Glossary

  • Affordable Housing – Housing is typically considered “affordable” if it consumes no more than 30% of a household's income. The federal government incentivizes development of affordable housing by, among other things, awarding tax credits that can be sold to private investors who use the credits to reduce their federal tax liabilities. Under the Settlement Agreement, affordable housing relief was directed to rental housing and was provided under Menu Item 5.
  • Affordable Rental Housing Unit – A rental housing unit in a development receiving Menu Item 5 relief that satisfied Annex 2's requirements for being affordable by households making no more than a specified percentage of the Area Median Income.
  • Annex 2 – Annex 2 to the Settlement Agreement. Under the Settlement Agreement, Citi was required to provide $2.5 billion worth of consumer relief as set forth in Annex 2.
  • Anti-Blight Measures – Consumer relief designed to help communities mitigate harms associated with distressed or abandoned properties. Citi provided anti-blight relief under Menu Items 4A and 4D-F of the Settlement Agreement.
  • Balance Forgiveness – Method of modifying a mortgage loan in which the borrower's unpaid balance, including the unpaid principal balance and any accrued but uncapitalized interest, is permanently reduced. Citi provided balance forgiveness relief under Menu Items 1G and 2A of the Settlement Agreement.
  • CFS – CitiFinancial Servicing, a Citi business unit that provided various forms of consumer relief under the Settlement Agreement.
  • Citi Community Capital – The Citi business unit that provided consumer relief under the Settlement Agreement in the form of subordinated debt lending for affordable rental housing (Menu Item 5).
  • Citi Community Development – The Citi business unit that provided consumer relief under the Settlement Agreement in the form of anti-blight donations (Menu Items 4D-F).
  • CMI – CitiMortgage, Inc., a Citi business unit that provided various forms of consumer relief under the Settlement Agreement.
  • Costs Paid – Money paid to cover costs related to a loan refinancing. Citi provided costs paid relief under Menu Items 1G and 2A of the Settlement Agreement.
  • Credit – Credit earned by Citi under the Settlement Agreement by providing consumer relief (also referred to as “settlement credit”).
  • Early Incentive Credit – Bonus credit of 15% for all consumer relief activity Citi offered or completed by October 1, 2015.
  • Extinguishment – As used in the Settlement Agreement, extinguishment means reducing a debt to a zero balance. Citi provided extinguishment relief under Menu Items 1D (second liens), 1H (junior liens and unsecured debt), and 4A (first liens) of the Settlement Agreement.
  • First Lien – A lien that has priority over all other liens or claims on a property, other than a tax lien or certain other liens pursuant to state law (e.g., mechanic's lien), in the event of borrower default.
  • HMDA Data – Data reported in accordance with the Home Mortgage Disclosure Act, which requires financial institutions to maintain, report, and disclose certain loan-level information about mortgages.
  • Home Mortgage Disclosure Act (HMDA) – Federal law, codified at 12 U.S.C. &sect 2801 et seq., that requires many financial institutions to maintain, report, and publicly disclose loan-level information about mortgages.
  • Junior Lien – Lien that is not a first or second lien. A junior lien is lower in priority than either a first or second lien in the event of borrower default.
  • Lien – Interest in property held by a creditor to secure payment of a debt. A mortgage is a type of lien.
  • Loan Origination – The process by which borrowers take out a loan.
  • Menu Items – The categories of Consumer Relief specified in Annex 2 of the Settlement Agreement.
  • Principal Reduction – Permanent forgiveness of debt, typically used to refer to partial rather than complete forgiveness. Citi provided principal reduction relief under Menu Items 1A (first liens), 1G (refinancing assistance), and 2A (rate reductions) of the Settlement Agreement.
  • Rate Reduction – A reduction to the interest rate of a loan. Citi provided rate reduction relief under Menu Item 2A of the Settlement Agreement.
  • Relief – Assistance given to borrowers or communities. Citi received credit under the Settlement Agreement for some, but not all, of the relief it provided.
  • Second Lien – Lien that, in the event of borrower default, has priority over all other liens or claims on a property except the first lien, a tax lien, or certain other liens pursuant to state law (e.g., mechanic's lien). An example of a second lien is a home equity line of credit on an already-mortgaged home.
  • Settlement Agreement – The July 11, 2014 agreement among Citi, the U.S. Department of Justice (DOJ), and the states of California, New York, Illinois, Delaware, and the Commonwealth of Massachusetts resolving potential federal and state legal claims for violations of law in connection with the packaging, marketing, sale, structuring, arrangement, and issuance of RMBS (residential mortgage-backed securities) and CDOs (collateralized debt obligations) between 2006 and 2007.
  • Settling States – States that participated in the Settlement Agreement: California, New York, Illinois, Delaware, and the Commonwealth of Massachusetts.
  • State Minimums Bonus – A 15% bonus that Citi received for earning credit affecting the Settling States after Citi satisfied the State Minimums by earning state-specific minimum amounts of credit under any menu item. Such bonus credit could be earned only for relief provided under Menu Item 1 (forgiveness/forbearance), Menu Item 2 (rate reduction/refinancing), Menu Item 3 (low- to moderate-income lending), and Menu Items 4A-C (certain anti-blight relief).
  • Unpaid Principal Balance (UPB) – Amount owed on a loan at any given time and on which interest generally accrues until it is repaid.