Friday December 20, 2013
You can never be too informed as a prospective homebuyer. However, because realestate professionals use terminology so frequently, they can lose sight of the fact that their clients aren’t as familiar. The following terms commonly require clarification:
Restructured MortgageA mortgage that remains in place, but with new terms. If you increase your monthly payments by $100, you have restructured your loan. These additional payments reduce the principal debt at a faster rate than originally planned; resulting in a lower interest and fewer number of payments.
LienA lien is a claim against property. Not only are mortgages and trusts liens, but overdue property taxes, unpaid repair bills, and even water and sewer charges can all be liens. A major purpose of a title search is to be certain that all liens are known as of the day of settlement and paid off as required.
Graduated Payment MortgageThis type of mortgage initially offers homebuyers a low monthly payment that is set to increase at specified intervals to a predetermined rate. The graduated payment mortgage lets borrowers save at the present time by paying low monthly amounts; the overall expense of a graduated payment mortgage loan is higher than that of conventional mortgages, especially when negative amortization is involved.
RecordingThis has nothing to do with records or tapes. It is a system of public notice so that ownership interests, tax liens and other encumbrances can be open for inspection.Each county recorder keeps a public record of real estate transactions recorded under the legal description of the property.
REPC (Real Estate Purchase Contract)The Real Estate Purchase Contract is a contract between parties for the purchase and sale of real estate. They are legally binding and are written down and signed by both parties.
What home or real estate terms do you have trouble understanding? Leave it in a comment on our Facebook page and we’d be happy to help!