Principles 8 Flashcards
Federal Reserve Bank System
Was created by Congress in 1913 to serve as the central bank of the United States.
Federal Deposit Insurance Corporation (FDIC)
Was created by Congress in 1933 to insure individual accounts in participating banks and (as of 1989) savings and loan associations, currently up to $250,000 per depositor, per insured bank, for each ownership category.
Home affordable refinance program (HARP)
- introduce March 2009, and later extended through September 30, 2017.
- it’s for borrowers with little or no equity in their home
- Allows a borrower to refinance their mortgage with no new or additional mortgage insurance
Promissory note
- Is the borrower’s promise to pay the amount borrowed
- is evidence of the debt
- It establishes the underlying obligation of the loan transaction.
Security instrument
Is used to identify the real estate that serves as assurance that the loan will be repaid.
Hypothecation
The real property will be forfeited to the holder of the security instrument if the underlying debt is not paid.
Usury
Is the charging of an exorbitant amount or rate of interest and is the subject of both state and federal law.
Pledge
Possession of the pledges property is turned over to the lender until the debt is paid.
Balloon payment
An installment that is at least twice the amount of the smallest installment.
Joint and several liability
If one co-signer defaults in payment on the note, the note holder can demand full payment from any other co-signer.
Mortgage
- security instrument
- an instrument by which property is hypothecated to secure the payment of a debt or an obligation.
Redemption period
A period following the sale during which the judgement debtor or the judgement debtor’s successor in interest can buy back the property.
Deed of trust (trust deed)
Is an instrument by which real property is hypothecated to secure payment of a debt or an obligation.
Difference between mortgage vs. a trust deed?
There is no right of redemption following a trustee’s sale.
Unlawful detainer
Is the legal action which the court orders the sheriff to evict the present occupant.
Unruh Civil Rights Act
Covers contracts for goods and services.
Construction loan
- Aka interim loan
- made to finance building construction or other improvements to land.
- a short-term temporary loan used until permanent financing is available
Uniform residential loan application
Typically is used to qualify a prospective borrower purchasing a single-family residence.
Office of thrift supervision (OTS)
Regulates the savings and loan industry.
Federal Housing Finance Agency (FHFA)
Oversees the federal Home Loan Banks, which lend funds to member institutions.
Judicial foreclosure of a mortgage is?
A longer process than a trustee’s sale, and there is no right of redemption following the trustee’s sale.
Institutional lenders
- include thrifts, commercial banks, mutual savings banks, credit unions, and insurance companies.
Noninstitutional lenders
- include mortgage companies, and private individuals
Money is?
A medium of exchange as well as a measure of value
FDIC
Federal agency that insures savings accounts
Judicial foreclosure
Proceeding in which a mortgage, a trustee, or another lienholder on property requests a court-supervised sale of the property to cover the unpaid balance of a delinquent debt.
