Insurance coverage that compensates for physical damage to a property
from fire, wind, vandalism, or other hazards.
Conversion Mortgage (HECM)
A special type of mortgage that enables older home owners to convert
the equity they have in their homes into cash, using a variety of payment
options to address their specific financial needs. Unlike traditional home
equity loans, a borrower does not qualify on the basis of income but on
the value of his or her home. In addition, the loan does not have to be
repaid until the borrower no longer occupies the property. Sometimes
called a reverse mortgage.
home equity line of credit
A mortgage loan, which is usually in a subordinate position, that
allows the borrower to obtain multiple advances of the loan proceeds at
his or her own discretion, up to an amount that represents a specified
percentage of the borrower's equity in a property.
A thorough inspection that evaluates the structural and mechanical
condition of a property. A satisfactory home inspection is often included
as a contingency by the purchaser. Contrast with appraisal.
Fannie Mae's adjustable-rate conventional reverse mortgage, which
allows older homeowners to borrow against the value of their homes and
receive the proceeds according to the payment option they select. The
amount available is based on the number of borrowers and their ages and
the adjusted property value. Anyone 62 years or older who either owns his
or her own home free and clear or has very low mortgage debt is eligible.
A nonprofit association that manages the common areas of a planned
unit development (PUD) or condominium project. In a condominium project,
it has no ownership interest in the common elements. In a PUD project, it
holds title to the common elements.
An insurance policy that combines personal liability insurance and
hazard insurance coverage for a dwelling and its contents.
homeowner's warranty (HOW)
A type of insurance that covers repairs to specified parts of a house
for a specific period of time. It is provided by the builder or property
seller as a condition of the sale.
HomeStyle® Mortgage Loan
A mortgage that enables eligible borrowers to obtain financing to
remodel, repair, and upgrade their existing homes or homes that they are
purchasing. See also HomeStyle Standard Mortgage, HomeStyle Remodeler,
HomeStyle Community Mortgage and HomeStyle Consumer Energy Loan.
housing expense ratio
The percentage of gross monthly income that goes toward paying housing
HUD median income
Median family income for a particular county or metropolitan
statistical area (MSA), as estimated by the Department of Housing and
Urban Development (HUD).
A document that provides an itemized listing of the funds that are
payable at closing. Items that appear on the statement include real estate
commissions, loan fees, points, and initial escrow amounts. Each item on
the statement is represented by a separate number within a standardized
numbering system. The totals at the bottom of the HUD-1 statement define
the seller's net proceeds and the buyer's net payment at closing. The
blank form for the statement is published by the Department of Housing and
Urban Development (HUD). The HUD-1 statement is also known as the "closing
statement" or "settlement sheet."