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VWXYZincome property
Real estate developed or improved to produce
income.
index
A number used to compute the interest rate
for an adjustable-rate mortgage (ARM). The
index is generally a published number or
percentage, such as the average interest
rate or yield on Treasury bills. A margin is
added to the index to determine the interest
rate that will be charged on the ARM.. This
interest rate is subject to any caps that
are associated with the mortgage.
in-file credit report
An objective account, normally
computer-generated, of credit and legal
information obtained from a credit
repository.
inflation
An increase in the amount of money or credit
available in relation to the amount of goods
or services available, which causes an
increase in the general price level of goods
and services. Over time, inflation reduces
the purchasing power of a dollar, making it
worth less.
initial interest rate
The original interest rate of the mortgage
at the time of closing. This rate changes
for an adjustable-rate mortgage (ARM).
Sometimes known as "start rate" or "teaser."
installment
The regular periodic payment that a borrower
agrees to make to a lender.
installment loan
Borrowed money that is repaid in equal
payments, known as installments. A furniture
loan is often paid for as an installment
loan.
insurable title
A property title that a title insurance
company agrees to insure against defects and
disputes.
insurance
A contract that provides compensation for
specific losses in exchange for a periodic
payment. An individual contract is known as
an insurance policy, and the periodic
payment is known as an insurance premium.
insurance binder
A document that states that insurance is
temporarily in effect. Because the coverage
will expire by a specified date, a permanent
policy must be obtained before the
expiration date.
insured mortgage
A mortgage that is protected by the Federal
Housing Administration (FHA) or by private
mortgage insurance (MI). If the borrower
defaults on the loan, the insurer must pay
the lender the lesser of the loss incurred
or the insured amount.
interest
The fee charged for borrowing money.
interest accrual rate
The percentage rate at which interest
accrues on the mortgage. In most cases, it
is also the rate used to calculate the
monthly payments, although it is not used
for an adjustable-rate mortgage (ARM) with
payment change limitations.
interest rate
The rate of interest in effect for the
monthly payment due.
interest rate buy down plan
An arrangement wherein the property seller
(or any other party) deposits money to an
account so that it can be released each
month to reduce the mortgagor's monthly
payments during the early years of a
mortgage. During the specified period, the
mortgagor's effective interest rate is
"bought down" below the actual interest
rate.
interest rate ceiling
For an adjustable-rate mortgage (ARM), the
maximum interest rate, as specified in the
mortgage note.
interest rate floor
For an adjustable-rate mortgage (ARM), the
minimum interest rate, as specified in the
mortgage note.
investment property
A property that is not occupied by the
owner.
IRA (Individual Retirement
Account)
A retirement account that allows individuals
to make tax-deferred contributions to a
personal retirement fund. Individuals can
place IRA funds in bank accounts or in other
forms of investment such as stocks, bonds,
or mutual funds.