APR - Annual Percentage Rate - the determination of the rate necessary to arrive at total payments from amount financed over the  life of the loan, based on life expectancy.

Churning - a lending practice whereby lenders engage in multiple refinancing to generate additional profit from loan fees and charges.  This type of mortgage is not in the best interest of the borrower and provides no financial benefit to the borrower.

Completed House - is defined as ready for occupancy with only minor finish items (i.e. touch-up painting, final grading and seeding) remaining.

Dangerous or Adverse Situations - situations that pose a threat of injury to the homeowner or occupant and/or require the use of special protective clothing or safety equipment on the part of the homeowner or occupuant(s).

Durable POA - means the Power of Attorney can sign the loan documents if the borrower becomes disabled or incapacitated.

Expected Average Monthly Interest Rate - the amount indicated on the payment plan.  It is a constant interest rate used to calculate monthly payments to the Borrower throughout the life of the loan.

Judgment - is a court's final determination of the rights and obligations in a case.  A money judgment is a judgment for a specific sum and is subject to immediate execution.

Judgment Lien - a lien imposed against the judment debtor's property.  A judgment lien gives the judgment creditor the right to seize a debtor's assets (i.e. real property) to secure a judgment or sell the assets to satisfy  the judgment.

Loan Advances - all funds advanced from or charged to Borrower's account under conditions set forth whether or not actually paid to the Borrower.

Maturity - unlike a traditional "forward" residential mortgage, which is repaid in periodic payments, a reverse mortgage is repaid in one payment at the time of the Maturity Date or a Maturity Event.  The Maturity Date on the Note and Security Instrument (deed) is 150 years past the birthday of the youngest borrower.  A Maturity Event is any occurrence which would require immediate payment in full including accrued interest.  Immediate payment in full of all outstanding pricipal and accrued interest may be require if:

• A borrower dies or the property ceased to be the principal residence of a borrower for reasons other than death and the property is not the pricipal residence of at least one surviving borrower
• For a period of longer than twelve consecutive months, a borrower fails to occupy the property because of physical or mental illness and the property is not the property of at lease one borrower
• An obligation of the borrower under the Security Instrument (deed) is not performed
• All of a borrower's title in the property (or his/her beneficial interest in a trust owning all or part of the property) is sold or otherwise transferred and no other borrower retains title to the property in Fee Simple; or a Leasehold under a lease for not less than 99 years which is renewable or a lease having a remaining period of not less than 50 years beyond the date of the 100th birthday of the youngest borrower (or retaining a beneficial interest in a trust with such an interest in the property); or Life Estate in the property

Maximum Claim Amount - the lesser of the appraised value of the Property or the National Lending Limit

Non-Recourse - the Borrower will never owe more than the loan balance or the value of the property, whichever is less; and no assest other than the home must be used to repay the debt.

Principal or Principal Balance - the sum of all Loan Advances made as of a particular date, includeing interest and mortgage insurance premiums.

Principal Limit - the amount indicated on the payment plan when the Loan Agreement is executed and increased each month for the life of the loan at a rate equal to one-twelfth of the Mortgage Interest Rate in effect at that time, plus one-twelfth of one-half percent per annum.  The Principal Limit is calculated using factors provided by the Secretary of Housing, which take into account the age of the youngest borrower, the Mortgage Interest Rate and the Maximum Claim Amount.

Principal Residence - the dwelling where the borrower maintains his or her permanent place of abode, and typically spends the majority of the calendar year ( at least 183 days per year). A person may have only one pricipal residence at any one time.  The Property shall be considered to the the Principal Residence of any borrower who is temporarily or permanently in a health care institution as long as the Property is the Principal Resident of at least one other borrower whi is not in a health care insititution.

Readily Observable - is defined as observations made by athe appraiser of conditions that are immediately discernable and nnoticeable during the typical site visit.  The appraiser is not required to move furniture, equipment or cause damage to the property.

Representative Sample - For multiple identical components such as windows and electrical outlets, a representative sample is one such component per room.  For multiple identical exterior componenets, a representative sample is one such component on each side of the building.