R



Glossary



Radon

A naturally occurring radioactive gas found in some buildings.In sufficient concentrations, Radon may cause Health Problems


Ratified Sales Contract

A sales contract in which an offer has been made and accepted, and the contract has been signed and initialed by all parties involved.


Rate

The amount of interest on a loan, expressed as a percentage.



Rate of return

The gain or loss on an investment over a period of time. The rate of return is typically reported annually and expressed as a percentage.



Real rate of return

The rate of return on an investment adjusted for inflation.



Rate lock

A commitment issued by a lender to a borrower guaranteeing a specific interest rate for a specified period of time. Rate lock periods are for a fixed number of days, and rate lock expiration occurs when that period has passed, subjecting the interest rate on the loan to market fluctuations since the date of the initial rate lock. When a rate lock expires, you will need to contact your lending specialist to establish a new rate lock prior to closing your loan.



Rate lock expiration

A commitment issued by a lender to a borrower guaranteeing a specific interest rate for a specified period of time. Rate lock periods are for a fixed number of days, and rate lock expiration occurs when that period has passed, subjecting the interest rate on the loan to market fluctuations since the date of the initial rate lock. When a rate lock expires, you will need to contact your lending specialist to establish a new rate lock prior to closing your loan.



Rate reduction option

A provision in a fixed-rate mortgage that gives the borrower the option to reduce the interest rate at a later date without having to refinance. Exercising a rate reduction option typically does not require requalifying for the loan.



Real Estate Settlement Procedures Act (RESPA)

A consumer protection law that, among other things, requires advance disclosure of settlement costs to home buyers and sellers, prohibits certain types of referral and other fees, sets rules for escrow accounts and requires notice to borrowers when servicing of a home loan is transferred.



Realtor

A real estate agent who is a member of National Association of Realtors.



Real Estate Agent / Broker

One who is engaged on behalf of another (usually on a commission) to negotiate contracts relating to property in which he or she has no custodial or proprietary interest.

Real Property

Land and anything growing on, attached to, or erected on it. Real property can be either corporeal (soil and buildings) or incorporeal (easements).




Reamortize

To take the remaining balance of a mortgage loan and establish a new period of amortization after which the principal balance will be zero. Typically used after the end of the term of an interest-only loan.



Reclamation

The act or an instance of improving the value of economically useless land by physically changing the land, such as irrigating a desert.



Reconveyance

The restoration or return of something to a former owner or holder.



Recorder

A charge for a public official (typically a Registrar of Deeds or County Clerk) noting in the public record the terms of a legal document affecting title to real property such as a deed, a security instrument, a satisfaction of mortgage or an extension of mortgage.



Recording

A charge for a public official (typically a Registrar of Deeds or County Clerk) noting in the public record the terms of a legal document affecting title to real property such as a deed, a security instrument, a satisfaction of mortgage or an extension of mortgage.



Recording fee

A charge for a public official (typically a Registrar of Deeds or County Clerk) noting in the public record the terms of a legal document affecting title to real property such as a deed, a security instrument, a satisfaction of mortgage or an extension of mortgage.



Redemption

The selling of fund shares back to the fund. This may also refer to the repayment of a bond on or before the agreed upon pay-off date.



Repayment Plan

An arrangement by which a borrower agrees to make additional payments to pay down past due amounts which still making regularly scheduled payments.


Redemption fee

A fee, generally charged by a mutual fund, to discourage certain trading practices by investors, such as short-term or excessive trading. If a redemption fee is charged, it is done when the investment is redeemed or sold.



Return

The gain or loss on an investment. A positive return indicates a gain, while a negative return indicates a loss.



Refinance

When a business or person revises a payment schedule for repaying debt.



Reduced documentation

A method used to determine income when qualifying a borrower for a loan. Borrower(s) provide their income, however no verification documentation is typically required.



Refinance

Paying off your existing loan with the proceeds from a new loan, generally using the same property as collateral, in order to take advantage of lower monthly payments, lower interest rates or save on financing costs.


Restriction

A limitation placed on the use or enjoyment of property


Rehabilitation loan

A first mortgage that enables borrowers to purchase or refinance and rehabilitate homes. With this mortgage product, borrowers can qualify for loan amounts based on the as-completed value of the property, up to the maximum loan limits.



Rehabilitation Mortgage

A mortgage that covers the costs of rehabilitating a property. Some rehabilitation mortgages allow a borrower to roll the costs of rehabilitation and home purchase into one mortgage loan.


Remaining Term

The original term of the loan after the number of payments made has been subtracted.



Rent with Option to Buy

A contractual provision by which an owner of realty enters an agreement with another allowing the latter to rent the property upon signing the lease with the option to buy the property at the end of the lease term, usually for a reduced rate.



Repayment period

The time you have to fully repay your outstanding balance, according to your payment terms. In a home equity line of credit, for example, the repayment period (typically 20 years) is the loan term that follows the draw period (typically 10 years).



Replacement Cost

The cost of a substitute asset that is equivalent to an asset currently held. The new asset has the same utility but may or may not be identical to the one replaced.



Rescission

The cancellation of a contract. In certain real estate-secured transactions that involve the refinance of a primary residence, applicants have 3 business days to cancel the transaction.



Reverse Annuity Mortgage (RAM)

A mortgage in which the lender disburses money over a long period to provide regular income to the borrower, and in which the loan is repaid in a lump sum when the borrower dies or when the property is sold.




Revolving Debt

Open-ended accounts, usually with variable interest rates, predetermined credit limits and payments that are calculated as a percentage of the unpaid balance. Credit Cards, Home Equity Lines of Credit (HELOC) and personal lines of credit are all examples of revolving debt.



Reserves

The amount of savings, separate from the down payment, that a homebuyer sets aside in case of unforeseen events or emergencies. During the loan approval process, many lenders require reserves (typically the equivalent of 2 monthly mortgage payments) to be verified.



Right of first refusal

A provision in an agreement that requires the owner of a property to give another party the first opportunity to purchase or lease the property before he or she offers it for sale or lease to others.



Rider

An optional rider added to your life insurance policy or annuity contract can offer additional coverage and protection on select products.



Risk

The potential for you to lose some or all of your investments, or to fail to achieve your investment objectives.



Risk tolerance

An investor’s ability and willingness to lose some or all of an investment in exchange for greater potential returns.



Rural housing loan

A loan offered by the Rural Housing Service (RHS), an agency within the Department of Agriculture. The RHS provides financing to farmers and other qualified borrowers buying property in rural areas who are unable to obtain loans elsewhere. Funds are borrowed from the U.S. Treasury.



Rural Housing Service (RHS)

A loan offered by the Rural Housing Service (RHS), an agency within the Department of Agriculture. The RHS provides financing to farmers and other qualified borrowers buying property in rural areas who are unable to obtain loans elsewhere. Funds are borrowed from the U.S. Treasury.



R-squared

R-squared measures the relationship between a portfolio and its benchmark. It can be thought of as a percentage from 1 to 100. R-squared is not a measure of the performance of a portfolio. If a portfolio moves like the benchmark, it has a high R-squared. If it doesn't move at all like the benchmark, it has a low R-squared.

General Range for R-Squared:

  • 70-100% = good correlation between the portfolio's returns and the benchmark's returns
  • 40-70% = average correlation between the portfolio's returns and the benchmark's returns
  • 1-40% = low correlation between the portfolio's returns and the benchmark's returns

R-squared can be used to ascertain the significance of a particular beta or alpha. Generally, a higher R-squared will indicate a more useful beta figure. If the R-squared is lower, then the beta is less relevant to the fund's performance. Alpha, beta and R-squared are considered MPT (Modern Portfolio Theory) statistics and are based on a least-squared regression of the fund’s return over Treasury bills (called excess return) and the excess returns of the fund’s benchmark index.



Russell 1000 Growth Index

An unmanaged index that measures the performance of the large capitalization growth segment of the U.S. equity universe. Includes Russell 1000 Index companies with higher price-to-book ratios and higher forecasted growth values.



Russell 1000 Index

An unmanaged index that measures the performance of stocks of the large capitalization segment of the U.S. equity universe.




Russell 1000 Value Index

An unmanaged index that measures the performance of the large capitalization value segment of the U.S. equity universe. Includes Russell 1000® Index companies with lower price-to-book ratios and lower forecasted growth values.



Russell 2000 Growth Index

An unmanaged index that measures the performance of the small capitalization growth segment of the U.S. equity universe. Includes Russell 2000® Index companies with higher price-to-book ratios and higher forecasted growth values.



Russell 2000 Index

An unmanaged index that measures the performance of the small-capitalization segment of the U.S. equity universe.



Russell 2000 Value Index

An unmanaged index that measures the performance of the small capitalization value segment of the U.S. equity universe; includes those Russell 2000® Index companies with a lower price-to-book ratios and lower forecasted growth values.



Russell Midcap Growth Index

An unmanaged index that measures the performance of the mid capitalization growth segment of the U.S. equity universe. Includes Russell Midcap® Index companies with higher price-to-book ratios and higher forecasted growth values.



Russell Midcap Value Index

An unmanaged index that measures the performance of the mid-capitalization value segment of the U.S. equity universe; includes those Russell Midcap® Index companies with a lower price-to-book ratios and lower forecasted growth values.





Acronyms



RDOT
Recorded Deed of Trust



REO
Real Estate Owned



RESPA
Real Estate Settlement Procedures Act was designed to protect consumers by requiring lenders to provide certain disclosures, as well as prohibiting referral fees and kickbacks



RESPRO
Rural Housing Service



RHS
Real Estate Services Provider's council



RML
Residential Mortgage Loan



ROR
Right of Rescission



RTC
Right to Cancel



RWA
Risk Weight Average