Real Estate 101 Glossary

Lola and mea REMAX logo

Give me an “E”

EARNEST MONEY DEPOSIT  A cash deposit made to a home seller to secure an offer to buy the property. This amount is often forfeited if the buyer decides to withdraw his offer, after contingencies are removed.

EASEMENT  The right of a non-owner of property to exert control over a portion or all of the property. For example, power companies often own an easement over residential properties for access to their power lines.

EAVE  The part of the roof that extends beyond the exterior wall.

ECONOMIC DEPRECIATION  The decline in property value caused by external forces, such as neighborhood blight or adverse development.

ECONOMIC LIFE The amount of time which any income-producing property is able to provide benefits to its owner.

EFFECTIVE AGE  The subjective, estimated age of a property based on its condition, rather than the actual time since it was built. Excessive wear and tear can cause a property’s effective age to be greater than its actual age.

 EMINENT DOMAIN The legal process whereby a government can take ownership of a piece of property in order to convert it to public use. Often, the property owner is paid fair-market value for the property.

ENCROACHMENT  A building or other improvement on one property which invades another property or restricts its usage.

ENCUMBRANCE  A claim against a property. Examples are mortgages, liens and easements.

 ENERGY EFFICIENCY RATIO  An efficiency rating system for air conditioning units that corresponds to the number of BTU’s output per watt of electricity used.

EQUAL CREDIT OPPORTUNITY ACT (ECOA)  U.S. federal law requiring that lenders afford people equal chance of getting credit without discrimination based on race, religion, age, sex etc.

EQUITY  The difference between the fair market value of a property and that amount an owner owes on any mortgages or loans secured by the property.

EQUITY BUILDUP  The natural increase in the amount of equity an owner has in a property, accumulated through market appreciation and debt repayment.

ERRORS AND OMISSIONS INSURANCE  (E & O) An insurance policy taken out by appraisers to cover their liability for any mistakes made during the appraisal process.  Other’s,  such as real estate agents, mortgage brokers, ect. pay for  E and O insurance

ESCROW  An amount retained by a third party in a trust to meet a future obligation. Often used in the payment of annual taxes or insurance for real property.  Also, the independent third party that exchanges the buyer’s money for the seller’s deed in the sale of real property.

ESCROW ACCOUNT  An account setup by a mortgage servicing company to hold funds with which to pay expenses such as homeowners insurance and property taxes. An extra amount is paid with regular principal and interest payments that go into the escrow account each month.

ESCROW ANALYSIS  An analysis performed by the lender usually once each year to see that the amount of money going into the escrow account each month is correct for the forecasted expenses.

ESCROW DISBURSEMENTS  The payout of funds from an escrow account to pay property expenses such as taxes and insurance.

ESTATE  The total of all property and assets owned by an individual.

EXAMINATION OF TITLE  The report on the title of a property from the public records or an abstract of the title.

EXCLUSIVE LISTING  An agreement between the owner of a property and a real estate broker giving the broker exclusive right to sell the property. 

EXECUTOR  The person named in a will to administer the estate.

Advertisements

Tags: , , , , , , , , , , , , , , , , , , , , , ,

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s


%d bloggers like this: