| Equity |
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| The value of a property after deducting payment and other costs. |
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| Escrow |
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| Money held in acount by an independent third party to be released when pre-agreed obligations are fulfilled. |
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| Early redemption fees |
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This refers to any redemption fees that a lender will charge if a mortgage is redeemed before the end of the term. |
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| Exchange of contracts (England & Wales only) |
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At this stage of property purchase legally binding contracts are exchanged between the buyer and the seller. After contracts have been exchanged the vendor must sell and the purchaser must buy on the terms agreed. |
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| Existing liabilities |
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This phrase simply refers to all the other financial commitments apart from the existing or proposed mortgage. Liabilities will include credit cards, bank loans, maintenance payments to ex-spouse and school fees, etc. Lenders will take these items into account when evaluating the mortgage amount they are prepared to lend. |
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| Endowment Mortgage |
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An interest only mortgage supported by an endowment policy. During the term of the mortgage only interest on the mortgage is paid to the lender. At the same time premiums are paid into an endowment policy which is designed to mature at the end of the mortgage term. The proceeds of the endowment policy are designed to repay the mortgage debt, although with a low cost endowment policy it is not guaranteed that the proceeds will be sufficient to repay the debt. In addition to providing the investment to repay the mortgage debt the endowment policy will also include life assurance which will repay the mortgage debt in the event of the death of the policyholder within the policy term. |
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| Escalating |
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Interest rate that increases during the term of the account, on defined dates and by agreed amounts. |
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