Borrower

After-Acquired Clause
A clause in a mortgage agreement providing that any additional mortgageable property acquired by the borrower after the mortgage is signed will be additional security for the obligation.
Bank Line
A bank line, also known as a line of credit, refers to a bank's moral commitment to lend to a particular borrower up to a specified maximum during a specified period, usually one year. Unlike a legal commitment, it does not involve charging a commitment fee.
Borrower
A borrower is a person who has received a loan and is obligated to repay the amount borrowed (principal) with interest and other fees, according to the loan terms.
Cross-Default Clause
A cross-default clause in a loan agreement that stipulates that a default on one loan can trigger defaults on other loans held by the same borrower.
Deed in Lieu of Foreclosure
A deed in lieu of foreclosure is a legal process where a borrower voluntarily transfers the ownership of property to a lender to satisfy a loan that is in default and avoid foreclosure proceedings.
Deficiency Judgment
A deficiency judgment is a court order stating that a borrower still owes money on a loan when the security or collateral does not fully satisfy the defaulted debt.
Early Repayment Tax Clause
An Early Repayment Tax Clause is a provision in a loan agreement that allows the borrower to repay the loan early if changes in relevant tax legislation increase the amount of interest payable.
Grace and Notice Provision
A grace and notice provision gives borrowers extra time to make required payments or comply with loan terms before being classified as in default in a loan agreement.
Interest Rate
The amount charged by a lender to a borrower for the use of assets, expressed as a percentage of the principal. It also refers to the earning rate for deposits held in a financial institution.
Late Charge
A late charge is a fee charged by a lender when the borrower fails to make a timely payment on their loan or credit account.
Lender
An individual or firm that extends money to a borrower with the expectation of being repaid, usually with interest, creating debt in the form of loans. Lenders are paid off before stockholders in the event of corporate liquidation.
Line of Credit
A line of credit is an agreement between a financial institution and a borrower that allows the borrower to access funds up to an approved limit, providing flexibility in borrowing. It is not necessary to reapply each time funds are needed, but repayment is expected as the credit is used.
Loan
A loan is a financial transaction where a lender provides property, typically money, to a borrower, who promises to return the property with interest after a specified period.
Loan Commitment
A loan commitment is an agreement by a financial institution to lend a specified amount of money on established terms in the future. This commitment outlines the conditions under which the loan will be provided and ensures the borrower of available funds when needed.
Loan Creditor
A Loan Creditor is an individual or institution that provides financing to a business or individual, thereby becoming entitled to repayment of the principal amount along with interest.
Mortgage Commitment
A detailed understanding of a mortgage commitment helps both borrowers and lenders formalize the loan process and prepare for property transactions.
Mortgage Note
A mortgage note is a legal document that states the names of the borrower and lender, the amount borrowed, the interest rate, repayment terms, and other loan provisions. While the mortgage pledges the property as collateral, the mortgage note outlines the debt and the repayment requirements.
Mortgagor
A mortgagor is an individual or entity that borrows money through a mortgage by pledging property as security for the loan.
Open-End Mortgage
An Open-End Mortgage refers to a type of mortgage under which the borrower can borrow additional funds from the lender, typically up to a specified ceiling.
Prepayment Clause
A prepayment clause is a provision in a bond or mortgage that allows the borrower to pay off the loan before its scheduled due date. In some cases, there may be penalties for prepayment, such as the waiver of interest that is not yet due.
Quasi-Loan
An arrangement wherein a creditor agrees to satisfy certain financial obligations of a borrower, provided the borrower agrees to reimburse the creditor.
Reconveyance
Reconveyance is a process in which a lender transfers the title of a property back to the borrower once the mortgage debt is fully paid off. This legal document ensures the borrower's ownership of the property is unencumbered by the lender’s lien.
Secured Liability
A secured liability is a debt against which the borrower has pledged sufficient assets as collateral to protect the lender in case of default.

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