B

Back-end ratio, or debt ratio
The amount you pay in monthly debt (credit cards, student loans, etc.) divided by your gross monthly income.

Balloon (payment) mortgage
Usually a short-term fixed-rate loan which involves small payments for a certain period of time, and one large payment for the remaining amount of the principal at a time specified in the contract.

Betterment
An improvement that increases property value, as distinct from repairs that simply maintain value. It's an upgrade, not just upkeep.

Bill of sale
a written document that transfers title to the property.

Binder
A preliminary agreement, secured by an earnest money deposit, through which the buyer offers to purchase the home.

Biweekly payment mortgage
A mortgage that requires payments to be made every two weeks (instead of monthly).

Blanket Mortgage
A mortgage covering at least two pieces of real estate as security for the same mortgage.

Blended Payments
payments placed in an osterizer and mixed until all the lumps are gone. Er... just kidding.

Actually, it's a repayment method by which the same amount is paid each month, but the composition of the interest and principal changes with each payment. With each payment, the amount allocated to the principal increases as the amount allocated to interest decreases.

Most mortgages use blended payments because it provides a consistent monthly payment amount for the borrower.

Blockbusting
The attempt to induce someone to sell their home because someone from a protected class is rumored to be moving into the neighborhood. The classic example of this would be a real estate agent passing out her card to neighbors while telling them that a minority family is moving in down the block and they should sell now before the neighborhood gets any worse. This is illegal.

Bona fide
In good faith, real, not fraudulent. We think this is a Latin phrase, but it may also have something to do with a dog.

Borrower (Mortgagor)
One who applies for and receives a loan in the form of a mortgage, with the intention of repaying the loan in full.

If you don't have the intention to repay the loan, then there are other terms that you might not want to see applied to you: crook, deadbeat, scam artist, fugitive from justice, etc.

Breach
A violation of any legal obligation. Not to be confused with Henry V -- "Once more unto the breach, dear friends!"

Broker
1) an individual in the business of helping to arrange funding or negotiating contracts for a client, but who does not loan the money himself. This is a mortgage broker; mortgage brokers usually charge a fee or receive a commission for their services.

2) Someone who helps you find a house and charges a fee for their services as well. This is a real estate broker; the term is usually synonymous with real estate agent, although there are, technically, differences.

Building code
Local regulations having to do with design and construction of a building. This means, of course, that it's not OK to build a house made of oatmeal, no matter what that builder may tell you.

Buy-down
The lender and/or the home builder subsidize the mortgage by lowering the interest rate during the first few years of the loan. While the payments are initially low, they will increase when the subsidy expires.

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