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Reference

Definitions R

Real

In finance and economics 'real' means 'inflation-adjusted'.

Recast

A mortgage recast is a reworking of the payment amount and schedule.

From Ezine:

“Interest-only and negative amortization payments cannot go on forever. At some point, the loan balance must be paid in full. For all adjustable rate mortgages, there is a mandatory recast after a fixed period of time where the loan reverts to a conventionally amortizing loan to be paid over the remaining portion of a 30 year term.”

From Wikipedia:

“The minimum payment on an Option ARM can jump dramatically if its unpaid principal balance hits the maximum limit on negative amortization (typically 110% to 125% of the original loan amount). If that happens, the next minimum monthly payment will be at a level that would fully amortize the ARM over its remaining term. In addition, Option ARMs typically have automatic “recast” dates (often every fifth year) when the payment is adjusted to get the ARM back on pace to amortize the ARM in full over its remaining term.”

From Investopedia:

“A feature in some types of mortgages where the remaining scheduled principal and interest payments are recalculated based on a new amortization schedule.”

Reserves and resources

In the oil and gas industry, deposits are classified according to how likely it is that oil and gas can be recovered, as well as how large the amounts are likely to be. The main distinction is between

  • resources (all the deposits in the ground, recoverable or not) and
  • reserves (deposits that are likely to be brought to the surface and used)

There is often a large difference in volume between the two, so the distinction is essential. There are many finer distinctions, as well as differing assumptions in applying them. “Risked resources”, or “Risk-adjusted resources” usually means an attempt has been made to calculate likely future reserves based on (1) resource estimates, and (2) analogies with reserves in similar locations (Example).

From a Society of Petroleum Engineers glossary:

“Contingent Resources – Those quantities of petroleum which are estimated, on a given date, to be potentially recoverable from known accumulations but which are not currently considered to be commercially recoverable. …

Possible Reserves – Possible reserves are those unproved reserves which analysis of geological and engineering data suggests are less likely to be recoverable than probable reserves. In this context, when probabilistic methods are used, there should be at least a 10% probability that the quantities actually recovered will equal or exceed the sum of estimated proved, plus probable, plus possible reserves. …

Probable Reserves – Probable reserves are those unproved reserves which analysis of geological and engineering data suggests are more likely than not to be recoverable. In this context, when probabilistic methods are used, there should be at least a 50% probability that the quantities actually recovered will equal or exceed the sum of estimated proved plus probable reserves. …

Prospective Resources – Those quantities of petroleum which are estimated, on a given date, to be potentially recoverable from undiscovered accumulations. …

Proved Reserves – Proved reserves are those quantities of petroleum which, by analysis of geological and engineering data, can be estimated with reasonable certainty to be commercially recoverable, from a given date forward, from known reservoirs and under current economic conditions, operating methods, and government regulations. …

Resources = Total petroleum initially-in-place – The entire resource base is generally accepted to be all those estimated quantities of petroleum contained in the sub- surface, as well as those quantities already produced.”

From the USGS:

“Technically recoverable resources can be produced using currently available technology.” [as opposed to economically recoverable]

From Assessing gas and oil resources in the intermountain west:

“In practice, the definition of the term “technically recoverable” is unclear and is inconsistently applied among the different assessments. A large part of the difference between existing resource assessments results from differing assumptions as to what constitutes a technically recoverable resource.”

From Rosetta Resources:

“We use the term “net risked resources” to describe the Company’s internal estimates of volumes of natural gas and oil that are not classified as proved reserves but are potentially recoverable through exploratory drilling or additional drilling or recovery techniques. Estimates of unproved resources are by their nature more speculative than estimates of proved reserves and accordingly are subject to substantially greater risk of actually being realized by the Company.”

From Max Petroleum:

“Risked Resources – Risked prospective resource volumes are commonly categorized as Risked Mean Resources and are calculated by multiplying the unrisked mean resources by the geological chance of success to account for the risk of drilling an unsuccessful exploration well.”

Resubordination

Resubordination is when the home equity lender agrees to stay in second place in a refinance.

From MKEmortgage.net:

“Resubordination occurs in a refinance when the borrower wishes to keep their current second mortgage and only refinance their first mortgage. . . Subordination or resubordination can also occur with other items that may be on title to your home which may not necessarily be a second mortgage.”

Roll rate

In lending, the “roll rate” in a given pool of loans is the fraction of loans changing in delinquency status. This can be an aggregate rate for all statuses, or may be for a particular status pair. For example, the 60 day to 90 day roll rate would be the fraction of loans already at least 60 days late, progressing to being at least 90 days late.

From HousingWire.com 23 Dec 2008:

“About roll rates: “Rolls,” BTW, refer to roll rates, which assess the percentage of loans that worsened in delinquency status; rolls can be calculated in the aggregate or for any group of loans moving from one status to the next. Because vintage pools are static and tend to prepay over time, decreasing the number of loans in the pool, it’s usually the case that delinquencies will go up as a vintage seasons, regardless of the relative performance of the vintage itself — borrowers who can revintage usually do, while those who cannot don’t, leaving the riskier loans behind in any given vintage. Roll rate analysis is one way to get around this artifact in most data.”