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Jan 30

Mortgage Words You Should Know

Mortgage Words You Should Know

 

The mortgage industry loves jargon and it can quickly confuse a real estate professional and all the moreso a borrower. The Fannie Mae Sellers Guide alone has 91 different acronyms and abbreviations.

The National Mortgage News recently offered up a few of the most common acronyms buyers and professionals should know while going through the home buying process.

DTI: Debt to income

  • Underwriters turn to this ratio to determine if a borrower can financially meet a mortgage obligation.

UETA: Uniform Electronics Transactions Act

  • One of this Act’s purposes is to help harmonize state laws with the recognition of electronic signatures on documents.

PITI: Principal and interest plus taxes and insurance

  • Lenders often will break a borrower’s monthly payment down into this equation.

ATR: Ability to repay

  • The Dodd-Frank Act mandates that lenders ensure borrowers have the ability to repay their debt.

    Mortgage Words You Should Know

    Mortgage Words You Should Know

HOEPA: Home Ownership Equity and Protection Act

  • The law helps to determine when a loan becomes considered a high-cost mortgage.

SFHA: Special Flood Hazard Area

  • Lenders must monitor flood maps to see if the property has been placed into these zones.

Test yourself on more mortgage-related acronyms at National Mortgage News.

Source: “10 Mortgage Abbreviations Everyone in the Industry Should Know,” National Mortgage News (2017)

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