Mortgage Glossary
There are a lot of unfamiliar terms that get tossed around during the mortgage process. But don't worry, we've put together this glossary to help you get a better grasp of any terms that may be less than clear.
C
Cooperative Corporation
A corporation that holds the title to a cooperative project and grants occupancy rights to shareholders through leases or similar rental agreements.
Cooperative Project
A residential or mixed-use building wherein a corporation holds title to the property, sells shares of stock, representing the value of a single apartment, to individuals who then receive a lease, or similar agreement, as evidence of title.
Cosigner
Another person who signs your loan and assumes equal responsibility for it.
Cost of Funds Index (COFI)
An index that may be used to determine the interest rate changes of an adjustable rate mortgage (ARM). The Cost of Funds Index, or COFI as it is commonly called, is the weighted average of interest rates that Federal Home Loan banks have paid to their customers recently. Usually, the COFI for the 11th district of Federal Home Loan Banks is used and covers banks in California, Nevada, and Arizona. The index value is announced on the last working day of the month following the month listed.
Courier/Mailing Fee
The fee associated with a lender sending documents to other parties involved in the loan, like an attorney or title company. For our comparison purposes, this fee is considered a third party fee, however some lenders may choose not to pass these costs on to the borrower.
Covenant
A promise written into deeds, mortgages and other financial instruments that obligates or restricts the borrower. The violation of some covenants can result in foreclosure.
Credit
A lender may reduce the actual amount of the closing costs by a credit in order to offer more competitive fees.
Credit Bureau
An agency that gathers and keeps your credit record.
Credit Grade
A value given to an individual to reflect their current and past debt repayment patterns. A grade of "A" is considered to be the best.
Credit History
A record of a person’s debt history, including all open and fully repaid obligations. A credit history helps a lender to determine whether a potential borrower has satisfactory history of repaying debts in a timely fashion.
Credit Life Insurance
A type of insurance, often bought by borrowers, that will pay off the debt if the borrower dies while the policy is in force.
Credit Report
A record of an individual's current and past debt repayment patterns. A credit history helps a lender to determine whether a borrower has a history of repaying debts in a timely manner. For our comparison purposes, the credit report fee is considered to be a third party fee.
Credit Repository
An institution that collects, maintains, stores and sells financial and publicly recorded information about the payment records of individuals applying for credit.
Credit Scoring System
A statistical system used to rate credit applicants according to various characteristics relevant to creditworthiness.
Credit-Related Insurance
Health, life or accident insurance designed to pay the outstanding balance of a debt.