Archives: Glossary Terms

A resident who also owns the property. Example: Homer lives in a home that he also owns. Landon owns a home but rents it to Renton- Homer is an owner occupant, Landon is an absentee owner, and Renton is a rental tenant.

The owner who holds record title and whose name appears on the recorded deed.

Title insurance for the owner of property, rather than a lien holder.

A policy of title insurance, which insures a named owner against loss by reason of defects, liens and encumbrances or lack of marketability of the title.

The right of one or more parties to possess, use, enjoy and to dispose of property and to exclude all others.

A sharing of an interest in an income property by a lender in addition to the base interest collected on a mortgage loan, a percentage of gross income is required, sometimes predicated on certain conditions being fulfilled such as a minimum occupancy rate or a percentage of net income after expenses of debt service and taxes. Also called Equity participation.

The period of time necessary for the cash flow from a project to equal the amount of money invested.

The date the borrower’s monthly principal and interest payment may change in an adjustable rate mortgage.

The maximum amount of increase that is at the borrower’s option that can be made to the interest in an adjustable rate mortgage on the payment adjustment date, if the increase called for, exceeds the payment cap amount and which may result in negative amortization.

The rate at which the borrower repays an adjustable rate loan that reflects any buy downs or payment caps.

The document signed by a lender indicating the amount required to pay a loan balance in full and satisfy the debt; used in the settlement process to protect both the seller’s and the buyer’s interests. Also called a reduction certificate.