Vocabulary Flashcards
The borrower in a mortgage loan clause
Mortgagor
The lender in a mortgage loan
Mortgagee
The act of signing a loan agreement
Executing
A borrower’s personal pledge to repay a debt according to agreed-upon terms
Promissory note
The pledging of a property as security for payment of a loan without actually surrendering the property itself
Hypothecation
A financing instrument that conveys bare legal title on behalf of a beneficiary but no right of possession
Deed of trust
A charge for the use of money
Interest
The act of charging interest in excess of the maximum legal rate
Usury
A charge imposed by lenders to adjust for the difference between a loan’s interest rate and the yield an investor demands
Discount points
The part of a financing agreement that gives the lender the right to declare the entire debt due and payable immediately on default
Acceleration clause
Percentage of the loan amount charged to a borrower for the costs of generating a loan
Loan origination fee
The part of a financing agreement that requires the lender to execute a satisfaction or release when the note has been paid in full
Defeasance clause
A provision in a financing agreement that permits the lender to declare the entire debt due immediately in the event the property is sold
Alienation clause
A device by which one lender agrees to change the priority of its loan relative to another lender
Subordination agreement
A legal procedure in which property pledged as security is taken from the borrower to satisfy the debt
Foreclosure
