GLOSSARY

This glossary is Alphabetical please choose your letter below.

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

 

r

Radon
A radioactive gas found in some homes that, if occurring in strong enough concentrations, can cause health problems.

 

Rate Cap
The limit on the amount that the interest rate on an ARM can increase or decrease during any one adjustment period.

 

Rate Protection
Protection for a borrower against the danger that rates will rise between the time the borrower applies for a loan and the time the loan closes. This protection can take the form of a "lock" where the rate and points are frozen at their initial levels until the loan closes; or a "float-down" where the rates and points cannot rise from their initial levels but they can decline if market rates decline. In either case, the protection only runs for a specified period.

 

Ratified Sales Contract
A contract that shows both you and the seller of the house have agreed to your offer. This offer may include sales contingencies, such as obtaining a mortgage of a certain type and rate, getting an acceptable inspections, making repairs, closing by a certain date, and the like. Also known as a fully executed contract.

 

Real Assets
Real estate or real property owned by an individual or business.

 

Realtor
A real estate broker or an associate holding active membership in a local real estate board affiliated with the National Association of Realtors.

 

Real Estate Agent
An individual who is licensed to negotiate and arrange real estate sales; works for a real estate broker. The real estate professional is paid a percentage of the home sale price by the seller. Unless you have specifically contracted with a buyer's agent, the real estate professional represents the interest of the property seller. Real estate professionals may be able to refer you to local lenders or mortgage brokers, but are generally not involved in the lending process.Also known as real estate professional.

 

Real Estate Mortgage Investment Conduit (REMIC)
A security that represents a beneficial interest in a trust having multiple classes of securities. The securities of each class entitle investors to cash flows structured differently from the payments on the underlying mortgages.

 

Real Estate Settlement Procedures Act ( RESPA )
A federal law that allows consumers to review information known or estimated settlement cost once after application and once prior to or at a settlement. The law requires lenders to furnish the information after application only.

 

Real Property
Land and that which is affixed to it.

 

Recast Payment
Raising the mortgage payment to the fully amortizing payment. Periodic recasts are sometimes used on ARMs in lieu of negative amortization caps.

 

Recession ( Recission )
With respect to refinancing, The cancellation of a contract. With respect to mortgage refinancing, the law that gives the homeowner three days to cancel a contract in some cases once it is signed if the transaction uses equity in the home as security. This means the money for refinance is not disbursed till after the 3 days are up. The only exception would be an emergency. Also know as "right of recission". See also recission period.

 

Recording Fees
Money paid to the lender for recording a home sale with the local authorities, thereby making it part of the public records. The record is given a official records book and page number making it easy to find.

 

Recission Period
The rescission period is the time during which you have an opportunity to review the documents and legal disclosures provided to you at closing. All loans secured by primary residences allow for this review time. During this time, you have the right to cancel this transaction at no cost to you. You may exercise this right until midnight of the third business day after loan closing or delivery of the required disclosures (whichever is later); therefore Lenders are not able to fund the loan until the rescission period has expired. You will receive a detailed notice of your rights regarding rescission with your closing documents.

 

Refinance
Obtaining a new mortgage loan on a property already owned. Often to replace existing loans on the property. Also called refinancing.

 

Rehabilitation Mortgage
A mortgage that covers the costs of rehabilitating (repairing or Improving) a property. Commonly called a rehab loan or rehab mortgage. Some rehabilitation mortgages like the FHA's 203(k) allow a borrower to roll the costs of rehabilitation and home purchase into one mortgage loan.

 

Repayment Plan
An agreement between a lender and a borrower who is delinquent on his or her mortgage payments, in which the borrower agrees to make additional payments to pay down past due amounts while still making regularly scheduled payments.

 

Replacement Cost
The cost to replace damaged personal property without a deduction for depreciation.

 

Required Cash
The total cash required of the home buyer to close the transaction, including down payment, points and fixed dollar charges paid to the lender, any portion of the mortgage insurance premium that is paid up-front, and other settlement charges associated with the transaction such as title insurance, taxes, etc. The total required cash is shown on the Good Faith Estimate of Settlement that every borrower receives.

 

Return on Average Common Equity
Net income available to common stockholders, as a percentage of average common stockholders' equity.

 

Reverse Mortgage
A financial tool which provides seniors with funds from the equity in their homes. Generally, no payments are made on a reverse mortgage until the borrower moves or the property is sold. The final repayment obligation is designed to not exceed the proceeds from the sale of the home.

 

Reverse Annuity Mortgage (RAM)
A form of mortgage in which the lender makes periodic payments to the borrower using the borrower's equity in the home as Satisfaction of Mortgage (The document issued by the mortgagee when the mortgage loan is paid in full.

 

Risk Based Capital
The amount of capital necessary to absorb losses throughout a hypothetical ten-year period marked by severely adverse circumstances.