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tenancy in common
As opposed to joint tenancy, when there are two or more individuals on title to a
piece of property, this type of ownership does not pass ownership to the others in the
event of death.
third-party
origination
A process by which a lender uses another party to completely or partially originate,
process, underwrite, close, fund, or package the mortgages it plans to deliver to the
secondary mortgage market.
title
A legal document evidencing a person’s right to or ownership of a property.
title company
A company that specializes in examining and insuring titles to real estate.
title insurance
Insurance that protects the lender (lender’s policy) or the buyer (owner’s policy)
against loss arising from disputes over ownership of a property.
title search
A check of the title records to ensure that the seller is the legal owner of the
property and that there are no liens or other claims outstanding.
transfer of
ownership
Any means by which the ownership of a property changes hands. Lenders consider all of
the following situations to be a transfer of ownership: the purchase of a property
“subject to” the mortgage, the assumption of the mortgage debt by the property
purchaser, and any exchange of possession of the property under a land sales contract or
any other land trust device.
transfer tax
State or local tax payable when title passes from one owner to another.
Treasury index
An index that is used to determine interest rate changes for certain adjustable-rate
mortgage (ARM) plans. It is based on the results of auctions that the U.S. Treasury holds
for its Treasury bills and securities or is derived from the U.S. Treasury’s daily yield
curve, which is based on the closing market bid yields on actively traded Treasury
securities in the over-the-counter market.
Truth-in-Lending
A federal law that requires lenders to fully disclose, in writing, the terms and
conditions of a mortgage, including the annual percentage rate (APR) and other charges.
two-step mortgage
An adjustable-rate mortgage (ARM) that has one interest rate for the first five or
seven years of its mortgage term and a different interest rate for the remainder of the
amortization term.
two-
to four-family property
A property that consists of a structure that provides living space (dwelling units)
for two to four families, although ownership of the structure is evidenced by a single
deed.
trustee
A fiduciary who holds or controls property for the benefit of another.
VA mortgage
A mortgage that is guaranteed by the Department of Veterans Affairs (VA).
vested
Having the right to use a portion of a fund such as an individual retirement fund. For
example, individuals who are 100 percent vested can withdraw all of the funds that are set
aside for them in a retirement fund. However, taxes may be due on any funds that are
actually withdrawn.
Veterans
Administration (VA)
An agency of the federal government that guarantees residential mortgages made to
eligible veterans of the military services. The guarantee protects the lender against loss
and thus encourages lenders to make mortgages to veterans.