Late charge
Penalty paid by a borrower when a payment is made after the due date.

Lender
The bank, mortgage company or mortgage broker offering a loan.

LIBOR (London Interbank Offered Rate)
The interest rate charged among banks for short-term Eurodollar loans, and a common index for ARMs.

Lien
A claim by one person on the property of another for payment of a debt.

Life cap (Interest)
A pre-determined amount that establishes the maximum interest rate life of loan. This can be expressed as a percentage above the start rate or as a rate of interest independent of the start rate.

Loan administration
The collection of mortgage payments from borrowers and related responsibilities (such as handling escrows for property tax and insurance, foreclosing on defaulted loans and remitting payments to investors).

Loan application
A document required by lenders prior to loan approval containing detailed information about the borrower and property.

Loan application fee
A fee a prospective buyer pays a lender when applying for a mortgage.

Loan origination fee
A fee a lender charges to process a mortgage, usually expressed as a percentage of the loan (or points), which pays for the work in evaluating and processing the loan.

Loan servicing
See Loan administration.

Loan to value ratio (LTV)
The percentage of the property value borrowed. (Loan amount/property value=LTV)

Lock or lock-in
A lender’s guarantee of an interest rate for a set period of time, usually between loan application and loan closing. This protects borrowers against rate increases during that time.

LTV
See Loan to Value Ratio.