Glossary and Acronyms "E"

Encroachment

An interference with or intrusion onto another's property.

Entitlement

An absolute right to a benefit granted immediately upon legal requirement.

Encumbrance

Any lien or liability attached to a property that affects or limits the title to that property, for example unpaid taxes, mortgages and leases.

Equal Credit Opportunity Act (ECOA)

A federal law that requires lenders and other creditors to make credit available without discrimination based on race, color, religion, national origin, age, sex, marital status or receipt of income from public assistance programs. Ref: ECOA 

Equity

The difference between the fair market value (appraised value) of your home and your outstanding mortgage balances and other liens.

Equitable Mortgage

A transaction that has the intent but not the form of a mortgage, and that a court of equity will treat as a mortgage.

Escrow

Funds deposited with a third party, to be held until a specific date is reached and/or a specific condition is met. Ref: Escrow

Escrow impound account /Escrow Account

Typically refers to an account set up by a lender in which funds to pay for real estate taxes and homeowners insurance are deposited as part of the borrower's monthly mortgage payment, then disbursed as tax and insurance payments come due. Ref: What are "Escrow accounts"? 

Escrow analysis

The periodic examination of escrow accounts to determine if current monthly deposits will provide sufficient funds to pay taxes, insurance and other bills when due.

Escrow Agent

The third-party depository of an escrow. An escrow holder is not a common-law agent because the holder does not act subject to the control of the parties to the escrow agreement.

Escrow Agreement

The instruction given to the third-party depository of an escrow.

Escrow Contract

The contract among buyer, seller, and escrow holder, setting forth the rights and responsibilities of each.

Eviction

The act or process of legally dispossessing a person of land or rental property.

Exclusive Right-to-sell Listing

The right to sell a principal's products or to act as the seller's real estate agent to the exclusion of all others, including the owner. The listing agreement upon which the broker gets commission even if seller is the one who sells the house during the agreement period or for a certain period thereafter.

Exclusive Agency Listing

A listing giving one agent the right to be the only person, other than the owner, to sell the property during a specified period. A listing agreement upon which the broker does not get a commission if the seller sells the property themselves.

Executor

A person named by a testator to carry out the provisions of the testator's will.

Earnings

Money gained on the principal in your financial accounts, such as an IRA.

Emerging market

Generally, economies that are in the process of growth and industrialization. Developing markets, such as Africa, Asia, Eastern Europe, the Far East, Latin America and the Middle East may hold significant growth potential in the future. Investing in emerging markets may provide significant rewards, as well as significant risks

Emerging market fund

A fund that invests primarily in emerging market countries.

Employee Retirement Income Security Act of 1974 (ERISA)

A federal law that imposes various requirements on voluntary established pension plans in the private industry. ERISA establishes standards in order to provide protection for plan participants. Ref: ERISA

Equity

A security or investment representing ownership in a corporation. Equity is often used interchangeably with stock. Compare to a bond, which represents a loan to a borrower.

Equity Fund

A fund that invests primarily in equities.

Equity wash restriction

A provision in certain stable value or fixed income products that require transfers to be directed to an equity fund or other noncompeting investment option. Restrictions last for a stated period of time (usually 90 days) before those funds may be invested in any other competing fixed income fund (such as a money market fund) provided by the plan.

Exchange traded fund (ETF)

An investment company, such as a mutual fund. ETF shares are traded throughout the day on stock exchanges at market-determined prices.

Expense ratio

A measure of what it costs to operate an investment, expressed as a percentage of its assets or in basis points. You pay for these costs through a reduction in the investment’s rate of return. See operating expenses and total annual operating expenses.

Employee-Assisted Housing

A program in which an employer assists its employees in purchasing homes by helping with the down payment, closing costs, or monthly payments.

Effective Interest rate

The actual annual rate, which incorporates compounding when calculating interest, rather than the stated rate or coupon rate.

Eminent domains

The inherent power of a governmental entity to take privately owned property and convert it to public use, subject to reasonable compensation for the taking.

Easement

An interest in land owned by another person, consisting of the right to use or control the land, or an area above or below it, for a specific limited purpose. e.g an ingress and egress easement for the right to access the land through the land of another. The land benefiting from an easement for the right to access the land though the land of another. The land benefiting from an easement is called the dominant estate, while the land burdened by an easement is called the servient estate. Unlike a lease or license, an easement may last forever, but it does not give the holder the right to possess, take from, improve upon, or sell the land. The Primary recognised easements are:

(1) A right of way

(2) A right of entry for any purpose relating to the dominant estate

(3) A right to support of land and buildings

(4) A right of light and air

(5) A right to water

(6) A right to do some act that would otherwise amount to nuisance

(7) A right to place or keep something on the servient estate

Economic Obsolescence

Obsolescence that results from external economic factors, such as decreased demand or changed governmental regulations.

Earnest money Deposit

A deposit made toward a down payment as a sign of good faith. The deposit is typically made when a purchase agreement is signed.