Fannie Mae (Federal National Mortgage Association/FNMA)

FNMA is one of the major secondary market investors that purchases loans from mortgage companies and other depository institutions. The company is a private corporation and its stock is traded on the New York Stock Exchange.

Federal Home Board

The board which oversees the Federal Home Loan Bank systems.

Federal Home Loan Bank

Provides liquidity to supervised financial service companies, such as savings and loans and credit unions. The bank system has several districts.

Federal Home Loan Board

The board which charters and forbids discrimination in the sale.

Federal Home Loan Mortgage Corporation (Freddie Mac/FHLMC)

A government sponsored agency that is also a publicly traded company on the New York Stock Exchange that purchases mortgage loans from mortgage bankers and financial depository institutions. FHLMC is a major secondary market investor.

Federal Housing Administration

A federal agency which insures first mortgages, enabling lenders to loan a very high percentage of the sale price.

Federal Reserve Bank

The regulatory agency for certain commercial banks and bank holding companies. Sets monetary policy for the country and provides liquidity for supervised financial institutions.

Federal Tax Lien

A lien attached to property for nonpayment of a federal tax.

Federal Tax Return

The U.S. government's method to identify individual and company's annual tax responsibility. The tax returns identify the income and taxes.

Fee Simple

Highest possible degree of ownership of land. The estate allows owners to have unrestricted powers to dispose of property, and which can be left by will or inherited.

Fiduciary

A person in a position of trust or responsibility with specific duties to act in the best interest of a client. Real estate brokers and mortgage brokers are fiduciaries.

First Mortgage

Mortgage holding priority over the claims of subsequent lenders against the same property.

Fixture

Personal property affixed to structures or land, usually in such manner that they cannot be independently moved without damage to themselves or the property housing, supporting, or pertintent to them. Varies under state laws.

Foreclosure

A proceeding in or out of court to extinguish all rights, title and interest of the owner(s) of a property in order to sell the property and satisfy a lien against it.

Fredde Mac

See Federal Home Loan Mortgage Corporation.

Full Disclosure

Revealing all known facts which may affect the decision of a buyer or tenant.

Functional Obsolescence

Impairment of functional capacity or efficiency. For example, homes without indoor plumbing (while they may contain working outdoor plumbing facilities) are considered functionally obsolete.

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General Lien

A lien such as a tax lien or judgement lien, which attaches to all property of the debtor rather than the lien of, for example, a trust deed, which attaches only to a specific property.

General Warranty Deed

A deed which conveys not only all the grantor's interests in and title to the property to the grantee, but also warrants that if the title is defective or has a "cloud" on it (such as mortgage claims, tax liens, title claims, judgements, or mechanic's liens against it) the grantee may hold the grantor liable.

Government National Mortgage Association (GNMA/Ginnie Mae))

A government owned agency that acts as a secondary market conduit for FHA and VA loans. GNMA guarantees the timely principal and interest payments to investors.

Grandfather Clause

The clause in a law permitting the continuation of a use, business, etc., which was permissible but because of a change in the law is now no longer permissible.

Ground Rent

Rent paid for vacant land. If the property is improved, ground rent is the portion attributable to the land only.

Grantee

The buyer, who receives a deed.

Grantor

The seller, who gives a deed.

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Hazard Insurance

Insurance on a property against damages caused by fire, wind storms, and similar risks.

Heirs and Assigns

One who might inherit or succeed to an interest in a property under the rules of law applicipable when a property owner dies.

Holographic Will

Will written in the testator's handwriting and not witnessed.

Homeowners Association

An association of people who own homes in a given area for the purpose of improving or maintaining the quality of the area.

Homeowner's Policy

Policy which expands the insurance for a homeowner. It may include theft, liability, earthquake, etc.

Homeowner's or Maintenance Fees

Payments made by property owner(s) of a condominium or a unit in PUD to the homeowners' association for expenses incurred in upkeep of the common areas.

Homestead

Tract of land occupied as a family home.

Housing and Urban Development (HUD)

The federal government agency that oversees FHA.

HUD 1

A closing document required by HUD that outlines the settlement cost of a loan. The closing agent generally prepares the document and buyer receives it shortly after the loan is closed.

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Impound Account

Account held by a lender for payment of taxes, insurance or other related expenses. Also known as an escrow account.

Improvement

Valuable additions to property which raise the value of the property.

Incidental Recording, Delivery, Wire, etc., Fees

Other costs that are incurred when a real estate loan is closed.

Index

A published rate or benchmark measure of current interest rate levels used to calculate periodic changes in rates charged on adjustable rate mortgages.

Installment Sale

A tax term used to describe a sale which is usually accomplished by use of a land contract.

Insured Mortgage

A mortgage insured against loss to the mortgagee (lender) in the event of default and failure of the mortgaged property to satisfy the balance owing plus cost of foreclosure.

Interest Payment Notification (1098)

A federal tax form that lenders use at year end to notify borrowers of the interest that was paid on their mortgage over the last year.

Interest Rate

The percentage of an amount of money which is paid for its use for a specified time.

Intestate

Someone who has died without leaving a valid will.

Investment Property

A property that is not occupied by the owner and in most cases produces income or is held for gains from appreciation.

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Joint and Several Liability

A liability which allows the creditor to sue any one of the debtors or sue all together.

Joint Tenancy

An undivided interest in property taken by two or more joint tenants. The interests must equal, accruing under the same conveyance and beginning at the same time. Upon death of a joint tenant, the interest passes to the surviving joint tenants rather than to the heirs of the deceased.

Judgment

The decision of a court of law. Money judgments, when recorded, become a lien on real property of the defendant.

Junior Mortgage

A mortgage subordinate to another mortgage.

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