LEASE 
A contract between the owner (leassor) and the tenant (leassee) stating the conditions under which the tenant may occupy or use the property. 

 

LEGAL RATE OF INTEREST 
The maximum rate of interest fixed by the laws of the various states which a lender may charge a borrower for the use of money. 

 

LENDING INSTITUTION 
Any institution, including a commercial bank, savings and loan association, commercial finance company, or other lender qualified to participate with SBA in the making of loans. 

 

LEVERAGED BUY-OUT 
The purchase of a business with financing provided largely by borrowed money, often in the form of junk bonds. 

 

LIEN 
A charge upon or security interest in real or personal property maintained to ensure the satisfaction of a debt or duty ordinarily arising by operation of law. 

 

LIQUIDATION  
The disposal, at maximum prices, of the collateral securing a loan and the voluntary and enforced collection of the remaining loan balance from the obligators and/or guarantors. 

 

LIQUIDATION VALUE 
The net value realizable in the sale (ordinarily a forced sale) of a business or a particular asset. 

 

LITIGATION  
Refers to a loan in "liquidation status" which has been referred to attorneys for legal action.
Also: The practice of taking legal action through the judicial process. 

 

LOAN AGREEMENT 
Agreement to be executed by borrower, containing pertinent terms, conditions, covenants, and restrictions.