Home Loan Glossary – Q & R

Q
Qualifying Ratios: Qualifying ratios are calculations used to help determine whether a potential borrower qualifies for a mortgage. Two different qualifying ratios are used: the Housing Expense Ratio and Debt-to-Income Ratio. Both provide underwriters an objective standard for determining the affordability of the home loan the borrower has requested.
Quitclaim Deed: A quitclaim deed transfers an individual's ownership interest in a piece of real property to another person, without any warrantee of ownership.
R
Rate Lock: A rate lock is a lender's promise to provide a set interest rate to a specific borrower and loan program for a set period of time. See Lock-In.
Rate Reduction Option: This is a type of fixed rate mortgage that gives borrowers the option to reduce the interest rate of the mortgage at a later stage, without having to refinance. This home loan option is similar to a prearranged refinancing agreement, but it does not require borrowers to re-qualify.
Real Estate Agent: A real estate agent is a licensed professional trained to facilitate the sale and purchase of real estate, usually for a commission or fee.
Real Estate Settlement Procedures Act (RESPA): This is a consumer protection law that states that settlement or closing costs must be disclosed to home sellers and buyers up front. It also forbids certain types of referral and other fees, outlines regulations for escrow accounts, and requires that borrowers be notified when servicing of a home loan is transferred, among other things.
Real Property: Real property is another term for real estate. It refers to land and the buildings or improvements on it. It also includes permanent accessories like trees, minerals and other natural resources, as well as their benefits, interest and inherent rights.
Realtor^®: A Realtor^® is a real estate broker or associate who is a member of the National Association of Realtors, the trade group of real estate professionals.
Recorder: Also referred to as a Registrar of Deed or a County Clerk, a recorder is the public official who keeps a record of all transactions affecting real property in the area.
Recording: Recording refers to the detailing, in a book of public record, of the terms of a legal agreement affecting ownership of real property, such as a mortgage note, a deed, or an extension or satisfaction of mortgage.
Reduced Documentation: This is a loan option offered to streamline a borrower's loan application. For example, borrowers may provide details of their income, but without traditional verification documentation.
Refinance Transaction: A refinance transaction is a home loan that allows a borrower to use the funds to pay off a previous loan—either for improved terms, or for additional cash out. Usually, the same property is used as collateral for the new loan. Contrast with a Purchase Transaction.
Rehabilitation Mortgage: A rehabilitation mortgage covers the expense of renovating and repairing an existing property, or, in some cases, acquiring a new property.
Remaining Balance: The remaining balance is the portion of a loan's principal amount that still has to be paid. See Principal Balance.
Remaining Term: The remaining term of a home loan is the original length of a loan minus the number of months for which installments have been paid.
Rent With Option To Buy: See Lease-Purchase Mortgage Loan.
Repayment Plan: A repayment plan is an arrangement made to repay early or late installments. Formal repayment plans offered by home loan lenders are usually referred to as "relief provisions".
Request For Notice Of Default: This is a written document that requires the holder of a first mortgage to notify secondary lien holders of any default by the borrower.
Rescission: Rescission is the legal cancellation of a contract or transaction. Usually, borrowers can cancel certain transactions, including credit card, mortgage refinance or home equity deals, up to three days after consummation of the transaction.
Revolving Liability: Revolving liability is a credit arrangement, such as a home equity line of credit or credit card, which permits an individual to borrow as cash is needed, up to a certain limit. The payments made by the borrower will vary based on individual loan terms, and may result in credit being freed up to borrow again without the need for another loan application.
Right Of First Refusal: A condition in an agreement that requires a property owner to give a specific person the first opportunity to buy or lease the property being sold before making the property available to others for sale or lease.
Right Of Ingress Or Egress: This term refers to the right to enter or exit certain properties.
Right Of Survivorship: The right of survivorship applies to joint tenancy, and it entitles living joint tenants to the ownership interest of a deceased joint tenant.
Rural Housing Service (RHS): The Rural Housing Service (RHS) is an agency within the Department of Agriculture that offers financing to farmers and other borrowers who wish to purchase property in rural areas and cannot obtain home loans from another source. Funding for these loans is borrowed from the U.S. Treasury.