Abstract – A summary or brief, i.e., an abstract of judgment.
Abstract of Judgment – Summary of a court judgment that sets up a lien against a property when issued by the county recorder.
Abstract of Title – A summary of a title to a particular property that consists of a condensed account of the original grant, all resulting conveyances and encumbrances affecting the property, and a certification by a reviewer that the history is complete and accurate.
Abstract Plant – Information associated with the title of a particular property; also referred to as a title plant.
Acceleration Clause – A stipulation in a loan’s terms allowing a lender to speed up the repayment rate in the event of default, up to and including requiring you to pay off an entire balance immediately.
Acceptance – Written approval from a seller in response to a buyer’s offer.
Accrued Interest – The daily accrual of interest on a loan.
Addendum – The daily accrual of interest on a loan.
Additional Principal Payment – Money above and beyond the monthly loan amount paid to reduce the loan faster and lower the amount of interest paid.
Adequate Protection – Payment to a creditor to secure the value of a creditor’s lien during the bankruptcy proceeding from loss due to depreciation or nonpayment of another lien.
Adjustable-Rate Mortgage (ARM) – A mortgage or home equity loan with a interest rate and monthly payment that varies from time-to-time during the life of the loan, based on the rise and fall of an index. In many instances lenders charge a lower interest rate for the first few months of the loan. Many ARMs have a rate cap that limits the amount the interest rate can fluctuate, both in a periodic adjustment and over the life of the loan. ARMs are also referred to as variable-rate mortgages.
Adjusted Balance – The balance on a credit card, minus payments made during one billing cycle, plus the finance charges.
Adversary Proceeding – A bankruptcy court lawsuit filed that is associated with to the debtor’s bankruptcy case, i.e., complaints to assess the debtor’s ability to discharge a debt and complaints about the validity of liens.
Agent – A person licensed to conduct real estate transactions in a particular state.
Agreement of Sale – Also known as a sales agreement or purchase agreement, this document provides details of the sale, including terms.
Alienation – Property transfer between two people. Involuntary (i.e., seizure through eminent domain and voluntary (through a sale, for example) alienation are both possible.
Alienation Clause – A mortgage term that requires that the borrower to be responsible for the principal and interest at the conclusion of the sale of the property. (See the entries for acceleration and due-on-sale clause.)
All-Inclusive Deed of Trust – A type of deed of trust that includes the amounts of any prior deeds of trust and any other amounts financed; also known as a wrap-around or over-riding trust deed.
Amortization – The incremental reduction in principal of an overall amount owed on a loan. Usually during the earlier years of a loan, the vast majority of each payment is applied only toward interest. Often during the final years of the loan, whole payments are applied almost exclusively to the remaining principal. The only exception to this occurs when there has been negative amortization.
Amortization Table – A breakdown of a loan’s monthly payments into principal and interest. This tool is used to determine the amount of principal vs. interest you will pay over the life of the loan.
Amortization Term – The time needed to pay off a loan, usually in months (i.e., a 30-year fixed-rate mortgage’s amortization term is 360 months).
Annual Adjustment Cap – A restriction on how much a variable interest rate loan may go up or down each year.
Annual Fee – A yearly fee paid by a borrower for an open line of credit.
Annual Income – The net income, less alimony, child support or separate maintenance income (at the borrowers discretion) earned in a year.
Annual Percentage Rate (APR) – The borrower’s overall yearly cost, in addition to monthly payments, of a loan. Much like an interest rate, the APR is added as a percentage into the loan amount. Included in the APR are fees and charges that are added to the loan’s percentage rate to arrive at the true, overall cost to the borrower. The Federal Truth in Lending Act mandates a full detailing of the APR. This uniform disclosure allows consumers to compare and contrast various loans against one another.
Application Fees – These non-refundable fees are paid up-front, when your loan is initiated. These fees can include property appraisals, credit reports, etc.
Appraisal or Appraised Value – A professional estimate of value, usually performed by an appraiser. Also referred to as a valuation.
Appraisal Fee – The cost of the appraisal.
Appraise – To set the value or price of a property or other item.
Appreciation – The opposite of depreciation, the amount an asset value goes up over a period of time.
Arrears – In most cases, the state of being overdue for installment payments.
Assessor – A municipality employee who is responsible for valuing properties for tax purpose.
Asset – Property (could be a home, valuable art, cars, etc.) a lender may consider as collateral for a loan.
Assignee – A person who receives a transfer of interest. Therefore, in the case of an assignee for an agreement of purchase and sale is eligible to purchase the property and enforce relevant contracts in the same way as the original party.
Assignment – The process through which rights or contracts are transferred from one person to another.
Assignor – The person who transfers an interest of some kind to another person.
Assumable – When a buyer “assumes” a loan from a seller. For example, if a buyer qualifies, he or she may take over an existing mortgage, which can sometimes make buying a home more affordable – if prevailing interest rates are high, if down payment money is scarce, etc. – to a buyer.
Authorized User – Person allowed by a credit cardholder to the use a credit card but someone who is not legally liable to repay the debt incurred by using the card.. Credit reports for both the cardholder and the authorized user will display the credit card account. Authorized users wanting to remove their names from the account must contact the credit grantor.
Automated Teller Machine (ATM) – A computerized terminal, usually tied to a bank or credit card, used by customers to withdraw or deposit money.
Automated Underwriting System – Computer software used to determine whether or not someone should be pre-approved for a loan.
Automatic Stay – A court-order that prevents creditors from pursuing collection actions against a debtor who has filed a bankruptcy.
Available Funds – All of the assets at your disposal which can be used for your down payment, closing and loan costs.
Average Daily Balance – The number determined by dividing the days in a billing cycle with a loan’s or credit account’s outstanding balance.
Avoidance — The U.S. bankruptcy code allows a debtor to steer clear of some types of liens that hinder exemptions claimed in the bankruptcy filing. Most judgment liens attached to the a debtor’s property can be skirted if the total value of mortgages, judgment liens and statutory liens is more than the worth of the property in question. This is also known as lien stripping.
Avoidance Powers — A bankruptcy trustee (is empowered to recover some property transfers, such as preferences or fraudulent transfers. or to annul liens created before the start of a bankruptcy case.
Balance Sheet – An up-to-date financial breakdown indicating your assets, liabilities and overall net worth.
Balance Transfer – To move debt from one creditor to another, usually among credit cards.
Balance Transfer Fee – A charge for transferring a credit card balance (or other account) from one account to another.
Balloon Loan – A loan featuring smaller payments up-front, with a larger “balloon” payment or payments later, all tied to a specific timetable.
Balloon Payment – A lump-sum payment larger than your regular periodic payment, which is paid at the end of your loan repayment period.
Bankruptcy – A federal legal proceeding with the intention of altering or eliminating one’s debts. If a borrower qualifies, he or she may relieve debts by transferring assets to a trustee. There are many different “chapters” or types of bankruptcy. A bankruptcy filing appears on a borrower’s credit report for up to 10 years.
Bankruptcy Code — Title 11 of the U.S. code guides bankruptcy proceedings. Bankruptcy is a part of federal law and extends the same laws to every state, with the exception of exemptions that vary in every state.
Bankruptcy Estate — A debtor’s estate composed of is all legal and equitable interests at the start of a bankruptcy case. The debtor may be able to claim some property as exempt; the rest of his/her estate will be liquidated in a Chapter 7 bankruptcy to cover creditors’ claims and any administrative costs incurred by the proceeding.
Base Rate – The benchmark interest rate used for pricing variable-rate loans such as adjustable-rate mortgages (ARMs), car loans and credit cards.
Beneficiary — A person who will benefit financially (usually be receiving either money or assets) from a trust or an estate. Lenders are considered beneficiaries when they possess a deed of trust or a note as a security as collateral from a loan.
Betterment — Real estate improvement that increases the value of a property.
Bi-Weekly – Some borrowers prefer loans that offer a bi-weekly (occurring every other week) payment option. With this plan borrowers pay 26 half payments per year instead of 12 full payments. The primary advantages to this payment option are principal is paid down faster, equity increases more rapidly, and the loan is paid off earlier than it would have been with a standard 12 annual payment option. Some lenders may charge a fee for paying off a loan in this fashion.
Bid — An offer by a prospective buyer to pay a certain price for a property being sold at auction.
Bill of Sale — A document that gives title to a property that is being transferred from one party to another.
Billing Cycle — The number of days that transpire between one statement and the next. The billing cycle is used to calculate payment due, average daily balance, and finance charges.
Billing Error — A mistake in your monthly statement.
Billing Statement — The monthly bill sent to a debtor by a creditor detailing the creditor’s obligations and recent activity. This statement shows balance, purchases, payments, credits and finance charges.
Blanket Deed of Trust — A deed of trust secured by more than one lot or parcel of land.
Borrower – Person or entity approved for a loan and obligated to repay all principal interest and fees associated with the loan.
Breach – A violation of a contract or other legal obligation.
Bridge Loan – A loan “bridging” the time between a new home purchase and the sale of a borrower’s current home.
Broker – A go-between who helps to locate funding sources, or someone who negotiates a contract, but does not actually lend money.
Brokerage — The gathering together of two or more parties with an interest in conducting a real estate transaction.
Brokers Price Opinion (BPO) — A tool that lenders use to assess the value of properties in situations where they believe the expense and time needed to appraise a property is not required.
Business Days – The days a company or entity is considered legally open.
Buy-Down – An incentive offered by a lender or homebuilder, wherein it pays a portion of your interest during the “buydown period,” thereby reducing your monthly payments. This period is usually one, two or three years. During this period your payments increase on an annual basis, after which time the full, normal payments are paid by the borrower for the remainder of the loan.
Buyers Market — A type of market condition that is populated with fewer buyers than sellers. A good indication of this state is a property unsold for more than 90 days and high interest rates 12 percent or higher).
Canceled Loan – A loan that is no longer being processed because the loan proceeds have been returned to the lender.
Cap – A contractual limit on how much a variable interest rate can go up. This cap can be for semi-annual, annual and/or lifetime increases.
Capitalization – The increase in principal balance of a loan as a result of a lender adding the interest accrued on the loan to the outstanding principal balance.
Capital Gain — Profits earned from the sale of an asset.
Capitalized Interest – Interest added to a loan’s principal amount instead of paid as it is charged.
Cash Advance – Money advanced from a credit card company, often saddled with extra fees and higher interest rates than normal credit card purchases
Cash Flow — Surplus remaining after paying operating expenses and mortgage payments.
Certification – Confirmation of a truth or the meeting of a standard.
Certificate of Sale — A certificate issued at a judicial sale entitling the purchaser to collect a property deed after it is confirmed by the court.
Certificate of Title – The legal evidence of ownership.
Chapter 7 – The type of bankruptcy whereby a court discharges most debts by selling a debtor’s assets and property. Unless special provisions are arranged, the courts generally seize most property (cars, homes, furnishings, jewelry) under Chapter 7 bankruptcy. Chapter 7 bankruptcy, which appears on a person’s credit for 10 years, does not discharge any debts for taxes, child support, alimony, or student loans.
Chapter 11 — Chapter 11 bankruptcy is proceeding in which the debtor may remain in business or in control of the business property as a trustee. A confirmed Chapter 11 plan creates a plan for the debtor to satisfy the claims of creditors in whole or in part.
Chapter 12 — Chapter 12 bankruptcy is designed for family farmers and fishermen whose debts occur in a limited range.
Chapter 13 – The type of bankruptcy whereby the debtor and the courts settle on a debt repayment plan that allows the debtor to keep his or her property so long as the debt is paid in accordance with the settlement. Though a Chapter 13 bankruptcy remains on a credit report for 10 years, it is less detrimental to a consumer’s borrowing power than a Chapter 7 bankruptcy.
Charge-off – Charge-off is the determination made by collectors to consider some uncollectable accounts as bad debt and hence, a loss. Collectors may still attempt to obtain money from you for these accounts, but the companies no longer expect the accounts to be profitable.
Chattel — Personal property, including household or personal items.
Chattel Mortgage — A mortgage that is secured by personal property.
Civil Action – This refers to any court action against a borrower to recoup money owed. This can take the form of a wage assignment, child support judgment, small claims judgment, or a civil judgment.
Claim Amount – The amount of money obtained in a court action.
Closing Costs –These fees – attorneys’ fees, mortgage filing and preparation, taxes, title search, and insurance – are paid by a borrower at or just prior to a loan’s closing. Other closing costs can include the expenses arising from obtaining a loan and/or costs associated with transferring ownership of collateral from the seller to the buyer. Closing costs vary, but are generally between 2% and 6% of the mortgage.
Closing Date – A scheduled date, time and place for all of your loan documents to be signed, dated and notarized. This is also sometimes called a settlement date.
Cloud (On Title) – A negative claim affecting the viability of a property’s title.
Co-Borrower – A person who is equally responsible for repayment of a debt, in addition to the primary borrower, and is fully obligated to do so under the terms of the loan. A co-borrower is also legally entitled to any proceeds.
Collateral – A tangible piece of property – be it a car, home or annuity – which is used as by a borrower to help secure a loan. Collateral may be forfeited if the terms of the loan are breached.
Collection — An attempt to acquire payment or the liquidation of a debt through personal solicitation or legal proceedings.
Collection Agency – A company that collects debt on behalf of creditors. Also called a Credit Agency or Collection Company.
Combined Bill – The combination of a group of a borrower’s loans into one monthly payment.
Combined Liens – The combined amount owed on all mortgages held on specific piece of property, often used by a potential lender to determine a borrower’s total available equity.
Combined Loan-To-Value Ratio (CLTV) – The percentage of your debts – remaining mortgage principal, a home equity loan (if applicable) and/or line of credit – vs. the current appraised value of your home.
Comparables — Similar properties used as to measure the value of other properties.
Complaint — The original statement in a lawsuit that includes the essential facts of the alleged offense.
Condemnation — A judicial or administrative proceeding in which the power of eminent domain is exercised. A government agency usually appropriates private property for public use and compensates the owner at a market rate.
Confirmation — The court order makes the terms of a bankruptcy repayment plan in Chapters 11, 12, or 13 binding. The terms of the confirmed plan automatically supersede the pre-petition rights of all parties.
Confirmed — A court-approved plan of reorganization for bankruptcy in Chapters 11, 12, or 13 that binds both parties..
Conforming Loan – A standardized mortgage loan according to federal rules and regulations of Fannie Mae and Freddie Mac.
Consumer Bankruptcy — A bankruptcy filing for debts that belong to a consumer.
Consumer Credit – As opposed to business or commercial debts, loans for an individual’s personal or household use. Consumer credit loans are generally not backed by collateral.
Consumer Debts – As opposed to business debts, debts for personal needs.
Consumer Report – A credit report. A document that summarizes an individual’s history of paying debts. This information is collected and stored by a credit bureau in a database and can be viewed by a creditor when a borrower applies for a loan or account. Landlords and employers also review creditor reports to determine whether to approve a tenant or hire an employee. The consumer report / credit report is used to calculate a person’s credit score, but it does not contain the score itself.
Consumer Reporting Agency (CRA) – A company that gathers and sells information about an individual (such history of paying bills, history of judgments, history of liens, history of bankruptcies, whether the individuals has any collection accounts, and the like). Credit agencies are considered CRAs.
Contingency – A specific improvement, change, stipulation, etc., condition that must be completed before the home sale can occur. Common contingencies include that the house must pass inspection and that the borrower must be approved for a loan.
Contingent — A term describing debts that are dependent on another event happening to repair the liability issues.
Commission – A broker’s or agent’s fee, often a percentage of the overall price of the home or size of the loan.
Commitment – Usually a written agreement outlining date, conditions, etc., between a lender and a borrower to loan money.
Contract – A written or oral agreement between two or more parties in which an offer is made and accepted.
Consolidation Loan – A restructuring of multiple loans into one loan payment, often time with lower overall payments over a longer period of time.
Consumer Credit Counseling Service – The CCCS is a nonprofit organization that helps consumers handle credit problems. CCCS has offices throughout the U.S. and can be contacted by calling (800) 388-2227.
Conventional Loan — A loan with no insurance or guarantees.
Conversion — Cases under bankruptcy code may be converted from one chapter to another under some circumstances. For instance, a Chapter 7 bankruptcy may be changed to a Chapter 13 bankruptcy if the debtor meets certain income requirements for Chapter 13.
Conveyance — The document that directs that transfers of a property title to or other financial interest from one party to another
Co-Signer – A loan wherein an additional person signs your loan and assumes equal responsibility for repayment.
Counter-Offer — A response to an offer.
Cost Benefit Analysis – A comprehensive but common sense financial comparison between buying a home and not buying a home. Factors include tax benefits, projected appreciation, loan costs, property taxes, etc.
Credit – A contractual agreement between a borrower and a lender wherein the borrower agrees to pay for goods or services at a later date, often with interest.
Credit Agency – A third-party company that collects debt on behalf of creditors. Also called a Collection Agency or Collection Company.
Credit Bureaus – A privately owned, for-profit agency that collects and distributes consumer credit information in the form of individual credit reports. These agencies are subject to government regulations because of the sensitive nature of financial information. Experian, Equifax, and TransUnion are the three biggest credit bureaus. .
Credit Card – A card used in lieu of cash to buy goods and services, with payment due at a later date.
Credit Card Accountability Responsibility and Disclosure Act of 2009 – A federal law that reforms credit card company practices intended to protect consumers and promote transparency in the credit card industry.
Credit CARD Act of 2009 – See Credit Card Accountability Responsibility and Disclosure Act of 2009.
Credit Counseling Service – Organizations that try to help consumers pay their credit card debt. Credit counseling services generally consolidate debts into one payment made by the borrowers to the CCS. The CCS then disperses a portion of the money to the creditors. Consumer credit counseling can hurt a credit score by failing to make payments to creditors on behalf of the borrowers.
Credit History – The history of your debts and payments. Used by potential lenders to determine risk.
Credit Insurance – An insurance policy that pays a debt should the debtor lose his or her job, die, or become disabled.
Credit Items – Debts reported on a credit report by current or past creditors.
Credit Limit – The highest amount a lender is inclined to loan to a borrower.
Credit Line – The maximum amount available from a lender such as a credit card or bank.
Credit Rating – See Credit Score.
Credit Report – A report, obtained from a credit reporting agency or credit bureau, detailing a person’s outstanding debts and past payment history.
Credit Reporting Agency or Credit Bureau – A private, for-profit company that gathers and stores persons’ financial records and provides this information potential creditors, employers, etc.
Credit Score – The three-digit score given to a borrower by the credit bureaus. This score is based on a formal that predicts consumer-spending behaviors and determines a person’s credit-worthiness.
Credit Scoring System – A ratings system used to quantify a person’s creditworthiness. A higher credit score can translate into savings on loan costs for borrowers.
Creditor – An individual or company from which you borrow money.
Creditworthiness – The measure of the likelihood one will repay a debt.
Daily Balance – The dollar amount of a beginning credit card balance, any new transactions or periodic finance charges calculated on the previous day’s balance, minus any payments or credits posted that day.
Date of Status – The item on your credit report that displays the date that a creditor most recently reported information about the account.
Debit Card (EFT Card) – A card used to make purchases and other electronic transactions, with the debit coming directly from an existing account.
Debt – An amount of money owed by one entity to another.
Debt Consolidation – A restructuring of multiple loans into one loan payment, often time with lower overall payments over a longer period of time.
Debt Load – The total amount of money a person owes.
Debt Management Plan – A plan, often created by a Credit Counseling Company, that helps debtors pay their debts. Most often used when a consumer is having a difficult time making payments on time.
Debt Management Proposal – A proposal a debtor sends to creditors asking for an altered repayment plan. Often, Debt Management Proposals ask the creditor to accept a lowered payment, adjust the due date, eliminate late fees or penalties, or reduce or eliminate interest.
Debt-to-Income Ratio – The ratio of total pre-tax debt vs. total income.
Debtor – Someone who owes money to a creditor.
Debtor in Possession — In a Chapter 11 bankruptcy filing, the debtor usually remains in possession of his/her/its assets and takes on the duties of a trustee and answers to the creditors of the estate.
Decree of Foreclosure — A court order to set out the outstanding amount on a delinquent mortgage in order to sell the property to pay the mortgagee.
Deed — A document that represents title to a property or an interest in real estate.
Deed in Lieu of Foreclosure — A process where an owner of a property, in consultation with a lender, signs over the deed of the property to the lender to avoid foreclosure. Lenders are mostly hesitant to accept a deed in lieu unless the title is free of any complications. To do this, the owner must execute an estoppel affidavit acknowledging their choice in the matter and their decision to act with informed consent.
Deed of Reconveyance — A document that discharges a deed of trust as soon as mortgage obligations have been paid off.
Deed of Trust (Trust Deed) — A document representing a three-party security arrangement that exchanges a property deed for security for the repayment of a loan. The owner is referred to as the trustor. A neutral third party (the trustee) is transferred the property and is responsible for liquidating the property if need needed. In this arrangement, the lender is known as the beneficiary. When the loan is re-paid, the trustee is directed by the beneficiary to issue a deed of reconveyance to the trustor, which terminates the trust deed lien.
Default – Missing your mortgage payments, causing your mortgage to go into default, and often times causing foreclosure.
Defeasance Clause — A clause in leases and mortgages that terminates a specified right upon the occasion of another condition, such as cancellation of a mortgage upon repayment of the loan.
Defendant — The person who defends against a claim set forth in a legal setting.
Deferment – The temporary postponement of loan payments. The federal government will pay the interest that accrues during a deferment of a subsidized loan. Interest on unsubsidized loans is the responsibility of the borrower.
Default – Missing your loan payments, causing your loan to go into default.
Default Fee (Guarantee Fee, Insurance Fee) – A percentage of the loan amount, this fee is paid to the guarantor to pay costs associated with collection and defaults. The lender then deducts this fee from the loan amount and pays the guarantor.
Deficiency Judgment — A judgment determined in a lawsuit concerning a property sold for less than the amount of the loan.
Delinquency – Failure to make payments on time.
Deferred Interest – The term denoting a period in which a borrower’s interest payments are delayed, to be paid at a later time.
Demand Letter — Also known as a breach letter or notice of intent to foreclose.
Denial of Discharge — Penalty for debtor misconduct during a bankruptcy filing or with creditors in general. When a debtor’s discharge is denied, debts that might have been discharged in the particular bankruptcy filing cannot be subsequently discharged in another bankruptcy filing. Liquidation of assets and other items related to the administration of the case will continue for the benefit of creditors.
Department of Housing and Urban Development (HUD) — The federal department that deals with programs related to housing and urban renewal
Depreciation – A decline in property value over time. The opposite of appreciation.
Derogatory Item – Any possibly negative item on your credit report or public records that can affect your credit worthiness.
Destination Charge – Costs the dealer pays, and bills back to you at cost, to ship and/or deliver a new car.
Discharge – A status granted by a bankruptcy court to release a debtor from most of his/her outstanding debts. Some debts– alimony, child support, liability for willful and malicious conduct, and certain student loans –are not eligible for bankruptcy and therefore cannot be discharged.
Dischargeable Debt – Debts that are deleted during a bankruptcy settlement.
Disbursement Date – A scheduled date by the lender or escrow agent for the release of funds, through an electronic funds transfer (EFT) or a check.
Disbursement Fee – The lender charge, paid by the borrower, for the release of loan funds. Usually added to the loan amount.
Disclosures – Information you receive regarding history and condition of an item for which your are procuring a loan.
Disclosure Statement – Written information provided by a lender or creditor regarding terms and fees of a loan or credit card.
Discount Points – A fee paid to a mortgage lender at closing to lower an interest rate by an agreed upon percentage point.
Dismissal — The termination of a bankruptcy case before a discharge is arranged or a denial of discharge is issued. After a case is dismissed, the debtor and the creditors revert to the same situation before the bankruptcy case was initiated. Dismissal may be a caused by minor infractions of bankruptcy procedures.
Dispute – An option provided to consumers if a consumer they believe that an item on their credit report is wrong or incomplete.. Consumers then dispute the item, and credit reporting bureaus will investigate and change any incorrect information or fill in information that is missing. This process may be done by phone or online.
Document Preparation Fee – A fee sometimes added to the borrower’s costs for preparing closing documents.
Document Drawn Date – The date your legal documents are created, in preparation of closing.
Domestic Support Obligation — A category of debts representing alimony, maintenance or support owed to child, spouse, or governmental entity.
Down Payment – A cash amount paid by a buyer toward a sale price. Down payment amount is a major factor in determining what kind of interest rate you end up with.
Draw – Borrowing against a line of credit.
Draw period – The length of time a lender allows a borrower to use a line of credit.
Due-on-Sale Clause — A mortgage clause requiring that the entire mortgage be paid in full upon the transfer of ownership.
Due Diligence — A measure of prudence, activity, or assiduity in service of researching a particular circumstance, though usually in preparation for a real estate purchase.
Earnest Money – A deposit made by a buyer to a seller to guarantee a transaction and/or assure payment.
Easement — A right of way granted to someone for the purpose of crossing another’s property for specified purposes, such as power lines or water mains.
Elderly Applicant – A person 62 or older, as defined by the Equal Credit Opportunity Act.
Electronic Fund Transfer (EFT) – A term used to describe the transfer of money between bank accounts.
Encroachment — A fixture that illegally intrudes into, obscures, or invades the property another, thus diminishing its width or area.
Encumbrance — Anything that lessens the value, use, or enjoyment of a property.
End-User – A business that receives credit reports for the purpose of making a decision to grant credit. Such businesses must conform to the legal requirements of the FCRA
Equal Credit Opportunity Act (ECOA) – A federal law requiring lenders provide credit 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 value of an asset and your debts.
Equity Right of Redemption — The right to avoid foreclosure action by paying off debts, interest, and fees that have accumulated on a property.
Escrow – A neutral third party (an “escrow agent”) who holds money and documents, and is authorized to distribute money and documents to the proper parties in a real estate transaction. This term can also mean an account (an “escrow account” or “impound account”) many lenders use to insure borrowers set aside enough money to maintain insurance and pay property taxes.
Escrow Account — A bank account held by a depositor and an escrow agent, which is returnable to the depositor or paid to a third person on the fulfillment of a condition, such as the sale of a property.
Estate — The total assets possessed by a person on death, including property.
Estoppel Certificate — A certificate in which a borrower identifies the amount owed on a mortgage loan and the agreed-upon rate of interest.
Eviction — The act of forcing out a person from a property through legal means.
Exempt — Exempt property can be removed from an estate during bankruptcy filing and is beyond the reach of creditors or the bankruptcy trustee. Exempt property depends on state and federal laws and varies from state to state. Exempt property may be made available to debtors for use in after bankruptcy proceedings.
Exemptions – Property that is protected by law from a creditor’s reach.
Expected Family Contribution (EFC) – An amount you are expected to contribute toward repayment of a loan.