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GLOSSARY
Unearned interest
Unearned interest is an account on a lender's balance sheet that represents interest amounts that were collected in advance of being accrued.
Unified Managed Account - UMA
Unified managed account, or UMA, is a fee-based investment management product that includes all of the assets in an investor's portfolio, including stock positions, mutual funds, hedge funds, separate accounts, etc. A unified account makes it easier for the investor or money manager to employ a comprehensive investing strategy and maintain proper asset allocations.
Uniform Gift to Minors
Uniform Gift to Minors, also known as UGMA, is a trust that allows minors to invest in securities. Parents establish UGMAs on behalf of their children, and any funds deposited by the parents are considered irrevocable gifts. When the child reaches the age of 18 or 21 (depending on the state), he receives full control of the assets in the account.
Uniform Premarital Agreement Act
Uniform Premarital Agreement Act is state legislation that gives the parties to a premarital contract the option to choose the state that will have jurisdiction over the premarital contract. The state can be one in which either party lives or plans to live. It can also be the state in which the couple is to be married. Not all states have passed the Uniform Premarital Agreement Act, which limits the legislation's effectiveness somewhat.
Uniform Transfer to Minors Act - UTMA
Uniform Transfer to Minors Act, or UTMA, is legislation that allows parents to establish a trust account for their children. The trust account can invest in securities, as well as real estate, patents, royalties, and fine art on behalf of a minor child. Assets deposited to the account are subject to gift taxation laws. When the child reaches the age of 18 or 21 (depending on the state), she receives full control of the assets in the account.
Uninsured driver or motorist
Uninsured driver or motorist is an optional coverage type available on an auto insurance policy. Uninsured driver or motorist coverage pays the insured for injuries or damages that result from being hit by another driver who doesn't have auto insurance.
Universal default
Universal default is a policy of some lenders that allows them to punish borrowers who pay any creditor late.
Universal life insurance
Universal life insurance is an insurance contract that remains in force for the insured's lifetime, pays a benefit to designated beneficiaries upon the insured's death, and builds a cash value over time. A portion of the premium goes towards the death payment, and a portion is directed into yield-generating investments. The insured has the ability to transfer funds between the two parts of the policy, such as using investment earnings to pay premiums.
Unpaid dividend
Unpaid dividend is a profit distribution to owners that has been declared but not yet remitted.
Unrecorded deed
Document that transfers title to property, but which is not filed with a county recorder.
Unscheduled recast
Unscheduled recast is a recalculation of payments due on a loan that's triggered by something other than the passing of time since funding. Unscheduled recasts are usually triggered by certain events, which would be specified in the loan documentation. Negative amortization mortgages are subject to unscheduled recasts; when the balance reaches an upper limit on the negative amortization, a recast is triggered. In this case, the recast will increase the payment amount substantially.
Unsecured
Unsecured describes a loan that's not supported by collateral. Unsecured debt is riskier for the lender, because there's little recourse available if the borrower doesn't repay as promised. A traditional credit card is unsecured.
Unsecured claim
Claim or debt for which a creditor holds no special assurance of payment, unlike a mortgage or lien; a debt for which credit was extended based solely upon the creditor's assessment of the debtor's future ability to pay.
Unsecured debt
Debt that is not guaranteed by the pledge of any collateral. Most credit cards are unsecured debt, which is a main reason why their interest rate is higher than other forms of lending, such as mortgages, which employ property as collateral.
Unsecured loan
Advance of money that is not secured by collateral.