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Mortgage Educators and Compliance > Mortgage Acronym Glossary > Flashcards

Mortgage Acronym Glossary Flashcards

1
Q

AARMR: Responsible for the create of the NMLS

A

America Association of Residential Mortgage Regulators

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2
Q

AFBA: an arrangement between two different companies involved in providing services in the closing of a real estate transaction. There can be no ownership interest. requires disclosure under RESPA

A

Affiliated business arrangement

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3
Q

AMC: the middeman between appraisers and mortgage companies

A

Appraisal Management Company

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4
Q

AML: a law in place to require financial institutions to prevent, detect and report money laundering activities

A

Anti-money laundering

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5
Q

APOR: rate used to determine whether a loan is high-cost or higher priced

A

average prime offer rate

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6
Q

APR: calculates the APR you would pay on the loan once the costs of getting the loan are factored in

A

annual percentage rate

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7
Q

ARM: a mortgage that will have a fixed rate for a set period and then the rate is adjusted. the rate will normally be adjusted once or twice a year

A

adjustable rate mortgage

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8
Q

ATR: The rule that requires lenders to determine whether a borrower has the ability to repay their loan requires verification of the information provided to prove the ability to repay

A

ability to repay

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9
Q

AUS: used to automatically underwrite conforming loans

A

Automated underwriting system

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10
Q

BSA: requires suspicious activity reports (SARS) to be filed regarding dubious activities

A

bank secrecy act

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11
Q

CAIVRS: a federal database of people who have delinquencies on any kind of federal debt

A

credit alert verification reporting system

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12
Q

CFPB: the federal entity that regulates the entire mortgage industry

A

consumer financial protection bureau

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13
Q

CHARM: required disclosure on ARM loans to educate the consumer about the type of loan they have

A

consumer handbook on adjustable rate mortgage

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14
Q

CLTV: this ratio is calculated by dividing the amount of a 1st lien loan and the total line of credit on a home equity line of credit HELOC) or total amount of a 2nd lien loan by the purchase price or the appraised value of the property, whichever is less

A

combined loan to value

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15
Q

COFI: index used on the ARM loans (margin + index)

A

Cost of funds index

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16
Q

DTI: two ratios, front end and back end DTI. Front end DTI (housing expense) is determined by dividing the amount of housing by the borrower’s gross income.

A

debt to income

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17
Q

DU: the AUS used by fannie mae

A

Desktop underwriter

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18
Q

ECOA: a law in the US that makes it illegal for any creditor to discriminate against an applicant based on race, religion, national origin, sex

A

equal credit opportunity act

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19
Q

FACTA: regulates how consumer-reporting agencies use consumer information

A

fair and accurate credit transaction act

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20
Q

FCRA: regulates how consumer-reporting agencies use consumer information

A

fair credit reporting act

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21
Q

FDIC: regulates depository institutions

A

Federal deposit insurance corporation

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22
Q

FFIEC: collects and distributes HMDA information

A

Federal financial institutions examination council

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23
Q

FHA: the federal government agency that oversees the US housing market. FHA mortgages are guaranteed by the Federal government and offered by banks/lenders

A

Federal housing administration

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24
Q

FHLMC: a corporation authorized by congress to provide a secondary market for residential mortgages

A

Federal home loan mortgage corporation/Freddie Mac

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25
Q

Freddie Mac: a government sponsored entity created by congress to increase access to mortgage. mortgages offered under Freedie Mac guidelines are called “conforming morgages”

A

Federal home loan mortgage corporation

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26
Q

FICO: the company that created the industry standard credit scores used by almost all lenders. the FICO score is a numerical summary of the information in your credit reports that represents your potential credit risk

A

Fair Isaac Corporation

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27
Q

FinCEN: the entity that a SAR would be reported to

A

Financial Crimes Enforcement Network

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28
Q

FNMA: a government sponsored entity created by congress to increase access to mortgages. mortgages offered under fannie mae guidelines are called “conforming” mortgages

A

Federal National Mortgage association (fannie mae)

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29
Q

FTC

A

Federal trade commission

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30
Q

GFE: a document that the lender is required to give a prospective borrower when they apply for a loan the GFE is an estimate of all closing costs and fees required for the proposed mortgage loan

A

Good faith estimate

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31
Q

GLBA: Requires disclosure of information sharing policies

A

Gramm-Leach Bliley Act

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32
Q

GNMA: Ginnie Mae, the fannie and freddie of government lending.

A

Government National Mortgage Association

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33
Q

GPM: with this type of mortgage the payment starts low and rises over time

A

graduate payment mortgage

34
Q

GSE: a financial services corporation created by the US congress (fannie and freddie mac)

A

government sponsored enterprise

35
Q

HARP: a refinance program that allows eligible borrowers, with little to no equity in their homes, to take advantage of low interest rates and other refinancing benefits

A

Home affordable refinance program

36
Q

HECM: loan for borrowers 62 years and older uses the equity in their home to create cash disbursements to the borrower

A

Home equity conversion mortgage

37
Q

HELOC: a loan in which the lender agrees to lend a maximum amount within an agreed loan term, where the collateral is the borrower’s equity in his or her house

A

Home equity line of credit

38
Q

HMDA: requires lenders to report their lending patterns geographically to prevent redlining and reverse redlining

A

home mortgage disclosure act

39
Q

HOA

A

homeowners association

40
Q

HOEPA: regulates high cost home loans

A

home ownership and equity protection act

41
Q

HPA: regulates the cancellation of private mortgage insurance

A

homeowners protection act

42
Q

HPML

A

higher priced mortgage loan

43
Q

HUD: the primary housing and lending regulatory authority in the U.S.

A

US department of housing and urban development

44
Q

IO: a payment that only covers the interest on the loan

A

interest only

45
Q

IP: a non-owner occupied property that is rented out by the borrower

A

investment property

46
Q

IRRRL: VA refinance loan allows you to lower your interest rate on an existing VA home loan

A

Interest rate reduction refinance loan

47
Q

LP: the AUS used by Freddie Mac

A

Loan prospector

48
Q

LTV: a ratio used by the lender that divides the amount of money borrowed by the appraised value of the home expressed as a percentage. for example, a borrower may purchase a home appraised at $200,000 with a down payment of $40,000. this means they have a LTV ratio of 80%

A

loan to value

49
Q

MARS

A

mortgae assistance relief services rule

50
Q

MBS: these are investment instruments that are bundled by Fannie, Freddie, and Ginnie Mae for sale on wall street

A

Mortgage backed security

51
Q

MDIA

A

mortgage disclosure improvement act

52
Q

MERS

A

mortgage electronic registration system

53
Q

MMI: mortgage insurance charged monthly on an FHA loan

A

monthly mortgage insurance

54
Q

MSA

A

marketing services agreements

55
Q

NINA: a loan that doesn’t require income or assets

A

No income no asset

56
Q

NIV: a loan that requires no income verification

A

no income verification

57
Q

NMLS

A

nationwide mortgage licensing system and registry

58
Q

NOO: a loan on a property not occupied by the owner

A

non-owner occupied

59
Q

O/O: a loan on a property owned by the owner

A

owner-occupied

60
Q

OCC

A

office of the comptroller of the currency

61
Q

P&I: the two elements that go towards repaying your loan

A

principal and interest

62
Q

PITI: 4 main components of your monthly mortgage payment

A

principal, interest, taxes, and insurance

63
Q

PMI: if you put down less than 20% most lender or banks require you to have PMI. this can be put into your monthly mortgage payment or calculated into your rate

A

private mortgage insurance

64
Q

PPP: a penalty charged to a borrower if they pay their loan in full before the end of its terms

A

prepayment penalty

65
Q

PUD: a type of development is designed real estate, usually combination of housing, recreation, commericial and industrial parks all within one development or subdivision

A

planned urban development

66
Q

QM: a type of loan that requires the lender to make sure that borrower can repay the loan

A

qualified mortgage

67
Q

SAR: report required to be made to FinCEN under the Bank Secrecy Act (BSA) when there is a suspicion of money laundering or fraud

A

suspicious activity report

68
Q

SISA: the loan only requires the borrower to state their income and assets doesn’t require verification

A

Stated income stated asset

69
Q

SRP: payment received by a lender on the sale of a closed mortgage loan to the secondary market

A

Service Release Premium

70
Q

TIL: an important document you will receive from the lender or bank within 3 days of your application. within the the document certain disclosures are set forth. such as, finance charges, APR, amount financed, total of payments, and total sales price will be disclosed.

A

Truth in Lending

71
Q

TIN

A

Tax identification number

72
Q

TLTV: calculated by dividing the sum of the 1st lien mortgage amount and the disbursed amount of a HELOC or 2nd lien by either the property’s purchase price or appraised value (whichever is less)

A

total loan to value

73
Q

TRID: new legislation as of oct 2015 requires the loan estimate and closing disclosure, replaces the GFE, TIL and HUD-1 disclosures

A

(TILA-RESPA Integrated Disclosure Rule)

74
Q

UFMIP: mortgage insurance premium paid in a lump sum upfront on an FHA loan

A

upfront mortgage insurance premium

75
Q

UST: 25 question addition to the national test component that replaced most individual states test

A

Uniform state test

76
Q

VOD: used to verify that X amount of money is in a borrower’s bank account

A

Verification of deposit

77
Q

VOE: used to verify that a borrower is employed

A

verification of employment

78
Q

VOM: used to verify that a borrower has X mortgage

A

Verification of mortgage

79
Q

VOR: used to verify that a borrower pays rent and pays their rent on time

A

verification of rent

80
Q

YSP: paid to the broker for giving a borrower a higher interest rate on a loan in exchange for lower up-front costs generally paid in origination fees, broker fees or discount points

A

Yield spread premium

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