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Georgia Real Estate
Chapter 15
| Term | Definition |
|---|---|
| Adjustable Rate Mortgage | A mortgage where the interest rate rises and falls with changes in prevailing interest rates. |
| Negative Amortization | Accrual of interest on a loan balance so that, as loan payments are made, the balance rises |
| Graduated Payment Mortgage | A mortgage with an interest and maturity that are fixed, but with a monthly payment that gradually rises because the initial monthly payments are insufficient to fully amortize the loan. |
| Equity Sharing | An arrangement whereby a party providing financing gets a portion of the ownership |
| Package Mortgage | A mortgage that secures personal property in addition to real property |
| Blanket Mortgage | A mortgage secured by two or more properties. |
| Reverse Annuity Mortgage | A loan to the homeowner where by periodic payments are made to the homeowner from the lender; typically for person of 62 years of age or older |
| Construction Loan | A short-term loan for new construction or remodeling of an existing structure; also called an interim loan. |
| equity mortgage | a loan where the lender agrees to make a loan based on the amount of equity in a borrower’s home |
| Wraparound Mortgage | A mortgage that encompasses any existing mortgage and is subordinate to them |
| Seller Financing | A note accepted by a seller instead of cash |
| Subordination | The act of yielding to another. In finance this mean one mortgage would take a lower position to a current mortgage. |
| Contract for deed | enables the seller to finance a buyer by permitting him to make a down payment followed by monthly payments. |
| illegal flipping | is purchasing a property and then selling it immediately at a fraudulent and increased price. |
| Option | is a right, for a given period of time, to buy, sell, or lease property at a specified price and terms. |
| Silent Second | involves increasing the sales price fraudulently and asking the seller to take a second loan with the increase in purchase price. |
| Chunking | is a scheme where the borrower makes multiple, simultaneous applications for a loan on one property. |
| Sale and Leaseback | an owner-occupant sells the property and then remains as a tenant |
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