|
|
GLOSSARY OF MORTGAGE TERMS:
Page 1 of 1 | 13 terms beginning with 'D' Deed of Trust Like a mortgage, a security instrument whereby real property is given as security for a debt. However, in a deed of trust there are three parties to the instrument: the borrower, the trustee, and the lender, (or beneficiary). In such a transaction, the borrower transfers the legal title for the property to the trustee who holds the property in trust as security for the payment of the debt to the lender or beneficiary. If the borrower pays the debt as agreed, the deed of trust becomes void. If, however, he defaults in the payment of the debt, the trustee may sell the property at a public sale, under the terms of the deed of trust. In most jurisdictions where the deed of trust is in force, the borrower is subject to having his property sold without benefit of legal proceedings. A few States have begun in recent years to treat the deed of trust like a mortgage. Deed-in-lieu A deed given by a mortgagor to the mortgagee to satisfy a debt and avoid foreclosure. Also called a "voluntary conveyance." Default Failure to make mortgage payments on a timely basis or to comply with other conditions of a mortgage. Deficiency Judgment A court order to pay the balance owed on a loan if the proceeds from the sale of the security are insufficient to pay off the loan. Deficiency judgments are not allowed in all states. Delinquency A loan in which a payment is overdue but not yet in default. Deposit A sum of money given to bind the sale of real estate, or a sum of money given to ensure payment or an advance of funds in the processing of a loan. Depreciation A decline in the value of property; the opposite of "appreciation." Discount Points See Points. Documentary Stamps A State tax, in the forms of stamps, required on deeds and mortgages when real estate title passes from one owner to another. The amount of stamps required varies with each State. Dower The rights of a widow in the property of her husband at his death. Down Payment The part of the purchase price, which the buyer pays in cash and does not finance with a mortgage Due-on-sale provision A provision in a mortgage that allows the lender to demand repayment in full if the borrower sells the property that serves as security for the mortgage. Due-on-transfer provision This terminology is usually used for second mortgages. |