Glossary of commonly used terms and phrases

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Laches - An unreasonable delay by a party making a claim or bringing an action, so that the rights of said party are waived.
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Land Development - A loan for the acquisition of raw land in anticipation of future zoning and development.
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Late Charge - The penalty a borrower must pay when a payment is made a stated number of days (usually 15) after the due date.
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Lateral Support - The landowner has the right to the natural support of his land by adjoining land. The adjoining landowner does not have the right to change his land so as to cause the support to be weakened or removed.
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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 rent.
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Lease-Purchase Mortgage Loan - A financing option that allows low and moderate income buyers to lease a home with the option to buy. Each month's payment includes principal, interest, taxes, and insurance (PITI) on the first mortgage, plus an additional amount that accrues in a savings account and is used for a down payment.
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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.
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Leasing Commission Reserve Funds - set aside on a monthly basis to pay leasing commission necessary to release vacant space during the term of the loan.
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Legal Description - A property description, recognized by law that is sufficient to locate and identify the property without oral testimony.
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Lender - An institution that makes loans to borrowers on real estate.
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Lender Margin - The profit the lender anticipates to receive from the loan.
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Lenders - Institutions that make loans to borrowers on real estate.
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Letter of Credit - A written statement permitting an individual to draw on a bank, or stating that the bank will honor their credit up to the stated amount.
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Letter of Intent - A written statement expressing that a buyer or developer is interested in a property. The letter is not legally binding.
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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.
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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.
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Lien - Any claim against a property, including mortgages, unpaid taxes, or repair bills, or other unpaid charges. Prospective property buyers conduct a title search to determine whether any liens against the property exist. A lien must be filed or recorded with the local county government to be attached to a property title.
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Lifetime Cap - A provision of an adjustable rate mortgage (ARM) that limits the total increase in interest rates over the life of the loan.
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Lifetime Payment Cap - For an adjustable-rate mortgage (ARM), a limit on the amount that payments can increase or decrease over the life of the mortgage.
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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.
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Liquid Asset - A cash asset or an asset that is easily converted into cash.
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Lis Pendens - A legal notice of action given when a lawsuit is pending.
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Loan - A sum of borrowed money (principal) that is generally repaid with interest.
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Loan Application - A non-binding agreement between a lender and a prospective borrower showing the terms they are going to submit to the underwriter for approval. A cash deposit is usually part of the agreement.
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Loan Closing - The end of the process of purchasing or refinancing a home. Often done at a title company where the documents are signed, recorded, and the loan funded usually within 3 days of signing the legal closing documents.
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Loan Commitment - Formal offer by a lender stating the terms under which it agrees to loan money to a homebuyer.
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Loan Origination - The process by which a mortgage lender brings into existence a mortgage secured by real property.
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Loan Policy - A title insurance policy that insures a mortgagee or beneficiary under a deed of trust against loss caused by invalid title.
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Loan Servicing - The collection of mortgage payments from borrowers and related responsibilities of a loan servicer.
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Loan-to-Value - A ratio calculated by dividing the mortgage amount by the value of the property. A lender will often use the lower of the purchase price or the appraised fair market value when the loan is used to purchase a property.
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Local Housing Authority - A government agency that monitors and executes community housing development programs.
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Lock - The period, expressed in days, during which a lender will guarantee a rate.
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Lock Period - The amount of time that a lender will guarantee a loan's interest rate. Once you've locked in the interest rate on a loan, the lender will guarantee that rate for a certain period of time, usually for 30, 45, or 60 days.
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Lockout Period - A period of time after the loan is originated during which a borrower cannot prepay the mortgage loan.
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London Inter-Bank Offer Rate (LIBOR) The rate of interest that the largest international banks charge each other for loans.
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Long Term Financing A mortgage or deed of trust that lasts at least ten years or more.
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Long Term Lease A lease with a term of five or more years.
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Lot Size The total square footage of a property.
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