Home Loan Workbook

Third-party Orgination - When a lender uses another party to completely or partially originate, process, underwrite, close, fund, or package the mortgages it plans to deliver to the secondary mortgage market. Title - A document that is evidence of ownership. Title Insurance - Protection for lenders and homeowners against financial loss resulting from legal defects in the title. Total Expense Ratio - Total obligations as a percentages of gross monthly income including monthly housing expenses plus other monthly debts. Treasury Index - An index used to determine interest rate changes for certain adjustable rate mortgage (ARM) plans. Based on the results of auctions that the U.S. Treasury holds for its Treasury bills and securities or derived from the U.S. Treasury’s daily yield curve, which is based on the closing market bid yields actively traded Treasury securities. Truth-In-Lending - A federal law that requires lenders to fully disclose, in writing, the terms and conditions of a mortgage, including the annual percentage rate (APR) and other charges. Underwriting - The process of evaluating a loaan application to determine the risk involved for the lender. Underwriting involves an analysis of the borrower’s creditworthiness and the quality of the property itself. VA Mortgage - A mortgage that is guaranteed by the Department of Veterans Aairs (VA). Also known as a government mortgage.

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