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I - Glossary - Don Wixom, Nampa, Caldwell, Boise, Eagle, Meridian

Real Estate Terms

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IThere are 40 entries in the glossary.Pages: 1 Impound accountSee Escrow. ImprovementAnything done to a house that increases its value, such as adding a sun porch or modernizing the kitchen. In-File Credit ReportAn objective account, normally computer-generated, of credit and legal information obtained from a credit repository. Income approachA valuation method that capitalizes or converts the current benefits of the property into an estimated value. Income capitalizationA way to determine the market value of an income-producing property by approach converting its future income stream into a single capital value. Income PropertyReal estate developed or improved to produce income. IndexA number used to compute the interest rate for an adjustable-rate mortgage (ARM). The index is generally a published number or percentage, such as the average interest rate or yield on Treasury bills. A margin is added to the index to determine the interest rate that will be charged on the ARM. This interest rate is subject to any caps that are associated with the mortgage. Index LeaseA lease in which the rental amount adjusts according to changes in a price index, commonly the consumer price index. Individual Retirement AccountA retirement account that allows individuals to make tax-deferred contributions to a personal retirement fund. Individuals can place IRA funds in bank accounts or in other forms of investment such as stocks, bonds, or mutual funds. Industrial revenue bondBonds issued to raise funds for developing commercial buildings for lease or industrial parks. InflationAn increase in the amount of money or credit available in relation to the amount of goods or services available, which causes an increase in the general price level of goods and services. Over time, inflation reduces the purchasing power of a dollar, making it worth less. IngressA means of entry to a property. (See egress.) Initial Interest RateThe original interest rate of the mortgage at the time of closing. This rate changes for an adjustable-rate mortgage (ARM). Sometimes known as "start rate" or "teaser." InspectionWhen a house is remodeled or rehabbed it must be inspected by an inspector from the local government to be sure all work is done properly. InstallmentThe regular periodic payment that a borrower agrees to make to a lender. The regular periodic payment that a borrower agrees to make to a lender. The installment is more often referred to as your monthly mortgage payment. Installments, or monthly payments, can be made either monthly or biweekly, depending on your mortgage type. Your approved lender may also offer additional payment plans tailored to fit your needs. Installment debtDebts or accounts that are paid off in monthly payments, or install-ments, such as credit-card accounts. Installment LoanBorrowed money that is repaid in equal payments, known as installments. A furniture loan is often paid for as an installment loan. Installment sale contract (land contractA contract in which a seller of real estate promises to deliver a deed to the buyer at some time in the future after the buyer has, in an agreed upon num ber of payments of principal and interest, paid the purchase price in full. Insurable interestA person's interest in property such that an occurrence of a peril would cause financial loss to that person. Insurable TitleA property title that a title insurance company agrees to insure against defects and disputes. Insurable valueThe value of the portions of the property that are physically destructible. InsuranceA contract that provides compensation for specific losses in exchange for a periodic payment. An individual contract is known as an insurance policy, and the periodic payment is known as an insurance premium. Insurance BinderA document that states that insurance is temporarily in effect. Because the coverage will expire by a specified date, a permanent policy must be obtained before the expiration date. Insured MortgageA mortgage that is protected by the Federal Housing Administration (FHA) or by private mortgage insurance (MI). If the borrower defaults on the loan, the insurer must pay the lender the lesser of the loss incurred or the insured amount. InterestThe fee charged for borrowing money. Simply put, this is the fee that is charged for borrowing money from lenders. The interest rate is the rate of interest that is in effect when the monthly payment is due. An interest rate ceiling for an adjustable-rate mortgage (ARM) is the maximum interest rate, as specified in the mortgage note; the interest rate floor is the minimum interest rate, as specified in the mortgage note. Interest Accrual RateThe percentage rate at which interest accrues on the mortgage. In most cases, it is also the rate used to calculate the monthly payments, although it is not used for an adjustable-rate mortgage (ARM) with payment change limitations. Interest escalation clauseProvides for variable rate of interest according to a standard index. Interest RateThe rate of interest in effect for the monthly payment due. Interest Rate Buydown PlanAn arrangement wherein the property seller (or any other party) deposits money to an account so that it can be released each month to reduce the mortgagor's monthly payments during the early years of a mortgage. During the specified period, the mortgagor's effective interest rate is "bought down" below the actual interest rate. Interest rate capA provision of an ARM limiting how much interest rates may increase or decrease per adjustment period or over the life of a mortgage. See also Lifetime cap. Interest Rate CeilingFor an adjustable-rate mortgage (ARM), the maximum interest rate, as specified in the mortgage note. Interest Rate FloorFor an adjustable-rate mortgage (ARM), the minimum interest rate, as specified in the mortgage note. Interest Rate for HECMsThe interest rate on a Home Equity Conversion Mortgage (HECM) adjusts monthly or yearly. It is tied to the weekly average yield of U.S. Treasury securities adjusted to a constant maturity of one year. The interest charged on the HECM loan will be payable to your lender when the loan terminates. Interest-only loanA method of loan amortization in which interest is paid periodicaly over the term of the loan and the entire original loan amount is paid at maturity. Internal Rate of Return (IRR)The percentage rate earned on each dollar that remains in an investment each year. The IRR of an investment is the discount rate at which the sum of the present value of future cash flows equals the initial cap ital investment. IntestateWithout a last will and testament. InvestmentAn item, such as a house, on which money is spent in the hope of getting money or other benefits back in return. Investment PropertyA property that is not occupied by the owner. Investment valueThe value to a specific investor, based on that investor's requirements, tax rate, financing, etc. Involuntary lienA lien such as taxes or mechanic's lien imposed without consent of the property owner. 

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