Arizona Mortgage Term O

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ARIZONA MORTGAGE LOAN DICTIONARY O

Obligatory Advances - Loan advances required by a lender under an agreement as construction progress.

Observed Condition Depreciation - A method of computing depreciation in which the appraiser estimates the loss in value for all items of depreciation.  

Observed Condition Method - The method of determining effective age of a property by its condition.

Obsolescence - Lessening of value from out-of-date features (such as property design, construction materials, etc) that no longer are desired by property buyers.  

Occupancy Rate - The percentage of total rental units occupied and producing income.  

Offer to Purchase -  A document completed by  home buyer specifying the terms and conditions under which real estate will be purchased.  

Offset Statement - An owner statement, deposited into escrow, showing the status of rents, security deposits, and other balances and obligations connected with the investment property.

Open-End Mortgage -  A mortgage with a provision that the outstanding loan amount may be increased upon mutual agreement of the lender and the borrower.  

Open Listing - A nonexclusive agency whereby the owner agrees to a fee only if the broker is the first to procure a buyer under the exact terms of the listing or any other terms to which the owner agrees. 

Open Mortgage - 1) A loan that can be prepaid without penalty. 2) a mortgage in default prior to foreclosure sale.

Operating Expenses - The cost of all goods and services used or consumed in the process of obtaining and maintaining income. 

Option - A right given for a valuable consideration to purchase or lease property at a future date for a specified price and terms.  The right may or may not be exercised at the option holder's discretion. 

Orientation - Positioning a structure on its lot considering its exposure to the sun and prevailing winds, and the need for privacy and protection from noise

Origination Fee -  The fee that the lender charges the borrower to cover the cost of issuing a loan commitment.  It pays for processing the loan which includes collecting information about the borrower’s creditworthiness and the property.  The fee is usually computed as a percentage (for example, 1%) of the mortgage loan.  It usually does not include fees for appraisals, credit report, inspections and loan document preparation.  

Ostensible Agency - An agency that is implied by actions of the parties.

Overall Rate - The direct ratio between a property's annual net income and its sales price.  

Overimprovement - An improvement to property that is not likely to contribute its cost to the total market value of the property.

Owner Occupancy Rate - The percentage of properties in a condominium subdivision or a PUD that are owned by owner occupants (versus rental properties).

Owner-Occupied Property -  The borrower or a member of the immediate family lives in the property as a primary residence.     

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