A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

H

Hazard Insurance

Protects against damages caused to property by fire, windstorms, and other common hazards.

Home Equity Conversion Mortgage (HECM)

A special type of mortgage that enables older home owners to convert the equity they have in their homes into cash, using a variety of payment options to address their specific financial needs. Unlike traditional home equity loans, a borrower does not qualify on the basis of income but on the value of his or her home. In addition, the loan does not have to be repaid until the borrower no longer occupies the property. Sometimes called a reverse mortgage.

Home Inspection

A thorough inspection that evaluates the structural and mechanical condition of a property. A satisfactory home inspection is often included as a contingency by the purchaser.

Homeowners' Association

A nonprofit association that manages the common areas of a planned unit development (PUD) or condominium project. In a condominium project, it has no ownership interest in the common elements. In a PUD project, it holds title to the common elements.

HUD

U.S. Department of Housing and Urban Development. Office of Housing/Federal Housing Administration within HUD insures home mortgage loans made by lenders and sets minimum standards for such homes.

I

Incurable Defect

A defect in a property that cannot be fixed, such as an adjacent hazardous waste site, or one that would cost too much to repair relative to the value of the property.

Independent Contractor

A person hired to do a particular job, subject to the direction of a supervisor. An independent contractor pays for his or her own expenses and taxes, and receives no employee benefits. Most real estate agents are independent contractors.

Index

Financial tables used by lenders to calculate interest rates on adjustable mortgages and on Treasury bills.

Infrastructure

The roads, schools, parks, utilities, bridges, and communications systems in a community.

Interest

The fee, expressed as a percentage, charged for a loan. The interest rate also helps determine the monthly payment. For adjustable-rate loans, the interest rate may change from its initial level.

Interest Accrual Rate

The percentage rate at which interest accrues on the mortgage. In most cases, it is also the rate used to calculate the monthly payments, although it is not used for an adjustable-rate mortgage (ARM) with payment change limitations.

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