Setback – The minimum required distance improvements must be from a property line.
- Example: – When building a shed in your backyard be sure and check the setback requirements first. If you build too close to the property line and violate the setback you could be subject to fines or worse.
Servicer – An company that provides services to mortgage holders such as collecting payments, tracking balances and starting foreclosure proceedings.
- Example: Once a loan is given to a buyer, its typically sold to an investor, therefore, servicers are hired to service the loans such as collecting payments, sending out notices, tracking balances and starting foreclosure proceedings.
Remaining Term – The amount of time left before a loan becomes due.
- Example: If a borrower has a 30 year loan with 360 equal monthly payments, once they make the 120th payment, at the end of year 10, the remaining term is 20 years or 240 months.
Power of Attorney – A document that grants authority for someone to act on someone else’s behalf. This can be complete power or just for a limited situation(s).
- Example: When buyers have good working relationships with their agents, sometimes they give power of attorney so they can sign documents on their behalf.
No-Cost Loan – A loan with no costs or fees charged directly by the lender. In some situations there are still other fees such as recording fees, but none of them are directly charged by the lender.
- Example: If you do not have extra cash, you should consider a no-cost loan where you would have to pay no costs or fees to the lender.
Modification – When a lender agrees to change the terms of your loan.
- Example: Lately, many people have been trying to get loan modifications to reduce their loan payments.
Joint Tenancy – A way to take title to a property where both owners own it together, there is no division of ownership. However, when one owner dies, the surviving owner becomes the full owner. It cannot be willed.
- Example: Married couples typically hold property using joint tenancy so that if one spouse dies it automatically goes to the surviving spouse.
Homeowner’s Warranty – A warranty that covers the appliances and systems of a home, this is purchased by the homeowner and can be for a variety of different lengths and cover a variety of different items.
- Example: When you purchase a home, it may be a good idea to also purchase a homeowners warranty in case the appliances or systems break down.
Fair Market Value – The price that a property should sell it given normal market conditions, with ready, willing and able buyer and seller, when neither party is compelled to act.
- Example: When you get a loan to purchase real estate the lender will get an appraisal to determine the fair market value of the property and they will use that for the basis of the amount of the loan.
Eminent Domain – The power of government to force the sale of private land for the greater good public use. They must pay fair market value for the property.
- Example: As cities expand, governments expand interstates and freeways. In order to acquire the necessary land to do so, they can call upon their power of eminent domain to induce a fair market value sale.