If you're in foreclosure or dangerously close to it, here are some mortgage foreclosure terms that might be helpful. You need to know everything involved and these terms will definitely be used from time to time. Don't be in the dark. Read through the glossary of foreclosure terms and definitions.
Acceleration Clause: a stipulation that allows the lender to demand the entire amount of the mortgage loan when the borrower fails to make or misses monthly payments.
Annual Percentage Rate (APR): the annual interest rate plus other fees associated with a loan.
Assignment: official property transfer from the home owner to the lender for the benefit of the lenders. This is in lieu of foreclosure.
Balloon Payment: a large amount due at the end of a home loan term.
Deed: a document stating ownership of property. A deed transfer is a transfer of ownership.
Deed-in-lieu of Foreclosure: giving up title of your home in lieu of a foreclosure. It's a voluntary transfer that is done by a homeowner to avoid an official foreclosure.
Deed of Trust: a document that gives legal title to property as security for the repayment of a loan (aka collateral). A deed of trust can replace a mortgage in some cases.
Default: when you fail to make monthly payments as agreed upon in your mortgage.
Deficiency Judgment: a legal judgment stating that the borrower must pay the balance remaining after his/her house has been sold as a result of a foreclosure.
Encumbrance: any restriction on the use of land such as a mortgage, lien, or tax.
Equitable Title: the present right to possession with the right to acquire legal title once a preceding condition has been met.
Equity: the true value of a home or other real estate minus what is still owed on the mortgage(s).
Fair Market Value: the value of a home based on what it would sell for in the current real estate market.
FHA: stands for the Federal Housing Administration of the United States.
Foreclosure: a forced sale of a home or other real estate as a result of failing to make payments as stated in the mortgage.
Grace Period: a set period of time between the due date of a mortgage payment and the overdue date as stated by the lender.
HUD: stands for the U.S. Department of Housing and Urban Development.
Judicial Foreclosure: a court initiated foreclosure.
Lien: a charge placed upon a home or other real estate to satisfy a debt.
Lis Pendens: a notice of a lawsuit.
Non-judicial Foreclosure: a result of a "power of sale" clause existing in a mortgage or deed of trust, which allows the borrower to pre-authorize the sale of real or personal property to pay off the balance on a loan if payments are defaulted.
Notary: a public officer licensed by the state to attest to and certify the validity of signatures of others. A notary is often referred to as a notary public.
Notice of Sale: a notice stating all the information about a defaulted loan and what actions will take place. This notice must be recorded with the county where property is located and advertised as stated in the security document or as dictated by state law.
Personal Property: anything temporary or moveable. A home is not personal property.
Right of Redemption: the right of the borrower to reclaim property sold as a result of a foreclosure if the borrower can come up with the outstanding amount owed plus fees. The period of time in which the borrow can reclaim his/her property is called Redemption.
Request for Notice: a document stating that the trustee sends a Notice of Default or Notice of Sale to a homeowner concerning proceedings.
Short Sale: when a lender allows the borrower to sell a home prior to foreclosure at a price that's below the full amount of the mortgage. This avoids foreclosure proceedings.
Title: the document that gives ownership to real property. Also referred to as a deed.
Trustee: a neutral party who oversees and advertises in a foreclosure regarding the sale of the property and conducts the auction to sell said property to the highest bidder.
Trustee Sale (Sheriff Sale): the auctioning of real property.
An auction of real property conducted by a trustee. Also known as a Sheriff's Sale.