ING Home Loan Glossary

Acceptance Letter
A letter from the applicant indicating his willingness to accept the loan after the loan is approved by the banking institution
 

Bankrupt
A person, firm, or corporation that, through a court proceeding, is relieved from the payment of all debts after the surrender of all assets to a court-appointed trustee

Bankruptcy
A proceeding in a federal court in which a debtor who owes more than his or her assets can relieve the debts by transferring his or her assets to a trustee

Base Lending Rate (BLR)

A minimum interest rate calculated by financial institutions based on a formula which takes into account the institutions' cost of funds and other administrative costs

Booking Receipt
Official recepit from the developer/vendor indication the booking amount received

CCRIS

Central Credit Reference Information System. A computerized database system developed and maintained by the Credit Bureau to collect, process, store and generate credit information

CTOS
CTOS collates factual information into an electronic media for easy, instantaneous, and accurate retrieval. When you apply for loans, credit cards, hire purchase or leasing facilities, the credit grantor will make an enquiry in the CTOS system for information leads

Daily Rest
Allow clients to make prepayment and interest is calculated based on balance at the end of each day (calculation is daily basic)

Default

Failure to pay the monthly instalment/interest payments to financial institutions when due

Disbursement Fees

Various type of fees such as registration of charge fee, land search fee, bankruptcy search fee incurred by financial institutions and solicitors attending to the loan documentation in relation to the loan which are payable by the borrower

Documentation

A set of agreements, forms, and other documents to be signed in connection with a loan. The documentation will form a full set of records for the loan

Downpayment

An initial payment made by the buyer to the seller of the house

Financial Institutions

All commercial banks and finance companies licensed under BAFIA 1989 and Islamic banks licensed under the Islamic Banking Act 1983

Fixed Rate Loan

A term used to describe interest that is charged as a fixed percentage of the loan amount throughout the tenure of the loan. The flat repayment amount is usually determined before the commencement of the repayment programme

Floating Rate Loan

A term used to describe a loan, where the interest charged fluctuates due to the rise and fall of a certain indicator such as the Base Lending Rate

Foreclosure

Legal action available to the financial institution for recovering outstanding sums owed by a borrower who has defaulted on his/her loan. The property pledged by the borrower to secure the loan is sold and the proceeds of the sale used to settle the outstanding loan amount

Freehold
Owner have unlimited right to subdivide and aggregate subject to town planning controls

Gross Monthly Household Income

The sum of gross monthly pay of all working family members before deducting income tax, Sosco, EPF, loan instalment or other deductions plus any additional income from overtime, commissions and other sources

Guarantor

Person or entity who is legally bound to pay a debt incurred by the borrower if that borrower fails to pay

Homeowners Insurance

An insurance policy that combines liability coverage for a homeowner together with protection from damages caused by wind, fire, vandalism and other risks

Interest Rate

The amount charged by the lender to the borrower for borrowing a sum of money expressed as percentage of sum borrowed

Land Title
Title of the land describes details of the land location, size, title status and extra

Late Charge

A penalty charged by financial institution for not paying instalment due on time

Leasehold
Lease transfers require State or its equivalent's approval. Lease duration usually 30, 60, 99 or 999 years. Limited by purpose of lease and land legislation, and also environmental and town planning controls

Legal Fees
The fees and charges or price to be paid for legal assistance provided by a lawyer. This includes fees charged for time spent on a legal matter

Lender
The bank, mortgage company, or mortgage broker offering the loan

Letter Of Offer
Letter issued by bank for borrower, will clearly stated the interest rate, loan tenure, term and condition about the loan. Borrower needs to initial every page to confirm he/she understands conditions inside before signing this Letter of Offer

Loan Agreement

The contract between the lender and the borrower that sets out the loan terms and conditions. These will include amount, repayment obligations, interest rate, and the security required. It is important to read the Loan Agreement carefully before it is entered into

Loan Tenure

Number of years taken to fully repay the loan principal and interest as agreed under a specific repayment programme

Margin of Financing

The loan amount granted by the financial institution, expressed as a percentage of the value of property pledged to secure the loan

Market Value
The highest price that a buyer would pay and the lowest price a seller would accept on a property. Market value may be different from the price a property could actually be sold for at a given time

Master Title
Title for a land

Mortgage Reducing Term Assurance (MRTA)

A term insurance which reduces over the tenure of the loan. This form of insurance is used to provide cover for the outstanding loan amount, in the event of death or total permanent disability of the insured. MRTA is normally calculated to meet the outstanding loan amount

Moving Cost
Processing fees for the loan application, ie: stamping fees, legal fees, disbursement fees and valuation fees

Monthly Rest
Interest is calculated based on balance at the end of each month and does not take into account the daily balance of the account

Outstanding Loan

Remaining loan not yet paid, including interest and other charges

Overdraft

A type of credit facility granted to the eligible current account holder. The borrower is allowed to issue cheques exceeding the credit balance in the current account but subject to a certain pre-approved limit granted by the financial institution

Power of Attorney

A formal legal document giving authority to one person to act on behalf of another person

Prepayment

Payment of all or part of a loan before maturity

Prepayment Penalty

A fee charged by financial institutions for early payment of loan in full. The fee charged is usually based on a percentage of the loan amount or "X" months of interest

Principal

The amount borrowed from financial institutions, excluding interest and other charges

Property

Refers to landed properties (like house, apartment, condominium) and land (like bungalow lots)

Refinancing

The process of paying off a portion or the entire amount of the existing loan with the intention of obtaining another loan from the same or another financial institution

Sale & Purchase Agreement (SPA)

A written contract signed between the buyer and seller stating amongst others, the terms and conditions under which a property will be sold

Strata Title
Same meaning with individual title, but use for non-landed like condominium/apartment

Subsale
Purchase from someone which is not a developer

Term Loan

A loan which is repaid through regular periodic payments, usually over a period of time, for example 20 years

Title

A legal document establishing the right of ownership on a property

Valuation Fees
Fees payable for market value indication

Valuation Report

A written analysis of the estimated value of real estate prepared by a licensed Valuer