As it relates to loans secured by financial assets- when a borrower uses his or her financial assets—life insurance policies, 401(k) accounts, individual retirement accounts, certificates of deposit, stocks, bonds, etc.as security for a loan, the borrower has a contingent liability. This contingent liability will not be considered as part of the borrower's recurring monthly debt obligations—as long as the lender obtains a copy of the applicable loan instrument that shows the borrower's financial asset as collateral for the loan. If the borrower intends to use the same asset to satisfy a financial reserve requirement, the lender must reduce the value of the asset (the account balance, in most cases) by the proceeds from the secured loan and any related fees to determine whether the borrower has sufficient reserves.

Mobilehomes - These homes were constructed to comply with standards enforced by the State of California prior to June 15, 1976. when the federal preemptive HUD Code became effective. Mobile homes have not been constructed since this date.

Factory Built Homes - Often called "modular" homes, factor-built homes are constructed to comply with the California Administrative Code. About three percent of all factory homes produced in California meet this code.

Manufactured Home - The manufactured home is constructed to comply with the National Manufactured Home Construction and Safety Standards, a uniform building standard administered and enforced by the U.S. Department of Housing and Urban Development (HUD Code). Over 97 percent of all homes constructed in California factories meet this code.

Bi-weekly payments - Biweekly mortgage - A mortgage in which you make payments every two weeks instead of once a month. The basic result is that instead of making twelve monthly payments during the year, you make thirteen. The extra payment reduces the principal, substantially reducing the time it takes to pay off a thirty year mortgage.

In addition to helping you pay off your mortgage early, bi-weekly mortgage payments can help those that have a hard time setting aside a lump sum of money on the first day of the month.

Lease purch - Assists low- to moderate-income homebuyers in purchasing a home by allowing them to lease a home with an option to buy; the rent payment is made up of the monthly rental payment plus an additional amount that is credited to an account for use as a down payment.

To be more clear, if a buyer enters into a lease purchase contract today for an agreed upon price of $100,000 (the current value of the home today) and then the property appreciates to $110,000 during the 12 month lease, the borrower can use the new appraised value of the home (110k)to qualify for a loan, often times lowering the loan-to-value and decreasing the rate.

Many lenders allow the borrower to show only 12 months of on time payments by cancelled checks to refinance the home into their name. Using this method there is normally no down payment required because the equity of the home can be used to include all closing costs in the transaction. The only fee out of pocket for the borrower in a lease option may be the appraisal fee.

Earnest money - Money put down by a potential buyer to show that he or she is serious about purchasing the home; it becomes part of the down payment if the offer is accepted, is returned if the offer is rejected, or is forfeited if the buyer pulls out of the deal.

Earnest money amounts differ depending on the seller and the sellers realtor. They may also ask for a larger earnest deposit if it looks like the buyer may take some time to close the mortgage transaction. This is an incentive for the seller to not take other offers.

Prepayment penalty - A lenders charge to the borrower for paying off the loan before the end of the term. It is present in some mortgages, preventing borrowers from rapidly refinancing.

Prepayment penalties on a loan offering can change the rate you pay for your mortgage. Many times you can pay a higher rate to reduce your prepayment penalty with that lender. This is one of many reasons why different mortgage brokers quotes may vary with the same borrower information.

Prepayment Penalty can be used as a tax write-off at the end of your current year. Please advise your tax consultant in regards to laws and guidelines. He/she may help you recoup the costs if you should break the contract between you and your bank.

Gross monthly income - The total amount that the borrower earns per month, before deductions

Gross income is the amount that is used in qualifing for a mortgage loan.

Gross monthly income is the total of all income written on the 1003 loan application. The total is calculated from base pay, additional wages including commissions, bonuses, and second jobs.

GFE - Good faith estimate. A written estimate of expected closing costs that a lender must provide a prospective homebuyer within three days of the homeowner submitting a mortgage loan application. Brokers and lenders are required by law to make as accurate an estimate as they can.

Good Faith Estimates vary by mortgage broker. When comparing, always ask for a TIL (Truth in Lending) which should break down the details of the mortgage loan they are offering. The GFE will vary because different lenders include different estimates and fees. When receiving a GFE, always ask for the matching TIL for that loan quote.