Chapter 12 - Loan Process/Products and Finance Instruments Flashcards
Accrued Expenses
Items on a settlement statement for which the cost has been incurred, but the expense has not yet been paid.
Acceleration Clause
Clause that gives a lender the right to declare the entire loan balance due immediately because of borrower default or for violation of other contract provisions.
Acquisition Cost
Total amount of money necessary to purchase property, including the sales price and charges needed to close the loan.
Credit
Sum of money to be received.
Debit
Sum of money that is owed.
First Mortgage
A security instrument with a first lien position.q
Foreclosure, Judicial
A lawsuit filed by a lender or other creditor to foreclose on a mortgage or other lien; a court ordered sheriff’s sales of the property to repay the debt.
Foreclosure, Non-judicial
Foreclosure by a trustee under the power of sale clause in a deed of trust, without the involvement of a court.
Hypothecate
Condition in which a debtor pledges personal or real property as security for a debt, typically without giving up possession of it.
Lien Position
The order in which liens are paid off out of the proceeds of a foreclosure sale.
Lis Pendens
A notice of pending legal action.
Prepaid Expenses
Items on a settlement statement that the seller has already paid. Also includes expenses that the borrower pays through an escrow account for items such as real estate taxes, homeowner’s insurance, etc.
Proration
In real estate, the division of expenses between buyer and seller in proportion to the actual usage of the item. In general financial matters, the proportionate distribution of a cost or benefit between two parties.
Uniform Residential Loan Application (Form 1003)
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When is an Application an “Application”?
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