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VWXYZsale-leaseback
A technique in which a seller deeds property
to a buyer for a consideration, and the
buyer simultaneously leases the property
back to the seller.
second mortgage
A mortgage that has a lien position
subordinate to the first mortgage.
secondary mortgage market
The buying and selling of existing
mortgages.
secured loan
A loan that is backed by collateral.
security
The property that will be pledged as
collateral for a loan.
seller take-back
An agreement in which the owner of a
property provides financing, often in
combination with an assumable mortgage. See
owner financing.
servicer
An organization that collects principal and
interest payments from borrowers and manages
borrowers’ escrow accounts. The servicer
often services mortgages that have been
purchased by an investor in the secondary
mortgage market.
servicing
The collection of mortgage payments from
borrowers and related responsibilities of a
loan servicer.
settlement
See closing.
settlement sheet
See HUD-1 statement.
special deposit account
An account that is established for
rehabilitation mortgages to hold the funds
needed for the rehabilitation work so they
can be disbursed from time to time as
particular portions of the work are
completed.
standard payment calculation
The method used to determine the monthly
payment required to repay the remaining
balance of a mortgage in substantially equal
installments over the remaining term of the
mortgage at the current interest rate.
step-rate mortgage
A mortgage that allows for the interest rate
to increase according to a specified
schedule (i.e., seven years), resulting in
increased payments as well. At the end of
the specified period, the rate and payments
will remain constant for the remainder of
the loan.
subdivision
A housing development that is created by
dividing a tract of land into individual
lots for sale or lease.
subordinate financing
Any mortgage or other lien that has a
priority that is lower than that of the
first mortgage.
subsidized second mortgage
An alternative financing option known as the
Community Seconds® mortgage for low- and
moderate-income households. An investor
purchases a first mortgage that has a
subsidized second mortgage behind it. The
second mortgage may be issued by a state,
county, or local housing agency, foundation,
or nonprofit corporation. Payment on the
second mortgage is often deferred and
carries a very low interest rate (or no
interest rate). Part of the debt may be
forgiven incrementally for each year the
buyer remains in the home.
survey
A drawing or map showing the precise legal
boundaries of a property, the location of
improvements, easements, rights of way,
encroachments, and other physical features.
sweat equity
Contribution to the construction or
rehabilitation of a property in the form of
labor or services rather than cash.