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Due-on-Sale-Clause
Provision in a mortgage or deed of trust which enables the lender to demand instant payment of the mortgage balance if the mortgage holder sells the property. |
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Down Payment
Sum of money the buyer puts down. It is usually anywhere from 5-25%.
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Discounted Loan
The lender requires additional points to raise the yield on the loan to the market rate when the note rate on a loan is less than the market rate.
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Discount Point
Sum of money payable to the lending institution by the borrower or seller to increase the lender's effective yield. One point equals one percent of the total loan amount. |
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Depreciation
When age causes real property to lose value. Also caused by physical deterioration, functional or economic obsolescence. |
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Deposit (earnest money)
Amount of money which is given to bind a real estate sale. |
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Department of Veterans Affairs
Autonomous agency of the federal government which guarantees long- term, low-or no-down payment mortgages to qualified veterans.
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Deminimus PUD
A PUD in which the ordinary property has less than a 2% influence upon the value of the premises. The 2% rule of thumb is calculated by dividing the dollar amount of amenities by the total number of units. |
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Delinquency
Failure to make prompt payments. This can bring about foreclosure.
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Default
Failure to meet contractual legal obligations, usually failure to make the mortgage monthly payments. |
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Deed of Trust
Legal document that affects the ownership transfer of real estate from the seller to the buyer. |
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Debt Ratio (Obligations Ratio)
One of a number of financial calculations which are executed by a lender to determine whether a borrower can afford a monthly payment. The debt ratio is the total amount of all the monthly debt payments plus the total monthly mortgage payment divided by the total monthly income. Normally acceptable debt ratios for Conventional Loans are 36-38%, FHA Loans are 41-43%, and VA Loans are 41%. |
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