The mortgage industry loves jargon and it can quickly confuse a real estate professional as well as the moreso a borrower. The Fannie Mae Sellers Guide alone has 91 different acronyms and abbreviations.
Mortgage Phrases You need to understand
The National Mortgage News recently offered up a handful of the most commonly encountered acronyms buyers and professionals should know while going through the homebuying process.
DTI: Debt to income
Underwriters use this ratio to determine if a borrower can financially meet a mortgage loan obligation.
UETA: Uniform Electronics Transactions Act
One of this Act’s purposes is always 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 makes it necessary that lenders ensure borrowers have the capacity to repay their debt.
HOEPA: Home Ownership Equity and Protection Act
The law enables you 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 home has been placed into these zones.
Test yourself on more mortgage-related acronyms at National Mortgage News.
This always makes us think about when we were both on Active Duty in the US Army. When we would go home and try and talk with our friends and family, sometimes they would look at us like we were speaking some sort of alien language. The military is notorious for acronyms. And to be quite honest they even have a manual of them today. So when you are going through the buying process and there is something that you do not understand, having someone who can explain it to you is vital.
Not only do we help our clients purchase their homes here in the Tampa Bay and Surrounding areas, we purchase homes ourselves too, so we are up to date with all that is current within the mortgage side too. So if you are ready to get started in finding your new home. We are ready to assist you. We are always just a click here or call to 813-300-7116 away.
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