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FHLMC
Acronym - Federal Home Loan Mortgage Corporation. See Freddie Mac.
fiduciary
The relationship of trust, honesty and confidence between agent and principal; the faithful relationship owed by an agent to the principal.
Finder's Fee
A fee charged by real estate brokers and apartment-finding services in exchange for locating a rental property. These fees are permitted by law. Some landlords, however, charge finder's fees merely for renting a place. This type of charge is not legitimate and, in some areas, is specifically declared illegal.
First Mortgage
A mortgage which is in first lien position, taking priority over all other liens (which are financial encumbrances).
Fixed Rate Mortgage
A mortgage with an interest rate and monthly payment that doesn't vary for the term of the loan.
Fixture
Personal property which has been attached to real estate so as to become part of the real property. The article must meet at least one of three conditions:
1. Attached in a permanent manner.
2. Specially adapted to the property. or
3. Intentionally made part of the real property.
Flood Control District
A special taxing district created to provide flood control in specific areas of a county.
Flood Insurance
A special and separate type of homeowner's insurance the provides coverage for damages resulting from flooding. Flood insurance is required by most lenders only if the property is located within a designated flood plain. The cost of the policy is related to the associated flooding risk. If a property has a small section of land located within a flood plain, but away from the residential improvements (house), the lender will still require a policy, but its cost will be much lower. Likewise, flood insurance policies for properties not located within any floodplain, are fairly inexpensive.
Most flood insurance is underwritten by the federal government through FEMA and the National Flood Insurance Program in cooperation with private insurance agencies. More than 18,000 communities participate in the Federal flood insurance program. More than 3.8 million National Flood Insurance Program (NFIP) home and business policies are in effect. The United States experiences flooding threats throughout all four seasons of the year and, in fact, flooding is the most common natural disaster. There are, on average, 1000 floods per year in the U.S. Nearly everyone is at some risk of experiencing the effects of flooding. In the Houston area, 25 percent of flood-insurance claims come from areas outside a designated flood plain.
Flood Plain
Flood plains are by definition subject to periodic flooding. They are generally characterized by relatively flat topography and soil types that were laid down during past inundations by flood waters. If your property is in the 100-year flood plain, there is a 1-in-100 chance in any given year that your property will flood. If it is in the 25-year flood plain, there is a 1-in-25 chance in any given year that your property will flood. The statistical chance of flooding is not changed by any one flooding event; but repeated flooding may result in the flood plain being recalculated.
A 100-year flood plain is always wider than a 25-year flood plain, and the 25-year flood plain is contained within the 100-year flood plain. The flood prone areas of the United States cover approximately 150,000 square miles or 94 million acres of land, an area roughly the size of the State of Montana. People living in flood plains are 26 times more likely to experience a flooding disaster than they are a fire disaster during the life of the 30-year mortgage on their homes.
The changes in flood plain maps reflect changes in land use (such as increased building activity), changes in the waterways, and flood control improvements (such as detention ponds or other flood control measures). As more lots are covered with more buildings and parking lots, the amount of water that flows into creeks and lakes increases because there is less vegetation to absorb the water when it rains. This is one reason why buildings that were not originally built in a flood plain are now in the 25-year or 100-year flood plain.
FNMA
Usually referred to as "Fannie Mae", the acronym stands for the Federal National Mortgage Association.
For Sale By Owner (FSBO)
An individual homeowner who is attempting to sell his property without a real estate broker. The acronym, FSBO is pronounced "fizzbo."
Foreclosure
A legal process instituted by a mortgagee or lien creditor after the debtor's default.
Forfeiture
The loss of property or a privilege due to breaking a law. For example, a landlord may forfeit his or her property to the federal or state government if the landlord knows it is a drug-dealing site but fails to stop the illegal activity. Likewise, a homeowner may lose his house to satisfy IRS debts or if the government suspects the home was bought with money derived from criminal acts. The government may seize and sell the property at auction, often far below its fair market value, before the homeowner has been allowed the due process of a trial. If the homeowner is found not guilty, the government is only required to pay back the amount received at auction, and not the market value.
Fraud
A misstatement of a material fact made with intent to deceive or made with reckless disregard of the truth, and which actually does deceive.
Freddie Mac
Chartered by Congress in 1970, Freddie Mac is a publicly held corporation that purchases mortgages in the secondary mortgage market. Freddie Mac came into being as the Federal Home Loan Mortgage Corporation (FHLMC) with the mission to create a continuous flow of funds to mortgage lenders. By supplying lenders with the money to make mortgages and packaging the mortgages into marketable securities which are sold to investors, Freddie Mac also helps to sustain a stable mortgage credit system which in turn, reduces the mortgage rates paid by homebuyers. Over the years, Freddie Mac has been responsible for opening the door to homeownership for one out of six home buyers in America who would not have qualified otherwise.
front foot
One linear foot (12 inches) along the street side of a lot.
Functional Obsolescence
Loss of value of real property caused by modernization or changing tastes or standards; e.g.. single bath, inadequate closet space, etc. Contrast with economic obsolescence.
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