Arbor Financial Group Marketing Engines, Inc.

Glossary of Terms

Mortgage. Real Estate & Insurance

E

Earnest Money
Earnest Money, also known as a Deposit or Down Payment, is made by a purchaser of real estate as evidence of good faith.
Earnest Money Deposit
Money paid by the purchaser of real estate when the buyer and seller reach an oral agreement for the sale of the property to show that the buyer's offer is being made in "good faith."
Easement
Right to the limited use or enjoyment of land held by another. An easement is an interest in land to enable sewer or other utilities lines to be laid, or to allow for access to a property. In another word, an Easement is an interest in land/property owned by another that entitles its holder to a specific use or enjoyment.
Economic Depreciation
Loss of value to real estate due to changes outside the particular property (e.g., a decline in the neighborhood or change in zoning).
Economic Life
Estimated period of time during which a property can be utilized profitably.
Effective Age
For purposes of appraisal, the physical age given to a building based on its present condition, which may be shorter or longer than its actual age.
EFFECTIVE DATE
This is the date a new mortgage payment is effective-the month following the rate change date.
Effective Gross Income
Income that is verifiable and likely to continue during the first five (5) years of the term of the mortgage.
Eminent Domain
Right of government bodies, public utilities, and public service corporations to take private property for public use (e.g., schools, roads, etc.) on payment of its fair market value.
Encroachment
Improvement that illegally violates another's property. Such as a wall, fence or building, that extends onto the property of another.
Enhancement
Amendment that may apply to specific loan programs (e.g., the Spot Relocation enhancement that may be utilized in coordination with non-conforming and conforming loan programs).
Encumbrance
Anything that affects or limits the fee simple title to property, such as mortgages, leases, easements, or restrictions.
ENDORSE
The act of a payee or holder of a note, bill, check or other negotiable instrument, of assigning and transferring said instrument to another by signing the back of the instrument, with or without qualifications.
ENDORSEMENT
An addition to a title insurance policy that adds or subtracts coverage.
Entitlement
Amount of guaranty available to an eligible veteran.
Equal Credit Opportunity Act (ECOA)
Federal law passed in 1974 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.
EQUITABLE INTEREST
An ownership interest in a property that is demonstrated by actions such as the payment of the current mortgage, property taxes or property insurance rather than by legal ownership.
Equity
Net ownership, the difference between fair market value and current indebtedness. Also known as the owner's interest.
EQUITY LINE OF CREDIT (HELOC)
A combination of a line of credit and equity loan secured by real property. A maximum loan amount is established based on credit and equity. A mortgage is recorded against the potential borrower's property for said maximum loan amount. The potential borrower has the right to borrow, as needed, up to the amount of the credit line.
Errors and Omissions Coverage
Indirect loss insurance that covers losses due to an error or neglect on the part of an employee to whom a specific responsibility has been assigned.
ESCROW
Delivery of something of value by a grantor to a 3rd party for delivery to the grantee upon the happening of a contingent event. In some states, all instruments necessary to the sale are delivered to a 3rd party, with instructions as to their use. Normally, in a residential real estate sale, the attorney for the seller is the "escrow agent" for the deposit money securing the deal until closing.
Escrow Agent
Person or organization with fiduciary responsibility to both the buyer and seller (or lender and borrower) to see that the terms of the purchase/sale (or loan) are carried out. Also known as escrow company and escrow depository.
Escrow Deposit Account
Trust account that holds funds allocated for the monthly payment of real estate taxes, hazard insurance, mortgage insurance, lease payments, and other items. Also known as an impound account in some areas.
ESCROW INSTRUCTIONS
For purchase transactions, instructions signed by both buyer and seller, which enable the escrow agent to carry out the procedures necessary to transfer real property, a business or other assignable interest.
Escrow Payment
Portion of a mortgagor's monthly payments held by the lender or servicer to pay for taxes, hazard insurance, mortgage insurance, lease payments, and other items as they become due. Also known as impounds or reserves in some states.
Estate
Ownership interest an individual has in real property. Sum total of all the real and personal property owned by an individual at the time of death.
Estoppel Certificate
Written statement setting forth certain facts about a piece of real estate, such as the precise amount of indebtedness remaining.
Et Uxor
Legal term meaning "and wife." sometimes abbreviated as et ux.
EXCEPTIONS TO GUIDELINES
The consideration of approving a loan having characteristics that don't fit into Lenders Guide Lines when it makes sense to do so.
EXCEPTIONS TO TITLE
Claims against the property as of the date of the title report.
Exclusive Right to Sell Agreement
Exclusive Right to Sell Agreement is an agreement between a broker and a seller which designates the broker as the seller's sole representative. Under this agreement, a commission is due to the broker even if the apartment is sold directly by the owner.
Execution
Judicial order directing an officer of the court to enforce a judgment against the property or person of the judgment to satisfy the judgment.
Executor
Person named in a will to administer an estate. The court appoints an administrator if no executor is named. Feminine form is executrix.
EXPERIAN (EXP)
The name of a national credit bureau.
External Depreciation (Economic Obsolescence)
Loss of value to real estate due to changes outside the particular property (e.g., economic factors or environmental changes).
EXTERNAL OBSOLESCENCE
Any influence negatively affecting a property's value that falls outside of the specific property site. An example of this would be a property located under an airport flight pattern.