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Nicolas Romo |
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(714)
231-3772 |
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Lic.
# 01787685 |
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Hablo Español |
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Late
Charge
The fee an individual is required to pay when a
payment is made after a specific number of days,
usually 15 days for a first trust deed or mortgage.
Lease
A written contract between a home owner and a tenant
that specifies the monthly rental payment and
conditions under which the tenant may possess the
real estate for an agreed time period. In most
states, a written lease s not required if the rental
period is less than 1 year. However, it is always
good practice to have your agreement in writing to
avoid any misunderstandings and to protect yourself.
Leasehold Estate
An estate for a set period of time between a
landlord and a tenant whereby the landlord gives up
possession of a property to the tenant, giving the
prospective tenant an equitable interest in the
property, as defined by the terms of the lease.
Lease Option
A rental agreement demonstrating a tenant's option
to buy the property, whereby the monthly rental
payments also include an additional amount that is
applied towards a down payment on a previously
agreed upon amount.
Legal Description
A legal property description that is adequate enough
to locate and identify the real property without the
need of someone’s oral testimony.
Lender
A “lender” can be the bank, mortgage company, or
mortgage broker who is offering the mortgage to the
borrower. Many lenders only "originate" (find new
clients to provide loans to) mortgages and then
resell the note/mortgage to third parties.
Leverage
Using another person’s or companies money in order
to buy real property.
Liabilities
Liabilities are individuals’ financial obligations
which can be long-term and short-term debt,
including any other amounts that are owed to others.
Liability Insurance
Insurance that protects real property owners against
claims that allege carelessness or improper action
that resulted in injury or property damage to
someone.
LIBOR
LIBOR, which stands for London Interbank Offered
Rate Index, is an avg. of the interest rates that
key international banks charge each other to borrow
U.S. dollars in the London money market. The LIBOR
tends to move and change fairly rapidly to changes
in interest rates.
Lien
A lien is a legal claim by one person against the
property of another person as security for a debt,
which is required to be paid when the property is
sold. An example: a mortgage or a first trust deed
is a lien, as well as when a contractor is not paid
for his work and then places a lien on the property.
Life Estate
A life estate is an estate that lasts for the
natural life of the grantee or "life tenant."
Further, if it can be sold, a sale doesn’t change a
life estate’s length, which is limited by the
natural life of the initial life tenant.
Life of Loan Cap
Also referred to as Lifetime Cap, this is the
highest interest rate that can be charged to a
borrower during the life of the mortgage, which is
regularly expressed as an increment above the
initial interest rate. An example would be: an
adjustable rate mortgage (ARM) with a starting
interest rate of 6% and a 5% lifetime cap will never
adjust above am interest rate of 11% (6+5).
Line of Credit
A written agreement between a bank/financial
institution and a borrower, whereby the borrower is
provided credit up to a certain amount and for a
certain time period.
Liquid Asset
Any asset, such as cash or stocks, which is easily
converted to cash.
Loan
The principal, or the sum amount of money that is
borrowed and that is ultimately repaid with
interest.
Loan Officer
An agent between lenders and borrowers. Loan
officers seek(originate) loans, represent lenders to
borrowers and vice versa.
Loan Origination
The practice of finding new clients to provide loans
to.
Loan Servicing
The service a lender performs to protect a loan
investment, such as collecting monthly payments from
borrowers as well as dealing with defaults and
delinquencies.
Loan-To-Value Ratio (LTV)
Expressed as a percentage, the LTV is the
relationship between the amount of the loan and the
appraised value of the property. A LTV ratio of 80%
signifies that a borrower is borrowing 80% of the
value of the property and making a 20% down payment.
The value of the property is understood to be the
purchase price when the transaction is a purchase.
However, for a refinance transaction, an appraisal
determines the value.
Lock (noun)
The time period (days) during which a lender will
guarantee an interest rate. Depending on the bank, a
borrower may lock a rate at the time of application
or after the application is taken.
Lock (verb)
The decision by a borrower to commit to an interest
rate some time between the application and closing
of the loan.
Lock-In Clause
The section in a loan contract that specifies that a
borrower may not repay a loan prior to a certain
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