Income Income other than the customer’s primary income.
Survey A map and plat containing a statement of courses, distances and quantity of land and showing lines of possession.
Swing Loan See Bridge Loan.
T
Table Funding Wholesale Table Funding is a process that allows Approved Wholesale Premiere Brokers to:
· Draw loan documents in the Broker’s company name.
· Fund loans in the Broker’s company name using a bank’s funds by assigning the loan to the bank after the customer signs the loan documents.
Assignment of the loan to a bank is accomplished by:
· A corporate assignment of the Deed of Trust/Mortgage instrument to the bank.
· Endorsing the note to the bank.
Tax Lien A government claim against real property for unpaid taxes.
Tax Sale Sale of property after a period of nonpayment of taxes.
Tenancy in Common Ownership of property by two or more persons in undivided interests without right of survivorship.
Tenant An individual, business, or organization that has the temporary use and occupation of real property owned by another.
Tenants by the Entirety See Joint Tenancy.
Term See Loan Term.
Three-Day Docs Disclosures required by law to be sent to the customer within three business days of receipt of a loan application; for example, Good Faith Estimate and Truth-In-Lending disclosure.
Title Right to or ownership of land; evidence of a person’s right to the possession of property.
Title Exception An exception appearing in a title policy against which the title company does not insure.
Title Report A report that discloses conditions of the title made by a title company preliminary to issuance of title insurance. Also see Preliminary Title Report.
Title Search An examination of public records, law, and court decisions to disclose the current facts regarding ownership of real estate.
Townhouse A residential unit on a small lot which has coincidental exterior limits with other similar units. Title to the unit and its lot is vested in the individual buyers with a fractional interest in common areas, if any.
Transfer Fee Fees collected from the buyer or seller of a property to defray county or city charges for changing public records.
Transfer Tax Taxes on the conveyance of real estate imposed by state and local governments.
Trust A fiduciary relationship in which a trustee holds title to property for the benefit of a beneficiary.
Trust Account An account separate and apart and physically segregated from the broker’s own funds. The broker is required by law to deposit all funds collected for clients in this account.
Trust Deed See Deed of Trust.
Trustee The person to whom property is conveyed in trust.
Trustee’s Deed Deed given by the trustee when the land is sold under a deed of trust.
Trustor The person who conveys property in trust.
Truth-In-Lending Act The Act, also known as Regulation Z, was enacted to protect consumers by requiring lenders to tell the consumer (customer) how much they are paying for credit. Also costs must be expressed as an annual percentage rate (APR).
