UNIT 3 UNIT 3 – Definitions

Term Definition
Apartment complexes Group of apartments or apartment building. They many offer common laundry, pools, and storage facilities.
Condominium (Condo) Form of ownership, where residents own individual unit and have shared common spaces; parking lot, laundry, pools… A management company uses takes care of the grounds and the owners pay association fees.
Cooperative Similar to Condos; but the residents own Shares of stock in the corporation that owns the building not the unit itself. Therefore, the residents are stockholders and/or shareholders. The residents pay fees for maintenance like condo owners.
MUDs (Mixed Urban Development) A highrise building can include residential units mixed with commercial space, apartments, offices, and recreational space. These are built up, vs PUDs built out.
PUDs (Planned Unit Developments) Combination of different land uses, such as commercial, residential, and recreational, into one development. The owner owns their dwelling and pays association fees for maintenance. A larger community. PUDs are usually built under special zoning ordina
Retirement communities Much like PUDs, but built for an older age group.
Converted-use properties A building originally built for commercial use and converted into residential dwellings. ex: warehouse converted to apartment building.
Manufactured housing, Mobile homes, housing that appear mobile in nature, but are completed on-site, usually in housing parks. Housing park provide the water, gas,and electricity.
Time-shares Several owners for 1 piece of property where owner get a designated length of time each year to the property…Usually for vacation property.
PITI Principle, Interest, Taxes, and Insurance. Required payment by lenders if you do not have enough for down payment.
Debt to income ratiohousing ratio or front-end ratio. a purchaser’s housing expense (PITI), cannot be more than 28% of their gross (pre-tax) income
Equity Portion of the mortgage paid off.
Homeowner's Insurance Lenders usually require that a homeowner obtain insurance when a debt is secured by the property.
Basic Form Insurance Policy • fire and lightning,• glass breakage,• windstorm and hail,• explosion,• riot and civil commotion,• damage by aircraft,• damage from vehicles,• damage from smoke,• vandalism and malicious mischief,• theft, and• loss of property removed
Broad Form Insurance Policy Basic+ • falling objects;• damage due to the weight of ice, snow, or sleet;• collapse of all or part of the building;• bursting, cracking, burning, or bulging of a steam or hot water heating system or of appliances used to heat water;• accidental
Flood Insurance If property located in flood zone, a lender will require you to get this insurance
Debt to income ratio back-end ratio, PITI plus all other loans can not exceed 36%.

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