A loan that allows someone to borrow more money by replacing the old mortgage with a larger one
What is a cash-out refinance loan?
100
A mortgage loan not insured by the federal government.
What is a conventional loan?
100
The ratio of a loan balance to the appraised value of a home.
What is LTV?
100
A document that discloses the terms and cost of a mortgage loan, including the APR.
What is the Truth in Lending Statement?
100
Special account set up by lender to pay for real estate property taxes and insurance when collected as part of the monthly loan payment.
What is an escrow account?
200
A fee charged by some lenders for paying off a mortgage early.
What is a prepayment penalty?
200
A second lien mortgage in which the loan can be paid down or additional funds drawn causing the balance to go up or down.
What is a home equity line of credit or HELOC?
200
The sum of all monthly debt payments divided by the borrower's income.
What is DTI?
200
A consumer right of borrowers who are refinancing or borrowing against their home equity that allows 3 days to cancel after signing.
What is the Right of Rescission?
200
A loan with fixed monthly payments based on a 30-year schedule on which the entire balance of the loan comes due at the end of a set period of time.
What is a balloon-payment mortgage?
300
A loan with fixed monthly payments based on a 30 year schedule on which the entire balance of the loan comes due at the end of a set period of time.
What is a balloon loan?
300
A type of loan in which the interest rate changes periodically, up or down, usually
once or twice a year.
What is an adjustable-rate loan?
300
FNMA, FHLMC, and the Federal Home Loan Banks.
What are GSEs?
300
FinCEN required all mortgage lenders to have this as of August 13, 2012
What is an Anti-Money Laundering Program?
300
The practice of a bank employee signing thousands of documents and affidavits without verifying the information contained in the document or affidavit.
What is Robo-signing?
400
An agreement by which a lender places its lien position behind that of another
lender.
What is subordination?
400
A type of insurance often required by a lender when the down payment is less than 20%
What is private mortgage insurance (PMI)?
400
Issuer of unique identifiers required of all mortgage originators.
What is NMLS?
400
Dispute resolution mechanism, (soon to be prohibited under Dodd-Frank) whereby an independent, neutral third party is appointed to oversee the dispute and render a financial binding decision.
What is arbitration?
400
A loss mitigation technique whereby a home is sold for less than the balance of the mortgage debt.
What is a short sale?
500
Refinancing that requires limited documentation and underwriting.
What is streamline refinancing?
500
A loan that allows the borrower to draw out equity and does not require monthly payments.
What is a reverse mortgage?
500
An electronic registry that tracks ownership or mortgage loans and servicing rights.
What is MERS?
500
The maximum interest rate that can be charged to military personnel during active service.
What is 6%?
500
When a lender is simultaneously pursuing both foreclosure and loan modification.