Page 18E — Real Estate & Home Builders Guide — April 2016
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Adjustable-rate
Mortgage (ARM) - A
mortgage for which the interest rate and the
payments change during the life of the loan.
Agreement of Sale - The contract in which the
seller agrees to sell and buyer agrees to buy, with
conditions and terms spelled out and signed by
both parities.
Amortization - A plan for gradually repaying, in
periodic payments, money borrowed.
Balloon Mortgage - A mortgage that has a
large amount of the principle due at the time of
maturity.
Bridge Loan - A loan that finances a mortgage
at the end of one loan and the start of a new
one.
Closing Costs - Expenses and fees that are
added to the price of the property, paid by the
buyer and the seller at the closing. The
Agreement of Sale states who pays which costs.
Commercial Bank - A financial institution
authorized to provide a variety of financial
services, including consumer and business loans
(generally short-term), checking services, credit
cards and savings accounts.
and managed corporation that purchases
mortgage loans originated by other lenders.
Fannie Mae issues stocks and securities to
obtain funds for its purchases.
Fixed-Rate Mortgage - A loan that has one
set interest rate. Installment Debts - A buyer's
long-term debts; they usually extend for periods
longer than nine months.
Intermediate-term Loan - A home loan of
less than 30 years.
Life-of-loan Cap - A consumer protection on
some adjustable loans. It limits the total upward
adjustment that may occur during the life of the
loan. Also known as an overall cap.
Loan-to-value Ratio - The relationship
between the amount of a home loan and the
total value of the property. Lenders may limit
their maximum loan to 80-95 percent of value.
Lock-in Rat e - A rate commitment made by
lenders when making a mortgage loan to
commit to or "lock in" that rate pending loan
approval. Lock-in commitment periods vary.
by a buyer to a lender as security for money
borrowed.
Payment Cap - Limits the amount that a
monthly payment on an ARM loan can increase
at the time of adjustment.
Points - One percent of the amount of the
mortgage loan.
Due-on-sale Clause - A mortgage stipulation
Prepayment - Payment of a mortgage loan,
or portion of the loan, before the due date.
property after payment of all liens or other
charges on the property.
Escrow - Funds left in trust with a third party, to
be paid to a designated recipient at a
designated time.
F ederal Home Loan Mortgage Corporation
(FHLMC or Freddie Mac) - A quasi-governmental
secondary market agency that purchases whole
mortgage loans. Freddie Mac sells interest in
pools of mortgage loans to obtain funds for
mortgage loan purchases.
Federal Housing Administration (FHA ) - A
government agency within the Department of
Housing
and
Urban
Development
that
administers many programs involving housing
loans made from private funds, including
mortgage insurance for lenders and rent or
interest assistance for low-income tenants and
mortgagors.
614 SE Court Ave. • Pendleton, OR 97801 • 541-278-9275 • FAX 541-278-9279
that obtains mortgages for others by finding
lending institutions, insurance companies, or
private lenders to lend money.
at by dividing the borrower's fixed monthly
obligations by the borrower's monthly income.
Equity - The ownership interest remaining in
OR, LLC
willing to pay for a property and the lowest
price the seller will accept.
Mortgage Broker - An individual or company
demanding payment of the entire loan balance
upon sale or other transfer of the real estate
securing the loan.
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Market Value - The highest price the buyer is
Conventional Loan - A loan not guaranteed
by the VA or insured by the FHA.
Debt-to-income Ratio - A percentage arrived
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Federal National Mortgage Association
(FNMA or Fannie Mae) - A privately owned
Mortgage - A lien or claim on property given
co-op unity, the buyer owns shares in the co-op
corporation (made up of co-op residents), rather
than owning real property.
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Condominium - The buyer owns title to a
residential unit, shares common areas with other
unit owners and pays maintenance fees to the
condominium association for property upkeep.
Co-op - In exchange for the right to occupy a
HOME OWNERSHIP
SEAQUIST
REAL ESTATE
Prime Rate - The interest rate that banks
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charge to their preferred customers. Changes in
prime rate are used as indexes in some
adjustable rate mortgages, especially home
equity lines of credit.
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Principal - The basic loan amount, separate
from interest, insurance, and taxes.
Private Mortgage Insurance (PMI) - The
insurance coverage offered by a private
company that protects a lender against loss on
a default mortgage loan. Its use is usually limited
to loans with high loan-to-value ratios. The
borrower pays the premiums.
Title - Proof of ownership.
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Title Search - A check of title records to assure
that the buyer is purchasing property with no
liens, encumbrances, or other claims which
might adversely affect the title's value or
marketability.
Veterans
Administration
(VA)
-
A
government agency that helps veterans of the
armed forces obtain housing.
Eastern Oregon
R eal E state
& H om ebu ilders G u ide
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www.eohomes.com
www.tourmf.com
Paul R. Seaquist Valerie Alderson
Principal Broker
509-520-3331
Principal Broker
541-969-9964
Tammy Manning
Broker
541-620-2181
