| DATE DOWN ADDENDUM |
An update to the Preliminary Title Report/Title Commitment that reflects
any changes to title since the original title report was prepared. Same
as UPDATE ADDENDUM.
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| DD Form 13 |
Statement of Service document that may be issued when a veteran is still
on active duty to verify military service.
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| DD Form 214 |
Report of Separation From Active Duty form for veterans separated after
January 1, 1950.
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| Debt |
Borrowed money, the repayment of which may be either secured or
unsecured, with various possible repayment schedules.
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| DEBT CONSOLIDATION LOAN |
A loan that combines debt obligations into one debt.
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| DEBT LOAD |
The total amount of debt a customer currently owes.
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| DEBTOR |
One who owes debt.
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| Debt-To-Income Ratios |
Calculations that are used to determine if a
borrower can qualify for a mortgage. These calculations include a
monthly housing expense-to-income ratio and a total
obligations-to-income ratio.
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| Deed-In-Lieu |
Deed given by a mortgagor to the mortgagee to satisfy a
debt and avoid foreclosure. Also known as a voluntary conveyance.
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| DEED OF RECONVEYANCE |
A document used to transfer legal title from the trustee back to the
borrower after a debt secured by a deed of trust has been paid in full.
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| Deed of Trust |
Document used in place of a mortgage in some states. A
type of security instrument conveying title in trust to a third party
covering a particular piece of property. It is used to secure the
payment of a Note. A conveyance of the title land to a trustee as
collateral security for the payment of a debt, with the condition that
the trustee shall reconvey the title upon the payment of the debt, and
with power of the trustee to sell the land and pay the debt in the event
the debtor defaults on the debt.
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| Deed Restriction |
In a deed, limits or restricts the use of the real property.
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| Default |
Breach or nonperformance of the terms of a Note or the covenants of a
mortgage.
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| Defeasance Clause |
Clause in a mortgage that gives the mortgagor the
right to redeem property upon the payment to the mortgagee of the
obligation due.
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| Deferred Maintenance |
Physical depreciation or loss in value of a
building or property resulting from maintenance functions not being
performed in a timely way. Often referred to as curable physical
depreciation.
|
| Deferred Interest |
Interest rate being added to
principle balance due to making minimum payment which is less than
interest only payment. Also called, Negative Amortization.
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| DELINQUENCY |
Failure to make payments when due.
|
| Deficiency Judgment |
Court order to pay the balance owed on a loan if
the proceeds from the sale of the security are insufficient to pay off
the loan.
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| DEMAND |
A letter from a lender showing the total amount due to pay off a
mortgage or trust deed, inclusive of unpaid principal, interest, impound
amounts, prepayment penalty, etc. Also, known as a Demand for Payoff
Request or Beneficiaries Demand Letter.
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| DEMAND FEATURE |
A feature that defines circumstances under which the remaining principal
and interest amount of the loan is due and payable on demand.
|
| Demand Note/Mortgage |
Note of mortgage that the lender can call due at
any time and without prior notice.
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| Deposit |
Sum of money given to bind a sale of real estate, or assure
payment or an advance of funds in the processing of a loan. Also known
as earnest money.
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| Depreciation |
Sum representing presumed loss in the value of a building
or other real estate improvement resulting from age, physical wear, and
economic or functional obsolescence that is deducted annually from net
income to arrive at taxable income.
|
| DEROG LETTER |
A letter written by the borrower that explains any derogatory
information or reporting on the credit report.
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| Description of Materials |
Details of the type grade, and color of all
building materials to be used in the construction of the home for an OTC
loan. Can be presented on a standard HUD Form or in any format chosen by
the builder/contractor.
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| Direct Costs (Hard Costs) |
Construction costs that include labor and
all building materials associated with the actual construction project.
These costs are found on the builder/contractor line item budget.
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| Directors and Officers Liability Insurance (D & O Liability Insurance) |
Insurance that protects both a corporation and its key employees. The
standard D & O policy usually includes corporate reimbursement, which
covers expenses incurred by the directors and officers for legal costs
and judgments indemnified by the corporation. Also included is personal
coverage, which protects individual officers and directors against
claims not indemnified.
|
| DISBURSEMENTS |
Payments made on behalf of the borrower pursuant to the instructions on
the HID Settlement Statement.
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| Disbursement Schedule |
A loan-specific schedule that is created as part
of the Construction Loan Agreement signed at closing of an OTC loan. The
schedule defines the percentage of construction funds that will be
disbursed to the borrower(s) and/or builder/contractor at each draw
request.
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| DISCHARGE |
Following a completed bankruptcy proceeding, discharged debts are no
longer enforceable. The customer has successfully completed the process
and debtors are either paid in full or eliminated based on the plan.
|
| Discharge Certificate |
|
For veterans who were separated before January
1, 1950, the usual method of verifying military service is to present an
honorable discharge certificate that shows the character of service and
active duty dates. Other types of discharge for this time period were:
- NAV PERS Form 553 (Naval Service)
- WDAGO Form 53-98 (Army)
- NAVMC Form 112PD (Marine Corps)
- NAVCG Form 553 (U.S. Coast Guard)
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| Discount |
In loan originations, the amount withheld from loan proceeds
by a lender. In secondary market sales, the amount by which the sale
price of a Note is less than its face value. In both instances, the
purpose of a discount is to adjust the yield upward, either in lieu of
interest or in addition to interest. The rate or amount of discount
depends on money market conditions, the credit of the borrower, and the
rate or terms of the Note.
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| DISPOSITION |
See FINAL DISPOSITION.
|
| DIVORCE DECREE |
A document issued by the court that dissolves the marriage relation.
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| DOCS |
Abbreviation for mortgage loan documents.
|
| Documentary Stamp |
Form of tax in some states imposed on the transfer
of real property.
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| Dower |
Rights a widow has to her husband's property at his death.
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| Down Payment |
Difference between the sale price of real estate and the
mortgage amount.
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| DR |
An acronym for debt ratio. See DEBT RATIO.
|
| Draw |
Advancing of money, such as the periodic advancing of funds
according to a schedule of payments in a construction loan agreement.
Also known as advance, disbursement, payout, progress payment, or
takedown.
|
| Draw Request Form |
A form submitted by the borrower(s) and/or
builder/contractor to the Lender to request a disbursement of
construction funds during the construction phase of an OTC loan.
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| Due-On-Encumbrance Provision |
Covenant in the FNMA/FHLMC uniform
multifamily mortgage that allows the mortgagee to call the mortgage due
and payable if the mortgagor places a subordinate lien against the
property without mortgagee approval. It also allows the mortgagee to
increase the mortgage interest rate if the mortgagee approves the
placement of a subordinate lien.
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| Due-On-Sale |
Clause in a mortgage stating if the mortgagor sells,
transfers, or in any way encumbers the property, the mortgagee has the
right to implement the acceleration clause making the balance of the
obligation due.
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| Duplex |
| Single structure designed with two separate housing/dwelling
units. |
