Mission San Jose Mortgage

Mortgage Terms


another name for closing.

Settlement statement:

this document is an itemized listing of all the charges related to your new loan. You should get a copy of the settlement statement one day before the closing. Also called the HUD-1 statement.

Short sale:

if you are unable to make your mortgage payments, you can apply for a short sale, where the lender agrees to a discount on the home in order to sell it quickly, avoiding a foreclosure. Short sales involve a lot of paperwork and may impact your credit negatively. If you are considering a short sale, please call me for more information.

Speculative home market:

investors may speculate on the chance of the housing market improving and purchase low-cost homes for quick resale. Often considered a high-risk investment strategy.

Sub-prime loan:

a high-risk loan with loosened lending and underwriting terms and conditions. Commonly considered the cause of the housing market collapse, it is almost impossible to secure a sub-prime mortgage these days, which means people with poorer credit scores are less likely to qualify for a home loan. Because they are associated with such high risk, sub-prime loans incurred high interest rates and fees.


a review of your property to establish official boundary lines and find any easements, encroachments, rights of way, improvement locations, etc. A diagram is drawn up to indicate the shape, size and other features of your property. Surveys are conducted by licensed surveyors and are normally required by the lender in order to secure your mortgage.

Tenancy in common:

when one or more persons share the property title.

Third-party fees:

see closing costs.

Third-party origination:

when a lender uses another real estate professional to complete part of the loan, such as origination, processing, underwriting or preparing the loan for sale on the secondary mortgage market.


the official document that declares the legal owner of a property. Also known as a deed.

Title company:

this company typically handles all tasks associated with the property title, including providing insurance and completing the title search.

Title insurance:

you are required to take out title insurance on a property in order to protect both yourself and the lender in case a question of ownership ever arises. It also guarantees the title company made a thorough search on your behalf. The fee is included in the closing costs.

Title search:

your title company will research your property to ensure there are no liens or other problems with ownership prior to completion of the purchase.

Transfer taxes:

some states and cities charge a fee to record the transfer of real estate into the public record.

Treasury index:

this is one of the more usual indices that the interest rates for an ARM can be based on.

Truth-in-lending disclosure (TIL):

federal law mandates that we provide you with this document, which discloses your interest rate, loan amount, the amount you will have paid upon the loan’s maturity and other relative financial information.


this is where your loan application is analyzed to ensure you will be able to repay the loan. Our Underwriters can request additional information in order to complete your loan package.

Up-front Charges:

these are the fees you pay at closing, including points, broker’s fees and insurance.

VA (Department of Veterans Affairs):

this federal agency guarantees loans made to veterans and their spouses, without requiring mortgage insurance.

VA loans:

Retired and active military service personnel may qualify for this special home loan program which offers 10 mb-100% financing. There is no limit to the number of times a veteran can use the VA loan for a purchase or refinance.


just before closing, you’ll take a walk through your new property to make sure any contingencies specified in the purchase agreement such as repairs have been completed, fixture and non-fixture property is in place and everything is in working order.

Warranty deed:

this document states that you own the property free and clear with no liens or issues related to ownership and that you have the right to sell it at will.


local laws regulating how land and buildings may be used in certain areas. They govern the establishment of commercial and residential areas, permitted types of structures, lot sizes and other related features of land and building uses.