 MORTGAGE DICTIONARY
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SAVINGS AND LOAN ASSOCIATION (S&L):
Another form of mortgage lender.
SAVINGS ASSOCIATION INSURANCE FUND (SAIF):
The Federal Deposit Insurance Corporation (FDIC) insurance fund for deposits in savings and loan associations.
SCHEDULED MORTGAGE PAYMENT:
The periodic payment the borrower is obliged to pay on a loan.
SEASONED MORTGAGE:
An old loan under which the borrower has proven herself capable of meeting loan obligations.
SECOND MORTGAGE:
A mortgage loan which is registered on title after another mortgage (the first mortgage) and, therefore, is behind the first mortgage in priority. In the event of default and sale of the property, the second mortgagee will only be paid if there are funds left after the payment of the first mortgagee.
SECONDARY FINANCING:
Another term for a second mortgage; a loan which stands behind the principal loan.
SECONDARY MARKET:
The purchase and sale of mortgages among lenders.
SECURITY:
An asset held as a guarantee of payment of a loan.
SECURITY INTEREST:
Legal term for the claim the lender has against the borrower's property which has been pledged under a loan.
SELF-AMORTIZING MORTGAGE LOAN:
A loan which will be paid off by the end of its term, such that its term equals its amortization period.
SELLER FINANCING:
Also known as "vendor take-back mortgage" or "mortgage back", where the seller of a property agrees to payment of part of the purchase price over time with the debt to the seller registered on title as a mortgage.
SELLER-TAKE-BACK:
See "seller financing".
SERIOUS DELINQUENCY:
The condition of being far behind in mortgage payments such that mortgage enforcement by the lender is imminent.
SERVICING (THE LOAN):
The act of collecting periodic payments toward a debt.
SERVICING FEE:
The fee charged to the borrower for the lender's costs of collecting payments and administering a loan.
SETTLEMENT BOOK:
An information pamphlet given by lender to borrower which explains the process of the loan, settlement of the loan, etc.
SETTLEMENT COSTS:
See "closing costs".
SETTLEMENT SHEET:
The information sheet which sets out the allocation of funds on closing.
SHARED APPRECIATION MORTGAGE (SAM):
A loan arrangement which allows the lender to share, in exchange for a reduced interest rate, in any gain in the value of the property against which the mortgage is secured.
SIMPLE INTEREST:
A charge for the use of money which is calculated on a periodic basis as a percentage of the principal borrowed. No further interest is charged on interest accumulated in earlier periods.
SPREADING AGREEMENT:
A contract in which the borrower gives the lender additional security for a loan by allowing it to be lodged against other property owned by the borrower.
STANDARD MORTGAGE:
A mortgage which has equal periodic payments and is paid out at the end of its term.
SUBJECT TO MORTGAGE:
A term of an agreement which states that the purchaser will assume an existing mortgage registered on title to the property.
SUBMORTGAGE:
Where a mortgage is pledged as security for a loan to the mortgagee (the original lender).
SUBORDINATE FINANCING:
See "secondary financing".
SUBORDINATION:
Placing the right of one person behind those of another.
SUBORDINATION CLAUSE:
An agreement by the lender which allows the current mortgage to be "postponed" or placed behind a later mortgage in priority.
SUBSTITUTE OF TRUSTEE:
An instrument registering a change of trustee under a deed of trust.
SURPLUS FUNDS:
Money gained in a mortgage enforcement sale of property which is in excess of the money required to satisfy the mortgage, interest, penalties, and costs.
SWING LOAN:
A short-term loan designed to bridge the borrower's finances between two events. For example, a person who buys a new home in April but cannot sell her old home until June may require a swing loan to carry both homes for the interim period until the old home may be sold and the proceeds used to pay out the swing loan. Also known as "bridge financing".
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