GLOSSARY OF TERMS

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lease option
A lease under which the tenant has the right to purchase the property either during the lease term or at its end.
 
legal description
A description of a specific parcel of real estate complete enough for an independent surveyor to locate and identify it.
 
leverage
The use of borrowed money to finance an investment.
 
levy
To assess; to seize or collect.  To levy a tax is to asses a property and set the rate of taxation.  To levy an execution is to officially seize the property of a person in order to satisfy an obligation.
 
lien
An encumbrance against property for money due, either voluntary or involuntary.
 
life estate
An interest in real or personal property that is limited in duration to the lifetime of its owner or some other designated person or persons.
 
life tenant
A person in possession of a life estate.
 
 
lifetime cap
A provision of an ARM that limits the highest rate that can occur over the life of the loan.
 
liquidated damages
An amount predetermined by the parties to a contract as the total compensation to an injured party should the other party breach the contract.
 
liquidity 
The ability to sell an asset and convert it into cash, at a price close to its true balue, in a short period of time.
 
lis pendens
A recorded legal document giving constructive notice that an action affecting a particular property has been filed in either a state or a federal court.
 
listing agreement
A contract between an owner (as principal) and a real estate broker (as agent) by which the broker is employed as agent to find a buyer for the owner's real estate on the owner's terms, for which service the owner agrees to pay a commission.
 
littoral rights
(1) A landowner's claim to use water in large nagigable lakes and oceans adjacent to his or her property.
(2) The ownership rights to land bordering these bodies of water up to the high-water mark.
 
loan origination fee
A fee charged to the borrower by the lender for making a mortgage loan.  The fee is usually computed as a percentage of the loan amount.
loan to value ratio (LTV)
The ratio of the amount of your loan to the appraised value of the home.  The LTV will affect programs available to the borrower and generally, the lower the LTV the more favorable the terms of the programs offered by lenders.
 
lock-ad-block (recorded plat) system
A method of describing real property that identifies a parcel of land by reference to lot and block numbers within a subdivision, as specified on a recorded subdivision plan
 
lock-in
A written agreement guaranteeing the home buyer a specified interest rate provided the loan is closed within a set period of time.  The lock-in also usually specifies the number of points to be paid at closing.

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