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.
V
VA Funding Fee
The Department of Veteran’s Affairs (VA) charges a Funding Fee to most veterans who obtain a VA mortgage loan to help sustain the VA home loan program. Only veterans receiving VA disability are exempt from paying this fee. The VA Funding Fee is a percentage of the principal loan amount and is due at closing. The amount of the VA Funding Fee varies depending on specifics of the transaction. The full amount can usually be financed as part of the loan amount or paid in cash.
VA Loan
A mortgage for veterans and service persons. The loan is guaranteed by the Department of Veterans Affairs (VA) and requires low or no down payment.
Vacancy Rate
The percentage of all units or space that is not leased, not rented or is unoccupied.
Vacant Land
Land that is not currently being used.
Vacate
To move out of a premises.
Vacation home
A home used by the owners only occasionally or seasonally, primarily for recreational purposes.
Valid
A document or contract that has legally binding force.
Vested
Having the right or privilege to use a portion of a fund, such as an individual retirement account (IRA).
W
Waiver
The voluntary abandonment or surrender of some claim, right, or privilege.
Warehousing
The packaging together of many mortgages for the purpose of selling them in the secondary market, usually by a mortgage banker who has originated the loans.
Warranty
A promise contained in a contract.
Water Table
Usually defined as the upper-most level at which underground water is normally encountered in a particular area.
Wire Transfer Fee
A fee charged by some lenders to cover the cost of wiring the mortgage funds to the appropriate parties, such as the title company or attorney, so that they are available for closing. For our comparison purposes, a wire transfer fee is considered to be a third party fee. However, some lenders may not charge for this service.
Wraparound Loan
A loan that includes the remaining balance on an underlying first loan. Instead of having separate first and second mortgages, a wraparound loan has both.
Y
Yield
A measurement of the rate of earnings from an investment, usually expressed as a percentage.