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Article (1): Definitions

C 31/2013 Effective from 28/11/2013
  1. Mortgage loan: A loan that is collateralized against a residential property granted for the purpose of constructing, purchasing or renovating a house for owner occupier or investment purposes. It also includes loans granted for the purchase or the development of land for these purposes.
     
  2. Collateral: Property upon which the residential real estate loan is secured.
     
  3. Collateral Management: All tasks and processes within granting of mortgage loans where collateral is involved, e.g. appraisal and constitution of collateral; confirmation of its legal existence and enforceability.
     
  4. Debt Burden Ratio: Ratio of debt burden to income.
     
  5. Down payment: Up-front payment from the buyer for a portion of the purchase price, which reduces the value of the loan against the property.
     
  6. Equity: Difference between the appraised value of the property and the total claims held against the property.
     
  7. Loan-to-Value (LTV): The ratio of the amount of the loan outstanding to the appraised value of the residential property.
     
  8. Property appraisal: a comprehensive assessment of the property characteristics including the determination of the collateral’s value.
     
  9. Mortgage loan providers: All banks, finance companies and other financial institutions that provide mortgage loans.
     
  10. Tenor: The initial term length of a mortgage loan.