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acceptance:
A positive response to an offer or a counter-offer that creates
a binding agreement between the parties. Acceptance may be conditional
upon the occurrence of certain events.
application
The form used to apply for a mortgage loan, containing information
about a borrower’s income, savings, assets, debts, and more.
appreciation
The increase in the value of a property due to changes in market
conditions, inflation, or other causes.
asset
Items of value owned by an individual. Assets that can be quickly
converted into cash are considered "liquid assets." These
include bank accounts, stocks, bonds, mutual funds, and so on. Other
assets include real estate, personal property, and debts owed to
an individual by others.
bankruptcy
By filing in federal bankruptcy court, an individual or individuals
can restructure or relieve themselves of debts and liabilities.
Bankruptcies are of various types, but the most common for an individual
seem to be a "Chapter 7 No Asset" bankruptcy which relieves
the borrower of most types of debts. A borrower cannot usually qualify
for an "A" paper loan for a period of two years after
the bankruptcy has been discharged and requires the re-establishment
of an ability to repay debt.
broker
Broker has several meanings in different situations. Most Realtors
are "agents" who work under a "broker." Some
agents are brokers as well, either working form themselves or under
another broker. In the mortgage industry, broker usually refers
to a company or individual that does not lend the money for the
loans themselves, but broker loans to larger lenders or investors.
(See the Home Loan Library that discusses the different types of
lenders). As a normal definition, a broker is anyone who acts as
an agent, bringing two parties together for any type of transaction
and earns a fee for doing so.
credit history
A record of an individual's repayment of debt. Credit histories
are reviewed my mortgage lenders as one of the underwriting criteria
in determining credit risk.
debt
An amount owed to another.
equity
A homeowner's financial interest in a property. Equity is the difference
between the fair market value of the property and the amount still
owed on its mortgage and other liens.
lease option
An alternative financing option that allows home buyers to lease
a home with an option to buy. Each month's rent payment may consist
of not only the rent, but an additional amount which can be applied
toward the down payment on an already specified price.
LESSEE
A tenant under a lease.
LESSOR
A landlord under a lease (the owner of the property being rented).
sweat equity
Contribution to the construction or rehabilitation of a property
in the form of labor or services rather than cash.
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