L

Late Charge
Penalty paid by a borrower when a payment is made after the due date.

Lease Purchase Agreement
An agreement whereby the buyer signs a property lease with the intention of purchasing it at a specified price on specified date thereafter.

Lender
The bank, mortgage company, or mortgage broker offering the loan.

LIBOR (London Interbank Offered Rate)
The interest rate charged among banks in the foreign market for short term loans to one another. A common index for ARM loans.

Lien
A claim against a property for the payment of a debt. A mortgage is a lien; other types of liens a property might have include a tax lien for overdue taxes, or a court judgment lien, or a mechanics lien for unpaid debt to a contractor.

Lien Search
A search on the seller and the co-op corporation to determine if there are any liens, loans or  judgments which may have an effect on your ownership of the unit.

Lifetime cap
A provision of an ARM that limits the highest rate that can occur over the life of the loan.

Liquidity
Cash or cash equivalents that a borrower has accumulated or the ability to readily convert other assets or investments into cash; a.k.a. cash reserves.

Loan Application
An initial statement of personal and financial information required to apply for a loan.

Loan Application Fee
Fee charged by a lender to cover the initial costs of processing a loan application. The fee may include the cost of obtaining a property appraisal, a credit report, and a lock-in fee or other closing costs incurred during the process or the fee may be in addition to these charges.

Loan Origination Fee
Fee charged by a lender to cover administrative costs of processing a loan.

Loan-to-Value Ratio (LTV)
The relationship expressed as a percentage, between the amount of the proposed loan and a property's appraised value or purchase price. For example, a $75,000 loan on a property appraised at $100,000 is a 75% loan-to-value.

Lock or Lock-In
A lender's guarantee of an interest rate for a set period of time. The time period is usually that between loan application approval and loan closing. The lock-in protects you against rate increases during that time. See Rate Lock Policy

©2000, FIXED-RATE-MORTGAGES.COM
Notice to Consumers - Privacy - Contact Us