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Acceleration Clause
A clause that most mortgages contain. It means that
the entire outstanding balance is due, usually at the
time of sale or transfer of the property. Also called
a Due-on-Sale, Alienation, or Call Provision clause.
A mortgage with an Acceleration Clause can only be assumed
with written permission.
Adjustable-Rate
Mortgage (ARM)
A mortgage where the payment is based on an Interest
Rate which can fluctuate up or down depending on the
Index that the mortgage is tied to. The Interest Rate,
for this type of mortgage, is the sum of the Index and
the Margin. This type of mortgage is also called Variable
Rate Mortgage.
Adjustment Date
The date of the adjustment for an Adjustable-Rate Mortgage.
This date marks the end of the Adjustment Period. It
may occur every six months, every year or however often
you and the lender agree.
Adjustment Period
The time period between adjustments for an Adjustable-Rate
Mortgage. Typically, Adjustment Periods range from one
month to one year. Of course, the longer the Adjustment
Period, the better it is for you.
Alienation Clause - see Acceleration
Clause
ALTA (American Land Title Association)
The form of Title Insurance that is more thorough and
complete than other types of Title Insurance.
Amortization
The paying back of a loan over time with equal payments.
The payment stays the same; however, the ratio of Principal-to-Interest
changes over time. At the beginning, most mortgages
are primarily Interest. At the end, they are primarily
Principal.
Amortization Schedule
A timetable for payment of a mortgage loan. An amortization
schedule shows the amount of each payment applied to
interest and principal and shows the remaining balance
after each payment is made.
Amortization Term
The amount of time required to amortize the mortgage
loan. The amortization term is expressed as a number
of months. For example, for a 30-year fixed-rate mortgage,
the amortization term is 360 months.
Annual Percentage Rate (APR)
The cost of credit on a yearly basis, expressed as a
percentage. Required to be disclosed by the lender under
the federal Truth in Lending Act, Regulation Z. Includes
up-front costs paid to obtain the loan, and is, therefore,
usually a higher amount than the interest rate stipulated
in the mortgage not. Does not include title insurance,
appraisal, and credit report.
Application
An initial statement of personal and financial information
which is required to approve your loan.
Application Fee
Fees that are paid upon application. An application
fee may frequently include charges for property appraisal
and a credit report.
Appraisal
A fee charged by an appraiser to render an opinion of
market value as of a specific date. Required by most
lenders to obtain a loan.
Appreciation
The amount by which the value of your property has increased
since its purchase. The opposite of depreciation.
Assessed Value
The valuation place on property by a public tax assessor
for purposes of taxation.
Assignment of Mortgage
Your lender can sell your mortgage to a different lender
at any time. Most lenders sell to Fannie Mae, Ginnie
Mae, Freddie Mac or the state housing finance agency.
The transfer is called an Assignment of Mortgage.
Assumption
To assume an existing mortgage. Utah Housing loans can
be assumed by qualified buyers. Only a few Fixed Rate
Mortgages are assumable. Most Adjustable-Rate Mortgages
are assumable although it is often undesirable for the
buyer to assume this type of mortgage. An assumable
loan can make your home more attractive to buyers when
you want to sell.
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