Glossary and Acronyms "F"

Fixed income fund

A fund that invests primarily in bonds and other fixed-income securities. Fixed income funds often provide shareholders with current income.

Fixed return investment

An investment that provides a specific rate of return to the investor.

Fixed annuity

With a fixed annuity, the insurance company guarantees the rate of return and payout. Guarantees are subject to the claims-paying ability of the issuing insurance company.

Financial Industry Regulatory Authority (FINRA)

A self-regulatory organization for brokerage firms doing business in the United States. FINRA operates under the supervision of the U.S. Securities and Exchange Commission (SEC). FINRA protects investors and ensures market integrity.

Financial statement

The written record of the financial status of a fund or company. Financial statements are usually published in a company’s annual report. They generally include a balance sheet, an income statement, and other financial statements and disclosures.

Form 1098

A legal tax form that reports the amount of interest and points paid during the previous year. Ref: 1098

Freddie Mac

A government-sponsored enterprise that buys and securitizes mortgages for resale in the secondary market. Ref: Freddie Mac

Funding date

The date on which the proceeds from a loan are available to or disbursed for the benefit of the borrowers.

Federal Deposit Insurance Corporation (FDIC)

A federal agency that insures deposits in member banks and thrift institutions. Ref: FDIC

Fiduciary

Any person or party who exercises any discretionary authority or control over the management of a plan, or the disposition of its assets. For a fee, a fiduciary gives investment advice, or has the authority to do so. A fiduciary also has discretionary responsibility in the administration of that plan.

Forfeiture

The loss of money, property, rights or privileges due to a breach of legal obligation.

Forbearance

A period during which your monthly loan payments are temporarily suspended or reduced. You may qualify for forbearance if you are willing but unable to make loan payments due to certain types of financial hardships. During forbearance, principal payments are postponed but interest continues to accrue.

Foreclosure

A legal procedure in which property securing a defaulted loan is sold by the lender in order to repay a borrower’s loan. The amount paid by a buyer at the foreclosure may not be enough to fully repay the loan and the borrower may continue to owe the lender the difference. Ref: Foreclosure

Floor

The lowest limit, such as the lowest interest rate allowed by law or the smallest permissible payment under a contract.

Flood Certificate Fee

Fee issued to the client which covers the cost of the assessment and is included in closing costs and fees.

Flood insurance

Insurance that protects against loss due to floods. When available, this type of insurance is required by law when a property is located within a special flood hazard zone.

Flood certification

A determination by a reputable source about whether property is located within a special flood hazard zone.

Floating rate

A loan rate for which the lender has not "locked" or committed to lend at a particular interest rate. The floating interest rate and any discount points are not guaranteed. Your actual interest rate and discount points will be based on the market price available for your loan product at the time your interest rate is locked.

Fixed Period Adjustable Rate Mortgage

An adjustable rate mortgage with an initial fixed interest rate period. After the fixed interest rate expires, the interest rate starts to adjust based on an Index plus a margin. The amount by which the interest rate can adjust after the fixed period is usually subject to an interest rate cap.

Fixed-rate option (Fixed-Rate Loan Option)

An option available on certain home equity lines of credit allowing borrowers to fix the payments and interest rate on a portion of their outstanding principal balance for a specific term. Customers may be charged a fee for this privilege.

Fixed-rate mortgage (FRM)

A home loan with a predetermined fixed interest rate for the entire term of the loan. Ref: Fixed Rate Mortgage

Fixed Installment

The monthly payment due on a mortgage loan which includes both principal and Interest.

First-Time Home Buyer

An Individual who has had no ownership in a principal residence during the 3-year period ending on the date of purchase of the property. This includes a spouse. If either meets the test, they are considered first-time home buyers. A single parent who has only owned with a former spouse while married. Ref: First Time Home Buyer Assistance Programs

First mortgage

A mortgage that is the senior lien against a property.

Finance charge

The cost of consumer credit expressed as a dollar amount. It includes the amount of interest you will pay during the terms of the loan, origination points and certain other items. Some closing costs are not treated as finance charges.

FICO

An acronym for Fair Isaac Corporation, which develops the mathematical formulas used to produce credit scores for assessing credit risk. FICO scores fall between a low of 300 and a high of 850. The higher the FICO score, the lower credit risk a consumer presents. Ref: Credit Score

Firm Committment

A Promise from a lender to make a Mortgage Loan.

FHA Mortgage Insurance

Current Federal Housing Administration (FHA) Loan upfront mortgage insurance premiums are 1.75 percent of the loan size. If an FHA-backed mortgage is used for a purchase mortgage and your loan size is $300,000.00, then your upfront Mortgage Insurance Premium (MIP) will be $5250.00.

FHA home loan / FHA Mortgage

A mortgage that is insured by the Federal Housing Administration (FHA). Also known as a government loan. FHA mortgage insurance protects the lender (not the borrower) if a borrower defaults on the FHA loan. This insurance enables a lender to provide loan options and benefits often not available through conventional financing.

Fee Simple

Clear and absolute ownership of a piece of property. The fee simple owner of a property has the right to use the land in any way desired, for example: build on it, sell it or lease it.

Federal Housing Administration (FHA)

An agency of the Department of Housing and Urban Development. The FHA provides mortgage insurance for certain residential mortgages. It also sets standards for underwriting these mortgages and for construction of homes secured by these mortgages.

Federal Reserve System (FRS)

The Central bank that sets credit and monetary policy by fixing the reserves to be maintained by depository institutions, determining the discount rate charged by Federal Reserve Banks, and regulating the amount of credit that may be extended on any security. The Federal Reserve System was established by the Federal Reserve Act of 1913. It incorporates 12 central banks supervised by a Board of Governors whose members are appointed by the President and confirmed by the Senate

Federal Home Loan Mortgage Corporation (Freddie Mac/FHLMC)

A Corporation that purchases both convetional and federally insured first mortgages from members of the Federal Reserve System and other approved banks. Ref: Freddie Mac

Fannie Mae / FNMA (Federal National Mortgage Assosiation

Federal National Mortgage Association, a government-sponsored enterprise that buys and securitizes mortgages for resale in the secondary market. It is a privately owned and managed corporation chartered by the US government that provides a secondary mortgage market for the purchase and sale of mortgages guaranteed by the Veterans Administration and those insured under the Federal Housing Administration. Ref: Fannie Mae

Fannie Mae/Freddie Mac Loan Limit

The current loan limits are $510,400 for a single family unit home, 653,550 for a two-unit home, &789,950.00 for a three unit home and 981,700.00 for a four-unit home. These numbers are 150 percent higher in high cost area like Alaska, Hawaii, Guam, and the U.S Virgin Islands. Ref: Loan Limits

Fair market value

The likely selling price of a home. The fair market value is usually determined by an appraisal.

Fair Housing Act (FHA)

A 1968 federal statute that prohibits discrimination based on race, sex, religion, family status, or National origin in the sale or rental of a dwelling, especially in the refusal to sell or rent. Ref: Fair Housing Act

Fair and Accurate Credit Transactions Act (FACT Act) 2003

A 2003 Amendment to the Federal Fair Credit Act Reporting Act providing free annual credit reports to consumers and establishing measures intended to help prevent identity theft. One of the Act's better-known and more heavily litigated provisions prohibits merchants from printing the expiration date or more thn the last five digits of the card number on a point-of-sale credit card or debit card receipts. Ref: FACT Act

Fair Credit Reporting Act (FCRA / Regulation V)

Law passed by Congress to give borrowers certain rights when dealing with consumer reporting agencies, or credit bureaus. All credit bureaus are required to provide accurate credit histories to authorized businesses for use in evaluating applications for insurance, employment, credit or loans. Ref: FCRA / FACT Act

Flat rate expenses

Base fees charged to a plan, regardless of the number of participants. Examples of flat rate expenses include preparation of IRS Form 5500, discrimination testing and vesting calculation.

Front-end load

A sales charge on mutual funds or annuities assessed at the time of purchase.

FTSE NAREIT® All Equity REITs Index

An unmanaged, free float-adjusted index that measures the performance of all publicly traded real estate companies and tax-qualified U.S. equity REITs; index constituents must have more than 50% of total assets in qualifying real estate assets other than mortgages secured by real property, and must meet minimum size and liquidity criteria.

FTSE World ex US Index

An unmanaged, broad-based, free float-adjusted, market capitalization-weighted index that measures the performance of large-cap and mid-cap stocks in developed and advanced emerging countries, excluding the United States.

FTSE World Index

An unmanaged, broad-based, free float-adjusted, market capitalization-weighted index that measures the performance of large-cap and mid-cap stocks in developed and advanced emerging countries, including the United States.

Fund family

A group or “complex” of mutual funds. Each group typically has its own investment objective, and is managed and distributed by the same company. Fund family also refers to a group of collective investment funds or a group of separate accounts managed and distributed by the same company.

Fund window

A plan feature that lets you buy investments that are not included in your plan’s general menu of designated investment alternatives.

Fully Amortized Mortgage

A Mortgage in which the mortgagor pays the interest as well as a portion of the principal in the periodic payment. At maturity, the periodic payments will have completely repaid the loan. Also known as a self-liquidating mortgage.

Acronyms

FOMC

Federal Open Market Comittee

FACTA

(Fair and accurate credit transactions act):

Prevents identity theft , puts limits on information sharing.

FCRA

(Fair credit reporting act): Regulates how consumer-reporting agencies use consumer information.

FHAC

Federal Housing Administration Connection (FHA computerized system)

FIPS

Federal Information Processing Standard

FDIC

(Federal deposit insurance corporation): Regulates depository institutions.

FED

Federal Reserve Board

FHLB

Federal Home Loan Banks

FFIEC

(Federal Financial Institution s examination council) collects and distributes HMDA information

FKA

Formerly known as

FHA

(Federal Housing Administration) the federal government agency that ovsersees the U.S housing market. FHA mortgages are guaranteed by the federal government and offered by banks/lenders.

FHLMC

(Federal Home Loan Mortgage Corporation) a corporation authorized by congress to provide a secondary market for residential mortgages

FHLMC

FreddieMac

FICO

Fair Issac Credit Score

FREDDIE MAC

(Another name for the federal home loan mortgage corporation) a govt sponsored entity created by congress to increase access to mortgage . Mortgages offered under freddie mac guidelines are called 'conforming' mortgages

FASB

Financial Accounting Standards Board

FCRA

fair credit reporting Act

FICO

(Fair isaac corporation) the company that created the industrial standard credit scores used by almost all lenders. The FICO score is in numerical summary of the information in your credit reports that represents your potential credit risk

FinCEN

(Financial crimes and enforcement network) the entity that SAR would be reported to

FNMA

(Federal National Mortgage Association or Fannie mae) a government sponsored entity created by congress to increase access to mortgages. Mortgages offered under fannie mae guidelines are called conforming mortgages. Along with Freddie Mac, it is one of the two Federal agencies that purchase home loans from lenders

FTC

(Federal Trade Commission)

FTHB

First Time Home Buyer

FTP

Final Title Policy

FDCPA

Fair Debt Collection Practices Act

FED

Federal Reserve Board

FHA Mortgage

A mortgage insured by the Federal Housing Administration, which insures the lender against loss. One advantage of an FHA loan is the low down payment requirement.

FHFA

Federal Housing Finance Authority

FSOC

Financial Stabity Oversight Council

FV

Fair Value

FVNI

Fair Value Net Income

FVOCI

Fair Value Other Comprehensive Income