Real Estate Glossary

Early occupancy

The condition in which buyers can occupy the property before the sale is completed.

Earnest money

Money a buyer gives with an offer to purchase a property. Also called a deposit.

Earthquake insurance

A policy that provides coverage against damage to a home from an earthquake.

Easement

A right given to a third party to use a portion of the property for certain purposes, such as power lines or water mains.

Effective age

The age of a structure estimated by its condition rather than its actual age.

Effective gross income

Additional income that a lender considers when assessing the loan application of a potential borrower.

Effective Rental Income

Potential rental income minus vacancy and credit losses.

Electric service panel

A panel that transfers power from the utility line into a house to be distributed through fuses or circuit breakers.

Eminent domain

The government's right to condemn private land for public use, such as the routing of a public highway.

Employer-assisted housing

Programs which help employees purchase homes through special plans developed with lenders.

Empty nesters

Potential buyers who have raised their families and want to move into a smaller home.

Encroachment

Fences or other structures that extend into the property of another owner.

Encumbrance

A claim or lien on a property which complicates the title process.

End loan

The conversion from a construction loan to permanent financing a condominium buyer secures after all units in a project have been completed.

Endorser

A person who signs over ownership of property to another party.

English Tudor style

An architectural design that features stone or brick exterior walls and exposed beams.

Environmental impact statement

A government-mandated evaluation of all aspects and effects a development will have on the environment of a proposed site.

Environmentally friendly home construction

A method of construction that utilizes recycled materials.

Equal Credit Opportunity Act.

A federal law that prohibits a lender or other creditor from refusing to grant credit based on the applicant's sex, marital status, race, religion, national origin or age. The law also prohibits a creditor from refusing to grant credit because the applicant receives public assistance.

Equifax

Equifax Credit Information Services, Inc., is one of the "Big Three" credit-reporting bureaus that operate nationwide. Address: P.O. Box 740249, Atlanta, GA 30374.

Equity

A determination of the value of a property after existing liens are deducted.

Equivalent Level Rate (ELR)

Flat rate per square foot that will equal the same total present value as a proposed lease's variable cash flows.

Errors and omissions insurance

A policy that pays for any mistakes a builder or architect makes in a project.

Escalation

A clause in a lease providing for an increased rental rate at a future time.

Escrow

A neutral third party holds the documents and money involved in a real estate transaction and ensures that all conditions of a sale are met.. Escrow also refers to a special account that a lender establishes to hold monthly installments from the borrower to cover property taxes and insurance.

Escrow account

An account that a lender or mortgage servicer establishes to hold funds for the payment of expenses such as homeowners insurance and property taxes. Also known as an impound account.

Escrow agent

A neutral third party who ensures that all conditions of a real estate transaction are met.

Escrow analysis

A lender's periodic examination of an escrow account to determine if the lender is withholding enough funds from a borrower's monthly mortgage payment to pay for expenses such as property taxes and insurance.

Escrow closing

Escrow closes when all conditions of a real estate transaction are met and the title of the property is transferred to the buyer.

Escrow company

Firms that act as neutral third parties to ensure that all conditions that the buyer, seller and lender establish in a real estate transaction are met.

Escrow payment

Firms that act as neutral third parties to ensure that all conditions that the buyer, seller and lender establish in a real estate transaction are met.

Estate

Funds that a mortgage servicer withdraws from a borrower's escrow account to pay property taxes and insurance.

Estimated Gross Costs of Buying

Total principal and interest payments over the number of years that you plan to own your home.

Estimated Increase in Equity

A specified property value increased by a selected rate of appreciation for a specific number of years.

Estimated Net costs of Buying

The estimated gross costs of buying minus estimated tax savings and the estimated increase in equity.

Estimated Tax Savings

The amount of tax a renter would save instead of owning a home based on property taxes and interest paid.

Estimated Total Costs of Renting

The total current rental payments for the same number of years you would plan to own a home increased by a yearly rental increase adjustment.

Estimated Total Savings

The amount of tax a renter would save instead of owning a home based on property taxes and interest paid.

Estoppel Certificate

Prevents individuals from asserting facts different from those contained in the document. Tenant and landlord both sign the document to confirm the facts pertaining to the lease.

Eviction

A legal procedure to remove a tenant for reasons including failure to pay rent.

Examination of title

An inspection by a title company of public records and other documents to determine the chain of ownership of a property.

Excavation

The process of clearing trees, removing topsoil and grading land before the foundation is laid.

Exchange

A sale in which the buyer partly pays for the property with a 'like kind' property instead of cash; a 'like kind' property is defined by the IRS because of tax implications.

Exclusive listing

A contract that gives an agent the exclusive right to market a property for a specific period of time.

Exclusivity

A restriction on the tenant's right to open a competing retail outlet within a certain area of leased premises.

Executor

A person appointed to carry out the instructions in a will. If there is no will, a probate court will appoint an executor.

Expense Stop

Fixed amount in a lease that serves as a limit on the amount for which the tenant is responsible, in the event expenses exceed a pre-stated amount.

Experian

Experian, formerly known as TRW Information Systems & Services, is one of the "Big Three" credit-reporting bureaus. Address: 505 City Parkway West, Orange, CA 92868.

Extension Option

Agreed continuation of occupancy under the same conditions as outlined in previous agreements.