Glossary

EASEMENT: Generally, this is a recorded right of a non-owner of property to exert control over a portion or all of the property. For example, power companies often own an easement over residential properties for access to their power lines or for purposes of ingress or egress to the property.

EAVE: A part of the roof that extends beyond the exterior wall.

ECONOMIC DEPRECIATION: When the decline in property value is caused by external forces, such as neighborhood deterioration or adverse development.

ECONOMIC LIFE: This is the amount of time which any income-producing property is able to provide benefits to its owner. This is mostly used in analysis of investment properties.

EFFECTIVE AGE: This is subjective, estimated age of a property based on its condition, rather than the actual time since it was built (most commonly used by appraisers). The excessive wear and tear can cause a property's effective age to be greater than its actual age.

EMINENT DOMAIN:  The legal process whereby a government can take ownership of a piece of property in order to convert it to public use. The property owner is forced to sell the property to the government. Often, the property owner is paid fair-market value for the property.

ENCROACHMENT: This can be building or other improvement (such as a fence) on one property which invades another property or restricts its usage. One usually must take legal steps to have the encroachment removed.

ENCUMBRANCE: This is recorded claim against a property. Examples are mortgages, judgments, taxes, liens and easements.

ENERGY EFFICIENCY RATIO: This is an efficiency rating system for air conditioning units which correspond to the number of BTU's output per watt of electricity used. You will find this on the Manufactory’s tag on the appliance.

EQUAL CREDIT OPPORTUNITY ACT (ECOA): U.S. federal law requires that lenders afford people equal chance of getting credit without discrimination based on race, religion, age, sex etc.

EQUITY: The difference between the fair market value of a property and that amount an owner owes on any mortgages or loans secured by the property.

EQUITY BUILDUP: When the natural increase in the amount of equity an owner has in a property has accumulated through market appreciation and debt repayment.

ERRORS AND OMISSIONS INSURANCE: An insurance policy taken out by appraisers and Realtors to cover their liability for any mistakes made during the appraisal process or sale of a property.

ESCROW:   An amount retained by a third party in a trust to meet a future obligation. Often used in the disbursement of fund to sell a property and or payment of annual taxes or insurance for real property.

ESCROW ACCOUNT: This is an account setup by a mortgage servicing company to hold funds with which to pay expenses such as homeowners insurance and property taxes. There is usually an extra amount of funds paid with regular principal and interest payments that goes into the escrow account each month.

ESCROW ANALYSIS: This is an analysis performed by the lender usually once each year to see that the amount of money going into the escrow account each month is correct for the forecasted expenses.

ESCROW DISBURSEMENTS: This is where the Escrow Company pays for funds from an escrow account to pay property expenses such as taxes and insurance.

ESTATE: The total of all real and person property and assets owned by an individual.

EXAMINATION OF TITLE: This is a report generated on the title of a property from the public records or an abstract of the title.

EXCLUSIVE LISTING: A written agreement between the owner of a property and a real estate agent giving the agent exclusive right to sell the property.

EXECUTOR Of EXECUTRIX:  A male or female person named in a will to administer the estate.