Clause used in a deed of trust that gives the lender the right to demand payment in full upon the happening of a certain event.
Adjustable Rate Mortgage
Mortgage loans on which the interest rate is periodically adjusted to more closely coincide with current rates.
A type of acceleration clause, calling for a debt under a mortgage or deed of trust, to be due in its entirety upon transfer of ownership.
Payment of debt in regular, periodic installments of principal and interest, as opposed to interest-only payments.
A schedule of monthly payments that varies according to interest rates and number of monthly payments.
Annual Percentage Rate
The total cost of financing expressed as one simple annual percentage rate. This rate must be clearly expressed on any loan agreement.
Agreement by the buyer to take over the financial responsibility for real property under the existing note and trust deed.
A lender for whose benefit a trust is created in those states where trust deeds are commonly used instead of mortgages.
A failure to perform the financial obligation to pay under a loan.
The amount for which the borrower is personally liable on a note and mortgage if the foreclosure sale does not bring enough to cover the debt.
Equal Credit Opportunity
Federal law granting women financial independence and preventing lenders from considering such negative credit apects as the possibility of a woman having children and dropping out of the labor market.
Ownership by one who does not have legal title, such as a vendee under a land contract or, technically, a trustor under a deed of trust.
The ownership interest in real property; it is the market value minus any unpaid loan amount.
A period of time past the due date for a payment (mortgage, insurance, etc.) during which a payment may be made and not considered delinquent.
Graduated Payment Mortgage
A mortgage or deed of trust for which the payments increase over the term of the loan. The payment may increase as the buyer's earnings increase.
Holder in Due Course
A holder of a check or note who takes the note in good faith, on the assumption it is valid.
The principal of using the real property as security for a debt while the borrower retains possession.
Money charged for the use of money
Junior Lien or Second Trust Deed
A type of lien that is subordinate to prior lien.
An installment contract for the sale of land. The seller (vendor) has legal title until paid in full. The buyer (vendee) has equitable title during the contract term.
The kind of title held by the vendor under a land contract and the trustee under a deed of trust. They are still owed money by the buyer.
The use of financing to allow a small amount of cash to purchase and control a large property investment.
A financing charge equal to one percent of the amount of the loan.
A penalty under a note, mortgage, or deed of trust imposed when the loan is paid before it is due.
A promise in writing to pay a specified amount during a limited time, or on demand, to a named person.
Purchase Money Instrument
The original loan taken out when purchasing a property, not a refinanced or junior loan.
An instrument used to transfer title back from a trustee to the equitable owner of real estate.
A limited amount of time during which the trustor has the right to pay all past due payments and charges due on a loan to bring it current.
Request for Notice of Default
A recorded form requiring the trustee to notify other creditors in the event of a default on the deed of trust to a property.
Right to Cancel
Part of the Truth in Lending Law that allows a borrower to rescind a loan transaction until midnight of the third business day, on business loans and second trust deeds secured by a borrower's residence.
A nonamortized note for which the principal is due in a lump sum upon maturity.
An agreement by which a lender substitutes a junior loan position for a senior loan position.
An instrument used in place of a mortgage in most western states that is based on the Spanish legal tradition. Property is transferred to a trustee by the borrower (trustor) in favor of the lender (beneficiary) and reconveyed upon payment in full.
In a deed of trust, the person who acts as an intermediary between the trustor and the beneficiary.
A sale at auction by a trustee under a deed of trust, pursuant of foreclosure proseedings.
The borrower under the deed of trust.
Truth in Lending Act
Regulation Z under the Federal Reserve regulations that requires a credit purchaser be advised, in writing, of all costs connected with the credit portion of their purchase.
Charging an illegal rate or amount of interest on a loan.
Purchaser or buyer, especially on a land contract.
The seller of the property under a land contract.
Wraparound Trust Deed
A second trust deed for which the monthly payment includes the amount of monthly payments on the existing first trust deed.