Loan Glossary
Business / Loan Glossary
Limited Liability: Limitation of shareholders' losses to the amount invested.
Limited Recourse: Rights only to specifically stipulated assets to satisfy an unpaid debt.
Line Of Credit: Also called an 'open line of credit' secured on your home. Often there are no closing costs involved, or the lender offers to pay all closing costs. Use like a checking account, borrowing cr . . . View Full Definition
Linked Deposit: A deposit in an account with a financial institution to induce that institution's support for one or more projects. By accruing no interest or low interest on its deposit, a foundation essen . . . View Full Definition
Loan Agreement: A written contract between a lender and a borrower that sets out the rights and obligations of each party regarding a specified loan.
Loan Approval-Commitment: A lender's agreement to make a loan on particular terms, including interest rate, fees and charges.
Loan Consolidation: The combining of a number of loans into a single new loan. Consolidation typically extends your repayment period and lowers your monthly payments, thereby greatly increasing the amount of in . . . View Full Definition
Loan Term: Length of time until your loan is due and payable.
Long Term Debt: Financing used to purchase or improve assets such as plant, facilities, large equipment and real estate.
Loss Reserves: That portion of a fund's earnings or permanent capital designated by the board of directors as a reserve against possible loan losses and, as such, unavailable for lending purposes. Generall . . . View Full Definition
Market Rate: The rate of interest a company must pay to borrow funds currently. Program-related investments generally are offered at below market rates or at no interest rate.
Maturity: A loan's maturity is the life of the loan; that is, how long you have to repay the loan. It usually applies to term loans and not lines of credit.
Mediation: A process of dispute resolution in which an impartial third party, a mediator, intervenes in a dispute with the consent of the disputing parties and helps them negotiate an agreement. The ro . . . View Full Definition
Mortgage: A mortgage is a promise in which you agree to put up your home as security for a loan. The mortgage is the instrument which secures the Promissory Note, in which you promise to repay the loa . . . View Full Definition
Mortgage Banker: A lender, other than a bank, credit union, or savings and loan, that specializes in making residential mortgage loans.
Mortgage Broker: A person or company that obtains a mortgage loan for the borrower from another lender. A mortgage broker will not always be representing the borrower and will not necessarily be looking afte . . . View Full Definition
Mortgage Insurance (PMI Or MI): Insurance that may be required when a loan is greater than 80% of the value of the home. This insurance protects the lender in the event a borrower fails to make his or her loan payments. Th . . . View Full Definition
Multi-Lender Environment: Numerous lending institution sharing the same site and information to provide instant financing to small businesses.
Word of the Day:
Bond: 1. A debt instrument, an obligation to pay, a security issued by a corporation. 2. A written promise that accopmpanies a mortgage and is evidence of t . . . Full Definition
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