Earnest Money
Deposit made by a buyer towards the down payment
in evidence of good faith when the purchase
agreement is signed.
Easement
A right of way giving persons other than the owner
access to or over a property.
Economic Obsolescence
The loss of value due to changes outside the
particular property affected (e.g., high power
lines, busy streets, proximity to an airport or
any other structure perceived to be less than
desirable); also called economic depreciation.
Effective Age
An appraiser's estimate of the physical condition
of a building. The actual age of a building may be
shorter or longer than its effective age.
Effective Rate
The effective rate is a consumer-oriented rate
that takes into account the projected amount of
time you tell us you will actually have the loan,
as well as the specific costs, fees, and potential
rate changes associated with it. The fees and
costs are distributed over the time you plan to be
in the house, allowing you to do an
apples-to-apples comparison of a variety of loan
types. The effective rate is not the APR. It is
similar in that it factors in interest, mortgage
insurance, and other fees (including points);
however, the APR assumes that you keep your loan
for the entire term, while the effective rate
takes into account how long you tell us you plan
to be in your house.
Encroachment
An obstruction, building, or part of a building
that intrudes beyond a legal boundary onto
neighboring private or public land, or a building
extending beyond the building line.
Encumbrance
Anything that affects or limits the fee simple
title to a property, such as mortgages, leases,
easements, or restrictions.
Environmental Hazard
Natural or man-made forces that may be hazardous
to the health or safety of the homeowner. Examples
include hazardous wastes, toxic substances, radon
gas and materials containing asbestos. These types
of hazards can adversely affect the value and
marketability of the property.
Equal Credit Opportunity Act (ECOA)
Federal law requiring 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 current market value of
a property and the total debt obligations against
the property. On a new mortgage loan, the down
payment represents the equity in the property.
Escrow
A transaction in which a third party acts as the
agent for seller and buyer, or for borrower and
lender, in handling legal documents and
disbursement of funds.
Escrow Account
An account held by the lender to which the
borrower pays monthly installments, collected as
part of the monthly mortgage payment, for annual
expenses such as taxes and insurance. The lender
disburses escrow account funds on behalf of the
borrower when they become due. Also known as
Impound Account.
Escrow Agent
A person with fiduciary responsibility to the
buyer and seller, or the borrower and lender, to
ensure that the terms of the purchase/sale or loan
are carried out. See Bank
Attorney
Escrow Collections
Funds collected by the servicer and set-aside in
an escrow account to pay the borrower's property
taxes, mortgage insurance, and hazard insurance.
Escrow Disbursements
The use of escrow funds to pay real estate taxes,
hazard insurance, mortgage insurance, and other
property expenses as they become due.
Escrow Payment
The portion of a mortgagor's monthly payment that
is held by the servicer to pay for taxes, hazard
insurance, mortgage insurance, lease payments, and
other items as they become due. Known as
"impounds" or "reserves" in
some states.
Estate
The ownership interest of an individual in real
property. The sum total of all the real property
and personal property owned by an individual at
time of death.
Eviction
The lawful expulsion of an occupant from real
property.
Examination of Title
The report on the title of a property from the
public records or an abstract of the title.
