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Glossary

Glossary of Loan Terminology

A

ABA routing number


A series of numbers located at the bottom of an account holder's checks or deposit slips. These numbers identify a particular account at a financial institution.

adjustable-rate mortgage (ARM)

A mortgage whose interest rate changes periodically based on the changes in a specified index.

adjustment date


The date on which the interest rate changes for an adjustable-rate mortgage (ARM).

adjustment period

The period that elapses between the adjustment dates for an adjustable-rate mortgage (ARM).

amortization

The repayment of a mortgage loan by installments with regular payments to cover the principal and interest.

amortization term


The amount of time required to amortize the mortgage loan. The amortization term is expressed as a number of months. For example, for a 30-year fixed-rate mortgage, the amortization term is 360 months.

annual percentage rate (APR)


The cost of a mortgage stated as a yearly rate; includes such items as interest, mortgage insurance, and loan origination fee (points).

annual percentage yield (APY)


The rate of interest earned by an account owner in a year, if no withdrawals occur. All financial institutions must calculate the APY in the same way.

application

A form, commonly referred to as a 1003 form, used to apply for a mortgage and to provide information regarding a prospective mortgagor and the proposed security.

appraisal


A written analysis of the estimated value of a property prepared by a qualified appraiser.

appraiser

A person qualified by education, training, and experience to estimate the value of real property and personal property.

appreciation

An increase in the value of a property due to changes in market conditions or other causes. The opposite of depreciation.

asset


Anything of monetary value that is owned by a person. Assets include real property, personal property, and enforceable claims against others (including bank accounts, stocks, mutual funds, and so on).

assignment

The transfer of a mortgage from one person to another.

assumable mortgage

A mortgage that can be taken over ("assumed") by the buyer when a home is sold.

assumption


The transfer of the seller's existing mortgage to the buyer.

assumption clause


A provision in an assumable mortgage that allows a buyer to assume responsibility for the mortgage from the seller. The loan does not need to be paid in full by the original borrower upon sale or transfer of the property.

assumption fee

The fee paid to a lender (usually by the purchaser of real property) resulting from the assumption of an existing mortgage.

Automated Clearing House (ACH)


ACH securely and efficiently transfers funds electronically through participating financial institutions.

B

balance sheet

A financial statement that shows assets, liabilities, and net worth as of a specific date.

balloon mortgage

A mortgage that has level monthly payments that will amortize over a stated term, but that provides for a lump sum payment to be due at the end of an earlier specified term.

balloon payment


The final lump sum payment that is made at the maturity date of a balloon mortgage.

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.

basis point

A basis point is 1/100th of a percentage point. For example, a fee calculated as 50 basis points of a loan amount of $100,000 would be 0.50% or $500.

before-tax income

Income before taxes are deducted.

beneficiary

The person designated to receive the income from a trust, estate, or a deed of trust.

binder

A preliminary agreement, secured by the payment of an earnest money deposit, under which a buyer offers to purchase real estate.

biweekly payment mortgage


A mortgage that requires payments to reduce the debt every two weeks (instead of the standard monthly payment schedule). The 26 (or possibly 27) biweekly payments are each equal to one-half of the monthly payment that would be required if the loan were a standard 30-year fixed-rate mortgage, and they are usually drafted from the borrower's bank account. The result for the borrower is a substantial savings in interest.

blanket mortgage

The mortgage that is secured by a cooperative project, as opposed to the share loans on individual units within the project.

bond


An interest-bearing certificate of debt with a maturity date. An obligation of a government or business corporation. A real estate bond is a written obligation usually secured by a mortgage or a deed of trust.

breach

A violation of any legal obligation.

bridge loan


A form of second trust that is collateralized by the borrower's present home (which is usually for sale) in a manner that allows the proceeds to be used for closing on a new house before the present home is sold. Also known as "swing loan."

broker

A person who, for a commission or a fee, brings parties together and assists in negotiating contracts between them.

buydown mortgage

A temporary buydown is a mortgage on which an initial lump sum payment is made by any party to reduce a borrower's monthly payments during the first few years of a mortgage. A permanent buydown reduces the interest rate over the entire life of a mortgage.

C

call option

A provision in the mortgage that gives the mortgagee the right to call the mortgage due and payable at the end of a specified period for whatever reason.

cap

A provision of an adjustable-rate mortgage (ARM) that limits how much the interest rate or mortgage payments may increase or decrease.

capital improvement


Any structure or component erected as a permanent improvement to real property that adds to its value and useful life.

cash-out refinance


A refinance transaction in which the amount of money received from the new loan exceeds the total of the money needed to repay the existing first mortgage, closing costs, points, and the amount required to satisfy any outstanding subordinate mortgage liens. In other words, a refinance transaction in which the borrower receives additional cash that can be used for any purpose.

certificate of deposit


Commonly known as a "CD," certificates of deposit bear a maturity date and a specified rate of interest. Penalties may apply for early withdrawal.

certificate of eligibility

A document issued by the federal government certifying a veteran's eligibility for a Department of Veterans Affairs (VA) mortgage.

certificate of reasonable value (CRV)


A document issued by the Department of Veterans Affairs (VA) that establishes the maximum value and loan amount for a VA mortgage.

certificate of title

A statement provided by an abstract company, title company, or attorney stating that the current owner legally holds the title to real estate.

chain of title

The history of all of the documents that transfer title to a parcel of real property, starting with the earliest existing document and ending with the most recent.

change frequency

The frequency (in months) of payment and/or interest rate changes in an adjustable-rate mortgage (ARM).

clear title


A title that is free of liens or legal questions as to ownership of the property.

closing

A meeting at which a sale of a property is finalized by the buyer signing the mortgage documents and paying closing costs. Also called "settlement."

closing cost item

A fee or amount that a homebuyer must pay at closing for a single service, tax, or product. Closing costs are made up of individual closing cost items such as origination fees and attorney's fees. Many closing cost items are included as numbered items on the HUD-1 statement. Expenses (over and above the price of the property) incurred by buyers and sellers in transferring ownership of a property. Closing costs normally include an origination fee, an attorney's fee, taxes, an amount placed in escrow, and charges for obtaining title insurance and a survey. Closing costs percentage will vary according to the area of the country.

closing statement


Also referred to as the HUD-1. The final statement of costs incurred to close on a loan or to purchase a home.

cloud on title

Any conditions revealed by a title search that adversely affect the title to real estate. Usually clouds on title cannot be removed except by a quitclaim deed, release, or court action.

collateral

An asset (such as a car or a home) that guarantees the repayment of a loan. The borrower risks losing the asset if the loan is not repaid according to the terms of the loan contract.

collection

The efforts used to bring a delinquent mortgage current and to file the necessary notices to proceed with foreclosure when necessary.

combination loan

With this type of loan, you receive a first mortgage for 80% of the loan amount, and a second mortgage at the same time for the remainder of the balance. If avoiding PMI (mortgage insurance) is important to you, consider combination loans.

combined loan-to-value (CLTV)


The unpaid principal balances of all the mortgages on a property (first and second usually) divided by the property's appraised value.

co-maker


A person who signs a promissory note along with the borrower. A co-maker's signature guarantees that the loan will be repaid, because the borrower and the co-maker are equally responsible for the repayment. See endorser.

commission


The fee charged by a broker or agent for negotiating a real estate or loan transaction. A commission is generally a percentage of the price of the property or loan.

commitment letter

A formal offer by a lender stating the terms under which it agrees to lend money to a homebuyer. Also known as a "loan commitment."

common areas


Those portions of a building, land, and amenities owned (or managed) by a planned unit development (PUD) or condominium project's homeowners' association (or a cooperative project's cooperative corporation) that are used by all of the unit owners, who share in the common expenses of their operation and maintenance. Common areas include swimming pools, tennis courts, and other recreational facilities, as well as common corridors of buildings, parking areas, means of ingress and egress, etc.

Community Home Improvement Mortgage Loan

An alternative financing option that allows low-and moderate-income homebuyers to obtain 95 percent financing for the purchase and improvement of a home in need of modest repairs. The repair work can account for as much as 30 percent of the appraised value.

community property

In some western and southwestern states, a form of ownership under which property acquired during a marriage is presumed to be owned jointly unless acquired as separate property of either spouse.

compound interest

E-LOAN CDs and savings accounts compound interest daily. This refers to any interest earned on an account holder's principal balance, as well as any prior interest.

condominium

A real estate project in which each unit owner has title to a unit in a building, an undivided interest in the common areas of the project, and sometimes the exclusive use of certain limited common areas.

condominium conversion

Changing the ownership of an existing building (usually a rental project) to the condominium form of ownership.

conforming loan

The current conforming loan limit is $417,000 and below. Conforming loan limits change annually.

construction loan


A short-term, interim loan for financing the cost of construction. The lender makes payments to the builder at periodic intervals as the work progresses.

consumer reporting agency (or bureau)


An organization that prepares reports that are used by lenders to determine a potential borrower's credit history. The agency obtains data for these reports from a credit repository as well as from other sources.

contingency


A condition that must be met before a contract is legally binding. For example, home purchasers often include a contingency that specifies that the contract is not binding until the purchaser obtains a satisfactory home inspection report from a qualified home inspector.

contract

An oral or written agreement to do or to no do a certain thing.

conventional mortgage

A mortgage that is not insured or guaranteed by the federal government.

convertibility clause


A provision in some adjustable-rate mortgages (ARMs) that allows the borrower to change the ARM to a fixed-rate mortgage at specified timeframes after loan origination.

convertible ARM

An adjustable-rate mortgage (ARM) that can be converted to a fixed-rate mortgage under specified conditions.

cooperative (co-op)


A type of multiple ownership in which the residents of a multiunit housing complex own shares in the cooperative corporation that owns the property, giving each resident the right to occupy a specific apartment or unit.

corporate relocation


Arrangements under which an employer moves an employee to another area as part of the employer's normal course of business or under which it transfers a substantial part or all of its operations and employees to another area because it is relocating its headquarters or expanding its office capacity.

cost of funds index (COFI)


An index that is used to determine interest rate changes for certain adjustable-rate mortgage (ARM) plans. It represents the weighted-average cost of savings, borrowings, and advances of the 11th District members of the Federal Home Loan Bank of San Francisco.

covenant

A clause in a mortgage that obligates or restricts the borrower and that, if violated, can result in foreclosure.

credit


An agreement in which a borrower receives something of value in exchange for a promise to repay the lender at a later date.

credit history

A record of an individual's open and fully repaid debts. A credit history helps a lender to determine whether a potential borrower has a history of repaying debts in a timely manner.

credit report

A report of an individual's credit history prepared by a credit bureau and used by a lender in determining a loan applicant's creditworthiness.

credit repository

An organization that gathers, records, updates, and stores financial and public records information about the payment records of individuals who are being considered for credit.

D

debt

An amount owed to another.

deed

The legal document conveying title to a property.

deed in lieu

A deed given by a mortgagor to the mortgagee to satisfy a debt and avoid foreclosure.

deed of trust

The document used in some states instead of a mortgage; title is conveyed to a trustee.

default

Failure to make mortgage payments on a timely basis or to comply with other requirements of a mortgage.

delinquency


Failure to make mortgage payments when mortgage payments are due.

deposit


A sum of money given to bind the sale of real estate, or a sum of money given to ensure payment or an advance of funds in the processing of a loan.

depreciation

A decline in the value of property; the opposite of appreciation.

down payment


The part of the purchase price of a property that the buyer pays in cash and does not finance with a mortgage.

due-on-sale provision 


A provision in a mortgage that allows the lender to demand repayment in full if the borrower sells the property that serves as security for the mortgage.

E

earnest money deposit

A deposit made by the potential homebuyer to show that he or she is serious about buying the house.

easement

A right of way giving persons other than the owner access to or over a property.

effective age

An appraiser's estimate of the physical condition of a building. The actual age of a building may be shorter or longer than its effective age.

effective gross income


Normal annual income including overtime that is regular or guaranteed. The income may be from more than one source. Salary is generally the principal source, but other income may qualify if it is significant and stable.

eighty-ten-ten loan


See "combination loan".

electronic funds transfer (EFT)

EFT allows account holders to transfer funds from an account electronically. This method of transfer is not only highly secure, but also extremely efficient and easy to transact.

encumbrance

Anything that affects or limits the fee simple title to a property, such as mortgages, leases, easements, or restrictions.

endorser

A person who signs ownership interest over to another party. Contrast with co-maker.

Equal Credit Opportunity Act (ECOA)


A federal law that requires lenders and other creditors to make credit equally available without discrimination based on race, color, religion, national origin, age, sex, marital status, or receipt of income from public assistance programs.

equity

A homeowner's financial interest in a property. Equity is the difference between the fair market value of the property and the amount still owed on its mortgage.

escrow

An item of value, money, or documents deposited with a third party to be delivered upon the fulfillment of a condition. For example, the deposit by a borrower with the lender of funds to pay taxes and insurance premiums when they become due, or the deposit of funds or documents with an attorney or escrow agent to be disbursed upon the closing of a sale of real estate.

escrow account

The account in which a mortgage servicer holds the borrower's escrow payments prior to paying property expenses.

escrow analysis

The periodic examination of escrow accounts to determine if current monthly deposits will provide sufficient funds to pay taxes, insurance, and other bills when due.

escrow collections

Funds collected by the servicer and set aside in an escrow account to pay the borrower's property taxes, mortgage insurance, and hazard insurance.

escrow disbursements

The use of escrow funds to pay real estate taxes, hazard insurance, mortgage insurance, and other property expenses as they become due.

escrow payment

The portion of a mortgagor's monthly payment that is held by the servicer to pay for taxes, hazard insurance, mortgage insurance, lease payments, and other items as they become due. Known as "impounds" or "reserves" in some states.

estate

The ownership interest of an individual in real property. The sum total of all the real property and personal property owned by an individual at time of death.

eviction

The lawful expulsion of an occupant from real property.

examination of title

The report on the title of a property from the public records or an abstract of the title.

F

Fair Credit Reporting Act

A consumer protection law that regulates the disclosure of consumer credit reports by consumer/credit reporting agencies and establishes procedures for correcting mistakes on one's credit record.

fair market value

The highest price that a buyer, willing but not compelled to buy, would pay, and the lowest a seller, willing but not compelled to sell, would accept.

Fannie Mae


A congressionally chartered, shareholder-owned company that is the nation's largest supplier of home mortgage funds.

Fannie Mae's Community Homebuyer's Program

An income-based community lending model, under which mortgage insurers and Fannie Mae offer flexible underwriting guidelines to increase a low-or moderate-income family's buying power and to decrease the total amount of cash needed to purchase a home. Borrowers who participate in this model are required to attend pre-purchase homebuyer education sessions.

FDIC insured

E-LOAN is a subsidiary of Banco Popular North America (BPNA). E-LOAN and BPNA combine account balances for insurance purposes. The Federal Deposit Insurance Corporation (FDIC) insures the total balances up to the maximum allowed by law.

fee simple

The greatest possible interest a person can have in real estate.

Federal Housing Administration (FHA)


An agency of the U.S. Department of Housing and Urban Development (HUD). Its main activity is the insuring of residential mortgage loans made by private lenders. The FHA sets standards for construction and underwriting but does not lend money or plan or construct housing.

FHA mortgage

A mortgage that is insured by the Federal Housing Administration (FHA). Also known as a government mortgage.

finder's fee

A fee or commission paid to a mortgage broker for finding a mortgage loan for a prospective borrower.

first adjustment

When you can expect the first rate adjustment in your ARM loan.

first mortgage

A mortgage that is the primary lien against a property.

float down option

An option to choose a lower rate within 30 days before the closing of your loan and "float down" to a lower rate than the previously locked-in rate. This allows you to pick the best rate within that time period.

fixed-rate mortgage (FRM)


A mortgage in which the interest rate does not change during the entire term of the loan.

fixed second mortgage

See home equity loan

flood insurance

Insurance that compensates for physical property damage resulting from flooding. It is required for properties located in federally designated flood areas.

foreclosure

The legal process by which a borrower in default under a mortgage is deprived of his or her interest in the mortgaged property. This usually involves a forced sale of the property at public auction with the proceeds of the sale being applied to the mortgage debt.

fully amortized ARM

An adjustable-rate mortgage (ARM) with a monthly payment that is sufficient to amortize the remaining balance, at the interest accrual rate, over the amortization term.

G

good faith estimate

An estimate of charges which a borrower is likely to incur in connection with a settlement.

H

hazard insurance

Insurance protecting against loss to real estate caused by fire, some natural causes, vandalism, etc., depending upon the terms of the policy.

home equity line of credit

a credit line that is secured by a second deed of trust on a house. Equity lines of credit are revolving accounts that work like a credit card, which can be paid down or charged up for the term of the loan. The minimum payment due each month is interest only.

home equity loan

a loan secured by a second deed of trust on a house, typically used as a home improvement loan.

housing ratio

The ratio of the monthly housing payment in total (PITI - Principal, Interest, Taxes, and Insurance) divided by the gross monthly income. This ratio is sometimes referred to as the top ratio or front-end ratio.

HUD

The U.S. Department of Housing and Urban

I

index

A published interest rate to which the interest rate on an Adjustable Rate Mortgage (ARM) is tied. Some commonly used indices include the 1 Year Treasury Bill, 6 Month LIBOR, and the 11th District Cost of Funds (COFI).

impound account

An impound account is an account established by the lender to pay a borrower's tax and insurance costs. The borrower's monthly mortgage payment is then increased to cover these costs, with the additional amount being held in the impound account and disbursed by the lender when the payments are due. Lenders typically prefer this arrangement because it reduces the possibility of a lapse in tax or insurance payments that could diminish the value of the lender's investment (your house). Therefore, while it is often possible to opt out of an impound account it will result in additional charges.

interest-only loan option

Loan payments have two components, principal and interest. An interest-only loan has no principal component for a specified period of time. These special loans minimize your monthly payments by eliminating the need to pay down your balance during the interest-only period, giving you greater cash flow control and/or increased purchasing power.

J

jumbo mortgage

The current loan limit for a conforming loan is $417,000. Loan amounts of $417,001 and above are considered non-conforming or jumbo mortgages and are usually subject to higher pricing.

L

lien

An encumbrance against property for money due, either voluntary or involuntary.

lender

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

LIBOR

LIBOR stands for London Inter-Bank Offered Rate. This is a favorable interest rate offered for U.S. dollar deposits between a group of London banks. There are several different LIBOR rates, defined by the maturity of their deposit. The LIBOR is an international index that follows world economic conditions. LIBOR-indexed ARMs offer borrowers aggressive initial rates and have proven to be competitive with popular ARM indexes like the Treasury bill.

lifetime cap


A provision of an ARM that limits the highest rate that can occur over the life of the loan.

loan to value ratio (LTV)


The unpaid principal balance of the mortgage on a property divided by the property's appraised value. The LTV will affect programs available to the borrower. Generally, the lower the LTV the more favorable the terms of the programs offered by lenders.

lock period

The amount of time that a lender will guarantee a loan's interest rate. Once you've locked in the interest rate on a loan, the lender will guarantee that rate for a certain period of time, usually for 30, 45 or 60 days.

lock-in

A written agreement guaranteeing the homebuyer a specified interest rate provided the loan is closed within a set period of time. The lock-in also usually specifies the number of points to be paid at closing.

M

margin


The number of percentage points a lender adds to the index value to calculate the ARM interest rate at each adjustment period.

maturity date


 A pre-set date informing account owners when they can withdraw principal funds without incurring a penalty. (Please note that you may withdraw any generated interest before reaching an account's maturity date at E-LOAN.)

mortgage


A legal document that pledges a property to the lender as security for payment of a debt

mortgage disability insurance

A disability insurance policy which will pay the monthly mortgage payment in the event of a covered disability of an insured borrower for a specified period of time.

mortgage insurance (MI)


Insurance written by an independent mortgage insurance company protecting the mortgage lender against loss incurred by a mortgage default. Usually required for loans with an LTV of 80.01% or higher.

mortgagee


The person or company who receives the mortgage as a pledge for repayment of the loan. The mortgage lender.

mortgagor



 The mortgage borrower who gives the mortgage as a pledge to repay.

N

negative amortization

Negative Amortization, or "deferred interest," occurs when the mortgage payment is less than a loan's accruing interest. This causes a loan's balance to grow instead of reduce or "amortize."

no income verification

See "stated income".

non-conforming loan

Also called a jumbo loan. Conventional home mortgages not eligible for sale and delivery to either Fannie Mae (FNMA) or Freddie Mac (FHLMC) because of various reasons, including loan amount, loan characteristics or underwriting guidelines. Non-conforming loans usually incur a rate and origination fee premium. The current non-conforming loan limit is $333,701 and above.

note

A written agreement containing a promise from the signer to pay a named person, or order, or bearer, a definite sum of money at a specified date or on demand.

O

origination fee

A fee imposed by a lender to cover certain processing expenses in connection with making a real estate loan. Usually a percentage of the amount loaned, such as one percent.

owner financing

A property purchase transaction in which the property seller provides all or part of the financing.

P

periodic cap

The maximum rate increase for a specific period for a specific loan (ARM) only.

PITI


Principal, interest, taxes and insurance--the components of a monthly mortgage payment.

planned unit developments (PUD)


A subdivision of five or more individually owned lots with one or more other parcels owned in common or with reciprocal rights in one or more other parcels.

points


 Charges levied by the mortgage lender and usually payable at closing. One point represents 1% of the face value of the mortgage loan.

prepaids


Those expenses of property which are paid in advance of their due date and will usually be prorated upon sale, such as taxes, insurance, rent, etc.

prepayment penalty

A charge imposed by a mortgage lender on a borrower who wants to pay off part or all of a mortgage loan in advance of schedule.

principal



 This term refers to the total amount of money originally deposited into a Savings or CD account. When taking out a loan however, it refers to the amount of debt, not including interest.

private mortgage insurance (PMI)


Insurance provided by non-government insurers that protects lenders against loss if a borrower defaults. Fannie Mae generally requires private mortgage insurance for loans with loan-to-value (LTV) percentages greater than 80%.

Q

qualifying ratios

The ratio of your fixed monthly expenses to your gross monthly income, used to determine how much you can afford to borrow. The fixed monthly expenses would include PITI along with other obligations such as student loans, car loans, or credit card payments.

R

rate


The annual rate of interest on a loan, expressed as a percentage of 100.

rate cap

A limit on how much the interest rate can change, either at each adjustment period or over the life of the loan.

rate lock-in

A written agreement in which the lender guarantees the borrower a specified interest rate, provided the loan closes within a set period of time.

rebate

Compensation received from a wholesale lender which can be used to cover closing costs or as a refund to the borrower. Loans with rebates often carry higher interest rates than loans with "points" (see above).

refinancing


The process of paying off one loan with the proceeds from a new loan using the same property as security.

residential mortgage credit report (RMCR)

A report requested by your lender that utilizes information from at least two of the three national credit bureaus and information provided on your loan application.

S

seller carry back

An agreement in which the owner of a property provides financing, often in combination with an assumed mortgage.

simple interest

An amount earned on an account holder's principal, according to a specified rate. This does not include any compounding interest.

stated/documented income

Some loan products require only that applicants "state" the source of their income without providing supporting documentation such as tax returns.

subordination


If you are refinancing your first mortgage and have an existing second or home equity line, one option is to "subordinate" the second mortgage: request that your second mortgage holder go back into the second lien position when you replace your existing first mortgage with the new refinance loan.

survey

A print showing the measurements of the boundaries of a parcel of land, together with the location of all improvements on the land and sometimes its area and topography.

T

tenants in common

An undivided interest in property taken by two or more persons. The interest need not be equal. Upon death of one or more persons, there is no right of survivorship.

term

The length of time your money must remain in a CD without incurring an early withdrawal penalty. This term also refers to the period of time that covers the life of a loan.

title

The evidence one has of right to possession of land.

title insurance

Insurance against loss resulting from defects of title to a specifically described parcel of real property.

title search

An investigation into the history of ownership of a property to check for liens, unpaid claims, restrictions or problems, to prove that the seller can transfer free and clear ownership.

total debt ratio

Monthly debt and housing payments divided by gross monthly income. Also known as Obligations-to-Income Ratio or Back-End Ratio.

Truth in Lending Act

A federal law requiring a disclosure of credit terms using a standard format. This is intended to facilitate comparisons between the lending terms of different financial institutions.

V

variable rate

An interest rate that may change once an account opens.

Veterans Administration (VA)


A government agency guaranteeing mortgage loans with no down payment to qualified veterans.

Y

yield

The amount generated in interest on an account.

All deposit products offered through E-LOAN, Inc. (E-LOAN) will be opened through Banco Popular North America (BPNA), a New York state chartered bank insured by the FDIC that is the direct parent company of E-LOAN (i.e. E-LOAN is a wholly-owned subsidiary of BPNA). Processing services are provided by BPNA. All deposits with BPNA are insured for the maximum amount allowed by law, and all balances on deposit with BPNA (whether directly or through E-LOAN) would be combined for purposes of determining FDIC coverage eligibility. Beginning January 1, 2013, all of a depositor's accounts at an insured depository institution, including all noninterest-bearing transaction accounts, will be insured by the FDIC up to the standard maximum deposit insurance amount ($250,000), for each deposit insurance ownership category. For more information about FDIC insurance coverage of noninterest-bearing transaction accounts, visit ww.fdic.gov/deposit/deposits/unlimited/expiration.html.