Mortgages Canada

Umbrella policy

Insurance that covers anything that regular insurance doesn’t cover.

Underpayment Penalty

Penalty for not paying taxes or for not paying taxes on time.

Underwater

Underwater refers to the mortgages that are bigger than the actual cost of the property.

Underwriting

In a mortgage world, underwriting refers to the risk analysis associated with a borrower. Before lenders give out a loan, lenders look at credit report assets, income and other factors to estimate whether borrower is eligible for a loan.

Underwriting Requirements

Standards set by lender in determining whether borrower qualifies for a mortgage. This includes credit check, loan to debt ratio and other factors.

Underwriting Fee

Fee paid for underwriting process.

Underwriting: In a mortgage world, underwriting refers to the risk analysis associated with a borrower. Before lenders give out a loan, lenders look at credit report assets, income and other factors to estimate whether borrower is eligible for a loan.

Underpayment

Mortgage payment that is smaller than regular payment amount. Lenders may impose fees for underpayment.

Underage

Fees collected by mortgage broker from the borrower that are smaller than those specified by the lender.

Unearned Income

Income that comes from:

Interest rates
Rent
Lease
Fees

And other income sources that do not require real labor.

Un-encumbered Property / Unencumbered Property

Property that is free from mortgages, loans, liens and other claims. For example, you paid your mortgage in full and now own the property. That property can be called Unencumbered Property

Unemployment Rate

Estimated number of people without work in a city, state(province), country.

Undisclosed Heir

Person who claims rights to a property after persons death, but is not specified in a will.

Universal Default

Universal default is a practice used by some lenders that allows them to punish borrowers who come short on payments to any creditor. This is mostly used by credit card companies. For example, if you have a credit card and come short on car payments, the credit card company may punish you with extra payments. This is simply a tactic to make more money off borrowers. Universal Default is specified in a contract.

Universal Life Insurance / Unbundled Life Insurance

Universal Life Insurance covers you for life and pays a lump sum to beneficiaries upon death. It also has a savings account within it. If you pay more than your monthly premium(monthly charge) extra amount goes into savings. If anything happens, your beneficiaries will be paid insurance + savings. If you come short on payments, the insurance will take the amount from savings and pay for itself, so there is a chance of skipping payments.

How it works in numbers:

Suppose your Universal Life Insurance guarantees $400.000 as a death benefit(accident, natural death, sickness, etc). Your monthly payments(premiums) are $100 per month. You also have a special savings account with Universal Life Insurance(its always there).

If you pay more than $100, say $150 per month, the extra will go into savings. The more extras you pay the more money there is on the savings account. If you get into accident, your beneficiaries will receive 400.000 + the savings you had.

But if you come short on payments, say only pay $50 per month or do not pay at all, the insurance will deduct money from savings as a way to pay for itself.

Universal Variable Insurance

An insurance, where death benefit depends on the type of investment insured person made. For example, insurer may choose to invest in the insurance company. As the stocks go up and down so will the amount paid upon death.

Unrecorded Deed

Property purchase that is not publicly recorded. Unrecorded Deed may be used as a way to fraud buyers. For example, Kate purchased a house from George, but failed to record a deed with local courthouse. George took notice and sold it again, to Alex. Kate found out about it and pressed charges against George, but the house will belong to Alex, since its deed was recorded in Good Faith.

Unsecured Claim / Unsecured Debt / Unsecured Loan

Debt for which the creditor has no assurance of payment, unlike a mortgage. This usually refers to credit cards, since borrowers have a choice of not paying back the money at the cost of being harassed by collection agencies and bad credit score.

Upgrades

Upgrades that the borrower can have on a property. For example, hardwood floors, different windows, different wall colors, etc.

Upside-down / Upside Down

Mortgage Balance that is bigger that the actual cost of the property.

Upzoning / Up Zoning

Change of residential property to commercial property.

Urban Sprawl

Expansion of the city past its outskirts. This may be due to rapid uncontrolled development or new rapid housing growth. Urban sprawl usually involves poorly connected neighborhoods, with few commercial centers and little public transportation.