Late Charge: Penalty paid by a borrower when a payment is made after the due date.
Lease-Purchase Mortgage Loan: An alternative financing option that allows low- and moderate-income homebuyers to lease a home from a nonprofit organization with an option to buy. Monthly rental payments cover mortgage payments and include an additional amount that is saved toward a down payment.
Legal Description: A property description, recognized by law, using a government rectangular survey, metes and bounds, or a plat map to sufficiently locate and identify a property.
Lender: The bank, mortgage company, or mortgage broker offering the loan.
Lender's Title Insurance: Premium paid to the title insurance company to insure that you are the legal owner of the property, there are no liens or encumbrances on your property that effect the transaction, there are no legal claims or pending legal claims against the property, and there are no tax liens on the property.
Liabilities: A person's debts or financial obligations. Liabilities include long-term and short-term debt, as well as potential losses from legal claims.
Liability Insurance: Penalty paid by a borrower when a payment is made after the due date.
LIBOR (London Interbank Offered Rate): The interest rate charged among banks for short-term Eurodollar loans, and a common index for adjustable rate mortgages.
Lien: A legal claim against a property that must be paid when the property is sold.
Lifetime Interest Rate Cap: - The highest interest rate that can be charged for an adjustable rate mortgage during the life of the loan.
Loan Administration (or Loan Servicing): The collection of mortgage payments from borrowers and related responsibilities (such as handling escrows for property tax and insurance, foreclosing on defaulted loans and remitting payments to investors).
Loan Application Document required by lenders prior to loan approval containing detailed information about the borrower and property.
Loan Application Fee: Fee paid by prospective buyer to lender when applying for a mortgage. Loan Origination Fee (Processing Fee) - Fee charged by a lender that compensates for the work in evaluating and processing the loan.
Loan Servicing (or Loan Administration): The collection of mortgage payments from borrowers and related responsibilities (such as handling escrows for property tax and insurance, foreclosing on defaulted loans and remitting payments to investors).
Lock or Lock In: A lender's guarantee of an interest rate and related points for a set period of time, usually between loan application and loan closing. Protects borrower against rate increases during that time.
Loan to Value (LTV) Ratio: The percentage of the property value borrowed (loan amount/property value = loan to value ratio).
LTV: See Loan To Value Ratio
