Escrow
Escrow is usually money held in trust by a third party to be
turned over to the grantee only upon fulfillment of a condition.
This could be proceeds from a loan closing that would be held
in escrow until a particular condition is met.
Broker
A term used to describe a person who serves as an agent
who negotiates contracts of purchase and sale of real estate.
The broker works with an individual in order to try to obtain a
permanent mortgage. The broker will be paid a fee for the
service and is usually beneficial in hard to qualify loans.
Penalty Clause
A clause which is part of a loan that states what monetary
penalty might be incurred if the loan is paid off early.
Foreclose
The act of a bank or lending institution calling for the early
payment in full of a loan. This process is usually brought
about when payments are not made on a loan resulting in
default.
Builders Risk
Builder’s risk is a form of insurance used during the
construction of a house. This would cover any damage
caused by fire or storms during the construction. Some
insurance companies no longer issue builder risk policies.
They issue home owner policies that turn into permanent
policies when the construction is complete.
Escrow is usually money held in trust by a third party to be
turned over to the grantee only upon fulfillment of a condition.
This could be proceeds from a loan closing that would be held
in escrow until a particular condition is met.
Broker
A term used to describe a person who serves as an agent
who negotiates contracts of purchase and sale of real estate.
The broker works with an individual in order to try to obtain a
permanent mortgage. The broker will be paid a fee for the
service and is usually beneficial in hard to qualify loans.
Penalty Clause
A clause which is part of a loan that states what monetary
penalty might be incurred if the loan is paid off early.
Foreclose
The act of a bank or lending institution calling for the early
payment in full of a loan. This process is usually brought
about when payments are not made on a loan resulting in
default.
Builders Risk
Builder’s risk is a form of insurance used during the
construction of a house. This would cover any damage
caused by fire or storms during the construction. Some
insurance companies no longer issue builder risk policies.
They issue home owner policies that turn into permanent
policies when the construction is complete.
Down Payment
Money required by banks secure a loan. The down payment
will reduce the principal amount of the loan. This will insure
that the buyer has some amount of monetary investment in
the house.
APR
A term used to express Annual Percentage Rate.
Appraisal
An estimate of the value of property by an authorized
appraiser.
Assessment
A value placed on a property in order to set a rate for a tax to
be levied.
Bid
Bid Bond
Bid bond is a bond issued by a bonding company on behalf
of a contractor. This provides assurance that if the bid is
accepted, the contractor will provide a contract and
performance bond. If the contractor defaults, the bonding
company is obligated to pay the recipient of the bid the
difference between the contractor's bid and the next lowest
acceptable lowest bidder.
Money required by banks secure a loan. The down payment
will reduce the principal amount of the loan. This will insure
that the buyer has some amount of monetary investment in
the house.
APR
A term used to express Annual Percentage Rate.
Appraisal
An estimate of the value of property by an authorized
appraiser.
Assessment
A value placed on a property in order to set a rate for a tax to
be levied.
Bid
Bid Bond
Bid bond is a bond issued by a bonding company on behalf
of a contractor. This provides assurance that if the bid is
accepted, the contractor will provide a contract and
performance bond. If the contractor defaults, the bonding
company is obligated to pay the recipient of the bid the
difference between the contractor's bid and the next lowest
acceptable lowest bidder.
| Financial-3 |
Construction Jargon
Cash Out
When an owner renegotiates or negotiates a new mortgage
and the proceeds of the new financing exceed the money
required to pay out the old mortgage and any other costs,
liens or expenses, leaving money for the borrower.
Building Permit
A document obtained from the local government, allowing for
the construction of a structure in accordance with the terms
of the permit
Breach of Contract
A failure to meet one's obligations, whether under a contract
or otherwise. A breach of contract allows the innocent party
to enforce the contract, rescind the contract or sue for
damages.
Cost Plus
Creative Finance
An arrangement for the financing of the purchase of a
property which is outside the normal practice of residential
financing
Ernest Money
A sum of money paid by a potential purchaser as proof of her
intention to complete the purchase transaction. Held in trust,
usually by the Listing Agent, and credited to Purchaser off
purchase price. May be forfeited if Purchaser fails to
complete transaction.
When an owner renegotiates or negotiates a new mortgage
and the proceeds of the new financing exceed the money
required to pay out the old mortgage and any other costs,
liens or expenses, leaving money for the borrower.
Building Permit
A document obtained from the local government, allowing for
the construction of a structure in accordance with the terms
of the permit
Breach of Contract
A failure to meet one's obligations, whether under a contract
or otherwise. A breach of contract allows the innocent party
to enforce the contract, rescind the contract or sue for
damages.
Cost Plus
Creative Finance
An arrangement for the financing of the purchase of a
property which is outside the normal practice of residential
financing
Ernest Money
A sum of money paid by a potential purchaser as proof of her
intention to complete the purchase transaction. Held in trust,
usually by the Listing Agent, and credited to Purchaser off
purchase price. May be forfeited if Purchaser fails to
complete transaction.
Permanent Loan
A permanent loan refers to the permanent mortgage on a
house.
Capped Rate
A Capped Rate is a limit that is put on the interest rate on
mortgage payments over the life of the mortgage. In an
Adjustable Rate Mortgage the rate can change but cannot
exceed the capped rate.
Convertibility
Convertibility allows an individual to change an Adjustable
Rate Mortgage to a Fixed rate Mortgage at a later date.
Discount Rate
A basis for interest rates, the rate charged by the Federal
Reserve System on loans to banks.
Due On Sale
A clause in a mortgage which requires that the mortgage be
paid out in full upon the sale of the house.
Graduated Payment
A periodic payment which will increase at a stated rate over
a stated period of time before levelling off for the remainder
of the term of the loan.
Vendor's Lien
Financing of a purchase of property whereby the vendor
accepts only a portion of the purchase price up front and
accepts a mortgage (with periodic payments and interest
chargeable) for the remainder
A permanent loan refers to the permanent mortgage on a
house.
Capped Rate
A Capped Rate is a limit that is put on the interest rate on
mortgage payments over the life of the mortgage. In an
Adjustable Rate Mortgage the rate can change but cannot
exceed the capped rate.
Convertibility
Convertibility allows an individual to change an Adjustable
Rate Mortgage to a Fixed rate Mortgage at a later date.
Discount Rate
A basis for interest rates, the rate charged by the Federal
Reserve System on loans to banks.
Due On Sale
A clause in a mortgage which requires that the mortgage be
paid out in full upon the sale of the house.
Graduated Payment
A periodic payment which will increase at a stated rate over
a stated period of time before levelling off for the remainder
of the term of the loan.
Vendor's Lien
Financing of a purchase of property whereby the vendor
accepts only a portion of the purchase price up front and
accepts a mortgage (with periodic payments and interest
chargeable) for the remainder
Mortgage Company
Note
A written instrument of indebtedness, promising to pay a
certain person a particular sum of money upon stated terms.
Assessed Value
The value assigned to a given property by the municipality for
the purpose of establishing realty taxes payable by the owner
of the property.
Depreciation
The lessening of the value of a property over time
Note
A written instrument of indebtedness, promising to pay a
certain person a particular sum of money upon stated terms.
Assessed Value
The value assigned to a given property by the municipality for
the purpose of establishing realty taxes payable by the owner
of the property.
Depreciation
The lessening of the value of a property over time
Encumbrance
Any right, interest or other claim against land which is
registered on title and affects the owner's ability to sell the
property.
Interim Financing
A construction loan to pay for construction costs up to
completion
Abstract Title
A summary listing of the documents registered in the local
land registry office and which affect title (ownership) of a
particular property
Any right, interest or other claim against land which is
registered on title and affects the owner's ability to sell the
property.
Interim Financing
A construction loan to pay for construction costs up to
completion
Abstract Title
A summary listing of the documents registered in the local
land registry office and which affect title (ownership) of a
particular property
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