Balloon Mortgage
A mortgage with periodic installments of principal and interest that do not fully amortize the loan. The balance of the mortgage is due in a lump sum at a specified date in the future, usually at the end of the term.
Balloon Payment
The final payment (balance due) of a balloon note.
Beneficiary
An individual named as the recipient of the income or principal of an estate or trust.
Bequest
Property given as a gift under the terms of a will.
Blue Chip Stocks
High-quality, common stock of well-known companies with extended records of earnings and dividends, well-respected management, and prospects for continued strong performance. Generally, these stocks are the choice of investors seeking long-term growth.
Bond
A debt instrument that is a "promise to pay" issued by corporations, federal and state goverments, and municipalities to raise capital. The bond issuer promises to pay the holder of the bond the principal amount of the loan when the bond matures and a fixed rate of interest periodically during the term of the bond.
Borrower
A mortgagor who receives funds in the form of a loan with the obligation of repaying the loan in fully with interest, if applicable.
Bridge Financing
A form of interim loan, generally made between a short term loan and a permanent (long term) loan, when the borrower needs to have more time before taking the long term financing.
Broker (Real Estate)
One who is licensed by the state to carry on the business of dealing in real estate. A broker may receive a commission for his or her part in bringing together a buyer and seller, landlord and tenant, or parties to an exchange.
Building Code
The local regulations that control design, construction, and materials used in construction. Building codes are based on safety and health standards.
Bull/Bear
Terms frequently used to describe the outlook for short-and long-term market performance:
- bull refers to the belief that stock prices are likely to rise;
- bear refers to the expectation that prices will decline.
Buydown
A payment to the lender from the seller, buyer, third party, or some combination of these, causing the lender to reduce the interest rate during the early years of a loan. The buydown is usually for the first 1 to 5 years of the loan.
