| DBA |
Doing Business As. Business names or aliases filed with the
county. |
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| Debenture |
Bonds issued without security. |
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| Debt |
An amount owed to another. See installment loan and revolving
liability. |
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| Debt Service |
The total amount of credit card, auto, mortgage or other debt
upon which you must pay. |
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| Debt-to-income Ratio |
The ratio, expressed as a percentage, which results when a
borrower's monthly payment obligation on long-term debts is divided by his or
her gross monthly income. |
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| Debt-Service Ratio |
The measurement of debt payments to gross household income
which may include, in addition to the main wage earner's salary, salaries of
other wage earners, commissions, bonuses, overtime, etc. |
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| Deceptive Trade Practices Act |
Part of the federal Consumer Protection Act originally passed
in 1973 and made specifically applicable to real estate in 1975, specifically
prohibiting a lengthy number of false, misleading and deceptive acts or
practices. |
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| Declaration of Restrictions |
A set of restrictions filed by a subdivider to cover an entire
tract or subdivision. |
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| Deed-In-Lieu |
A deed given by a borrower to the lender to satisfy a debt and
avoid foreclosure. Also called a "voluntary conveyance." |
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| 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. |
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| Deed |
A formal written instrument by which title to real property is
transferred from one owner to another. The deed should contain an accurate
description of the property being conveyed, should be signed and witnessed
according to the laws of the State where the property is located, and should be
delivered to the purchaser at closing day. There are two parties to a deed: the
grantor and the grantee. (See also deed of trust, general warranty deed,
quitclaim deed, and special warranty deed.) |
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| Default |
Failure to make mortgage payments as agreed to in a commitment
based on the terms and at the designated time set forth in the mortgage or deed
of trust. It is the mortgagor's responsibility to remember the due date and
send the payment prior to the due date, not after. Generally, thirty days after
the due date if payment is not received, the mortgage is in default. In the
event of default, the mortgage may give the lender the right to accelerate
payments, take possession and receive rents, and start foreclosure. Defaults
may also come about by the failure to observe other conditions in the mortgage
or deed of trust. |
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| Defeasanse |
A provision or condition in a deed or in a separate instrument
which, being performed, renders the instrument void. |
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| Defective Title |
Title to a negotiable instrument obtained by fraud. Title to
real property which lacks some of the elements necessary to transfer good
title. |
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| Delinquency |
A loan payment that is overdue but within the period allowed
before actual default is declared. |
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| Delivery |
The actual transfer of the deed, or an act of a seller showing
intent to make a deed effective, without which, there is no transfer of title
to the property. |
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| DeMinimus PUD |
A PUD in which the common 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. Also see
PUD. |
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| 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. See earnest money deposit. |
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| Depreciation |
A decline in the value of property because of physical or
economic changes such as wear and tear; the opposite of appreciation. |
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| Descent |
Acquisition of property through inheritance laws when there is
no will. |
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| Devise |
A transfer of real estate by will or last testament. |
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| Devisee |
A person who receives real estate from another by will. |
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| Devisor |
A testator who leaves real estate. |
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| Direct Reduction Mortgage |
An amortized mortgage. One on which principal and interest
being computed on the remaining balance. |
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| Disbursements |
Payments made during the course of an escrow or at closing.
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| Disclosure Report |
Residential real property disclosure act, effective since
October 1, 1994 in Illinois. Is an act relating to disclosure by the seller of
residential real property. The purpose of this report is to provide prospective
buyers with information about material defects in the residential real
property. |
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| Discount Points or Points |
Any amount paid to the lender when a loan is originated to
account for the difference between the current market-determined cost of
interest and the actual lower interest rate of the loan. In most cases each
point is equal to one percent of the original loan amount. Points may be paid
by either the buyer or seller. |
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| Discount Rate |
(1) The rate charged member banks who borrow from the Federal
Reserve System. (2) The rate used to convert future income into present value.
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| Discount |
Is an ARM with an initial discount, the lender gives up a
number of percentage points of interest to give you a lower rate and lower
payments for part of the mortgage term. After the discount period, the ARM rate
will probably go up depending on the index rate. |
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| Discount Points or Points |
Any amount paid to the lender when a loan is originated to
account for the difference between the current market-determined cost of
interest and the actual lower interest rate of the loan. In most cases each
point is equal to one percent of the original loan amount. Points may be paid
by either the buyer or seller. |
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| Discounted Loan |
When the not rate on a loan is less than the market rate, the
lender requires additional points to raise the yield on the loan to the market
rate. |
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| Dispossess |
To oust from land by legal process. |
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| Document Preparation |
This fee covers the expenses associated with this process of
preparing some of the legal documents that you will be signing at the time of
closing, such as the mortgage, note, and truth-in-lending statement. |
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| Documentary Tax Stamps |
Stamps, affixed to a deed, showing the amount of transfer tax.
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| Down Payment |
The down payment is the percentage of the purchase price that
the buyer must pay in cash and may not borrow from the lender. The down payment
amount in addition to the mortgage equals the purchase price of a property.
They can vary from 0% to over 50%. The less your down payment the better your
credit has to be. Lower down payments generally result in higher interest
rates. |
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| Dragnet Clause |
A clause in a mortgage or deed or trust which places the real
estate as security for existing debts between the parties. |
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| Draw Period |
The time period in which the borrower may access and use a
line of credit. |
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| Dual Agency |
In virtually all states it is unethical and illegal for a
broker to represent buyer and seller in a real estate transaction, however,
some states permit a real estate licensee to potentially act as a dual agent. A
licensee may legally act as a dual agent with the written disclosure and
informed consent of a consumer in form required by law. Since there is an
inherent conflict in fiduciary obligations to two different principals, dual
agency, at best, is a risky undertaking. |
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| Due on Sale |
A clause in a mortgage agreement providing that, if the
mortgagor (the borrower) sells, transfers, or, in some instances, encumbers the
property, the mortgagee (the lender) has the right to demand the outstanding
balance in full. |
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| Due-On-Transfer Provision |
This terminology is usually used for second mortgages. See
due-on-sale provision. |
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| Duress |
Forcing action or inaction against a person's will. |