Glossary of Mortgage Terms

A drive-by appraisal is a way to find out how much a house is worth by looking at the outside and using public records and sales data from similar homes.

A DSCR loan is a type of mortgage for investment properties that looks at the property's rental income instead of the borrower's personal income, tax returns, or work history to see if they qualify.

A home buyer's earnest money is a deposit the buyer pays to show the seller they're serious about buying their house. It's usually held in escrow until the deal is done.

An easement is a legal right that lets someone other than the property owner use a certain part of the property for a specific purpose without giving up ownership.

The government has the constitutional right to take private property for public use, as long as the owner is paid a fair amount that is equal to the property's fair market value.

When a structure, fence, or landscaping from one property crosses the line and goes onto a neighbor's land without permission, it’s called an encroachment.

An encumbrance is a claim, lien, or restriction on a property by someone other than the owner that makes it harder to use or move the property.

An energy-efficient mortgage (EEM) is a loan that lets you add the cost of home improvements that save energy to your mortgage so you can pay for them over time instead of all at once.

Equal opportunity housing is a set of federal and state laws that protect people from being discriminated against when they buy, rent, finance, or advertise housing because of their race, religion, sex, national origin, disability, or family status.

A mortgage lender or third-party servicer manages an escrow account, which is a holding account that collects and pays out money for property taxes, homeowners insurance, and other housing costs on behalf of a borrower.