tenancy
by the entirety
A type of joint tenancy of property that provides right of
survivorship and is available only to a husband and wife. Contrast
with tenancy in common.
tenancy in common
A type of joint tenancy in a property without right of
survivorship. Contrast with tenancy by the entirety and with joint
tenancy.
tenant-stockholder
The obligee for a cooperative share loan, who is both a
stockholder in a cooperative corporation and a tenant of the unit
under a proprietary lease or occupancy agreement.
third-party
origination
A process by which a lender uses another party to completely or
partially originate, process, underwrite, close, fund, or package
the mortgages it plans to deliver to the secondary mortgage
market. See mortgage
broker.
title
A legal document evidencing a person's right to or ownership of a
property.
title company
A company that specializes in examining and insuring titles to
real estate.
title insurance
Insurance that protects the lender (lender's policy) or the buyer
(owner's policy) against loss arising from disputes over ownership
of a property.
title search
A check of the title records to ensure that the seller is the
legal owner of the property and that there are no liens or other
claims outstanding.
total expense ratio
Total obligations as a percentage of gross monthly income. The
total expense ratio includes monthly housing expenses plus other
monthly debts.
trade equity
Equity that results from a property purchaser giving his or her
existing property (or an asset other than real estate) as trade as
all or part of the down payment for the property that is being
purchased.
transfer of ownership
Any means by which the ownership of a property changes hands.
Lenders consider all of the following situations to be a transfer
of ownership: the purchase of a property "subject to"
the mortgage, the assumption of the mortgage debt by the property
purchaser, and any exchange of possession of the property under a
land sales contract or any other land trust device. In cases in
which an inter vivo revocable trust is the borrower, lenders also
consider any transfer of a beneficial interest in the trust to be
a transfer of ownership.
transfer tax
State or local tax payable when title passes from one owner to
another.
Treasury index
An index that is used to determine interest rate changes for
certain adjustable-rate mortgage (ARM) plans. It is based on the
results of auctions that the U.S. Treasury holds for its Treasury
bills and securities or is derived from the U.S. Treasury's daily
yield curve, which is based on the closing market bid yields on
actively traded Treasury securities in the over-the-counter
market. See adjustable-rate
mortgage (ARM).
Truth-in-Lending
A federal law that requires lenders to fully disclose, in writing,
the terms and conditions of a mortgage, including the annual
percentage rate (APR) and other charges.
two-step
mortgage
An adjustable-rate mortgage (ARM) that has one interest rate for
the first five or seven years of its mortgage term and a different
interest rate for the remainder of the amortization term.
two- to four-family
property
A property that consists of a structure that provides living space
(dwelling units) for two to four families, although ownership of
the structure is evidenced by a single deed.
trustee
A fiduciary who holds or controls property for the benefit of
another
underwriting
The process of evaluating a loan application to determine the risk
involved for the lender. Underwriting involves an analysis of the
borrower's creditworthiness and the quality of the property
itself.
unsecured loan
A loan that is not backed by collateral.
VA mortgage
A mortgage that is guaranteed by the Department of Veterans
Affairs (VA). Also known as a government mortgage.
vested
Having the right to use a portion of a fund such as an individual
retirement fund. For example, individuals who are 100 percent
vested can withdraw all of the funds that are set aside for them
in a retirement fund. However, taxes may be due on any funds that
are actually withdrawn.
Department of Veterans
Affairs (VA)
An agency of the federal government that guarantees residential
mortgages made to eligible veterans of the military services. The
guarantee protects the lender against loss and thus encourages
lenders to make mortgages to veterans.
what-if analysis
An affordability analysis that is based on a what-if
scenario. A what-if analysis is useful if you do not have complete
data or if you want to explore the effect of various changes to
your income, liabilities, or available funds or to the qualifying
ratios or down payment expenses that are used in the analysis.
what-if scenario
A change in the amounts that is used as the basis of an
affordability analysis. A what-if scenario can include changes to
monthly income, debts, or down payment funds or to the qualifying
ratios or down payment expenses that are used in the analysis. You
can use a what-if scenario to explore different ways to improve
your ability to afford a house.
wraparound mortgage
A mortgage that includes the remaining balance on an existing
first mortgage plus an additional amount requested by the
mortgagor. Full payments on both mortgages are made to the
wraparound mortgagee, who then forwards the payments on the first
mortgage to the first mortgagee.
