Lien: A claim or legal right against assets that are typically used as collateral to satisfy a debt.
Satisfaction Piece: A document serving as evidence that you’ve paid off your mortgage in full, releasing the lien associated with the loan.
Personal Guarantee: An individual’s promise to repay financing if their business can’t.
Mortgage: A formal written acknowledgment by an obligee (as a mortgagee) that an obligation has been satisfied and that the obligor is discharged.
Deed in lieu of Foreclosure: An arrangement where you voluntarily turn over ownership of your home to the lender to avoid the foreclosure process.
Assignment: The document that is the legal record of this transfer from one mortgagee to another.
Points: A % of the loan amount. Example: 100,000 loan, 1 point = $1,000.
Balloon Loan: The loan has a larger-than-usual, one-time payment, typically at the end of the loan term.
Interest-only Loan: A loan with scheduled payments that require you to pay only the interest.
Interim Interest: The cost of borrowing money over the period of time between your mortgage closing date and the date of your first payment.
Per-diem: The amount of interest you’ll pay each day for your mortgage.
Interest Arrears: The payment you make on the first of each month pays the interest for the month just ended.
Pay-Off Letter: A letter that shows how much you will actually have to pay to satisfy the terms of your mortgage loan and completely pay off your debt. Your payoff amount is different from your current balance. Typically requested when selling conventionally or for fast for cash.
Net Fund: Net of loan amount minus costs.
Earnest Money: A deposit a buyer pays to show good faith on a signed contract agreement to buy a home.
Hard Money Lender: A short-term bridge loan that is originated by nontraditional lenders
Credit History: A record of your credit accounts and your history of paying on time as shown in your credit report.
PML: Private Money Lender aka Hard Money Lender.
Force-Placed Insurance: Lender purchased insurance due to a lapse in coverage. Normally carries a higher premium.
Foreclosure: When the lender or servicer takes back property after the homeowner fails to make mortgage payments.
Hud-1: The HUD-1 Settlement Statement lists all charges and credits to the buyer and to the seller in a real estate settlement.
Lenders Title Insurance: Lender’s title insurance protects your lender against problems with the title to your property.
Open Title Policy: A way to “hold open” the lender’s policy in order to issue it at a later date.
Prepayment Penalty: A fee that some lenders charge if you pay off all or part of your mortgage early.