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impact fees
Fees collected from developers
of new homes to pay for schools, parks, and other
facilities. |
implied warranty of
habitability
Legal doctrine stating that all
new homes are assumed to be fit for human habitation
and meet all building codes. |
impounds
A portion of the monthly
mortgage payment that is placed in an account and
used to pay for hazard insurance, property taxes and
private mortgage insurance. |
improvement
A change that adds value to a
house, prolongs its useful life, or adapts it to new
uses. |
in-file credit report
A computer-generated report
drawn from credit repositories and generally
regarded as an objective history. |
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income property
Property that is not occupied
by the owner but is used to generate income. |
incurable defect
A defect in a property that
cannot be fixed, such as an adjacent hazardous waste
site, or one that would cost too much to repair
relative to the value of the property. |
independent contractor
A person hired to do a
particular job, subject to the direction of a
supervisor. An independent contractor pays for his
or her own expenses and taxes, and receives no
employee benefits. Most real estate agents are
independent contractors. |
index
Financial tables used by
lenders to calculate interest rates on adjustable
mortgages and on Treasury bills. |
Individual Retirement
Account (IRA)
A tax-deferred savings account
in which a person may accrue retirement funds. |
infill development
Any significant new
construction in an established area. |
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infill housing
Home construction in
established areas. |
infiltration
Air from the environment that
penetrates a building. |
inflation
Inflation occurs when there is
more money available than there are goods and
services to be purchased. Mortgage rates, which are
determined by the marketplace and the actions of the
Federal Reserve Board and Wall Street, are sensitive
to inflation fears. |
infrastructure
The roads, schools, parks,
utilities, bridges, and communications systems in a
community. |
initial interest rate
The original interest rate on
an adjustable rate mortgage. |
initial rate cap
A specific limit defined by
some adjustable rate loans (ARMs) for the maximum
amount the interest rate may increase at the
expiration of the initial interest rate. |
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initial rate duration
Most adjustable rate loans
(ARMs) offer an initial interest rate below the
current market rate. This initial or "teaser" rate
expires after a period called the initial rate
duration, which may last months or years. |
inlet valve
The mechanism inside a toilet
tank that automatically fills the tank with water
when the tank empties. The inlet valve is connected
to the shutoff valve under the toilet. |
inspection fee
A fee paid to determine the
present physical condition of the home, required by
the lender in order to supplement the information
contained in the appraisal report. |
inspection report
An examination of a home's
exterior, foundation, framing, plumbing, electrical
system, heating, air conditioning, fireplace,
kitchen, bathroom, roof, and interior. |
installment contract
A purchase agreement in which
the buyer does not receive the title to the property
until all installments are paid. |
installment sale
A real estate transaction in
which the sales price is paid in installments. |
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instrument
A written legal document. |
insulation
Materials that slow heat loss,
such as cellulose, glass fiber, rock wool,
polystyrene, urethane foam, and vermiculite. |
insurable title
Title to property that a
company agrees to insure against defects and
disputes. |
insurance
Owners and buyers can purchase
various types of insurance including hazard, private
mortgage, and earthquake. The policies guarantee
compensation for specific losses. |
insurance binder
A temporary insurance
arrangement usually put in force until a permanent
policy can be obtained. |
interest
The fee borrowers pay to obtain
a loan. It is calculated based on a percentage of
the total loan. |
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interest accrual rate
The rate at which interest
accrues on a mortgage. |
interest paid over life
of loan
The total amount paid to the
lender for the use of money during the time the
money is borrowed. |
interest rate
The fee, expressed as a
percentage, charged for a loan. The interest rate
also helps determine the monthly payment. For
adjustable-rate loans, the interest rate may change
from its initial level. |
interest rate buy-down
plans
For cash-short buyers, some
sellers are willing to advance funds from the sale
of the home to buy down the interest rate and reduce
the buyer's monthly obligation. |
interest rate cap
The maximum interest rate
charge allowed on the monthly payment of an
adjustable rate mortgage during an adjustment
period. |
interest rate ceiling
The highest interest a lender
can charge for an adjustable rate mortgage. |
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interest-only loan
The borrower pays only the
interest that accrues on the loan balance each
month. Because each payment goes toward interest,
the outstanding balance of the loan does not decline
with each payment. |
interim financing
Short-term financing used by
sellers to bridge the gap between the sale of one
house and the purchase of another (also known as
bridge or swing loans). A construction loan is also
a form of interim financing. |
investment property
Real estate that generates
income, such as an apartment building or a rental
house. |
