A deed that transfers only that title or right to a property that the holder of that title has at the time of the transfer. It does not warrant or guarantee a clear title.

Department of Housing and Urban Development (HUD):

A U.S. Government agency established to implement certain federal housing and community development programs.

Disclosure laws:

State and federal regulations which require sellers to disclose such conditions as whether a house is located in a flood plain or whether there are known defects in or affecting the property.

Earnest money:

A portion of a down payment given to the seller by a potential buyer indicating the buyer’s intent to complete the purchase of the property.

Easement:

A right to use the land of another.

Encroachment:

A condition that limits the interest in a title to property such as a mortgage, deed restrictions, easements, unpaid taxes, etc.

Equity:

The value of real estate over and above the liens against it. It is obtained by subtracting the total liens from the value.

Equity mortgage:

A mortgage based on the borrowers’ equity in their home rather than on their credit worthiness.

Escrow:

The placement of money or documents with a third party for safekeeping pending the fulfillment or performance of a specified act or condition.

Federal Housing Administration (FHA):

An agency within the Department of Housing and Urban Development (HUD) that administers loan guarantee programs and loan insurance programs to make more housing available.

Fannie Mae:

Nickname for Federal National Mortgage Corp. (FNMA), a tax paying corporation created by Congress to support the secondary mortgages insured by FHA or guaranteed by VA, as well as conventional home mortgages.

FHA Insured mortgage:

A mortgage under which the Federal Housing Administration insures loans made, according to its regulation, by approved lenders.

Fixed rate mortgage:

A loan that fixes the interst rate at a prescribed rate for the duration of the loan.

Foreclosure:

Procedure whereby property pledged as security for a debt is sold to pay the debt in the event of default.

Freddie Mac:

Nickname for Federal Home Loan Mortgage Corp. (FHLMC), a federally controlled and operated corporation to support the secondary mortgage market. It purchases and sells residential conventional home mortgages.

Graduated-payment mortgage:

A mortgage that starts with low monthly payments and increases at a predetermined rate.

Growing-equity mortgage:

A mortgage loan in which the monthly payments increase by a specific amount each year, with the “Overpayments” applied to the principal.

Installment debts:

Long-term debts that usually extend for more than one month.

Investor:

The holder of a mortgage or the permanent lender for whom the mortgage maker services the loan. Any person or institution that invests in mortgages.

Joint & Survivorship Deed:

(Also known as “Warranty deed creating tenants in common with right of survivorship”) Upon death of one of the owners, title to the interest transfers “by contract” to survivors.

Lease purchase agreement:

Buyer makes a deposit for the future purchase of a property with the right to lease the property in the interim.

Lien:

A legal claim against a property that must be paid when the property is sold.

Loan-to-value ratio:

The relationship between the amount of a home mortgage and the total value of the property. Lenders may limit their maximum mortgage to 80-95 percent of value.

Lock-in-rate:

A commitment made by lenders on a mortgage loan to “lock in” a civilian rate pending mortgage approval. Lock-in periods vary.

Market value:

The highest price a buyer will pay for a property and the lowest price the seller will accept.

Mortgage:

One type of document used to make property the security for the payment of a loan.

Mortgage broker:

An individual or company that obtains mortgages for others by finding lending institutions, insurance companies, or private sources to lend the money; may also make collections and handle disbursements.

Mortgagee:

The lender of money or the receiver of the mortgage.

Mortgagor:

The borrower of money of the giver of the mortgage document.

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