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.
Equity
The difference between the fair market value (appraised value) of
your home and your outstanding mortgage balances and other liens.
Escrow
The process
of placing an amount of money and documents with a neutral third
party, called an escrow agent, who's given the authority to deposit,
disburse and distribute to the proper parties all the money and
documents involved in a real estate transaction. The purpose is
to protect both the buyer and seller in the transaction from the
other side's unauthorized use of funds and ensures an arm's-length
transaction between both sides.
Also commonly
used to mean an escrow account or impound account, required by
many lenders and held by the lender during the term of the loan.
This deposit is used to hold the borrower's advance payments toward
insurance and property taxes until they become due.
