J-L Terms


Joint Tenancy – A form of co-ownership that gives each tenant equal undivided interest and rights in the property, including the right of survivorship. Contrast with tenancy in common, tenancy by the entirety.

Judgment – A decree by a court of law that one person, a debtor, is indebted to another, a creditor, in a specified amount. The court may place a lien against the debtor’s real property as collateral for payment of the judgment to the creditor.

Judgment Lien – A lien on the property of a debtor resulting from a judgment.

Judicial Foreclosure – A type of foreclosure proceeding used in some states that is handled as a civil lawsuit where the court confirms the sales price for the property and the distribution of the sale proceeds.

Jumbo Loan – Any loan amount in excess of $252,700. Also called a nonconforming loan.


Late Charge – The penalty a borrower must pay when a payment is made a stated number of days (usually 10-15) after the due date.

Lease – A written agreement between the property owner and a tenant that stipulates the conditions under which the tenant may use the real estate for a specified period of time and the amount of rent to be paid.

Leasehold Estate – A tenant’s interest in or right to hold possession of a property.

Legal Description – A property description, recognized by law, using a government rectangular survey, metes and bounds, or a plot map to sufficiently locate and identify a property.

Lender’s Fees – Fees paid to the lender to cover costs associated with processing, underwriting and closing of the loan.

Lending Guidelines – Every loan program has different guidelines. Guidelines are used to meet Federal, State and Local laws and enforce minimum requirements by the lender. Guidelines ensure that prospective borrowers won’t purchase a home that they won’t be able to afford.

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 – Insurance coverage that offers protection against claims alleging that a property owner’s negligence or inappropriate action resulted in bodily injury or property damage to another party. See also homeowners insurance.

Lien – A legal claim against a property that must be paid off when the property is sold. A lien is created when you borrow money to purchase or refinance a home loan or and with obtain a home equity loan.

Lifetime Rate Cap – For an adjustable-rate mortgage (ARM), a limit on the amount that the interest rate can increase or decrease over the life of the loan. See cap.

Line/Loan Amount – The entire HELOC or Fixed Rate Second mortgage loan amount.

Line Of Credit – An agreement by a lender to extend credit up to a certain amount for a certain time without the need for the borrower to file another application. See home equity line of credit.

Liquid Asset – A cash asset or an asset that is easily converted into cash.

Loan Amount – The amount of money you want to borrow to purchase or refinance a home. Also called the principal and is generally repaid over time with interest.

Loan Commitment – A lender’s agreement to advance money on specified terms after specified conditions are met. See commitment letter.

Loan Origination – The process by which a mortgage lender makes a home loan and records a mortgage against the borrower’s real property as security for repayment of the loan.

Loan Program – Typically a lender will have several types of loan programs available. They are described in accordance with the major features of the loan program. For example, a loan described as a “Fixed 30 Year” would mean that the interest rate and payment remain fixed over the thirty year life of the loan. A program described as “Fixed/ARM 5/1” means that the interest rate and payment remain fixed for the first five years, and then it is subject to adjustments every year thereafter.

Loan-To-Value Ratio – The ratio of the total amount borrowed on a mortgage against a property compared to the appraised value of the property. For example, if you have an $80,000 1st mortgage on a home with an appraised value of $100,000, the LTV is 80% ($80,000 / $100,000 = 80%).

Lock-In – A written agreement in which the lender guarantees a specified loan program interest rate and points if a mortgage goes to closing within a set period of time.

Lock-In Period – The time period during which the lender has guaranteed an interest rate to a borrower. See lock-in.