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Ch 14: Real Estate Financing Principles

Ch 14: Real Estate Financing Principles - Term Definition...

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Term: acceleration clause Definition: The clause in a mortgage or deed of trust that can be enforced to make the entire debt due immediately if the borrower defaults on an installment payment or other covenant Term: Alienation Clause Definition: Also know as "due on sale" clause permits lender to declare balance of loan immediately due if property is sold; prevents loan assumption without lender approval Term: Deed in Lieu of Foreclosure Definition: Used by the mortgagor (borrower) who is in default to convey the property to the mortgagee (lender) in order to eliminate the need for a foreclosure. Term: Deed of Trust Definition: A deed to real property, which serves the same purpose as a mortgage, involving three parties instead of two. The third party holds naked title for the benefit of the lender. Beneficiary (Lender), Trustor (Borrower), Trustee (Third Party)
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Term: Deficiency Judgment Definition: Personal judgment levied against the borrower when a foreclosure sale does not produce sufficient funds to pay fully the mortgage debt Term: Discount Point Definition: Unit of measurement used for various loan charges; one point equals one percent of the loan amount Term: Hypothecation Definition: To pledge property as security for loan obligation without giving up possession of it; opposite of practice
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