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Home Buyer and House Plan Terms and Definitions – Part II

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PHOTO-Exterior-FrontBalloon – A loan which has a series of monthly payments (often for 5 years or less) with the remaining balance due in a large lump sum payment at the end.

Binder – A receipt for a deposit paid to secure the right to purchase a home at terms agreed upon by the buyer and seller.

Buydown – A subsidy (usually paid by a builder or developer) to reduce the monthly payments on a mortgage loan.

Cap – A limit to the amount an interest rate or a monthly payment can increase for an adjustable rate loan either during an adjustment period or over the life of the loan.

Certificate of Occupancy – A document from an official agency stating that the property meets the requirements of local codes, ordinances, and regulations.

Closing – A meeting to sign documents which transfer property from a seller to a buyer. (Also called settlement)

Closing Costs – Charges paid at settlement for obtaining a mortgage loan and transferring real estate title.

Conditions, Covenants, and Restrictions (CC and Rs) – The standards that define how a property may be used and the protections the developer has made for the benefit of all owners in a subdivision.

Condominium – A home in a multi-unit complex; each purchaser owns an individual unit, and all the purchasers jointly own the common areas, such as the surrounding land, hallways, etc.

Conventional Loan – A mortgage loan not insured by a government agency (such as FHA or VA).

[  PART III – Home Buyer and House Plan Terms and Definitions  ]

Home Buyer and House Plan Terms and Definitions – Part II
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