Glossary

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Radon
An invisible, odorless gas found in some homes that in sufficient concentrations may cause health problems.

Rate-Improvement Mortgage
A fixed-rate mortgage that includes a provision that gives the borrower a one-time option to reduce the interest rate (without refinancing) during the early years of the mortgage term.

Rate Lock
A commitment issued by a lender to a borrower or other mortgage originator guaranteeing a specified interest rate for a specified period of time. A rate lock guarantees the rate you choose will not change between the time you tell the lender you want to lock the rate and when the loan closes. See lock-in .

Real Estate Agent / Broker
A person licensed to negotiate and transact the sale of real estate on behalf of the property professional loan officer.

Real Estate Settlement Procedures Act (RESPA)
A consumer protection law that requires lenders to give borrowers advance notice of closing costs. See RESPA

Real Property
Land and improvements, including anything of a permanent nature such as structures, trees, minerals, and the interest, benefits, and inherent rights thereof.

Realtor
A real estate broker or an associate who holds active membership in a local real estate board that is affiliated with the National Association of Realtors.

Recorder
The public official who keeps records of transactions that affect real property in the area. Sometimes known as a "Registrar of Deeds" or "County Clerk."

Recording
The noting in the recorder's office of the details of a properly executed legal document, such as a deed, a mortgage note, a satisfaction of mortgage, or an extension of mortgage, thereby making it a part of the public record.

Refinance
Modified schedule of debt payments including a mortgage. Creditors may want to refinance one's obligations if he or she cannot satisfy the original payments or if interest rates have fallen since a borrower took out the loan.

Refinance Transaction
The process of paying off one loan with the proceeds from a new loan using the same property as security. Also known as a rate/term refinance.

Rehabilitation Mortgage
A mortgage created to cover the costs of repairing, improving, and sometimes acquiring an existing property.

Release Fees
A fee charged by a lien-holder to discharge a secured property from a lien.

Remaining Balance
The amount of principal that has not yet been repaid. See principal balance.

Remaining Term
The original amortization term minus the number of payments that have been applied.

Rent With Option To Buy
See lease-purchase mortgage loan.

Repayment Plan
An arrangement made to repay delinquent installments or advances. Lenders' formal repayment plans are called "relief provisions."

Replacement Reserve Fund
A fund set aside for replacement of common property in a condominium, PUD, or cooperative project -- particularly that which has a short life expectancy, such as carpeting, furniture, etc.

Rescission
The cancellation or annulment of a transaction or contract by the operation of a law or by mutual consent. Borrowers usually have the option to cancel a refinance transaction within three business days after it has closed.

Reserves
Money accumulated and set aside to cover recurring, periodic expenses, such as property repairs or taxes. Also, funds set aside to be used to make monthly mortgage payments in the case of financial difficulty.

Reverse Mortgage
A special type of mortgage that enables home professional loan officers to convert the equity they have in their homes into cash, using a variety of payment options to address their specific financial needs. Unlike traditional home equity loans, a borrower does not qualify on the basis of income but on the value of his or her home. In addition, the loan does not have to be repaid until the borrower no longer occupies the property. Sometimes called a home equity conversion mortgage . This product is usually attractive to older homeowners who have accumulated substantial equity in their homes.

Revolving Liability
A credit arrangement, such as a credit card, that allows a customer to borrow against a pre-approved line of credit when purchasing goods and services. The borrower is billed for the amount that is actually borrowed plus any interest due.

Right Of First Refusal
A provision in an agreement that requires the homeowner of a property to give another party the first opportunity to purchase or lease the property before he or she offers it for sale or lease to others.

Right Of Ingress Or Egress
The right to enter or leave designated premises.

Right Of Survivorship
In joint tenancy, the right of survivors to acquire the interest of a deceased joint tenant.