Deed: A written document by which the ownership of land is transferred from one person to another.
Delinquency: A loan payment is overdue, but within the period allowed before actual default is declared.
Depreciation: A loss of value in real property brought about by age, physical deterioration, functional or economic obsolescence.
Discounted Loan: When the note rate on a loan is less than the market rate of interest, the lender requires additional points to raise the yield on the loan to market rate.
Due-On-Sale Provision: A covenant in a conventional mortgage that allows the lender to call the mortgage due and payable, if ownership was transferred without the lender’s permission.
Debt-to Income Ratio (DTI): The relationship of a borrower’s total monthly payment obligations on long term debts divided by the gross monthly income, expressed in percentages (a.k.a. Back End Ratio).
Earnest Money: Deposit money given to the seller by the potential buyer to show that he or she is serious about buying the house. If the deal goes through, the earnest money is applied to the down payment. If the deal does not go through, it may be forfeited.
Easement: An interest in land owned by another that entitles its holder to a specific limited use, such as laying a sewer, putting up power lines, or crossing the property.
Encroachment: A fixture, such as a house, wall or fence, which intrudes upon another’s property.
Equal Credit Opportunity Act (ECOA): A federal law requiring lenders and other creditors to make credit available without discrimination based on race, color, religion, national origin, sex, marital status, receipt of income from public assistance programs or past exercising of rights under the Consumer Protection Act.
Equity: The ownership interest, or that portion of a property’s value over and above the liens against it.
Equity Loan: A loan based on the equity in a property. The credit of the borrower is not a major factor.
Escrow: A procedure whereby a disinterested third party handles legal documents and funds on behalf of a buyer and seller.