An acronym for “Automated Clearing House”; an electronic network for financial institutions in the United States used to electronically transfer both credits and debits; ACH credit transfers include direct deposit, payroll, and vendor payments. ACH direct debit transfers include consumer payments on insurance premiums, mortgage loans, and other kinds of bills. Both the government and the commercial sectors use ACH payments.©2011 NACHA - The Electronic Payments Association® All rights reserved.
Additional payment related information that can be sent along with a Corporate Trade Exchange.
An adjustable rate mortgage, commonly referred to as an ARM, is a loan type that allows the lender to adjust the interest rate during the term of the loan. Generally, these changes are determined by a margin and an index so that the interest rate changes, up or down, are based on market conditions at the time of the change. Most often these interest rate changes are limited by a rate change cap and a lifetime cap. If you apply for an adjustable rate mortgage, the lender is required to provide you with an ARM Program Disclosure which spells out the terms of the loan.
An acronym for “Automatic Funds Transfer”; an automatic draft setup to collect funds for a monthly payment, usually used for loan payments.©2011 NACHA - The Electronic Payments Association® All rights reserved.
A person who acts for another person (Principal) by the Principal's authority.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
A check or another negotiable instrument that has been materially and maliciously altered to effect a fraud. Usually either the name of the payee or the amount of the check is changed.www.investopedia.com
A loan repayment plan, which enables the borrower to reduce his debt gradually through monthly payments of principal and interest.
A timetable for payment of a mortgage loan. An amortization schedule shows the amount of each payment applied to interest and principals and shows the remaining balance after each payment is made.
The amount of time required to amortize the mortgage loan. The amortization is expressed as a number of months. For example, for a 30 year fixed rate mortgage, the amortization term is 360 months.
To repay a mortgage with regular payments that cover both principal and interest.
Subordinate or auxiliary to something or someone else; used in such terms as ancillary administration, ancillary administrator, and ancillary guardian.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
The amount of property that may annually be given to a donee, regardless of donee's relationship to the donor, free of gift tax. Only gifts of present interest qualify for the annual exclusion.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
To make it easier for consumers to compare mortgage loan interest rates, the federal government developed a standard format called an "Annual Percentage Rate" or APR to provide an effective interest rate for comparison shopping purposes. Some of the costs that you pay at closing are factored into the APR for ease of comparison. Your actual monthly payments are based on the periodic interest rate, not the APR.
The amount of money you will earn on an account with the effect of compounding interest. Some accounts pay you interest every month, some pay you interest every few months, some pay you interest once a year, etc. So the APY lets you see which account will earn more in a year. For example, if a bank offers you a choice between two accounts. One earns 6% interest that is paid at the end of the year. The other account earns 0.5% per month with monthly compounding. At first glance, the yields appear equal because 12 months multiplied by 0.5% equals 6%, so it appears that both accounts would earn 6% in a year. However, when the effects of compounding are included by calculating the APY, we find that the second investment actually yields 6.17%. So the account that earns 0.5% per month with monthly compounding will earn more.
A specified income paid yearly or at other regular intervals, often on a guaranteed dollar basis.
Software that monitors a computer for Viruses by looking for irregularities in a computer system and then comparing its findings to a database of virus information. It is important to update virus definitions or signatures regularly and upgrade the software periodically to protect against newly created viruses.Source: http://www.answers.com/topic/antivirus-software#ixzz1D1kzf9r0
The term "application" generally refers to a form that is used to collect information from a borrower by a lender.
An analysis performed by a qualified individual to determine the estimated value of a home.
In order to verify that the value of your home supports the loan amount you request, an appraisal will be ordered by the lender. The appraisal is generally performed by a professional who is familiar with home values in the area and may or may not require an interior inspection of the home. The fee for the appraisal is commonly passed on to the borrower by the lender. For our comparison purposes, the appraisal fee is a third party fee.
An opinion of a property’s fair market value, based on an appraiser’s knowledge, experience and analysis of the property.
An acronym for “Accounts Receivable Entry”; used when a business converts a consumer's check to an ACH entry when the check is mailed or dropped off in a night drop.©2011 NACHA - The Electronic Payments Association® All rights reserved.
An ARM (adjustable rate mortgage) is a loan type that allows the lender to adjust the interest rate during the term of the loan. Generally, these changes are determined by a margin and an index so that the interest rate changes, up or down, are based on market conditions at the time of the change. Most often these interest rate changes are limited by a rate change cap and a lifetime cap. If you apply for an adjustable rate mortgage, the lender is required to provide you with an ARM Program Disclosure which spells out the terms of the loan.
The process of deciding how investment dollars will be apportioned among available asset classes.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
An acronym for “Automated Teller Machine”; an electronic banking machine that dispenses cash, accepts deposits, and performs other services when a customer inserts a plastic card and pushes the proper coded buttons.Dictionary.com Unabridged
On a general level, it can mean any automatic transfer of funds between customer accounts. For example, a regular transfer from a checking account to pay off a bank loan, or a monthly transfer from a checking account to a savings account.
More specifically, it describes the overdraft protection provided when there is an automatic transfer of funds from a customer's savings account to his or her checking account when there are insufficient funds to cover unpaid checks or maintain a minimum balance.
The portion of the balance in a checking or non-demand account that is available to the account holder for spending, withdrawal, or transfer. If a check deposit has not been cleared by the issuing bank, the funds will not be available to the account holder even though they may show up in the account's stated total funds.
The net effect is that the account balance may be different from the balance that is available to the account holder for spending, withdrawal or transfer.
The portion of a customer's account balance on which the bank has placed no restrictions, making it available for immediate withdrawal.
A mutual fund that seeks to provide current income and long-term growth from a combination of stocks and bonds.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
The individuals elected by the bank's stockholders to constitute the board of directors. The board of directors is the governing body of the corporation and they are ultimately responsible for the bank's financial performance.
A bank officer is an employee of a bank endowed with the legal capacity to agree to and sign documents on behalf of the institution. The title is usually held by branch managers, assistant managers, loan officers, and other experienced personnel. Executives and others holding titles such as "Vice President" are considered officers of the bank for legal purposes.
The title is also used to designate those branch personnel who act in a supervisory capacity. In larger banks, an officer at the branch level sometimes reviews accounts and makes decisions on whether to honour NSF items or to return them. Such decisions are usually left up to those who are legally responsible to act on behalf of the bank.
The person to whom all or a portion of a deceased participant's account balance is payable.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
An acronym for “Back Office Conversion Entry”; used when a business converts your check to an ACH entry after the purchase is made.©2011 NACHA - The Electronic Payments Association® All rights reserved.
A type of debt instrument issued by corporations, governments, and government agencies. The issuer makes regular interest payments and promises to pay back, or redeem, the face value of the bond at a specified time called a maturity date.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A mutual fund that invests primarily in bonds; generally, corporate, municipal, or U.S. government debt obligations. Bond funds usually emphasize income rather than growth.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A form of assignment executed by the owner of registered bonds or stock, which contains an irrevocable appointment of an attorney-in-fact to make the actual transfer on the books of the corporation.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
The bank unit that maintains and updates all records of depositors accounts.
A marker within a file that allows a user to easily return to a given position. 2. A remembered address (Url) that allows a user to go directly to a given site on the World Wide Web. This terminology is used by Netscape Navigator; Microsoft's Internet Explorer uses the term Favorites.Read more: http://www.answers.com/topic/bookmark#ixzz1D1lrljq1
(noun) A check that the bank returns because the person who wrote it did not have enough money in his/her account to pay it.
A business that arranges contracts for the purchase and sale of stocks and bonds.
A program that accesses and displays files and other data available on the Internet and other networks. Entering a website's URL in the address window of a browser will bring up that website in the browser's main window.The American Heritage® Science Dictionary Copyright © 2005 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved.
An area of computer memory devoted to the high-speed retrieval of frequently used or requested data.The American Heritage® Science Dictionary Copyright © 2005 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved.
Funds invested in a company by the owners, such as stockholders, for use in conducting business. The owner's original investment plus any profit reinvested in the business.
The difference between purchase price and selling price in the sale of assets. The computation is used primarily in tax computations.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
An acronym for “Courtesy Amount Recognition”; the process by which recognition engines read the numeric value on a check or other payment document automatically so that operators do not have to key in most of the data.©2011 NACHA - The Electronic Payments Association® All rights reserved.
An acronym for “Corporate Credit or Debit”; an entry used by a Business to transfer funds to or from an account of that business with another bank or to another business.©2011 NACHA - The Electronic Payments Association® All rights reserved.
(noun) CD is an abbreviation for "certificate of deposit," which is a document issued by a bank stating that a person has a specified sum of money on deposit. CDs earn money at a specified rate so you can earn money while you save, but CDs have a period of time where you cannot take your money out. If you take your money out of the CD before the period of time is over, there will be a fee charged to you.©2010 Wordsmyth (definition only) - with additions by TB&T
A formal receipt issued by a bank for a specified amount of money, left with the bank for a certain amount of time to receive a fixed rate of interest usually greater than a regular savings account. Interest rates are competitive and reviewed daily. They carry an interest penalty if withdrawn prior to maturity.
A loan, obligation, or cardholder account that the bank no longer expects to collect and writes off as a bad debt.
A gift of real property to a legal charity by will.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
A trust for a fixed term of years wherein a charity is the income beneficiary and the remainder goes to a non-charitable beneficiary.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
A trust that provides a sum certain, not less than 5% of initial fair market value of all property placed in the trust, to be distributed at least annually to a non-charitable beneficiary, with remainder to a qualified charity.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
An arrangement wherein the remainder interest goes to a legal charity upon the termination (or failure) of a prior interest.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
A trust that provides a fixed percentage, not less than 5% of the net fair market value of property, valued annually, to be distributed at least annually to a non-charitable beneficiary, with remainder to a qualified charity.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
Authorized by a federal or state regulatory body to conduct banking business. The banking system in the United States today functions under a dual banking system whereby a bank may be chartered under the state or federal government.
Also known as a debit card; a plastic card that resembles a credit card but functions like a check and through which payments for purchases or services are made electronically to the bank accounts of participating retailing establishments directly from those of card holders.Dictionary.com Unabridged
An individual who signs a note to guarantee a loan made to another party and is jointly liable with that party for repayment.
An amendment or supplement to a will executed with all the formalities of the will itself.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
Checking account cash balance after deducting checks drawn on other banks. Generally defined as account ledger balances, less unpaid checks in the process of collection. A bank may count a deposited check as funds available for use by its customer in two business days, but usually will not include it in the depositor's collected balance for five or six days. This allows time for the drawer bank to return the check because of insufficient funds in the check maker's account or for other reasonsSource: http://www.answers.com/topic/collected-balance#ixzz1CGzt7MaU
A checking account designed for business concerns and organizations.
Credit extended by a bank to a business.
Property in which a husband and wife have each an undivided one-half interest by reason of their marital status; recognized in all civil law countries and in certain states (nine, including Texas).The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
A trust in which the trustee is not required to distribute income currently.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
(noun) Compounding interest is when money earns interest and then the original amount of money plus the earned interest go together to earn more interest.
A loan extended to consumers, either individually or jointly, primarily for buying goods and services.
The beneficiary whose interest is conditioned upon a future occurrence, which may or may not take place. Unless or until the condition takes place, the interest is only contingent.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
(noun) An agreement between people that is put into writing and bound by law. If one of the people that signed the contract does not hold up their end of the deal, you can take them to court with the written contract as evidence of their wrongdoing.
A piece of data downloaded to a computer by a website, containing details of the preferences of that computer's user which identify the user when revisiting that websiteCollins English Dictionary - Complete and Unabridged © HarperCollins Publishers 1991, 1994, 1998, 2000, 2003
The original price or cost of an asset usually based on the purchase price, or in the case of assets received from an estate, on the appraised value of the assets as of date of death, or other fixed date.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
Any fake currency, coin, or bank card made to appear authentic.
An imitation intended to be passed off fraudulently or deceptively as genuine; forgery.Dictionary.com Unabridged
Insurance purchased in conjunction with a loan that will automatically pay off the loan in the event of death or total disability.
A limited, usually non-cumulative power of withdrawal over trust property that ordinarily lapses within a specified period of time. This power gives a trust beneficiary a present interest over property transferred to the trust.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
A trust established granting a beneficiary a limited power to withdraw income or principal, or both. This power is exercisable during a limited period of time each year and is non-cumulative.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
An abbreviation for “Currency Transaction Report”; a report that U.S. financial institutions are required to file for each deposit, withdrawal, exchange of currency, or other payment or transfer, by, through, or to the financial institution which involves a transaction in currency of more than $10,000. Used in this context, currency means the coin and/or paper money of any country that is designated as legal tender by the country of issuance. Currency also includes U.S. silver certificates, U.S. notes, Federal Reserve notes and official foreign bank notes.Source: www.wikipedia.com
An acronym for “Corporate Trade Exchange”; an entry used by a Business to transfer funds to or from an account of that business with another bank or to another business that permits the use of an Addenda Record.©2011 NACHA - The Electronic Payments Association® All rights reserved.
A system of accounting that provides for the allocation of earnings and losses to a participant's account on a daily basis.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
The portion of a participant's accrued benefit that is payable to a named beneficiary upon the participant's death.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A type of qualified plan in which a participant's benefits are based solely on the participant's account balance; the account balance depends on the level of employer and employee contributions and the earnings on those contributions.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
Funds that may be withdrawn from a bank without advance notice. Checking accounts are the most common form of demand deposits.
Any placement of cash, checks or other drafts for credit to an account. All deposits are liabilities for a bank since they must be repaid in some form at some future time.
A form used to make a deposit. The form lists items given to the bank along with a total for credit.
A plan in which salaries or other payments are transferred by the paying agency directly to the accounts of the recipients.Dictionary.com Unabridged
Any employer contributions to a 401(k) or profit sharing plan that are not mandated by the terms of the plan.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
The provisions of a will or trust agreement relating to the disposition and distribution of the trust property in the estate or trust.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
A company owned and operated by a person or persons which is doing business under a name other than their own. The owners must obtain an assumed name certificate that is registered at the County Clerk's office. The certificate lists who the owners of the business are and who may receive funds on behalf of the company.
Maker of the check.
Bank where the maker's (drawee's) account is located.
A bank security procedure requiring that two members of the staff be involved in a transaction or duty, such as ATM collection.
A Power of Attorney that remains effective despite the disability or incompetence of the person granting the power.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
A 10 percent penalty (in addition to ordinary income taxes owed) on money withdrawn from a tax-advantaged retirement plan before age 59 ½. The penalty does not apply in special circumstances such as death, disability, or withdrawals in the form of an annuity or payment over the recipient's (and spouse's) life expectancy.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A sum of cash paid to a seller by a buyer prior to the closing to show that the buyer is serious about buying the house. The earnest money is deducted from the purchase price at closing and is not an additional cost. Sometimes referred to as a binder deposit.
A right of way giving persons, other than the owner, access to or over a property.
An acronym for “Electronic Funds Transfer”; the electronic exchange or transfer of money from one account to another, either within a single financial institution or across multiple institutions, through computer-based systems.©2011 NACHA - The Electronic Payments Association® All rights reserved.
The amount of a participant's voluntary reduction in pay; otherwise known as salary deferrals. An election to defer pay must be made in advance. The employer then contributes the deferral to the 401(k) plan.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
Using automated, electronic, technology to move funds without paper checks.
1 : to write on the back of; especially : to sign one's name as payee on the back of (an instrument) in order to receive the cash or credit represented on the face < endorse a check>
2 : to inscribe (as one's signature or a notation accompanied by one's signature) on an instrument (as a note or bill) esp. to transfer or guarantee it
3 : to transfer (an instrument) to another by inscribing one's signature endorse s a note to creditor as security for a debt - Uniform Commercial Code >
4 : to inscribe (as an official document) with a notation (as of date or title)
A signature that is make on an instrument. The legal transfer of one's right to an instrument.
The reversion of property to the State in case there are no devisees, legatees, heirs, or next of kin; originally applied to real property but now applies to all types of property.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
Funds paid by one party to another to hold until a specific date when the funds are released to a designated individual. Generally, an escrow account refers to the funds a mortgagor pays to the lender along with their principal and interest payments for the payment of real estate taxes and hazard insurance. This is also referred to as impounds. The money is held by the lender to make payments when they are due.
An escrow can also refer to funds that are held by a third party to ensure the completion of repairs or improvements that must be completed on the property but that cannot be done prior to closing.
The account that funds are held in by the lender for the payment of real estate taxes and/or homeowner's insurance. Can also refer to the account that funds are held in for the completion of repairs or improvements to a property that cannot be completed prior to closing.
A periodic review of escrow accounts to determine if current monthly deposits balances will provide sufficient funds to pay property taxes, hazard insurance and other bills when they come due.
The portion of a borrower’s monthly mortgage payment that is held by the loan servicing company to pay for property taxes, hazard insurance, mortgage insurance and other items as they become due.
The nature and extent of interest that an individual has in real property (degree of ownership). Also, the combined total of all real and personal property owned by an individual at the time of their death.
The legal expulsion of an occupant from real property. Usually exercised by a lessor against a lessee to recover possession of property.
The individual or corporation named in the will to take over and complete the administration of an estate.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
Reports the number of existing homes sold, expressed on an annual basis. Can be combined with New Home Sales to determine the total volume of home sales, a strong indicator of future national mortgage origination volume. Frequency: monthly. Source: National Association of Realtors.
The amount that a property would command if it were currently available to rent or lease.
The highest price that a willing, but not compelled, buyer would pay, and the lowest price that a willing, but not compelled, seller would accept.
Microsoft's term for documents or URLs that have been marked for easy retrieval.Read more: http://www.answers.com/topic/favorites-1#ixzz1D1mF3Hf5
Fed is a nickname that is sometimes used for the “Federal Reserve Bank”. This is the federal government's bank, which offers many services to banks such as printing bills and coins and recycling worn out bills and coins. Texas Bank and Trust's Federal Reserve Bank is located in Dallas, TX, in what is known as the 11th Federal Reserve district.
One of the 12 institutions, one in each Federal Reserve district, that serves as fiscal agents for the U.S. Treasury, which means that they are the federal government's bank. They also offer many services to financial institutions including check collection and clearing, electronic funds transfer, and distributing and receiving cash and coin. Each district bank is owned by its members. TB&T's Federal Reserve Bank is located in Dallas, Texas; in what is known as the 11th Federal Reserve district.
The organization created by the 1913 Federal Reserve Act. The system includes the 12 Federal Reserve banks and their branches, plus the member banks, which are its legal owners. The Board of Governors, headquartered in Washington, D.C., exercises overall control over the nationwide operations of the Federal Reserve System ("the Fed").
(noun) The price charged for a service.Banksite for definition only
Absolute ownership of real property; the greatest possible interest a person can have in real estate.
A mortgage insured by the Federal Housing Administration (FHA). FHA loans are also known as government mortgages.
Under ERISA, any person who (1) exercises any discretionary authority or control over the management of a plan or the management or disposition of its assets, (2) renders investment advice for a fee or other compensation with respect to the funds or property of a plan or has the authority to do so, or (3) has any discretionary authority or responsibility in the administration of a plan.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
(noun) The fees lenders charge for borrowing money, including interest, application fees, and service fees.Banksite for definition only
A mortgage that is the first loan recorded in the public record and generally the primary loan against a property.
A mortgage in which the monthly principal and interest payments remain the same throughout the life of the loan. The most common mortgage terms are 30 and 15 years. With a 30-year fixed rate mortgage your monthly payments are lower than they would be on a 15 year fixed rate, but the 15 year loan allows you to repay your loan twice as fast and save more than half the total interest costs.
A mutual fund with the objective of providing current income, primarily from fixed-income securities or bonds.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
a) The dollar amount of deposited items that have been given immediate, provisional credit but are in the process of collection from a drawee bank; also known as uncollected funds.
b) A term that describes the interest rate for a loan that has not yet been guaranteed by a lender. If the lender has not yet guaranteed or locked the interest rate, it is floating and could change prior to closing.
An inspection to determine if a property is located in an area prone to flooding also known as a flood plain. The federal government determines whether an area is in a flood plain. Lenders generally rely on the flood certification to determine if flood insurance will be required in order to obtain a mortgage. For our comparison purposes, the cost of the flood certification is considered to be a third party fee, though you may find that all lenders do not pass this fee on to the borrower.
Insurance that protects a homeowner from the cost of damages to a property due to flooding or high water. It is required by law that properties located in areas prone to flooding have flood insurance. The federal government determines whether an area is prone to flooding and considered to be in a flood plain.
One of the congressionally chartered, publicly owned companies that is the largest source of home mortgage funds.
The legal process in which a borrower's ownership of a property is dissolved due to default. Typically, the property is sold at a public auction and the proceeds are used to pay the loan in full.
Trading in or exchange of foreign currencies for U.S. funds or other foreign currencies.
The portion of a participant's benefit that may be lost of the participant separates from service before becoming 100 percent invested.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A demand draft, drawn on a bank, that has been fraudulently altered or on which the maker's signature is not genuine.
The legal term for counterfeiting a check or other document with the intent to defraud.
FHLMC (Federal Home Loan Mortgage Corporation) One of the congressionally chartered, publicly owned companies that is the largest source of home mortgage funds.
An adjustable-rate mortgage (ARM) with monthly payments that are sufficient to liquidate the remaining principal balance over the amortization term.
A mutual fund that invests in both U.S. and non-U.S. securities.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A written estimate of the closing costs the borrower will have to pay at closing. Under the Real Estate Settlement Procedures Act (RESPA), the lender is required to provide this disclosure to the borrower within three days of receiving a loan application.
A mortgage that is guaranteed by the Department of Veterans Affairs (VA) or, is insured by the Federal Housing Administration (FHA). Compare with conventional mortgage.
The person to whom an interest in real property is conveyed.
The person conveying an interest in real property.
Measures aggregate economic activity available, encompassing every sector of the economy. Quarterly percent changes (at an annualized rate) in GDP reflect the growth rate of total economic output. GDP growth is widely followed as the primary indicator of the strength of economic activity. Frequency: quarterly. Source: Commerce Department.
A mutual fund whose aim is to provide a balance of long-term growth and current dividend income from investing mainly in stocks of large and medium-sized companies.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A mutual fund whose main objective is long-term growth in capital from investing primarily in growth stocks. (See Growth Stocks)WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
The stocks of companies that have experienced or are expected to experience rapid growth in revenue or earnings and are expected to continue such growth for an extended period. Such stocks typically have relatively low dividend yields and sell at relatively high prices in relation to their earnings and book value. A mutual fund that emphasizes growth stocks is called a growth fund.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A half bathroom in a home that contains a wash sink and a toilet, but no bathtub or shower stall.
An in-service withdrawal from a 401(k) plan because of the immediate and heavy financial need of a participant that cannot be satisfied from other resources. The conditions for a hardship withdrawal of elective contributions can be determined through either a safe harbor or a facts-and-circumstances method.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
Insurance that protects a homeowner against the cost of damages to property caused by fire, windstorms, and other common hazards. Also referred to as homeowner's insurance.
A restriction on the payment of all or any part of the balance in an account.
A party who accepts an instrument in good faith and for value, without notice that it has been dishonored, that it is overdue, or that there is any claim against it.
A type of real estate credit in which the homeowner borrows against the value of his or her residence.
A complete and detailed inspection that examines and evaluates the mechanical and structural condition of a property. A complete and satisfactory home inspection is often required by the homebuyer. Compare with appraisal.
Insurance that protects a homeowner against the cost of damages to property caused by fire, windstorms, and other common hazards. Also referred to as hazard insurance.
A type of insurance policy that covers repairs to certain parts of a home for an agreed upon period of time. It is typically provided by the contractor or seller as a condition of the sale
A nonprofit association that manages the common areas of a condominium project or planned unit development (PUD). In a condominium development, the association has no ownership interest in the common elements. In a PUD, it holds title to the common elements of the project.
Payments made to an association responsible for the maintenance of the common areas in a condominium or subdivision development.
A standard calculation performed by mortgage lenders to determine if a borrower qualifies for a specific loan type and amount. It is calculated by dividing the monthly housing expense (Principal, Interest, Taxes and Insurance) by the borrower’s monthly gross income. Also referred to as a front-end ratio or a top ratio.
An acronym for “hypertext transfer protocol”; used as the standard protocol for transferring hypertext documents on the World Wide Web.Dictionary.com Unabridged
HUD, also known as the U.S. Department of Housing and Urban Development, insures home mortgage loans made by lenders meet minimum standards for such homes.
Also referred to as the closing statement or the settlement statement, this is the document that provides line by line detail of the financial details related to a specific real estate transaction such as the fees paid by the seller and the buyer for a purchase transaction or the fees paid by the borrower for refinances.
A method of storing data through a computer program that allows a user to create and link fields of information at will and to retrieve the data non-sequentially.Dictionary.com Unabridged
A crime involving the possession of identifying information not lawfully issued for that person's use or the attempt to access the financial resources of that person through the use of illegally obtained information.
A fund set aside for future needs, such as an escrow or reserve account.
An impound refers to the funds a mortgagor pays to the lender along with their monthly principal and interest payments for the payment of real estates taxes and hazard insurance. This is also referred to as an escrow account. The money is held by the lender to make payments when they are due.
A computer-generated report containing credit and legal information obtained from one of the main credit bureaus.
Real estate developed and improved to produce steady income.
An indicator that reflects the value of a representative grouping of securities. For example, Dow Jones Industrial Average or Standard & Poor Index of 500 Industrial Stocks.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A published interest rate used to establish the interest rate offered on an Adjustable Rate Mortgage (ARM). Some of the most common indices are treasury bills, treasury securities, London Inter-Bank Offering Rates (LIBOR) and the Cost of Funds Index (COFI).
A retirement account that allows individuals to make tax-deferred contributions to a personal retirement fund. Individuals can place IRA funds in bank accounts or in other forms of investment such as stocks, bonds, or mutual funds.
An increase in the amount of money or credit available relative to the amount of goods or services available. Inflation causes an increase in the general price level of goods and services. Over prolonged periods, inflation can reduce the purchasing power of a dollar, making it worth less.
The possibility that increases in the cost of living will reduce or eliminate the real returns on a particular investment.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
The original, starting interest rate of a loan at the time of closing. This rate changes for an adjustable-rate mortgage (ARM). Sometimes called a teaser rate.
A regularly scheduled periodic payment that a borrower agrees to make to a lender.
A loan made to an individual or business, repaid in fixed, periodic payments.
A banking term indicating that the drawer's balance does not contain sufficient funds to cover a check or checks.
A property title that a title insurance company agrees to insure against defects and claims.
A form of contract that provides compensation for specific losses in exchange for a periodic payment. An individual contract is known as an insurance policy. The periodic payments are known as insurance premiums.
A document stating that insurance is only temporarily in effect. Because the coverage will expire by a certain date, a permanent policy must be obtained prior to the expiration date.
A trust composed partly or wholly of life insurance policy contracts.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
A mortgage that is protected by the Federal Housing Administration (FHA) or by private mortgage insurance (PMI). If the borrower defaults on the loan, the insurer must pay the lender the lesser of the loss incurred or the insured amount.
The cost of the use of money.
The rate at which interest accrues on a mortgage. Usually, it is also the rate used to calculate the monthly payments.
The cost of borrowing a lender's money. Interest takes into account the risk and cost to the lender for a loan. The interest rate on a fixed rate mortgage depends on the going market rate and how many discount points you pay up-front. An adjustable rate mortgage's interest is a variable rate made up of the index and the lender's margin.
The maximum interest rate for an adjustable-rate mortgage (ARM), as specified in the mortgage loan note.
The minimum interest rate for an adjustable-rate mortgage (ARM), as specified in the mortgage loan note.
A short term mortgage loan for the construction of a building, usually a residence.
The agency of the Treasury Department with the responsibility for administering, interpreting, and enforcing the Internal Revenue Code.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A mutal fund that invests in securities traded in markets primarily outside the United States. (Contrast with Global Fund)WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
(verb) To invest is to put into use for the purpose of making more money.©2010 Wordsmyth (definition only)
(noun) An investment is money that is put into use for the purpose of making more money.©2010 Wordsmyth (definition only)
A property that is not occupied by the owner.
A retirement account that allows individuals to make tax-deferred contributions to a personal retirement fund. Individuals can place IRA funds in bank accounts or in other forms of investment such as stocks, bonds, or mutual funds.
An acronym for “Image Replacement Document”, also known as a “Substitute Check.” Substitute checks are digital copies of the fronts and backs of paper checks that provide the same legal protections and obligations as the originals, including serving as proof of payment.©2011 NACHA - The Electronic Payments Association® All rights reserved.
A trust which by its terms (1) cannot be revoked by the settlor or (2) can be terminated by the settlor with the consent of someone who has an adverse interest in the trust - that is, someone whose interest it would be for the trust not to be terminated, such as a beneficiary.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
A bank relationship in the names of two or more parties with each having access to the account.
A credit account held by two or more people so that all can use the account and all assume legal responsibility to repay.
A form of co-ownership that gives each tenant equal undivided interest and equal rights in the property, including the right of survivorship.
An agreement between two or more parties who invest in a property or business.
A decree made by a court of law. In judgments that require the repayment of a debt, the court may place a lien against the debtor's real property as collateral for the judgment's creditor.
A lien on the property of a debtor resulting from a judgment.
A loan that exceeds the maximum loan amount allowed by the most common mortgage investors. The cost of obtaining a jumbo mortgage is generally higher than the cost of obtaining a conforming mortgage. Also known as a non-conforming loan.
Any part of the surface of the earth.
A property installment selling agreement whereby the purchaser may occupy and use the land, but no deed is given by the seller until a specified part of the sales price has been paid.
An acronym for “Legal Amount Recognition”; the process by which recognition engines read the written value on a check or other payment document automatically so that operators do not have to key in most of the data.©2011 NACHA - The Electronic Payments Association® All rights reserved.
A legally enforceable declaration of a person's wishes regarding matters to be a attended to after his death and not operative until his death; revocable or amendable by codicil up to the time of death, or loss of mental capacity to make a valid will.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
The penalty a borrower must pay when a payment is made after the stated due date.
A payment made later than agreed upon in a credit contract and on which additional charges may be imposed.
A written contract between a property owner and a tenant that expresses the conditions under which the tenant may possess the real estate for a specified period of time and rent.
A way of holding title to a property wherein the mortgagor does not actually own the property, but instead has a long-term recorded lease on it.
A legal property description that is sufficient to locate and identify the property without verbal testimony.
The bank, mortgage broker, or financial institution providing the loan funds to a borrower.
A person or company that signs a lease to get temporary use of property.
A person or company that provides temporary use of property usually in return for periodic payment.
An instrument issued by a bank that guarantees that the bank will pay the seller, if all the terms of the contract are met, and protects the buyer by assuring that no payment will be make until the contract has been fulfilled.
A person's financial obligations including both long-term and short-term debt, as well as any other amounts that are owed to others.
A loan secured by real estate. An encumbrance against a property for money due. The lien can be voluntary such as a mortgage or involuntary such as a judgment.
On an adjustable-rate mortgage (ARM), a limit on the amount that the interest rate can increase or decrease over the term of the loan.
On an adjustable-rate mortgage (ARM), a limit on the amount that payments can increase or decrease over the term of the loan.
An agreement by a financial institution to extend credit up to a certain amount for a certain time to a specified borrower.
An asset that is easily converted into cash.
A trust that becomes operative during the lifetime of the settlor; opposed to a trust under will. The same as a trust inter vivos.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
Borrowed money that is usually repaid with interest.
A written offer from a lender to provide financing to a borrower. The commitment letter states the terms under which the lender agrees to provide financing to the borrower. Also called a commitment letter.
The process by which a mortgage lender creates a mortgage secured by real property.
The number of months that you will make monthly payments. If the loan term is the same as the payment calculation term, you will pay the loan in full during the loan term and no balance will be due. If the payment calculation term is greater than the loan term, a balance or "balloon payment" may be due at the end of the loan term.
A ratio used by lenders to calculate the loan amount requested as a percentage of the value of a home. To determine the loan to value ratio, divide the loan amount by the home's value. The LTV ratio is used to determine what loan types the borrower qualifies for as well as the cost and fees associated with obtaining the loan.
Written agreement in which a lender guarantees a specific interest rate if a loan closes within a set period of time. The lock-in may also specify the number of discount points to be paid at closing.
The number of days that the lender will guarantee the interest rate offered for a loan. In order to hold the guaranteed interest rate for a loan, the loan closing must occur during the lock period.
Written agreement in which a lender guarantees a specific interest rate if a loan closes within a set period of time. The lock-in may also specify the number of discount points to be paid at closing.
Magnetic codes on the bottom of a check that allow a machine to read the check.
The number of percentage points a lender adds to the index value to calculate the ARM interest rate at each adjustment period.
The possibility that stock or bond prices over broad segments of the market will fluctuate.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
The date on which the principal balance of a financial instrument becomes due and payable.
Usually, a loan amount that is within 5 percent of the highest loan-to-value (LTV) percentage allowed for a specific product.
A credit report that contains information from at least three credit repositories. Any duplicate entries are combined to provide a concise summary of a your credit.
Rules governing when distributions from a qualified plan must commence and the maximum time period over which benefit payment scan be made. Generally, distributions must commence by April 1 of the year following the later of the calendar year in which the employee attains age 70 ½ or retires (the delay until retirement is only for non-5 percent owners) and generally must be paid over a period based in part on the life expectancy of the employee.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
(verb) To make by stamping metal. The images you see on quarters, dimes, pennies, etc have been minted or stamped on there by the government. The government has a mint factory where all of the money of the United States is made.©2010 Wordsmyth (definition only)
Moving large amounts of illegally obtained cash through bank accounts to hide the source of the money.
A type of savings account that provides bank depositors with many of the advantages of a money market fund. Certain regulatory restrictions may apply to the withdrawal of funds.
A type of savings account created in 1982 that pays interest and allows account holders limited check-writing privileges.
A mutual fund that invests in highly liquid short-term securities, including bank certificates of deposit (CDs), commercial paper, and Treasury Bills (T-Bills).WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
The legal document used by a borrower to pledge their property as security in order to obtain a loan. In some areas of the country, the mortgage is called a "deed of trust".
Insurance provided by a private company to protect the mortgage lender against losses that might be incurred if a loan defaults. The borrower usually pays the cost of the insurance and is most often required if the loan amount is more than 80% of the home's value. Sometimes referred to as private mortgage insurance.
Amount paid by a borrower for mortgage insurance, either to a government agency such as the Federal Housing Administration (FHA) or to a private mortgage insurance (PMI) company.
Real estate credit, usually extended on a long term basis with the mortgaged property as security.
The person or company who provides the loan funds to the borrower.
A term used by the United States Bureau of Engraving and Printing (BEP) to describe currency which is very badly damaged, to the point where it is difficult to determine the value of the currency, or where it is not clear that at least half of the note is present. Common causes of damage are fire, water, chemicals, explosives, animals or damage from extended burying of the currency. Banknotes which are merely very dirty, or very worn out, but where the value is clear, are not considered mutilated and can be traded in at any bank from where they will eventually be processed out of circulation. In general, mutilated currency of US dollars can be sent to the BEP for evaluation, and if it is determined that at least half of the currency is present, or there is clear enough evidence that whatever parts are missing are destroyed, the owner of the mutilated currency can have the money value of the mutilated currency refunded to them. Annually, this amounts to about 30,000 claims and over 30 million dollars in refunds.Source: www.wikipedia.com
Currency and coin that is in such poor quality that is cannot be recirculated.
An investment company that combines the money of its numerous shareholders to invest in a variety of securities in an effort to achieve a specific objective over time.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A gradual increase in mortgage debt that occurs when the periodic monthly payment is not sufficient to cover the monthly principal and interest due. The amount of the deficit is added to the remaining principal balance to create negative amortization.
The income that remains for an investment property after the monthly operating income is reduced by the monthly housing expense, which includes principal, interest, taxes, and insurance.
For our comparison purposes, the net closing costs are the total closing costs quoted by a lender, less any credit or rebate that is offered.
The total value of all of a person's or company's assets, minus all liabilities.
An after bank hours depository service for customers. Deposits are inserted into a large receptacle on the outside of the building and dropped into a vault inside the building. The contents of the receptacle are retrieved under dual control.
A refinance loan is an amount that pays off the existing mortgage balance on the property and does not provide the borrower with any cash at closing.
The written agreement signed by the borrower at closing that contains the promise to repay the loan. The note also contains the terms of the loan, such as interest rate, payment, and term.
The interest rate stated on a mortgage note. Also called nominal rate or face interest rate.
An interest-earning transaction account on which check-like (negotiable orders of withdrawal) instruments may be used for withdrawal.
(noun) NSF is an abbreviation for “non sufficient funds.” Banks charge customers an NSF fee when the customer uses more money than they have in their account with the bank.
Percentage of currently rented units in a building, neighborhood, complex, or city.
A buyer's expression of willingness to purchase a property at the seller's specified price.
Total amount of principal owed on a loan before any payments are made.
An issued check that has not yet been presented for payment to, or paid by, a drawee.
A negative balance in an account, resulting from paying of checks for an amount greater than the depositor's balance.
A real property purchase transaction in which the seller provides the financing.
The monthly principal and interest payment required when repaying a mortgage in accordance with its terms.
An employee or former employee who has an accrued benefit under the plan.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A business operated by two or more individuals in non-corporate form.
The beneficiary of the check; the person or entity to whom it is payable.
On an adjustable-rate mortgage (ARM), a limit on the amount that payments can increase during a single adjustment period.
Economic indicator that measures the total income of all Americans from all sources, and is reported both before and after taxes. Also reports personal spending and personal savings. The level of spending can be used as an indicator of consumer optimism. Frequency: monthly. Source: Commerce Department.
Any and all property that is not real property.
A scam where a perpetrator imitates legitimate companies in e-mails to lure people to share passwords or credit card numbers.
(noun) A PIN is an abbreviation for "personal identification number." You need a PIN to get money out of an ATM. A PIN is a number that only you know, so if someone stole your debit card and tried to use it at an ATM, that person would not be able to get money out of your account because they do not know your PIN.©2010 Wordsmyth (definition only) with TB&T additions
(P)rincipal, (I)nterest, (T)axes, and (I)nsurance is a reference to the total monthly payment required to repay a mortgage in accordance with its term as well as monthly escrow payments for taxes and insurance.
A housing project that includes common property that is owned and maintained by a homeowners' association for the benefit and use of the individual unit owners.
A terminal used to transfer funds from a bank account to pay for purchases.
Fees that are collected by the lender in exchange for a lower interest rate. Commonly called discount points, each point is equal to 1% of the loan amount. For our comparison purposes, a discount point is considered to be a lender fee. To determine if it is wise to pay discount points to obtain a lower rate, you must compare the up front cost of the points to the monthly savings that result from obtaining the lower rate.
An acronym for “Point of Purchase Entry”; a method of payment for the in-person purchase of goods and services by consumers. The Single Entry debits are created by the originator based on written authorization and account information from a source document (check) obtained from the consumer at the point-of-purchase. The source document is voided by the merchant and returned to the consumer at the point-of-purchase is used to collect the information required to create the ACH Debit entry to the consumer's account.Source: http://www.treasurysoftware.com/Help_ACH_Universal/index.html?mapping_decide_pop.htm
A utility that prevents Web site popups from displaying. The challenge with this software is to distinguish a valid popup from an advertisement. There are an enormous number of Web pages that launch legitimate browser windows to display additional information, and a popup is a small browser window.Source: http://www.answers.com/topic/popup-blocker#ixzz1D1lLzylv
A cash-management service employed to deter check fraud. Banks use positive pay to match the checks a company issues with those it presents for payment. Any check considered to be potentially fraudulent is sent back to the issuer for examination.www.investopedia.com
An item bearing a future date. It is not valid until that date is reached.
The process of adding deposits to an account balance and subtracting checks and other withdrawals.
A written legal instrument that authorizes another person to act on one's behalf. A power of attorney can grant either complete or limited authority.
An acronym for “Prearranged Payment or Deposit”; prearranged deductions from a bank account for payment of a third party (an entry typically used for payrolls or billing).©2011 NACHA - The Electronic Payments Association® All rights reserved.
Procedure to determine how much money a potential homebuyer will be eligible to borrow prior to actually applying for a loan.
Expenses of property ownership or expenses incurred while obtaining a mortgage that must be paid in advance. Prepaids typically include real estate taxes and hazard insurance.
Any amount that is paid to reduce the principal balance, not interest, of a loan before the due date.
A monetary penalty charged by a lender if all or part of a loan is paid off before it is due.
The actual balance, excluding interest, of a mortgage loan. Also refers to the amount of the monthly mortgage payment that will be applied to the actual balance.
The payment required to repay a mortgage in accordance with its terms. Sometimes referred to as "P&I".
The outstanding balance of principal on a loan. Principal does not include interest or fees.
Insurance provided by a private company to protect the mortgage lender against losses that might be incurred if a loan defaults. The cost of the insurance is usually paid by the borrower and is most often required if the loan amount is more than 80% of the home's value. Sometimes referred to as mortgage insurance.
(verb) To present a will to the court for appointment of the executor or administrator, which is the first step in the settlement of an estate.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
The court that has jurisdiction with respect to wills and intestacies and sometimes guardianships and adoptions.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
A plan under which contributions made by the employer are allocated to a participants pursuant to a definite predetermined formula. Contributions are generally discretionary and may be made without regard to profits.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A written promise to pay a specified sum to specified person over a specified period of time.
The department that verifies that transactions are in balance (credits and debits equal) before sending them on to the data center for processing. Proof also MICR encodes amounts, account numbers, and transaction codes on the bottom of checks and other documents that are processed.
Taxes based on the assessed value of the home, paid by the homeowner for community services such as schools, public works, and other costs of local government. Sometimes paid as a part of the monthly mortgage payment.
A collection of legal documents that are filed with the local government registry so that the public will know what liens, encumbrances or judgements may affect any piece of real estate.
A written contract signed by the buyer and seller stating the terms and conditions under which a property will be sold.
Calculations performed by lenders to determine your ability to repay a loan. The first qualifying ratio is calculated by dividing the monthly PITI by the gross monthly income. The second ratio is calculated by dividing the monthly PITI and all other monthly debts by the gross monthly income.
A deed that transfers, without warranty, whatever interest or rights a grantor may have at the time the transfer is made. Often used to remove a possible cloud on the title.
The annual rate of interest for a loan. Also called the interest rate.
The maximum amount that an interest rate can change, either at an adjustment period or over the entire life of the loan. Commonly associated with an adjustable rate mortgage (ARM).
An agreement by a lender to guarantee the interest rate offered for a mortgage provided that the loan closes within the specified period of time.
(noun) The rate of interest is the percent charged for the use of someone else's money.
Same as interest rate.
An acronym for “Re-presented Check Entry”; used when a business converts your check to an ACH entry to collect funds for a check that was previously returned.©2011 NACHA - The Electronic Payments Association® All rights reserved.
An acronym for “Remote Deposit Capture”; refers to the ability to deposit a check(s) into a bank account(s) via scanning device from one's place of business without having to physically deliver the actual check(s) to the bank.©2011 NACHA - The Electronic Payments Association® All rights reserved.
A person licensed to negotiate the purchase and sale of real estate on behalf of buyers and sellers.
A consumer protection law to provide information to consumers regarding expenses involved in the real estate settlement process. It requires lenders and brokers to provide certain information to consumers, and it prohibits kickbacks and other abusive practices.
Land and anything permanently affixed to the land, including structures, trees, minerals, and the interest, benefits and rights thereof.
A real estate broker or associate who is an active member of a local real estate board that is affiliated with the National Association of Realtors.
The process of comparing and balancing one account record against another to provide proof that they ultimately equal.
The entering in a book of public record the details of a properly executed legal instrument that affects title to real property, thereby making it a part of the public record.
A fee charged by the local government to record mortgage documents into the public record so that any interested party is aware that a lender has an interest in the property. For our comparison purposes, a recording fee is considered to be a tax or other unavoidable fee.
The process of paying off any existing mortgages on a home with a new mortgage loan.
The fee charged to release a lien to free real estate from a mortgage.
The beneficiary of a trust who is entitled to the principal outright after the interest of the prior beneficiary has been terminated.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
The amount of principal owed on a loan that has not yet been fully repaid.
The number of payments left to be made on a loan before it is fully amortized (paid in full).
(verb) To repossess is to take possession of again, especially for failure to pay money that is owed.
The amount that must be withdrawn each year from all retirement plans once a participant reaches age 70 ½ or, if later, terminates employment. (The delay until termination of employment is for non-5 percent owners).WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
The cancellation of a contract by the operation of a law or by mutual consent. In some circumstances, borrowers have the right to cancel a transaction within three business days after closing.
See Real Estate Settlement Procedures Act.
Checks, drafts, or notes that have been dishonored by the drawee bank or maker and have been returned to the presenting party.
A credit agreement (typically a credit card) that allows a customer to borrow against a pre-approved credit line when purchasing goods and services. The borrower is only billed for the amount that is actually borrowed plus any interest due.
A contract provision that requires a property owner to give another party the first opportunity to purchase or lease the property before it is offered to others.
The right to enter or leave specific property or premises.
In joint tenancy, the right of surviving joint tenants to acquire the interest of a deceased joint tenant.
An investor's personal ability or willingness to endure declines in the prices of investments. Sometimes measured by risk tolerance questionnaires.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A plan contribution made by an employee, attributable to a distribution from a qualified plan, a governmental 457 plan, a 403(b) plan, and the taxable portion of a traditional IRA.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A nine digit numbering system used in the United States, which appears on the bottom of negotiable instruments, such as checks, that identifies which financial institution the check is drawn on. This number is also used by the Automated Clearing House to process direct deposits and other automated transfers and is used by the Federal Reserve Bank for a number of things including check clearing and wire transfers.
TB&T's ABA # is 1119 2323 8
The first two digits (11) show the bank's Federal Reserve District. The third digit (1) identifies the Federal Reserve Office. The fourth digit (9) shows the bank's state.
The next four digits (2323) are the bank's institutional identifier.
The last digit (8) combined with the first eight digits, verifies the routing number's accuracy in computer processing.
Set of numbers associated with a checking, savings, or other bank account that associates a financial institution with the account. This number is used to determine where to route funds to or from. Any individuals seeking direct deposit from a company will typically have to provide a routing and account number.Source: http://www.businessdictionary.com/definition/routing-number.html
An agreement between a buyer and seller to purchase real estate. A sales contract, also known as an offer to purchase or a binder, secures the right to purchase real estate upon agreed terms for a limited period of time. If the buyer changes his mind or is unable to purchase, the earnest money that was paid is forfeited unless the binder expressly provides that it is to be refunded.
A U.S. government bond with principal amounts up to $10,000.Dictionary.com Unabridged
A fee charged by a title company or attorney in some states to cover the cost of searching the public record to make sure the buyer is purchasing a house from the legal owner and there are no liens, overdue assessments, or other claims filed that would adversely affect the transfer of the title. For our comparison purposes, a search fee is considered to be a third party fee and may be included in the title insurance fee by some lenders.
A loan that has a lien position subordinate to the first mortgage.
The buying and selling of existing mortgages, primarily residential first mortgages.
A loan that is backed by collateral.
The collateral offered to a lender in exchange for a loan. When a lender provides a mortgage, you provide your home as the security. This means that if payments are in default, the lender has the right to take title to the property.
The lender's right to take property that has been offered as security.
A company that collects principal and interest payments from borrowers and manages borrowers' escrow accounts. The servicer may or may not be the original lender.
A meeting of parties involved in a real estate transaction to finalize the process. In the case of a purchase, the settlement usually involves the seller, the buyer, the real estate broker and the lender. In the case of a refinance, the settlement involves the borrower and the lender. Sometimes referred to as the closing or the close of escrow.
A fee charged by a title company, closing agent or attorney to act as a representative and agent for the lender to perform the closing of a real estate transaction.
Also referred to as the HUD-1 or the closing statement, this is the document that provides line by line detail of the financial details related to a specific real estate transaction such as the fees paid by the seller and the buyer for a purchase transaction or the fees paid by the borrower for refinances.
A written order to pay upon presentation or delivery.
A bank document containing the signature(s) of those who are authorized to draw against the account or otherwise issue instructions to the bank.
(noun) Simple interest is when interest is calculated on the base balance not including any already charged or earned interest.
A term known only in tax laws to describe a trust that is required to distribute all of its income currently and that does not provide for any charitable distributions, as opposed to a complex trust.The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
A business owned and operated by one person.
A split deposit consists of funds being split or divided into more than one account with multiple deposit slips.
A security that represents part ownership, or equity, in a corporation.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A mutual fund whose holdings consist mainly of stocks.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
A depositor's instructions to his or her bank directing the bank not to pay a previously issued check or item.
A prepaid card that stores funds. As the card is used, the amount is deducted from the card until the balance is completely used. (Gift Cards)
A housing development that is created by dividing a large parcel of land into many individual lots for sale.
Any mortgage or other lien that has a lower priority than that of the first mortgage.
A fee associated with obtaining a precise measurement of a piece of property by a licensed surveyor. The survey is typically a written map of the property showing locations of buildings and boundaries. In some states a survey is required by a title company to issue a title insurance policy. For our comparison purposes, a survey fee is considered to be a third party fee and may be included in the title insurance fee by some lenders.
A fee charged by a title company to issue an insurance policy without requiring that a full survey be completed. For our comparison purposes, a survey affidavit fee is considered to be a third party fee and may be included in the title insurance fee by some lenders.
Contribution to the construction of a property in the form of labor or services, instead of cash.
A prearranged automatic transfer of funds in an account to another account. One account is debited and the other credited.
Real estate and other property of value which can be seen and touched.
The total value of property, income, or other taxable assets subject to taxation.
A tax charged by some state or local governments at the time of transfer of real estate title from one owner to another. For our comparison purposes, these fees are considered to be a tax or other unavoidable fee.
A fee charged to a borrower by a lender so that another company will assume responsibility for verifying the amount of real estate taxes due and that taxes have been paid over the life of the loan. For our comparison purposes, a tax service fee is considered to be a third party fee, however, some lenders may not charge for this service.
Fees that we consider to be taxes and other unavoidable fees include State/Local Taxes and recording fees. These fees will most likely have to be paid regardless of the lender you choose. If you see a tax or recording fee in the fee comparison table that is listed by some of the sites and not others, don't assume that you won't have to pay it. It probably means that the lender who doesn't list the fee hasn't done the research necessary to provide accurate closing cost information nationwide. Contact one of the sites directly for more information or talk to your real estate agent or attorney for guidance.
An acronym for “Telephone Initiated Entry”; an entry that is initiated via a phone call to have your account debited by a business.©2011 NACHA - The Electronic Payments Association® All rights reserved.
A temporary Internet file is a file that is located on your hard drive that a browser uses to store Web site data for every Web page or URL address that you visit. When the Web server sends the Web page files to the browser, they are stored in a file so that the next time you visit the same Web site the browser takes the data from the temporary Internet file. Loading the Web site in this way from a temporary Internet file is called caching.
With this method, the page quickly displays in the browser instead of having to wait for response from the Web site's server all over again. Basically, the browser is opening the Web page from your hard drive instead of downloading the files from the Internet. Only the new content since your last visit would be downloaded on consecutive visits to a Web page. Not only is it faster to view the content from your temporary Internet files rather than from the Web server, but if your Internet connection is unavailable you can view the cached versions of recently visited Web pages while offline.
Type of joint tenancy that provides the right of survivorship and is available only to a husband and wife. Compare with tenancy in common.
Type of joint tenancy without the right of survivorship. Compare with tenancy by the entirety and with joint tenancy.
The loan term is the number of months that you will make monthly payments. If the loan term is the same as the payment calculation term, you will pay the loan in full during the loan term and no balance will be due. If the payment calculation term is greater than the loan term, a balance or "balloon payment" may be due at the end of the loan term.
Third party fees are usually fees that the lender will collect and pass on to the person who actually performed the service. For example, an appraiser is paid the appraisal fee, a credit bureau is paid the credit report fee and a title company or an attorney is paid the title insurance fees.
Examples of fees that we consider third party fees include the appraisal fee, the credit report fee, the settlement or closing fee, the survey fee, tax service fees, title insurance fees, flood certification fees, and courier/mailing fees.
Typically, you’ll see some minor variances in third party fees from lender to lender since a lender may have negotiated a special charge from a provider they use often or chooses a provider that offers nationwide coverage at a flat rate. You may also see that some lenders absorb minor third party fees such as the flood certification fee, the tax service fee or courier/mailing fees.
A deposit account carrying a specified maturity date, usually bearing interest and restricting the depositor's ability to make withdrawals before the maturity date.
A legal written instrument evidencing a person's lawful possession of a property.
A company that specializes in examining titles to real estate and issuing title insurance.
A fee charged by a title company or attorney in some states to cover the cost of searching the public record to make sure the buyer is purchasing a house from the legal owner and there are no liens, overdue assessments, or other claims filed that would adversely affect the transfer of the title. For our comparison purposes, a title examination fee is considered to be a third party fee and may be included in the title insurance fee by some lenders.
An insurance policy that protects the lender (and sometimes the property owner as well) against loss due to disputes over the ownership of a property and defects in the title that were not found in the search of the public record. For our comparison purposes, the title insurance cost is considered to be a third party fee.
A statement issued by an attorney as to the quality of title after examining an abstract of title. Also, referred to as an Attorney Opinion. For our comparison purposes, a title opinion fee is considered to be a third party fee and may be included in the title insurance fee by some lenders.
An examination of the public title records to determine the legal ownership of a property, and to ensure that there are no liens, encumbrances or other claims outstanding.
This is the total of all the items that must be paid at closing related to your new mortgage. Since the exact charges for some of these items cannot be obtained until the time of closing, the figure may only be an estimate.
A standard calculation performed by mortgage lenders to determine if a borrower qualifies for a specific loan type. It is calculated by dividing the monthly housing expense (Principal, Interest, Taxes and Insurance plus all other monthly debt obligation) by the borrower's monthly gross income. Also referred to as a back end ratio or a bottom ratio.
Equity that results from a buyer giving an existing property as trade for all, or part of, the down payment on the subject property.
(noun) A transaction is a single act of doing business.©2010 Wordsmyth
(verb) To transfer is to move or carry from one person or place to another.©2010 Wordsmyth (definition only)
Any legal method by which the ownership of property changes hands.
A negotiable instrument sold by a bank or other issuer in various denominations for the convenience of individuals who do not wish to carry cash. These checks are readily converted into cash upon proper identification, usually by a signature in the presence of the cashing party.
DEFINITION 1: The Treasury is the government department responsible for public money.
DEFINITION 2: A treasury is the money of a club, business, government, or other group.
An index used to establish interest rates for adjustable rate mortgages. It is based on the interest rate paid to private investors by the US Government to obtain funding for the national debt and other expenses. Sometimes called T-bills, they are available in denominations of 3-months, 6-months and 1-year. The 3-month and 6-month Treasury bills are auctioned every Monday, and the 1-year Treasury bills are auctioned on Tuesday. The resulting figures are released to the public the next day. This index can have either a weekly or a monthly value.
Negotiable, long-term U.S. Government debt obligation with a maturity of ten years or longer, issued in minimum denominations of $1,000.
An index that is used to determine interest rate changes for some adjustable-rate mortgage (ARM) programs. It is often based on the U.S. Treasury's daily yield curve.
An intermediate U.S. Government security with a maturity of 1 to 10 years. Denominations range from $1,000 to $1 million or more. The notes are sold by cash subscription, in exchange for outstanding or maturing government issues, or at auction.
An index used to establish interest rates for adjustable rate mortgages. It is based on the yields of actively traded 1-year, 3-year, or 5-year Treasury Securities adjusted to constant maturities. The Treasury Security indices are calculated by the U.S. Treasury and reported by the Federal Reserve Board. These indices have either a weekly or a monthly value. The weekly indices are released on Monday afternoon for the previous week. Monthly values for these indices are generally available on the first Monday of the following month.
A fiduciary relationship in which one person (the trustee) is the holder of legal title to property (the trust property) subject to an equitable obligation (an obligation enforceable in a court of equity) to keep or use the property for the benefit of another personal (beneficiary).The Glossary of Fiduciary Terms, second edition, published by the American Bankers Association
A fiduciary who holds property in trust for another to secure performance of an obligation or act.
The parties named in a trust document who have responsibility to hold assets for the participants. Some plan documents also give investment responsibility to the trustees.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
Also known as Regulation Z, this federal regulation requires a lender to provide borrowers with a disclosure estimating the costs of the loan including your total finance charge and the Annual Percentage Rate (APR) within three business days of the application for a loan. This act is designed to provide consumers with a standard method of comparing the financing costs from lender to lender.
Detailed process of evaluating a borrower's loan application to determine the risk involved for the lender. Underwriting usually involves an in-depth analysis of the borrower's credit history, as well as an examination of the value and quality of the subject property.
An ownership right to use and occupy property that is shared among more than one owner. No single co-owner may have exclusive rights or possession to any part of the property.
Group of laws that are applicable to commercial transactions. Only a few of the laws have relevance to real estate transactions.
Bank credit extended without collateral.
FHA charges the borrower an Upfront Mortgage Insurance Premium (Upfront MIP) for most transactions to financially support the FHA program. This fee is a percentage of the principal loan amount and is due at closing. The full amount can be financed as part of the loan amount or paid in cash.
An acronym for “Uniform Resource Locator”; An Internet address (for example, http://www.hmco.com/trade/), usually consisting of the access protocol (http), the domain name (www.hmco.com), and optionally the path to a file or resource residing on that server (trade).The American Heritage® Dictionary of the English Language, Fourth Edition copyright ©2000 by Houghton Mifflin Company. Updated in 2009. Published by Houghton Mifflin Company. All rights reserved.
The percentage of all units or space that is not leased, not rented or is unoccupied.
Land that is not currently being used.
To move out of a premises.
A home used by the owners only occasionally or seasonally, primarily for recreational purposes.
A document or contract that has legally binding force.
A document or contract that has legally binding force.
A loan that allows the lender to make periodic adjustments in the interest rate, according to fluctuating market conditions.
Having the right or privilege to use a portion of a fund, such as an individual retirement account (IRA).
Benefits that become nonforfeitable with respect to a participant as the result of the passage of time or the occurrence of an event such as retirement or plan termination.WK: 401(k) Answer Book - Great West Retirement Services, Glossary - © 2011 Wolters Kluwer
The voluntary abandonment or surrender of some claim, right, or privilege.
A term used for “Internet-Initiated Entry”; an entry that is initiated via the internet by purchasing something from a businesses website.©2011 NACHA - The Electronic Payments Association® All rights reserved.
Often simply called a “browser”; a software program that facilitates entry to and usage of the internet. The three most popular browsers are Microsoft Internet Explorer, Firefox and Safari.The American Heritage® New Dictionary of Cultural Literacy, Third Edition
A formal, written, witnessed instrument by which a person gives instructions for the deposition of his or her estate.
A transaction by which funds are moved electronically from one bank to another, upon a customer's instructions.
(verb) To withdraw is the act of taking money out of an account.
Mr. Perez will withdraw one hundred dollars from his bank account.
(noun) A withdrawal is the amount of money that is taken out of the account.
His withdrawal was one hundred dollars.
An acronym for “World Wide Web”; the beginning of a URL address (example: www.texasbankandtrust.com)
(verb) To yield is to gain money on your savings and investment.
(noun) A yield is the amount of money gained on your savings and investment.
A measurement of the rate of earnings from an investment, usually expressed as a percentage.
The internal rate of return on an investment. Typically takes into account all investment returns and their timing.