payments, ensuring payment of taxes and insurance, managing escrow accounts, managing communications with the homeowner, mitigating loss, initiating foreclosures, and otherwise “servicing” the mortgage. Servicing Transfer: When one servicer is replaced by another by the lender. Short Sale: Sale in which the servicer allows the homeowner to list and sell the mortgaged property with the understanding that the net proceeds from the sale may be less than the total amount due on the first mortgage. Also referred to as a “pre-foreclosure sale.” Title: The documented evidence that a person or organization has ownership of real property. Trust: A relationship in which one person holds title to property, subject to an obligation to keep or use the property for the benefit of another. Underwater: The condition of having negative equity or owing more on the property than the property is worth. Underwriting: The process of examining all the data about a homeowner’s property and income documentation to determine whether the mortgage modification should be issued. The person who does this is called an underwriter. Unpaid Principal Balance (UPB): Amount of a loan that is due to the lender. This does not include additional charges, such as interest. Weighted Average Life: Average number of years for which each dollar of unpaid principal on a loan or mortgage remains outstanding.
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