Home Improvement Loan,

RELEASE
The discharge or relinquishment of a right, claim or privilege. Releases involving real property transactions should be acknowledged and recorded.

AGREEMENT OF SALE
Contract signed by buyer and seller stating the terms and conditions under which a property will be sold.

PERCOLATION TEST
A hydraulic engineer's test of soil to determine the ability of the ground to absorb and drain water.

ESCROW
A transaction in which a third party acts as the agent for seller and buyer, or for borrower and lender, in handling legal documents and disbursement of funds.

HUD
Housing and Urban Development. A U.S. government agency established to implement federal housing and community development programs; oversees the Federal Housing Administration.

UNILATERAL CONTRACT
A contract in which one party makes an obligation to perform without receiving in return any express promise of performance from the other party, such as an open listing contract, where the seller agrees to pay a commission to the first broker who brings in a ready, willing and able buyer.

DEVELOPER
One who attempts to put land to its most profitable use by the construction of improvements.

DUE ON SALE CLAUSE
A form of acceleration clause found in some mortgages, especially savings and loan mortgages, requiring the mortgagor to pay off the mortgage debt when selling the secured property, thus resulting in automatic maturity of the note at the lender's option.

FIRST REFUSAL, RIGHT OF
The right of a person to have the first opportunity either to purchase or lease real property.

POINTS
A generic term for a percentage of the principal loan amount which the lender charges for making the loan; each point is equal to one percent of the loan amount.

EQUAL CREDIT OPPORTUNITY ACT (ECOA)
Federal law requiring creditors to make credit equally available without discrimination based on race, color, religion, national origin, age, sex, marital status or receipt of income from public assistance programs.

IMPROVED LAND
Real property whose value has been enhanced by the addition of on-site and off-site improvements such as roads, sewers, utilities, buildings, etc.; as distinguished from raw land.

BILL OF SALE
A written agreement by which one person sells, assigns or transfers his right to, or interest in, personal property to another.

OFFER
A promise by one party to act or perform in a specified manner provided the other party will act or perform in the manner requested.

OFFER AND ACCEPTANCE
The two components of a valid contract; a "meeting of the minds."

TERM
The period of time between the beginning loan date on the legal documents and the date the entire balance of the loan is due.

INVERSE CONDEMNATION
An action for "just compensation "brought by one whose property has been effectively "taken" or substantially interfered with or taken without just compensation

DEFAULT
Failure to meet legal obligations in a contract, including failure to make payments on a loan.

DEPOSIT
Money offered by a prospective buyer as an indication of good faith in entering into a contract to purchase; earnest money; security for the buyer's performance of a contract.

POCKET LISTING
A listing which is retained by the listing broker or salesperson, who does not make it available to other brokers in the office or to other Multiple Listing Service members.

BLANKET MORTGAGE
A mortgage that covers more than one parcel of real estate.

NON-COMPETITION CLAUSE
A provision in a contract or lease prohibiting a person from operating or controlling a nearby business which would compete with one of the parties to the contract.

POINT OF BEGINNING
The starting point in a metes and bounds description of property, which is usually a street intersection or a specific monument.

CAPS (PAYMENT)
Consumer safeguards which limit the amount monthly payments on an adjustable-rate mortgage may change. Since they do not limit the amount of interest the lender is earning, these consumer safeguards may cause negative amortization.

FIXED-RATE LOANS
Fixed-rate loans have interest rates that do not change over the life of the loan. As a result, monthly payments for principal and interest are also fixed for the life of the loan. Fixed-rate loans typically have 15-year or 30-year terms. With a fixed-rate loan, you will have predictable monthly mortgage payments for as long as you have the loan.

OPEN-END MORTGAGE
A mortgage in which the borrower is given a limit up to which he may borrow, with any incremental advances of money up to but not exceeding the original borrowing limit to be secured by the same mortgage.

ASSIGNMENT
The transfer of the right, title and interest in the property of one person, the assignor, to another, the assignee. In real estate, there are assignments of mortgages, contracts, agreements of sale, leases, and options, among others.

JUNIOR MORTGAGE
A mortgage which is subordinate in right or lien priority to an existing mortgage on the same realty, such as a second mortgage.