Debt-to-Income Ratio:
The ratio, expressed as a percentage, which results when a borrower’s monthly payment obligation on long-term debts is divided by his or her gross monthly income.
Deed
Legal document by which title to a property is transferred from one owner to another. The deed contains a description of the property, and is signed, witnessed and delivered to the buyer at closing.
Deed of Trust
Agreement to pledge property as security for a loan used in many states in place of a mortgage. In such an arrangement, the borrower transfers legal title to a trustee who holds the property in trust as security for the repayment of the debt. The deed of trust becomes void if the debt is repaid, but if the borrower defaults on the loan, the trustee may sell the property to pay the debt
Default
Failure to meet legal obligations in a contract, including failure to make payments on a loan. A mortgage is generally considered to be in default when a payment is 30 days past due.
Deferred Interest
Interest added to the balance of a loan when monthly payments are not sufficient to cover it (see “Negative Amortization”).
Delinquency
Failure to make required payments on time.
Deposit
Cash paid to the seller when a formal sales contract is signed.
Depreciation
Decline in property value
Discount Points (Points)
Money paid to a lender at closing in exchange for lower interest rates. Each point is equal to 1% of the loan amount.
Document Review
Fee charged by lender for review of documents necessary to fund a loan.
Documentary Stamps
A state tax, in the form of stamps, required on deeds and mortgages when real estate title passes from one owner to another.
Down Payment
Money paid for a house from the buyer’s funds at closing. The down payment is the difference between the purchase price and the mortgage amount.
Due-On-Sale Clause
A clause that requires full payment of a mortgage or deed of trust when the secured property changes ownership.