Vocab – Lesson 3

vocabulary property guidingA little cheat sheet to help you understand some of the types of documents you might see at your closing.

1. Affidavit
– A sworn statement in writing.

2. Deed
– A written document by which the ownership of land is transferred from one person to another.

3. Deed of Trust
– An instrument used in many states in place of a mortgage. Property is transferred to a trustee by the borrower (trustor), in favor of the lender (beneficiary), and reconveyed (satisfied) upon payment in full.

4. HUD 1
– A form settlement (closing) statement required by the U.S. Department of Housing and Urban Development (HUD), where federally related mortgages are made on residential properties. It is a balance sheet showing the source of funds and the distribution of funds in connection with the purchase and/or mortgaging of residential property.

5. Mortgage
– An instrument used to encumber land as security for a debt.

6. Note
– The instrument evidencing the indebtedness. A note is usually secured by a security instrument such as a mortgage or deed of trust.

7. Power of Attorney
– An instrument authorizing another to act on one’s behalf in legal matters.

8. Second Mortgage
– A second loan on real estate that already has a mortgage. It is subordinate to the first mortgage. Usually of shorter term and often at a higher interest rate.

9. Truth-In-Lending Disclosure
– Federal legislation designed to protect borrowers by requiring lenders to furnish information in writing regarding the cost of the loan. The law requires interest to be expressed as the annual percentage rate (APR) to the nearest 1/8 of one percent. It also requires disclosure of the finance charge, amount financed, total of payments, payment schedule, late payment fees, and other items.

Look for lesson 4 in the coming weeks!
Call us for any of your title needs or questions 239-415-6574!!

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Posted on August 10, 2012, in Title and tagged , , , , , , , , , , , , , , , , , , . Bookmark the permalink. Leave a comment.

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