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GLOSSARY 'B' |
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1. |
Balloon Mortgage:
A mortgage with periodic installments of principal and interest for a set number of years (usually five or seven) and then must be paid off in full in a single "balloon" payment.
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2. |
Balloon Payment:
A lump sum principal payment due at the end of a mortgage.
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3. |
Bankruptcy:
Court proceedings to relieve the debts of an individual or business unable to pay its creditors. Bankruptcy may be declared under one of several chapters of the federal bankruptcy code:
- Chapter 7: Bankruptcy filing which gives a trustee the power to distribute a debtor's assets to creditors. This is also called a liquidation.
- Chapter 11: A reorganization by a business allowing the debtor to maintain operating control of the business while restructuring debts and working out a repayment schedule acceptable to the creditors. This is also referred to as "debtor in possession".
- Chapter 13: A debt repayment plan where an individual debtor files a budget with the court and agrees to make partial payment to creditors over a three to five year period. Also called a "wage earner plan."
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4. |
Basis Point:
Equals one hundredth of one percent.
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5. |
Beneficiary:
As used in a trust deed, the entity that obtains the benefit of the security.
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6. |
Binder:
Sometimes known as an offer to purchase or an earnest money request. It is the acknowledgment of a deposit and a written agreement to enter into a contract for the sale of real estate.
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7. |
Blanket Mortgage:
A mortgage that covers more than one parcel of real estate owned by the mortgagor.
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8. |
Borrower:
Receives funds in the form of loan with the obligation of repaying the loan in full with interest.
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9. |
Broker:
A person who arranges funding or negotiating contracts for a client but who does not loan money himself.
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10. |
Buydown:
Funds paid to the lender by the borrower or third party to reduce the interest rate of the loan for a specified period of time.
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11. |
Buy-Back Agreement:
An agreement specifying conditions under which the seller agrees to repurchase the property.
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12. |
Buy-Down Mortgage:
A mortgage with a below-market interest rate made by a lender in return for an interest rate subsidy in the form of additional discount points paid by the builder, seller or buyer.
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13. |
Buyers Market:
A market in which there are more houses for sale than there are potential buyers.
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