Real Estate Glossary S

S

sale-leaseback

A technique in which a seller deeds property to a buyer for a consideration, and the buyer simultaneously leases the property back to the seller.

Second home

A property occupied part-time by a person in addition to his or her primary residence.

second mortgage

A mortgage that has a lien position subordinate to the first mortgage.

secondary mortgage market

An informal market where lenders and investors buy and sell existing mortgages. Government-sponsored entities and private investors buy mortgages from lenders who use the proceeds to make additional loans.

secured loan

A loan that is backed by collateral. If the borrower defaults, the lender can sell the collateral to satisfy the debt.

security

The property that will be pledged as collateral for a loan. If the borrower defaults, the lender can sell the collateral to satisfy the debt.

Security Interest

An interest a lender takes in the borrower's property to assure repayment of a debt. If the borrower defaults, the lender can sell the collateral to satisfy the debt.

seller take-back

An agreement in which the owner of a property provides financing, often in combination with an assumable mortgage. See owner financing.

Semi-Detached

Semi-detached housing (often abbreviated to semi in the UK, Canada, and Australia, as in "three-bedroom semi"; called a duplex or Zero Lot Line in Stockton California), consists of pairs of houses built side by side as units sharing a party wall and usually in such a way that each house's layout is a mirror image of its twin. This style of housing, although built throughout the world, is commonly seen as particularly symbolic of the suburbanization of the United Kingdom and Ireland, or post-war homes in Central Canada.

servicer

An organization that collects principal and interest payments from borrowers and manages borrowers' tax and insurance escrow accounts. A mortgage banker is often paid a fee to service mortgages that have been purchased by an investor in the secondary mortgage market.

servicing

The collection of principal and interest payments from borrowers and management of borrowers' tax and insurance escrow accounts.

settlement

See closing.

settlement sheet

See HUD-1 settlement statement.

short sale

A short sale is the sale of a house in which the proceeds fall short of what the owner still owes on the mortgage. Many lenders will agree to accept the proceeds of a short sale and forgive the rest of what is owed on the mortgage when the owner cannot make the mortgage payments. By accepting a short sale, the lender can avoid a lengthy and costly foreclosure, and the owner is able to pay off the loan for less than what he owes. See also deed in lieu (or foreclosure).

Single family residence

A Single Family Residence is a residential structure designed to include one dwelling.

special deposit account

An account that is established for rehabilitation mortgages to hold the funds needed for the rehabilitation work so they can be disbursed from time to time as particular portions of the work are completed.

Stand Alone

A Home Equity loan originated without obtaining a Countrywide first mortgage at the same time.

start rate

See initial interest rate.

subdivision

A subdivision is a housing development that is created by dividing a tract of land into individual lots for sale or lease.

subordinate financing

Any mortgage or other lien that has a priority that is lower than that of the first mortgage. The subordinate loan has a claim to payment in a foreclosure only after the first mortgage is paid.

subsidized second mortgage

An alternative financing option known as the Community Seconds® mortgage for low- and moderate-income households. An investor purchases a first mortgage that has a subsidized second mortgage behind it. The second mortgage may be issued by a state, county, or local housing agency, foundation, or nonprofit corporation. Payment on the second mortgage is often deferred and carries a very low interest rate (or no interest rate). Part or all of the second mortgage debt may be forgiven depending on how long the buyer remains in the home.

Suburb

Tract housing and culs-de-sac are hallmarks of suburban planning. Suburbs are commonly defined as smaller residential communities lying immediately outside a city. In the United States, suburbs have a prevalence of usually detached single-family homes. Some suburbs have a degree of political autonomy, and most have lower population density than inner city neighborhoods.

Subprime

A type of mortgage that is normally made out to borrowers with lower credit ratings. As a result of the borrower's lowered credit rating, a conventional mortgage is not offered because the lender views the borrower as having a larger-than-average risk of defaulting on the loan. Lending institutions often charge interest on subprime mortgages at a rate that is higher than a conventional mortgage in order to compensate themselves for carrying more risk.

survey

A drawing or map showing the precise legal boundaries of a property, the location of improvements, easements, rights of way, encroachments, and other physical features.

sweat equity

Contribution to the construction or rehabilitation of a property in the form of labor or services performed personally by the owner.