Finance terminology and definitions

VA -- see Veteran's Administration.

Vacancy factor -- a measurement of gross rental income loss due to vacancy and non-collection of rent. The rate is expressed as a percentage, and is calculated by dividing lost rental income (from vacancy and non-collection) into total potential gross rental income (including income from other rental units and the lost income).

Vacancy rate -- the percentage of housing units that are unoccupied.

Validation -- proof, confirmation, or evidence to confirm or legally support a claim or contract.

Valuation -- an estimated value or worth of something.

Valuation allowance (or valuation reserve) -- funds in an account established to cover probable loan losses. If a savings association believes a loan is uncollectible, it sets aside in the reserve account a portion of earnings equal to the difference between unpaid principal and the market value of the loan. If the loan is charged off as worthless, the institution writes down the loan portfolio and the reserve account by equal amounts. See specific valuation allowance and general valuation allowance.

Value -- the monetary worth of property, goods or services. See fair market value, fair value, and net realizable value.

Variable rate certificate -- a certificate savings account on which the interest rate varies during the term of the deposit according to a predetermined schedule, formula, or index.

Variable rate mortgage -- see adjustable rate mortgage.

Variance -- permission from an appropriate governing agency to not conform to specific construction codes, zoning regulations, or other prescribed restrictions concerning property use.

Vault -- a secure room or rooms in a financial institution where cash on hand is stored and safe deposit boxes are located.

Velocity -- (1) the rate at which money flows from one transaction to another. The number of times money changes hands in a given time period. (2) the rate at which total money in circulation is spent on goods and services in a given time period (usually measured as the ratio of GNP to the money stock). Greater velocity thus means that a given amount of money is used for a higher dollar volume of transactions.

Vend -- to sell, or offer to sell, something.

Vendee -- a buyer of property, goods or services.

Vendor -- a seller of property, goods, or services.

Vendor’s lien -- the right of a seller who has not yet been paid to take back possession of sold property until its purchase price has been received from the buyer.

Venue -- the place where a suit or charge is brought to court, generally the place or jurisdiction where the alleged wrong was committed.

Vest -- (1) to confer the right of immediate or future possession and use of property. (2) a designation of ownership or possession of property. For example: a title is said to vest in John Doakes. (3) a designation of the endowment of rights, power or authority. For example: the authority to regulate the thrift industry is vested by Congress in the Office of Thrift Supervision.

Vested interest -- a fixed interest in tangible or intangible property, although the right of possession, use and enjoyment may be postponed until some future date or until the happening of some specified event.

Veterans Administration (VA) -- a federal government agency that, among other things, aids veterans of the U. S. armed forces in obtaining housing. VA loans offer a guarantee to the lending institution as to repayment of the loans and result in veteran home buyers being able to obtain mortgage loans with a lower down payment.

Voluntary association account -- a savings account held by a nonincorporated group, such as a club, baseball team, church, civic group or charity; otherwise generally similar to a corporation account.

Voluntary conveyance -- see deed in lieu of foreclosure.

Voting stock -- stock that gives the holder the right to vote in the election of the corporation's directors, in the appointment of auditors and in other matters brought up at the annual stockholders' meeting. Most common stock is voting stock. Most preferred stock in nonvoting stock.

Voucher -- (1) a written statement that bears witness or substantiates a transaction; for example providing evidence that services have been rendered, goods purchased, or some other expenditure has been made. (2) a printed form authorizing a disbursement.

Voucher check -- a check to which is attached a form (voucher) describing the purpose of the check, and/or explaining various items on which the check is based. The voucher is detached before the check is cashed.

Voucher payment plan -- a system of advancing funds from lender to borrower in a construction loan. The borrower/contractor must complete a ledger form requesting each loan payout when particular, prespecified stages of construction are reached.