Notice of Default (NOD): To initiate a non - judicial foreclosure proceeding involving a public sale of the real property securing the deed of trust. The trustee under the deed of trust records a Notice of Default and Election to Sell ("NOD") the real property collateral in the public records.
Non - Recourse: A finance term. A mortgage or deed of trust securing a note without recourse allows the lender to look only to the security (property) for repayment in the event of default, and not personally to the borrower. A loan not allowing for a deficiency judgment. The lender's only recourse in the event of default is the security (property) and the borrower is not personally liable.
Operating Expense: Periodic expenses necessary to the operation and maintenance of an enterprise (e.g., taxes, salaries, insurance, maintenance). Often used as a basis for rent increases.
Participation: A type of mortgage where the lender receives a percentage of the gross revenue in addition to the mortgage payments.
Percentage Lease: Commonly used for large retail stores. Rent payments include a minimum or "base rent" plus a percentage of the gross sales "overage." Percentages generally vary from 1% to 6% of the gross sales depending on the type of store and sales volume.
Phase I: An assessment and report prepared by a professional environmental consultant who reviews the property - both land and improvements - to ascertain the presence or potential presence of environmental hazards at the property, such as underground water contamination, PCB's, abandoned disposal of paints and other chemicals, asbestos and a wide range of other potentially damaging materials. This Environmental Site Assessment (ESA) provides a review and makes a recommendation as to whether further investigation is warranted (a Phase II Environmental Site Assessment). This latter report would confirm or disavow the presence of an mitigation efforts that should be undertaken.
PITI: Principal, interest, taxes and insurance. Your calculated estimated of monthly payments.
Points: Loans fee paid by the borrower. One point is 1% of the loan amount.
Prepayment Penalty: A Change for paying off a loan before it is due.
Pre - qualification: The process of determining the amount of money a particular lender will let you borrow. You should strive to obtain pre-qualification with at least two or three lenders.
Prime Rate: An artificial rate set by commercial bankers. Many banks will use the Wall Street Prime rate. This is a rate set by the top lending banks in the country.
Principal: 1. The amount of debt, not including interest, left on a loan. 2. The face amount of the mortgage.
Property Appraisal: A report showing exactly how much the particular home is worth.
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