A mortgage that allows the lender to adjust its interest rates at certain intervals during the term of the loan.
Adjustment Date
The date which dictates the changes in rate on an adjustable rate mortgage (ARM).
Adjustment Period
The length of time between adjustment dates for an adjustable rate mortgage (ARM).
Amortization Schedule
A table which dissects a mortgage payment into the amount applied to the interest and the amount applied to the principal of the loan balance.
Annual Percentage Rate (APR)
The cost of a mortgage standardized as an annual rate; including interest, points, and other costs of a mortgage loan.
Application
A form used to petition for a mortgage loan and to record relevant information about a perspective buyer and the proposed security.
Assessor
A public official who establishes the taxable value on a property.
Assignment
Transferring ownership of a mortgage from one person to another.
Assumable Mortgage
The responsibility of the mortgage is assumed by the buyer when the home is sold. A stipulation in an assumable mortgage allows a buyer to assume responsibility for the mortgage from the seller. It is not required for the loan to be paid in full by the or
Assumption
Transferring ownership of the seller's existing mortgage to the buyer.
The lump sum payment due at the culminating date of a balloon mortgage.
Binder
A preliminary document, coupled with a deposit of pledge money, under which a buyer offers to purchase real estate.
Bi-weekly Payment Mortgage
A mortgage that provides the borrower a substantial savings in interest by requiring payments every two weeks instead of the traditional monthly installment plans. The biweekly payments (26 or 27 per year) are equal to one-half of what a monthly payment w
Bridge Loan
This loan, also known as a "swing loan," is a short-term loan that is paid back quickly, such as by a subsequent longer term loan. This is usually used for closing on a new home before the previous property is sold. The bridge loan then becomes the source
Broker
An individual who is paid to assist in negotiating contracts between two parties.
A refinance transaction in which the borrower receives money that exceeds the total amount needed to repay the existing first mortgage. The additional cash generally may be used for any purpose by the borrower.
Chain of Title
The collection of all documents that trace the history of a property's title from the earliest recorded document to the most recent.
Closing Agent
An individual hired to coordinate the various closing activities; including preparing and recording closing documents and disbursing funds.
Closing Costs
Expenses in addition to the price of the property to be paid by the buyers and sellers in transferring ownership of property.
Closing Date
The date set to finalize the mortgage process. Often, your real estate agent will coordinate this date with you, the seller, the closing agent and the lender. It is important that the closing occurs before your lender's commitment letter and any rate guar
COFI
Cost of Funds Index Loan
Condominium
A piece of real estate in which each unit owner has a title to a unit in a building, a united interest in the common areas of the real estate, and sometimes the sole use of certain limited common areas.
Construction Loan
A temporary loan used for financing the cost of construction.
Contingency
A stipulation that must be satisfied before a contract is legally binding.
Convertible ARM
An adjustable rate mortgage that can be changed to a fixed-rate mortgage under explicit criteria.
Cooperative (co-op)
A multi-unit building owned and operated by a corporation in which shares are sold giving each shareholder the right to occupy a specific unit in the complex.
Credit Bureau/Report
An agency which will provide you a copy of your credit report (a small fee may apply). The three top credit reporting agencies are: Equifax, Trans Union, and Experian.
Credit Scoring
All the information on your credit report is converted to a number. A lender will use this number to assess your ability to repay a loan on a timely basis. Scores used for mortgage lending generally range from 300 to 900. The higher your credit score, the
Failure to make your mortgage payments on time or to abide by other terms of the mortgage agreement.
Detached Single-Family Home
Traditional single-family dwelling that is separate from any other housing structure.
Down Payment
Cash the buyer puts toward the purchase of a house reducing the finance amount of the mortgage. A down payment gives a lender assurance that a buyer is committed to the investment. The down payment amount is left up to the discretion of the lender. Resour
A federal law that mandates all lenders and creditors to make credit available to all applicants based on objective qualifications and not race, religion, gender, marital status, or receipt of income from public assistance programs.
Escrow
Money (or other item of value) deposited with a third party to be paid out upon satisfying established requirements.
Eviction
To force an occupant from real property by legal process.
An established account in which a borrower can make multiple cash draws from at his or her own discretion up to a specified percentage of the borrower's equity in a property.
Homeowner’s Insurance
Required insurance equal to at least the replacement cost of the house you wish to purchase to ensure that the property will be fully restored in case of a total loss.
Homeowners' Association (HOA)
A nonprofit organization that governs the shared areas of a planned unit development (PUD) or condominium project.
HUD-1 Statement
A form published by the Department of Housing and Urban Development (HUD) used to provide an itemized listing of the funds that are payable at closing. This listing includes real estate commissions, loan fees, points, and initial escrow amounts. Totals ar
Similar to the prime lending rate posted by major U.S. banks, LlBOR (The London Interbank Offered Rate) is based on the interest rate that major international banks are willing to lend and borrow funds for a stated period of time. A financial index.
Lien
A legal debt for a property that must be paid in full when the property is sold.
Loan
Borrowed money that is repaid over a specified period of time (usually with interest).
Loan Application/1003
A petition providing detailed personal information from you to a lender. This form will be used to evaluate whether or not you qualify for a loan and the amount of money a lender can offer you. When evaluating this form, lenders look at your capacity, cr
Loan Origination Fee
The fee that is charged to cover the administrative costs of processing a loan. This fee is often defined in points (one point is equal to one percent of the mortgage amount).
Loan-to-Value (LTV) Percentage
The percentage of home value that has, or will have, financial claim divided by the appraised value of a home (Loan Amount/Home Value).
Lock-In
An agreement by the lender to guarantee a specific interest rate if the loan is closed within in a designated time frame. A lock-in can also determine the number of points to be paid at closing.
Homes that are built in one location, then transported to the home site. These units must be built on a permanent chassis at a factory. Once at the permanent home site, they must be securely attached to a foundation.
Market Value
The value of a home in comparison to other comparable homes in the area that have recently been sold, are currently on the market, or are currently under contract.
Monthly Payment Mortgage
Mortgage payments obligated to be made once a month. This payment consists of four components (PITI):
Principal - part of the payment that reduces the balance of a mortgage.
Interest -- part of the payment that covers the fee for borrow
Mortgage Banker
A company that makes home loans to consumers, and often, sells the loans to other lenders and investors.
Mortgage Broker
An individual or company that brings borrowers and lenders together for a commissioned fee for the purpose of funding a loan.
Multi-family Properties
Buildings that contain five or more units for residents.
The refinancing of an existing mortgage in which the amount of the new mortgage is limited to the sum of the outstanding balance of the existing first mortgage, closing costs, points, balances on any mortgage liens that are more than one year old, and oth
Note
A legal document that specifies the terms of repaying a debt.
The amount of cash resources a borrower is required to have on hand after closing a loan must equal the cost of paying for PITI for a preset number of months.
Planned Unit Development (PUD)
A residential complex or subdivision that provides common property (owned and maintained by a homeowners' association) for use by its individual residents.
Point
A one-time fee charged by a lender for processing a loan application. A point is equal to one percent of the mortgage amount.
Power of Attorney
A legal document that grants one person the authority to act on behalf of another individual. A power of attorney can administer complete authority or be restricted to certain acts or designated periods of time.
Pre-Approved
An indication of your loan amount eligibility prior to actually completing a loan application and submitting all necessary documentation.
Prepayment Penalty
A fee that may result from paying off a loan before the scheduled due date.
Pre-Qualification
The process of determining the amount of money you will be able to borrow prior to completing a loan application.
Prime Rate
The interest rate that banks charge to their elect clients. Published in major news publications daily.
Principal
The loan amount borrowed or the outstanding balance on a note (not including interest or other fees).
Purchase Money Transaction
Obtaining possession of property through monetary means.
A law designed to protect consumers by requiring, among other things, lenders to give borrowers advance notice of closing costs.
Recission
The act of annulling the terms of a contract or transaction through legal means or by mutual consent.
Recording
A written account in the register's office detailing a properly executed legal document, such as a deed or mortgage note, making it available for public knowledge.
Refinance
The process of paying off one loan with the profits derived from obtaining a new loan using the original property as collateral.
5 E College Drive, Suite
104, Arlington Heights, IL 60004
Illinois Residential Mortgage Licensee - License # MB.6760198
IDFPR/Division of Banking, Commissioner Jorge A. Solis, 122 S Michigan
Ave, Suite 1900, Chicago, IL 60603
License exempt in many states. Call to see if we can do a loan in your state
