|
|
Late Charge
The penalty a borrower must pay when a payment is made after the due date (usually 15 days).
Latent Defects
Flaws that are hidden but are apt to surface later.
Lease
A written agreement between the property owner and a tenant that stipulates the conditions
under which the tenant may possess the real estate for a specified period of time and
amount of rent.
Lease Option
An alternative financing option that allows home buyers to
lease a home with an
option to purchase.
Each month's rent payment may consist of not only the rent, but an additional amount
which can be applied toward the down payment on an already specified price.
Leasehold Estate
A way of holding title to a property wherein the
mortgagor
does not actually own the property but rather has a recorded long-term
lease on it.
Legal Description
A property description, recognized by law, that is sufficient to locate and identify
the property without oral testimony.
Lender
A term which can refer to the institution making the loan
or to the individual representing the firm.
For example, loan officers are often referred to as "lenders".
Letter of Commitment
Officical notification to a borrower of the lender's
intent to grant a loan.
Norminally, the terms of the loan are specified and a
date for closing is established.
Liabilities
A person's financial obligations.
Liabilities include long-term and short-term debt,
as well as any other amounts that are owed to others.
Liability Insurance
Insurance coverage that offers protection against claims
alleging that a property owner's negligence or inappropriate action resulted in bodily injury or property
damage to another party.
Lien
A legal claim against a property that must be paid off when the property is sold.
Lifetime Cap
For an adjustable-rate mortgage (ARM),
the limit that the interest rate can increase
or decrease over the life of the loan.
Line of Credit
An agreement by a commercial bank or other financial institution to extend
credit up to
a certain amount for a certain time to a specified borrower.
Liquid Asset
A cash asset or an
asset that is easily converted into cash.
Listing
A written contract between a principal and an
agent,
authorizing the agent
to perform certain services for the principal involving the principal's proprerty.
Loan
A sum of borrowed money (principal) that is
generally repaid with interest.
Loan Application
A document required by the lender prior to making the
loan commitment.
The loan application includes information such as loan amount, term of the loan, and the borrower's financial
and employment data.
Loan Approval
The decision by a lender to extend
credit in a specified amount and under specified terms.
Loan Origination
The process by which a mortgage lender brings into existence a
mortgage secured by
real property.
Loan-To-Value (LTV)
The relationship between the principal balance of the
mortgage and the
appraised value
(or sales price if it is lower) of the property.
For example, a $300,000 home with an $240,000 mortgage has a LTV percentage of 80 percent.
Lock-In
A written agreement in which the lender guarantees a
specified interest rate if a
mortgage closes within a set period of time.
The lock-in usually specifies the number of points
to be paid at closing.
Lock-In Period
The time period during which the lender has guaranteed
an interest rate to a borrower.
|
|
