S.I. / Statement of Information – The form the customer fills out for the title company giving further identification of the customer. This allows the title company to eliminate debts and liens owed by people with similar names.
Second Mortgage – A mortgage which is entered after the primary loan. Called a second due to it being the second lien position to the first mortgage.
Secondary Financing – Financing obtained, subordinate to the first mortgage, to facilitate closing the first mortgage. Also known as a “piggyback” loan.
Servicing – All the steps and operations a lender perform to keep a loan in good standing, such as collection of payments, payment of taxes, insurance, property inspections and the like.
Shared Appreciation Mortgage (SAM) – A mortgage in which a borrower receives a below-market interest rate in return for which a lender (or another investor such as a family member or other partner) receives a portion of the future appreciation in the value of the property. May also apply to mortgages where the borrower shares the monthly principal and interest payments with another party in exchange for a part of the appreciation.
Submission – This refers to a complete loan application package submitted for approval to the underwriting department.
Subordination Agreement – The agreement detailing the contingencies of subordination, filed with the county recorder. If a lien holder agrees to accept a lien position after that of a later recorded lien.
Substitution of Trustee – A document, filed by the beneficiary, which changes the trustee on a particular trust deed
Surety Bond – A bond which ensures against harm to a party (usually the lender or owner) by a lien still attached to the property. This is usually used when the original deed was lost or the beneficiary cannot be located.
Survey – A measurement of land prepared by a registered land surveyor showing the location of the land with reference to known points, its dimensions, and the location and dimensions of any building.
Suspended – The underwriter cannot yet approve or deny the loan. More information is required.
Tenants in Common – A percentage interest in a property by two or more individuals without rights of survivorship.
Title Insurance– The insurance policy insuring the lender and/or the buyer that the liens are as stated in the title report. Any claim arising from a lien other than that disclosed is payable by the title insurance company.
Title Search – An examination of municipal records to determine the legal ownership of property. Usually is performed by a title company.
Title – A document that gives evidence of an individual’s ownership of property.
Trust Deed – The Trust Deed attaches the note as a lien on the property. This is the document which conveys the ability to collect from the proceeds of the property.
Truth-in-Lending – A federal law requiring disclosure of the Annual Percentage Rate to homebuyers shortly after they apply for the loan. Also known as a TIL
Two-Step Mortgage -A mortgage in which the borrower receives a below-market interest rate for a specified number of years (most often seven or 10 years), and then receives a new interest rate adjusted (within certain limits) to market conditions at that time. The lender sometimes has the option to call the loan, due within 30 days notice at the end of seven or 10 years. Also called “Super Seven” or “Premier” mortgage.
Underwriting – The decision whether to make a loan to a potential homebuyers based on credit, employment, assets, and other factors and the matching of this risk to an appropriate rate and term or loan amount.
VA Loan – A long-term, low-or no-down payment loan guaranteed by the Department of Veterans Affairs. Restricted to individuals qualified by military service or other entitlements.
VA Mortgage Funding Fee – A premium of up to 2 percent (depending on the size of the down payment) paid on a VA-backed loan. On a $75,000 30-year fixed-rate mortgage with no down payment, this would amount to $1,406 either paid at closing or added to the amount financed.
Verification of Deposit (VOD) – A document signed by the borrower’s financial institution verifying the status and balance of his/her financial accounts.
Verification of Employment (VOE) – A document signed by the borrower’s employer verifying his/her position and salary.
Wraparound – Results when an existing assumable loan is combined with a new loan, resulting in an interest rate somewhere between the old rate and the current market rate. The payments are made to a second lender or the previous homeowner, who then forwards the payments to the first lender after taking the additional amount off the top.
Zoning – The division of a city or county by legislative regulations into areas (zones) specifying the uses allowable for the real property in these areas.