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Business Glossary-Term List

Welcome to the MISMO Business Glossary - your online source of mortgage industry business terms and data point descriptions. Follow the links provided for Term Type; Focus Area; and Source descriptions; complete terms of authorized usage; and a more detailed description of the MISMO Business Glossary.  Search tip:  Use quotes for an exact search (e.g., "keyword or phrase"). 

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Abandonment

The intentional relinquishment of claim or title to personal or real property.

Term Source: MBA Glossary

Term Type: Process

Focus Area: #MBAGlossary

Abatement (Rental)

A reduction or elimination of rent payments for a specified period of time, usually granted by the landlord as an inducement to the tenant to enter into or to renew a lease.

Term Source: MBA Glossary

Term Type: Process

Focus Area: #MBAGlossary

Abatement (Tax)

A reduction in real property tax granted by a taxing authority as the result of an appeal. In some jurisdictions, tax abatements may also be granted as an inducement for development or to attract or retain job-providing industries.

Term Source: MBA Glossary

Term Type: Process

Focus Area: #MBAGlossary

Absorption

The level of property units rented or sold after which price concessions must be made for market demand to continue at current levels. Used to determine the feasibility of new residential or commercial construction.

Term Source: MBA Glossary

Term Type: Process

Focus Area: #MBAGlossary

Abstraction

Method for computing depreciation by comparing the replacement cost of the improvements to the sales price less land value.

Term Source: MBA Glossary

Term Type: Process

Focus Area: #MBAGlossary

Accelerated Cost Recovery System (ACRS)

Part of the Economic Recovery Act of 1981, an accounting method which allows for a shorter depreciation period for real property over traditional depreciation methods.

Term Source: MBA Glossary

Term Type: Process

Focus Area: #MBAGlossary

Acceptance

An offeree�s consent to enter into a contract and be bound by the terms of the offer.

Term Source: MBA Glossary

Term Type: Process

Focus Area: #MBAGlossary

Accession

Title to property is gained through its addition to the owner�s existing real estate and can apply to both land and improvements.

Term Source: MBA Glossary

Term Type: Process

Focus Area: #MBAGlossary

Accrual Basis Of Accounting

An accounting method under which income and expenses are charged to the periods for which they are applicable, rather than when payment is made or received. In contrast, cash accounting is the method calling for income and expenses to be based on payment being made or received.

Term Source: MBA Glossary

Term Type: Process

Focus Area: #MBAGlossary

Action To Quiet Title

A court action to remove any interest or claim in or title to real property; to remove a cloud on title.

Term Source: MBA Glossary

Term Type: Process

Focus Area: #MBAGlossary

Activate MI

Process in which the Lender notifies the MI Company that the loan has closed and that the MI is requested to be activated.

Term Source: MISMO Life of Loan

Term Type: Process

Focus Area: #MISMOLifeOfLoan, #Origination

Adaptive Re-Use

The rehabilitation of old property for a new purpose.

Term Source: MBA Glossary

Term Type: Process

Focus Area: #MBAGlossary

Add Mortgage Loss Payee Clause for Each Policy

Process of reviewing that the Lender information is accurately listed as the Mortgage Loss Payee on each of the subject property's insurance policies. The addition of the loss payee clause helps protect the Lender from loss, after closing, in the event the subject property is damaged by a covered event.

Term Source: MISMO Life of Loan

Term Type: Process

Focus Area: #MISMOLifeOfLoan, #Origination

Administer Fees

The process of setting up and managing fee names, fee amounts and other rules for use in systems.

Term Source: MISMO Life of Loan

Term Type: Process

Focus Area: #MISMOLifeOfLoan

Administer Loan

The cyclical process of receiving principal, interest, taxes and insurance (PITI) payments from borrowers, applying the funds to a loan's financial record and ensuring that these payments are properly reported and disbursed to Investors, Insurers, Tax Agencies and others as appropriate.

Term Source: MISMO Life of Loan

Term Type: Process

Focus Area: #MISMOLifeOfLoan, #Servicing

Administer Payoff

The process of calculating and applying loan payoff proceeds and clearing the loan from the servicer's portfolio.

Term Source: MISMO Life of Loan

Term Type: Process

Focus Area: #MISMOLifeOfLoan, #Servicing

Administer Prepayment Penalties

The process of determining rules and assessing fees for early payoff of a loan based on the terms of the mortgage note.

Term Source: MISMO Life of Loan

Term Type: Process

Focus Area: #MISMOLifeOfLoan, #Servicing

Administer REO

The process of managing and marketing properties obtained through default on behalf of the investor or guarantor. Often an insurer will market a foreclosed property on their own behalf.

Term Source: MISMO Life of Loan

Term Type: Process

Focus Area: #MISMOLifeOfLoan, #Servicing

Adverse Action

Steps taken by a lender to collect past due mortgage payments. Sometimes these steps lead to foreclosure.

Term Source: MBA Glossary

Term Type: Process

Focus Area: #MBAGlossary

Adverse Possession

The right by which someone occupying a piece of land acquires title against the real owner, if the occupant�s possession has been actual, continuous, hostile, visible and distinct for a statutory period.

Term Source: MBA Glossary

Term Type: Process

Focus Area: #MBAGlossary

 

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