Addendum: Something added. A list or other material added to a document, letter, contractual agreement, escrow instructions, etc.
Agent: One who is authorized to act for or represent another (principal), usually in business matters? Authority may be express or implied.
Agreement: A general term usually describing a common view of tow or more people, regarding the rights and obligations of each with regard to a given subject. Not necessarily a contract, although all contracts are agreements.
Amendment: A change, either to correct an error or to alter a part of an agreement without changing the principal idea to essence.
Appraisal: An opinion of value based upon a factual analysis, legally, an estimation of value by two disinterested persons of suitable qualifications.
As is condition: Premises accepted by a buyer in the condition existing at the time of sale, including physical defects.
Asking price: The price at which the seller is offering property for sale! The eventual selling price may be less after negotiation with a buyer.
Backup Offer: A secondary offer to buy property!
Closing Cost: Expenses incidental to a sale of real estate, such as; loan fees, title fees, and appraisal fees, etc.
Comparables: Properties used as comparisons to determine the value of a specific property.
Contingency: Commonly, the dependence upon a stated event, which must occur before a contract, is binding. For example: The sale of a house, contingent upon the buyer obtaining financing.
Counter Offer: An offer (instead of acceptance) in response to an offer.
Credit Report: A report on the past ability of a loan applicant to pay installment payments! Several national and local companies make such reports.
Credit Counseling: Under the new bankruptcy law which took effect in October of 2005, those wishing to file bankruptcy must complete an approved credit counseling course within the six (6) months prior to filing.
Deed in Lieu: Voluntary conveyance of title in exchange for a discharge of debt. The house must be free of other liens and must have clear title. In simple terms, the borrower agrees to transfer title of the property to the lender, who accepts the property in exchange for the total debt.
Deed of Trust: A legal document that dictates the terms of a loan used to buy a property and transfers the ownership of the property to a third party called a trustee until the loan has been paid in full.
Default: Occurs when the borrower does not meet its legal obligations according to the loan terms.
Equity Deficient: A property is Equity Deficient when, if sold, sales proceeds would not fully pay off existing mortgage debt.
Escrow: Delivery of a deed by a grantor to a third party for delivery to the grantee upon the happening of a contingent event. Modemly, in some states, all instruments necessary to the sale (including funds) are delivered to a third (neutral) party, with instructions as to their use.
Hardship Letter: Letter from the seller explaining their current circumstances, in request for a short sale. Some examples of a hardship are:
- Reduced Income or Unemployment.
- Inability to work due to health reasons.
- Separation or Divorce.
- Medical Bills.
- Business Failure.
- Death of a Spouse.
- Adjustment in mortgage payment or unforeseen increase in your monthly expenses.
- Any other circumstance that cripples your ability to repay your mortgage.
Investor: Owner of the Note.
Lien: A legal claim on a property by a lender or other entity (called the lien holder) against the property owner that owes the money.
Mailing: A copy of the Notice of Trustee’s Sale must be mailed (certified and first class) at least 20 days before the foreclosure sale to the borrower and to anyone who was entitled to receive a copy of the Notice of Default and Secretary of State and IRS, if applicable.
Modification: A transaction in which lender agrees to modify any or some of the terms of the mortgage. This is a process where an existing note is modified, but not cancelled. Changes may include: extending the term of the loan, changing the monthly payments, changing the interest rate, etc.
Notice of Default (NOD): A publicly recorded notice stating that a property owner is behind scheduled loan payments for a loan secured by a property. This process is required in a few states to begin the foreclosure process if a borrower is in default.
Notice of Trustee Sale: An official notice that is posted, mailed, published/advertised and recorded by trustee at the direction of lender indicating lender’s intention to sell the property at public auction. The notice includes a specific date, time and location.
Posting: A copy of the notice of sale must be posted in a conspicuous place on the property to be sold at least twenty days before the sale. Also, a copy of the notice must be posted at one public place in the city where the property is to be sold at least twenty days before the sale.
Postponement: Trustee Sales may be postponed by the first at the direction of the lien holder. Notice may be given in advance or at the time and location specified for the intended sale.
Promissory Note: A promise in writing, and executed by the maker, to pay a specified amount during a limited time, or on demand, or at sight, to a named person, or on order, or to bearer.
Purchase Agreement: An agreement between a buyer and seller of real property, setting forth the price and terms of the sale.
Qualifying Funds: In order to bid at a Trustee Sale bidder must have qualifying funds available at the sale. Qualifying funds are cash or a cashiers check(s) drawn by a State or National Bank, a check(s) drawn by a State or Federal Credit Union or check drawn by a State or Federal Savings and Loan Association, savings association or savings bank specified in section 5102 or the Financial Code and authorized to do business in the State of California.
Short Sale: (Also called "Short Pay" or "Pay Off") A process in which a lender agrees to receive a lower amount of an owed debt in exchange for the sale of the property to a third party.