Laguna Beach Mortgage

949-495-5885

Mortgage Glossary

Use this glossary to look up definitions of mortgage terms.

The definitions given here explain how the terms are used in the field of real estate finance.
 

A   B   C   D    E    F   G   H   I   J   K   L   M   N   O   P   Q   R   S   T   U   V   W   X   Y   Z
 

Earnest Money
A deposit that a prospective buyer gives the seller when the purchase and sale agreement is signed, as evidence of his or her good faith intention to complete the transaction.
Economic Life
The period during which improved property yields a return over and above the rent due to the land itself; also called the useful life. Compare: Physical Life.
Encumber
To place a lien or other encumbrance against the title to a property.
Entitlement
The VA home loan benefit is called entitlement. Entitlement for a VA guaranteed home loan. This is also known as eligibility.
Equal Credit Opportunity Act (EC
Is a federal law that requires lenders and other creditors to make credit equally available without discrimination based on race, color, religion, national origin, age, sex, marital status or receipt of income from public assistance programs.
Equity
The difference between the fair market value and current indebtedness, also referred to as the owner's interest. The value an owner has in real estate over and above the obligation against the property.
Equity Exchange
When a buyer gives a seller real or personal property in addition to or instead of cash for the purchase price.
Escalation Clause
A clause in a contract or mortgage that provides for payment or interest increases if specified events occur, such as a change in the property taxes or in the prime interest rate. Also called an escalator clause.
Escrow
A system in which things of value (such as money or documents) are held on behalf of the parties to a transaction by a disinterested third party (the escrow agent) until specified conditions have been fulfilled.
Escrow Account
An account held by the lender into which the home buyer pays money as tax or insurance payments. It is also where deposits are held pending a loan closing.