Mortgage Dictionary: E

Please view the glossary definitions from our list below. Some terms have a dedicated page with a longer definition. This is available by clicking on the "more about " link.

Early Payment Discount A discount offered for payment of a bill before the due date. This is common practice with utility companies, as it saves the paperwork required in sending out reminders. However, paying by direct debit is usually cheaper. Early Redemption Payment Penalty charged by a lender for withdrawing from a mortgage before the date specified in the mortgage conditions. These penalties are usually associated with fixed or discounted loans. Early Repayment Period Period in which charges are levied by the lender when the mortgage loan is repaid before the end of the full term. Effective Gross Income Total income, including extra income that the lender considers when assessing a loan application, such as bonuses, rent payments, alimony or share dividends. Employed Refers to a person who has an open-ended contract of employment and has income tax and national insurance contributions deducted from their salary. Employee A person who works for a company, government body, or other organisation, as opposed to someone who does not work (un-employed), or someone who works for their own company (self-employed). Employer Any business, government body, or other organisation which has one or more staff members. Employer's Reference A written statement from an employer confirming the borrower's employment, giving details of salary and length of service. This is essential in assessing an employee's ability to repay the mortgage. Employment Status The individual's employment position. That can be either employed, self-employed or unemployed; full time or part time. Endowment A  life assurance policy into which you pay monthly premiums. The proceeds are free from all taxes as long as the policy conforms to all the qualifying rules. See also: with profit, unit linked, unitised with profits. Equity The share that you own in your home, i.e. The property value less the mortgage loan outstanding. Equity Appreciation Increase in the equity you have in your home. Exclusive Products Particular mortgage lenders fund and administrate certain mortgage products that are only available whilst such mortgage products are funded and administered by a particular mortgage lender, they are available only from certain mortgage brokers or other particular distribution channels. Executor A person who executes the instructions in a will. Existing Liabilities Loans and other repayments which are taken into account by lenders when you apply for a mortgage. Extended Redemption Penalty When a redemption penalty continues beyond capped and fixed rates. Extension An addition to any existing property in order to provide more space. Major extensions should always be drawn up by an RIBA registered Architect, and will require planning permission from the relevant local authority. See also: overdraft extension.