finance important concepts

Wage -- compensation paid to employees.

Wage assignment -- a clause in a loan contract that allows the lender to obtain the borrower's wages in the case of a default without notice or a hearing. This credit practice was prohibited by federal regulation in 1985.

Wage garnishment -- a process granted by a court order by which a lender obtains, directly from an employer, part of the salary of an employee who is behind in payments to the lender.

Waiver -- the voluntary relinquishment of a right to one's own property or to a claim against another's property, or to any other legally enforceable right.

Waiver of exemption -- a loan contract clause that contains a waiver or limitation of the borrower's right to exempt his or her personal or real property from attachment, execution or other legal process in the event of a default. This credit practice was prohibited by federal regulation in 1985.

Warehousing -- the borrowing of funds by a retail lender on a short-term basis using permanent mortgage loans as collateral. This form of interim financing, called a warehouse loan, is used to raise funds to make home mortgages and carry them until the mortgages are packaged and sold "out of the warehouse" to an investor. Proceeds from the sale are used to reduce the warehouse loan.

Warehouse loan -- see warehousing.

Warrant -- (1) a certificate giving the holder the right to purchase securities at a stated price within a specified time period. (2) a written order, signed by a magistrate in the name of the government directing an officer to make an arrest.

Warranty -- a statement, either written, expressed or implied, providing assurance that some specified provision in a contract, such as a sale, is true.

Warranty deed -- a deed in which the seller warrants that the title to the real estate to be sold is good and salable.

Water table -- the point beneath the surface of the ground at which natural ground water is found. It is one of the factors considered by mortgage lenders.

Way -- a street, alley or other thoroughfare or easement permanently established as a passage for people and/or vehicles.

Wealth -- the value of one's total possessions and property rights.

When issued -- short for "when, as, and if issued." The term indicates a conditional sale of a security; the security has been authorized but not yet issued and paid for. All when-issued transactions are on a conditional basis until the security is delivered to the buyer and payment is delivered to the issuer. Federal Home Loan Bank System bonds are sold on a when-issued bas is.

White elephant -- slang for property or a business that is so costly to maintain or operate that it is impossible to make a profit.

Whole loan -- a mortgage loan sold in its entirety. When a whole loan is sold by the original lender to an investor, all of the contractual rights and responsibilities of the original lender pass to the investor.

Will -- a written document signed by an individual that sets forth how the person desires his or her property to be distributed upon the person's death.

Windfall profit -- an unexpected profit arising from causes not controlled by the recipient.

Wire transfer -- an order to pay or to credit money transmitted electronically rather than by paper check.

Withdrawal -- a removal of funds from a savings or checking account by the account's owner.

Withdrawal form -- a source document filled out by a customer to authorize a withdrawal from the customer's savings or checking account. The form is kept by the savings institution for its records.

Withdrawal penalty -- a charge imposed upon an account holder for the early removal of funds from a certificate account; usually an amount equal to interest earned during a prespecified period.

Withdrawal ratio -- withdrawals expressed as a percentage of gross savings during a given period of time.

Withdrawal value -- the amount credited to the savings account of a thrift institution depositor, less deductions as shown on the records of the savings institution.

With full recourse -- a term used in the secondary mortgage loan market. It refers to a written clause in a sales agreement by which a lender sells mortgages to an investor. It means the seller/lender will fully reimburse the buyer/investor for any losses resulting from the purchased loans. This may be accomplished by the seller taking back any loans that become delinquent.

Without recourse -- a term used in the secondary mortgage market. It is a clause in a sales contract by which a lender sells mortgage loans to an investor. It means the seller/lender is under no obligation to reimburse the buyer/investor for any losses resulting from the purchased loans. See with full recourse.

With partial recourse -- a secondary mortgage market term referring to a clause in the sales contract by which lenders sell their mortgage loans to investors. It means the seller/lender is obligated to reimburse the buyer/investor for an agreed-on portion of any losses resulting from default or other problems in the purchased loans.

Working capital -- liquid assets available for conducting the daily affairs of a business.

Workout agreement -- a plan approved by borrower and lender by which a delinquent borrower can reschedule loan payments so that the entire outstanding principal is eventually repaid.

Worth -- the total value of something.

Wraparound mortgage -- a financing device that permits an existing loan to be refinanced and new, additional money to be advanced at an interest rate between the rate charged on the old loan and the current market interest rate. The creditor combines or "wraps" the remainder of the old loan with the new loan at the intermediate rate. The borrower makes one payment, to the new lender, who in turn makes the monthly payments to the original lender. The amount of the wraparound mortgage is the total of the outstanding principal of the first mortgage (which remains in effect) and the additional outstanding funds advanced by the wraparound lender.

Writ -- a written order, under the seal of government authority, issued by a court and directing an officer of the court to perform some act, or enjoining a party to do or refrain from doing some act.

Write-off -- the accounting procedure used when an asset has been determined to be un-collectible and is therefore charged off as a loss. On the books, the amount is removed from the asset portion of a balance sheet and recorded as an expense item on the income statement.