| Abstract of Title - |
A summary of the conveyances, transfers,
and any other facts relied on as evidence of title, together with any other elements of
record which may impair the title to real property. |
| Acceleration Clause - |
A clause in trust deed or mortgage giving
the lender the right to call all sums owing him to be immediately due and payable upon the
happening of a certain stated event. |
| Acceptance - |
A legal term referring to the acceptance
of an offer. A buyer offers to buy and the seller accepts the offer. |
| Acknowledgment - |
A formal declaration before a duly
authorized officer by a person who has executed an instrument that such execution is his
act and deed. |
| Ad Valorem - |
"According to value." A method
of imposing a tax on the ownership of real property. |
| Adverse Possession - |
The open and notorious possession and
occupancy under an evident claim or right, in denial or opposition to the title of another
claimant. |
| Affidavit - |
A statement or declaration reduced to
writing and sworn to or affirmed before some officer who has authority to administer an
oath or affirmation. |
| Affirmation - |
A solemn declaration made under the
penalties of perjury by a person who conscientiously declines taking an oath. This is
equivalent to an oath. |
| Agency - |
The relationship between an agent and
principal. One who represents another from whom he has derived authority. |
| Agreement of Sale - |
A written contract between seller and
buyer in which they reach a meeting of minds on the terms and conditions of the sale. |
| Amortization - |
The liquidation of a financial obligation
on an installment basis; also recovery, over a period, of cost or value. |
| Appraisal - |
An estimate of value of property
resulting from an analysis of facts about the property. An opinion of value. |
| Appurtenance - |
Something belonging to the land and
transferred with it, such as buildings, fixtures, rights |
| Assemblage - |
Putting together two or more lots to form
a large parcel. |
| Assessed Value - |
A value placed upon property by the tax
assessor. |
| Assessment - |
The valuation of property for the purpose
of levying a tax, or the amount of the tax levied. |
| Assessor - |
One appointed to assess property for
taxation. |
| Assignment - |
A transfer or making over to another of
the whole of any property, real or personal, or of any estate or right therein. To assign
- to transfer or make over to another. |
Assumption of
Mortgage - |
When a grantee takes a title to real
property and the deed
contains an assumption agreement, or grantee executes a separate assumption agreement, the
grantee becomes the principal guarantor for unpaid portions of the note and is primarily
liable for the amount of any deficiency judgment. |
| Attachment - |
Seizure of property by court order,
usually done to have it available in event a judgment is obtained in a pending suit. |
| Attorney-in-Fact - |
One who is authorized to perform certain
acts for another under a Power of Attorney; may be limited to a specific act or acts, or
be general. |
| Balloon Payment - |
Where the final installment payment on a
note is greater than the
preceding installment payments and it pays the note in full, such final installment is
termed a balloon payment. |
| Beneficiary - |
(1) One entitled to the benefit of a
trust; (2) One who receives profit from an estate, the title of which is vested in a
trustee; (3) The lender on the security of a note and deed of trust. |
| Blanket Encumbrance |
A single mortgage or trust deed which
covers more than one piece of real estate. |
| Bona Fide - |
In good faith, without fraud or deceit;
authentic; sincere. |
| Breach - |
Violation of an obligation in a contract.
|
| Capitalization - |
In appraising it is a method of
determining the value of property by interpreting the property's net income with a
percentage which represents a reasonable return on invested capital. |
| Capitalization Rate - |
The rate of interest which is considered
a reasonable return on the investment. It is used in the process of determining value
based upon net income. |
| Cash Flow - |
Income generated by a property which is
determined by subtracting vacancy allowances and collection costs, operating expenses and
debt-servicing costs from the property's scheduled gross income. |
| Caveat Emptor - |
"Let the buyer beware." The
buyer must examine the goods or property and buy at his own risk. |
| Chain of Title - |
A history of conveyances and encumbrances
affecting the title from the time it passed from government ownership, or as far back as
records are available. |
| Closing Statement - |
The written statement provided by the
escrow company to each of the parties to the loan transaction showing the amounts received
and the amounts paid out for various items. |
| Cloud on Title - |
Any conditions revealed by a title search
which affect the title to property; usually relatively unimportant items but which cannot
be removed without a quitclaim deed or court action. |
| Codes - |
A systematic collection of laws in
writing. |
| Collateral Security - |
A separate obligation attached to another
contract to guarantee performance of the contract. |
| Collusion - |
An illegal agreement between two or more
persons to defraud another of his rights by the forms of law, or to obtain an object
forbidden by law. |
| Color of Title - |
That which appears to be good title but
which is not title in fact |
| Commingling - |
The broker's unauthorized and improper
mixing of office funds, which are personal or business monies, with trust funds, which are
client customer monies. |
| Commission - |
A payment for the performance of specific
duties in real estate; a percentage of the selling price of property, percentage of
rentals, etc. |
| Compound Interest - |
Interest paid on the original principal
and on interest accrued from time it became due. |
| Condemnation - |
The act of taking private property for
public use by the sovereign powers; a declaration that a structure is unfit for use. |
| Conventional Loan - |
A loan that's neither guaranteed nor
insured by Federal Housing Administration (FHA) or Veterans' Administration (VA). |
| Conveyance - |
The transfer of title to land. Includes
most instruments by which an interest in real estate is created, mortgaged, or assigned. |
| Convenants - |
Agreements written into deeds and other
instruments promising performance or non-performance of certain acts or stipulating
certain uses or non-uses of the property. |
| Damages - |
The indemnity recoverable by a person who
has sustained an injury either in his person, property or relative rights, through the act
or default of another. |
| Deed - |
A written instrument which, when properly
executed and delivered, conveys title to real property. |
| Deed in Lieu of Foreclosure - |
A deed to real property accepted by a
lender from a defaulting borrower to avoid the necessity of foreclosure proceedings by the
lender. |
| Default - |
Failure to fulfill a duty or promise or
to discharge an obligation, or to perform any act in an instrument in writing, that has
been agreed upon. |
| Deferred Maintenance - |
Existing but unfulfilled requirements for
repairs and rehabilitation. |
| Deficiency Judgment - |
A judgment given when the security
pledged for a loan does not satisfy the debt upon its default. |
| Depreciation - |
Loss of value in real property brought
about by age, physical deterioration or functional or economic obsolescence. |
| Deterioration - |
Reflecting the loss in value brought
about by wear and tear, disintegration, use in service, and the actions of the elements. |
| Discount Fee - |
Sometimes referred to as
"points," a fee charged by the lender in order to obtain a higher earning than
the interest stated in the mortgage note. |
| Documentary Transfer Tax - |
A state enabling act allows cities and
counties to adopt a
documentary transfer tax to apply on all transfers of real property located within their
jurisdictions. |
| Duress - |
Unlawful constraint exercised upon a
person whereby he is forced to do some act against his will. |
| Easement - |
Created by grant or agreement for a
specific purpose, an easement is the right privilege or interest which one party has in
the land of another. (Example: right of way.) |
| Economic Life - |
The period over which a property will
yield a return on the investment, over and above the economic or ground rent due the land. |
| Eminent Domain - |
The right of the government to acquire
private property for public use by condemnation. The owner must be compensated fully. |
| Encroachment - |
Trespass; the building of a structure or
construction of any improvements partly or wholly on the property of another. |
| Encumbrance - |
Anything which affects or limits the fee
simple title to property, such as mortgages, trust deeds, easements or restrictions of any
kind which do not prevent alienation of the fee title by the owner. Liens are special
encumbrances which make the property security for the debt. |
| Enforceable - |
That which can be made to effective; to
cause to take effect. An agreement or contract between persons in which one or other party
can legally compel the performance of another or other parties. |
| Equity - |
The interest or value which an owner has
in real estate over and above the liens against it. |
| Escheat - |
The reverting of property to the state in
the absence of heirs or other claimants. |
| Escrow - |
The deposit of instruments and funds with
instructions to a third party to carry out the provisions of an agreement or contract;
when everything is deposited to enable carrying out the instructions, it is called a
complete or perfect escrow. |
| Estate - |
The degree, quantity, nature and extent
of interest which a person owns in real property. |
| Estoppel - |
A legal theory under which a person is
barred from asserting or denying a fact because of the person's previous acts or words. |
| Exchange - |
A means of trading equities in two or
more real properties, treated as a single transaction through a single escrow or as a
deferred exchange through two or more escrows. |
| Exclusive Agency Listing - |
A written instrument giving one agent the
right for a specified time to sell a property, but reserving the right of the owner to
sell the property himself without payment of a commission to the agent. |
| Exclusive Right to Sell Listing - |
A written agreement between an owner and
an agent
giving the agent the right to collect a commission if the property is sold by anyone
during the term of his agreement. |
| Execute - |
To complete, to make, to perform, to do,
to follow out. To execute a deed is to make a deed, including especially the signing,
sealing, and delivery; to execute a contract is
o perform the contract, to follow it out to the end, to complete it. |
| Executed Contract - |
A contract that is fully performed. |
| Execution of Contract - |
To sign a contract. |
| Executory Contract - |
A contract not yet fully performed. |
| Executor - |
A person named in a will to carry out its
provisions as to the disposition of the estate of a deceased person. |
| Executor's Deed - |
A legal deed to real property given by an
executor of an estate. |
| Fee Simple - |
The terms "fee" and "fee
simple" are substantially
synonymous. The term "fee" is of old English derivation. "Fee simple
absolute" is an estate in real property by which the owner has the greatest power
over the title which it is possible to have, being an absolute estate. In modern use, it
expressly established the title of real property in the owner, without limitation or end.
They may dispose of it by sale, or trade or will, as he chooses. |
| FHA Loan - |
A loan that is underwritten to the
standards of the Federal Housing Administration, which grants approval of the loan and
insures the lender against financial loss. |
| Fiduciary - |
A person in a position of trust and
confidence, as between principal and broker; broker as fiduciary owes certain loyalty
which cannot be breached under rules of agency. |
| Fixtures - |
Appurtenances affixed to buildings or
land, usually in such a way that they cannot be moved without damage to themselves or the
property; plumbing, electrical fixtures, fences, trees, shrubbery, etc. Fixtures are real
property. |
| FNMA (Fannie Mae) - |
A private corporation dealing in the
purchase of first or second mortgages, at discounts. |
| Foreclosure - |
Procedure whereby property pledged as
security for a debt is sold to pay the debt in event of default in payments or terms. |
| Forfeiture - |
Loss of money or anything of value due to
failure to perform, such as a deposit given to insure performance. |
| Fraud - |
The intentional and successful employment
of cunning, deception, collusion; or artifice used to cheat or deceive another person
whereby that person acts upon it to the loss of his property and to his legal injury.
|