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Contact Nancy Comenitz Real Estate

If you have any questions or need more detailed information, please feel free to contact me via phone at 617.232.4186 or fill out the form to let us know how we can help with your real estate needs.

Office Location 77 Pond Avenue,
Brookline, MA
Phone: (617) 232-4186
Fax: (617) 232-7954


Mortgage Terms


Adjustable Rate Adjustable Rate (ARM)
A type of mortgage loan program in which the interest rate and payments may be adjusted as frequently as every month. The principal loan balance or term of the loan may also be adjusted to reflect the rate change. The purpose of the program is to allow mortgage interest rates to fluctuate with market conditions.

Adjusted Income 
Your Gross Receipts Income minus business expenses, which equals total qualifying income.

Amortization
The repayment of a loan in a specified number of equal periodic payments that includes principal and accrued interest.

Amortized Loan
A loan that is completely paid off, interest and principal, by a series of regular payments that are equal or nearly equal.

Amortization Schedule
A table showing the amounts of principal and interest due at regular intervals and the unpaid balance of the loan after each payment is made.

Amortization Term
The period of time used in an amortization schedule to determine the dollar amount of scheduled loan payments,usually expressed as a number of months.

Annual Percentage Rate (APR)
The annual cost of a loan, including interest, loan fees, and other costs.

Appraisal
An estimate of the market value of a piece of real estate made by a competent professional who knows local real estate prices and markets.

Appreciation
The increase in value or price of a property over time.

Assessed Value
The value of a property for tax purposes set by a tax assessor according to a formula.

Assignment
The transfer of a mortgage from one person to anotherAssumable Mortgage
A mortgage that can be taken over or "assumed" by the buyer when a home is sold.

Assumption Clause
A provision in an assumable mortgage that allows a buyer to assume responsibility for the mortgage from the seller.
The loan does not need to be paid in full by the original borrower upon sale or transfer of the property.

Balloon Mortgage
A mortgage with periodic installments of principal and interest that do not fully amortize the loan. The balance of the mortgage is due in a lump sum at a specified date in the future (usually at the end of the term).

Balloon Payment
A scheduled payment on a mortgage that is larger than other periodic payments, usually the unamortized final payment.

Binder
An agreement to consider the purchase of real estate. The agreement is secured and backed by a cash deposit as evidence of good faith on the part of the purchaser.

Bridge Loan
A second mortgage that is collateralized by other property owned by the applicant and currently offered for sale. The agreement allows the proceeds to be used for closing on the new purchase before the property sold.
Cap
A limit on the increase of an adjustment rate or the mortgage payment for an adjustable-rate mortgage (ARM).

Capital Gain
Income from the sale of an asset rather than from the general business activity. Capital gains are generally taxed at a lower rate than ordinary income.

Certificate of Title
A written document stating that the title to a piece of property is legally vested in the present owner.

Clear Title
Title not burdened by liens or legal questions.

Closing
In real estate, the delivery of a deed, the payment of the purchase price, the signing of notes, and the paying of closing costs, which completes a real estate transaction.

Closing Costs
The miscellaneous expenses involved in closing a real estate transaction that are over and above the purchase price. Some of the closing costs include title insurance, appraisal fee, and credit report.

Closing Statement
Also referred to as the "HUD-1." The final statement of costs incurred to close a loan or to purchase a home.

Collateral
Any property pledged as security for repayment of a debt.

Co-maker or Endorser on a Note
One who agrees to be responsible for repaying a debt obligation in addition to the
principal borrower.

Combination Loan
A loan in which the borrower receives a first mortgage for 80 percent of the loan amount, and a second mortgage at the same time for the remainder of the balance. If borrower is trying to avoid PMI (mortgage insurance) it is important to consider a combination loan or the Advantage90 loan.

Combined loan-to-value (CLTV)
The relationship between the unpaid principal balances of all the mortgages on a property (first and second usually)and the property's appraised value (or sales price, if it is lower).

Commitment Letter
A formal offer by a lender which states the terms under which it agrees to lend money to a home buyer. Also known as a "loan commitment." This letter will indicate the contingencies that must be cleared prior to funding the loan.

Conforming Loan
A loan that is eligible for purchase by FNMA or FHLMC. The current FNMA or FHLMC conforming loan limit is $481,850 and below for a single-family residence,
$427,150 and below for a 2 unit property,
 
.

Contingency
A clause in a contract stating that the buyer or seller must meet a given condition before the purchase can be completed.

Conventional Mortgage
A mortgage that is not insured or guaranteed by the federal government.

Conveyance
The process by which title to property is officially transferred and which creates an&interesreal estate.

Convertible ARM
An adjustable-rate mortgage (ARM) that can be converted to a fixed-rate mortgage under specified conditions.

Curtailment
Payment applied to principal only in addition to and without affecting the regular monthly payments.

 
Debt -to-Income Ratio
interest real ratio of a borrower's monthly debt payments to his or her monthly gross income.Lenders use this ratio to assist them in determining how much to lend.

Deed of Trust
The document used in some states instead of a mortgage; title is conveyed to a trustee.

Easement
A right of way giving persons other than the owner access to or over a property.

Eighty-ten-ten (80/10/10)
Also known as a "Combination Loan." A loan in which you receive a first mortgage for 80 percent of the loan amount and a second mortgage at the same time for the remainder of the balance. If the borrower is trying to avoid PMI (mortgage insurance) it is important to consider a combination loan.

Encumbrance
Anything that affects or limits the fee simple title to a property, such as mortgages, leases, easements, or restrictions.

Escrow
The legal relationship between a buyer, seller, and a third party holding money or papers;until all conditions of a sales agreement and loan is fulfilled.

Escrow Account
An account held by the lender/servicer, into which a borrower makes monthly installment payments for property taxes, insurance and special assessments. The lender/servicer,disburses these sums as they become due.


Fair Market Value
The highest price that a buyer, willing but not compelled to buy, would pay, and the lowest  a  seller, willing but not compelled to sell, would accept.

Finance Charge
The charges that include all of the interest expected to be earned over the life of a loan, in addition to the service charges, mortgage insurance premiums and certain other charges related to a loan.

First Adjustment
When you can expect the first rate adjustment in your adjustable-rate mortgage (ARM) loan.


Fixed Amortization
The payment of a debt in regular, periodic installments of principal and interest. Fixed amortization occurs when the interest rate and payment never change. The same payment  is made over the life of the loan. Each month, as the principal is paid down and, since interest  is charged against the remaining amount of principal, the amount charged for interest decreases.

Fixed Rate Mortgage (FRM)
A mortgage loan with a constant interest rate and payment throughout the life of the loan.The interest rate and payment amount are established at the time of funding.

Float Down
A float-down option allows the consumer to lock in the interest rate and points on a loan,  yet retain the right to lower the locked-in interest rate prior to closing if interest rates offered by the lender for similar loans decreases.
 
Fully Indexed Interest Rate
This interest rate is the sum of the current index rate on an adjustable-rate mortgage (ARM) plus the margin.

Good Faith Estimate
A disclosure that must be given to all mortgage loan applicants within three business days of an application. It is an estimate of all settlement charges likely to be incurred at closing.

Home Equity Line Of Credit
A credit line that is secured by a second deed of trust on a house. Equity lines of credit are revolving accounts that work like a credit card, which can be paid down or charged up for the term of the loan. The minimum payment due each month is interest only.

Housing Ratio
The ratio of the monthly housing payment in total (PITI -- Principal, Interest, Taxes & Insurance divided by the gross monthly income. This ratio is sometimes referred to as the "top ratio" "front-end ratio."

Index
An economic indicator which lenders use to calculate interest rates on mortgages (ARMS).

Initial Fixed Interest Period
The period of time that the interest rate on an adjustable loan is initially fixed. Thereafter, the interest rate then becomes fully indexed (the then current index value plus factor/margin). May change in accordance with the index of the loan document.

Initial Interest Rate
The introductory interest rate on an adjustable-rate mortgage (ARM), which usually changes at the first rate adjustment.


Interest
Money paid for the use of borrowed funds, usually expressed as an annual percentage.

Interest Rate Cap
A limit to the interest rate increases and decreases on an adjustable rate loan; either from one adjustment period to the next or over the life of the loan.

Jumbo Mortgage
Also known as a "non-conforming" mortgage. Conventional home mortgages not eligible for sale and delivery to either Fannie Mae (FNMA) or Freddie Mac (FHLMC) because ofvarious reasons, including loan amount, loan characteristics or underwriting guidelines.;Non-conforming loans usually incur a rate and origination fee premium. 

Lien
A legal hold or claim of a creditor on the property of another.

Lien Search
An examination of public records to identify any claims of a creditor against real or personal property. In co-op lending   lien search is used instead of a title search.

Lifetime Cap
The maximum allowable interest rate over the life of the loan.

Loan Origination Fee
A one-time fee that covers a portion of the lender's administrative costs in processing a loan.

Loan Processing
The steps taken by an institution lender from the time a request for a loan application is received to the time the loan is approved or denied, including taking the application, credit investigation, evaluation of the loan and other steps.

Loan-to-Value (LTV)
The ratio of the principal amount of the loan to the lesser of the purchase price of the property or the property's appraised value. You may see this expressed as an 80% loan,or 80% LTV.

Lock-In
The time at which an interest rate is set and the length of time the rate will be held prior to the closing of a loan.

Low-Documentation
Some loan products require only that applicants state the source of their income without providing supporting documentation such as tax returns.


Margin
In ARMs, a margin, or spread, is the difference between the interest rate charged on the  loan and the index. Generally, the margin remains fixed over the life of the loan.

Maturity
The term of a loan, or the number or years for which the loan funds are advanced.

Mortgage Insurance (MI)
Often required when making a down payment less than 20%.

MTA Monthy Treasury Average
The 12-MTA index is based on yields published in the release entitled the "Selected Interest Rates - G13"which is published by the Federal Reserve Board.

 
Negative Amortization
Negative amortization occurs with some adjustable-rate mortgage (ARM) loans when the payment amount is insufficient to cover the interest due on the loan. Any interest notcovered ;payment is deferred and added to the principal balance.

Note
A written promise to repay a loan. It includes the loan amount, interest rate and term.

Origination Fee
A fee imposed by a lender to cover the monthly costs of setting up a mortgage. This will include the preparation of documents  and certain processing expenses in connection with making a real estate loan. This is usually charged as a percentage of the amount loaned,such as one point or one percent.

Payment Adjustment Period
The time during which payments on an adjustable-rate mortgage ARM) may go up or downnot covered

 

Payment Cap
The limit that the monthly payment can change from one adjustment period to another. Also referred to as a Payment Change Cap.

Payment Shock
A situation that occurs when an adjustable-rate mortgage (ARM) monthly mortgage payments rise very sharply at an adjustment. The borrower may not be able to afford the payments the loan will require.

Per Diem Interest
Interest calculated per day and collected from the consumer to cover the period of time from disbursement of the loan proceeds until the start of the first payment period.

Periodic Rate Cap
The maximum rate increase for a specific period for a specific adjustable-rate mortgage (ARM) loan.

PITI
Principal, interest,taxes and insurance--the components of a monthly mortgage payment.

Points
An upfront fee that is collected in addition to the interest on a loan. Each "point" charged is equal to 1% of the loan amount. Points may also be referred to as an "origination fee" or "discount points" depending on the purpose.

Pre-Approval
A process that mortgage lenders use to determine how much money they would lend  you based on a thorough review of your financial situation. Lenders issue a pre-approval letter which strengthens your position when bidding on a home, as it shows sellers that you will be able to raise funds needed to purchase.


Pre-Qualification
An informal process in which a lender will offer an opinion on how much money you may be able to borrow. This opinion is based entirely on the financial information you provide and is neither binding nor necessarily accurate because lenders have not yet verified your financial information.

Prepayment Clause
A clause that stipulates the amount of principal a borrower may prepay ahead of schedule without penalty as well as the prepayment penalty for larger prepayments.

Prime Rate
This typically refers to the best rate for short-term commercial paper. This is not a stable index.

Principal
The remaining amount or balance of the mortgage loan.

Principal and Interest
The total amount needed to pay on a loan each month. This includes the interest owed as well as the amount being paid towards the principal.

Quit Claim Deed
A deed that transfers without any warranty whatever interest or title a grantor may have at the time the conveyance is made.


Rate Cap
A limit on how much the interest rate can change, either at each adjustment period or over the life of the loan.


Real Estate Settlement Procedures Act (RESPA)
A federal law administered by the U.S. Department of Housing and Urban Development (HUD), requiring lenders to provide specific information to a consumer, including settlement costs and servicing transfer disclosures. RESPA also regulates lenders' practices during the servicing ofthe loan.

Reconveyance
Also known as Deed of Reconveyance or Release.An instrument a trustee executes to transfer title to the borrower& when the loan ispaid off. Once the instrument is recorded, the lien is removed from the records.

Recording
The noting in the registrar's or other public official's office of the details of a properly executed legal document, such as a deed of trust, mortgage, satisfaction of mortgage, or modification of mortgage, thereby making it a part of the public record.


RESPA
The Real Estate Settlement Procedures Act (RESPA) of 1974, which was implemented through Regulation X,requires lenders to provide customers with information about the real estate settlement process and expenses involved in that process. In addition to requiring a of the of disclosures relating to various aspects of a real estate transaction.

Right of Rescission
When refinancing a mortgage, this is the right of a is paid to change his or her mind and cancel the transaction within three business days after closing/settlement.

Second Mortgage
A mortgage which ranks after a first mortgage in priority. If the loan is not repaid,the first mortgage holder has firs right to the property; the second mortgage holder receives anything remaining.

Secondary Mortgage Market
The market where lenders and investors buy and sell existing mortgages or mortgage-backed securities, thereby providing greater availability of funds for additional mortgage lending.

Settlement Statement
A statement prepared by broker, escrow, or lender, giving a complete breakdown of costs involved in a real estate.A separate statement is prepared for the seller and buyer

Survey
A map executed by a licensed surveyor, which sets down precisely the boundaries of a given property as well as improvements, references to known landmarks, and the property's notable features.

Title Insurance
The insurance that protects the lender and if an owner's policy is purchased,the homeowner, against loss resultiing from any inconsistencies in the title of a property from liens or other title problems relating to a property.

Title Report
A report that discloses whether there are any competing claims, liens or other problems relating to a property. This must be done before title insurance is issued. Also known as a "Preliminary Title Report" or "Prelim."

 Title Search
An examination of public records, laws, and court decisions to disclose the current facts regarding ownership of and liens on real estate.

Total Debt Ratio
Monthly debt and housing payments divided by gross monthly income.Also known as "Obligations-to-Income Ratio"or "Back-End Ratio."

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