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​A - C

Abandonment - The voluntary surrender of property, owned or leased, without naming a successor as owner or tennant

Abstract of title - A condensed history or summary of all transactions affecting a particular parcel of real estate, including the original grant, all conveyances and encumbrances affecting the property, and the abstractor's certification of the history's accuracy

Acceleration clause - A clause in a mortgage that gives the lender the right to require payment of the entire principal balance if the borrower defaults on an installment payment or other covenant

Acceptance - An offeree's consent to enter into, and be bound by the terms of, a contract

Access - The right to enter and exit a parcel of land from a public way, including the right to enter and exit via land belonging to others

Acknowledgment - The confirmation by which a party executing a legal document confirms his signature and voluntary agreement with the terms of the document, made before an authorized officer of the Court or notary public

Acre - 43,560 square feet of land

Adjustable-rate mortgage (ARM) - A mortgage with interest rates that may fluctuate based on market conditions; the lender is permitted to adjust the mortgage's interest rate periodically, though most ARM's are limited in the amount that the interest rates can vary

Adjusted basis - The total of the original cost of a property and the value of any capital expenditures for improvements done to it, minus any depreciation taken

Adjustment date - The date on which the interest rate changes for an adjustable-rate mortgage (ARM)

Adjustment period - The period of time between the adjustment dates for an adjustable-rate mortgage (ARM)

Administrator - A person appointed by a probate court to administer the estate of an individual who has died without a will

Adverse Possession - A claim made against the land titled to another person, by virtue of open and hostile possession and use of the land to the exclusion of the titled owner

Affidavit of title - A sworn statement that is made in writing under oath by a seller of real property, and certified by a notary public, in which the seller identifies himself or herself, indicates marital status, certifies that no defects have occurred in the title since the examination of the title on the date of the contract, and confirms that he or she is in possession of the property (if applicable)

Agency - The relationship between two or more persons wherein the agent is authorized to act on behalf of another person (or principal) in certain transactions

Agent - A person or company that acts on behalf of another to transact business, generally in exchange for payment. In real estate, it is a person or company with a real estate license working under the authority of a real estate broker

Alienation - The act of transferring property to another, either voluntarily (via a sale), or involuntarily (via adverse possession)

Alienation clause - The clause in a mortgage or deed of trust which asserts the lender's option to require that the balance of the secured debt becomes immediately due and payable if the property is sold by the borrower, preventing the borrower from assigning the debt without the lender's approval

ALTA - American Land Title Association, the national association of title insurance companies, abstractors and attorneys specializing in real property law, headquartered in Washington, D.C.

Amenity - A natural or manmade feature of real property that enhances its value and attractiveness, though it is not essential to the property's use

Amortization - The process of payment of a debt or mortgage loan over time by installments

Amortization schedule - A timetable for repayment of a debt or mortgage loan, showing the amount of each payment, what portion is applied to interest and principal, and the remaining balance

Amortization term - The amount of time required to repay the mortgage loan, expressed in number of months

Amortize - To pay off a loan or mortgage with periodic payments that cover both principal and interest

Amortized loan - A loan in which both the principal and interest are payable in monthly or other periodic installments over the term of the loan, with no balloon payment prior to maturity

Annual mortgagor statement - An annual report sent to the borrower (mortgagor) each year, showing the amount paid in taxes and interest during the year, as well as the remaining mortgage loan balance

Annual percentage rate (APR) - The overall cost of a mortgage, including interest, mortgage insurance, and loan origination fee (points), stated as a yearly percentage, thus allowing buyers to compare different types of mortgages based on the associated annual finance charges; the APR must be disclosed to borrowers by lenders, per the Truth-in-Lending Act

Annuity - The return, including interest, from an investment of capital, paid in a series of regular payments

Appraisal - A written estimate of the value of an asset or property prepared by a qualified, independent party, through which the asset or property value is determined

Appraised value - The estimate of a property's fair market value, based on an appraiser's analysis of the property

Appraiser - An individual educated to estimate the value of real property and personal property

Appreciation - An increase in the worth of a property due to changes in economic conditions or other causes; the opposite of depreciation

Appurtenance - Anything attached to, or used with, a parcel of land that will go to the new owner on conveyance of the land

ARM - Adjustable-rate Mortgage. Also see "Variable Rate Mortgage"

Assessment - A tax, charge or levy against a property made by the government, based on its value, and levied for a specific purpose, such as to finance sidewalks, a sewer, etc.

Assessment rolls - The public record of taxable property

Assessor - A public official who evaluates the value of a property for taxation purposes

Asset - Anything of monetary value owned by an individual, including real property, personal property, and enforceable claims against others (bank accounts, stocks, mutual funds, etc.)

Assign - To transfer interest

Assignee - One who receives an assignment or transfer of rights

Assignor - One who makes an assignment or transfer of rights to another

Assumable mortgage - A mortgage that allows a new owner to take over its obligations

Assumption - The process of transferring the seller's existing mortgage and liability for payments to the buyer when purchasing a property, which usually saves the buyer money, since assuming a new mortgage incurs additional closing costs and possibly higher interest charges

Assumption clause - The provision in an assumable mortgage that allows a buyer to take responsibility for that mortgage from the seller

Attachment - Seizure of property through Court process to force payment of a debt

Attorney-in-fact - One who holds a power of attorney from another to execute legal documents on behalf of the grantor of the power

Back ratio - The ratio of monthly housing costs (principal, insurance, taxes, and interest) plus regular monthly payments to gross monthly income, used by the lender to evaluate an applicant's qualification for a loan; typical back ratios are between 32 - 45 percent

Balloon mortgage - A mortgage with level monthly payments over a stated term, but which requires a lump sum payment in full due at the end of an earlier specified term

Balloon payment - The final lump sum payment that is made at the maturity date of a balloon mortgage, which is larger than preceding regular payments

Bankruptcy - A legal proceeding in a federal court in which a debtor who owes more than the total of his or her assets can surrender those assets to the Bankruptcy Court, thereby being relieved of the future obligation to repay his or her unsecured debts; a Trustee in Bankruptcy administers the assets, selling them to pay as much of the debt as possible

Bargain and sale deed - A deed that carries with it no warranties against liens or other encumbrances, but which implies that the grantor has the right to convey title

Basis - The financial interest an owner of an investment property has, as determined by the Internal Revenue Service, in order to determine annual depreciation and gain or loss on the sale of the asset Adjusted Basis: When property is purchased, the owner's basis is calculated to be the property cost plus the value of any capital expenditures for improvements made, minus any depreciation taken

Benchmark - A permanent reference mark made on a piece of property for the sake of surveyors

Beneficiary - The person named to receive income from a trust, an estate, or a deed of trust

Bequeath - To gift or transfer personal property to another party, executed via a will

Betterment - An improvement to property that increases its value, as opposed to repairs or changes that maintain its value only

Bid - A financial offer to purchase a property

Binder - A preliminary agreement for the purchase of real estate, secured by the payment of an earnest money deposit which evidences the purchaser's good faith and intent to complete the purchase

Blanket loan - A mortgage covering more than one parcel of real estate, which provides for each individual parcel's partial release from the mortgage upon repayment of a portion of the debt

Bond - A written financial obligation, usually secured by a mortgage or a deed of trust, and often posted with the Court, to guarantee against loss incurred with a potential claim

Breach - Failure to follow through on a contractual promise or legal obligation

Bridge loan - A form of second trust, collateral for which is the borrower's present home, usually taken on to allow the proceeds from the sale of the borrower's present home to be used to close on a new home, before the previous home is sold

Broker - An intermediary who assists in negotiating contracts between two or more parties, for a fee; in real estate, a broker is licensed to assist in the purchase, selling, rental or managing of real estate; the broker's services will vary, depending on whether he or she is employed by the seller or the buyer

Building code - An ordinance that specifies minimal standards for construction, alteration, or demolition of a building, set for the sake of safety

Building Restriction Line (or "Set-back") - The minimal distance from the road where a building may be positioned, which appears in the original plat of subdivision, restrictive covenants, or in zoning ordinances and building codes

Bureau of Land Management - The branch of government responsible for the surveying and management of public lands

Buy-back agreement - A written agreement which specifies the conditions under which the seller is allowed to repurchase the property, usually restricted to a certain period of time and to a price stated in the agreement

Buydown - When the lender or home builder lowers the interest rate on initial payments on a loan, often for the first few years, allowing a borrower whose income is expected to increase in subsequent years to qualify for a loan they otherwise are currently not qualified for

Buyer-agency agreement - When the broker is the agent for the buyer and is financially obliged to the buyer

Buyer's market - When the real estate buyer is at advantage because there is more supply of houses or real estate available for sale than there is demand, thus lowering prices

CC & R ' s - Covenants, Conditions and Restrictions; or the rights and obligations of individual owners of real property within a subdivision (or other tract of land where there is more than one owner of property) in relation to other owners, or to the organized association of owners, within the same subdivision, relative to the use and maintenance of the property commonly owned among them

Call option - A provision of a mortgage that allows the mortgagee, or lender, to require the mortgage to be due and payable for any reason at the end of a specified period of time

Cap - A limit placed on an adjustable-rate mortgage (ARM) as to how much the interest rate or mortgage payments may increase or decrease

Capital expenditure - The expense incurred making an improvement to a property in order to extend it useful life or to add to its value

Capital gain - Profit earned from the sale of an asset

Capitalization - A mathematical formula that estimates the value of a property, utilizing the rate of return on the investment and the annual net operating income expected

Capitalization rate - The rate of return a property will produce on the owner's investment

Cash-out refinance - A loan for refinancing a property which offers cash over and above what is needed to repay the first mortgage, closing costs, points and any other mortgage liens due. The additional cash can be used for any purpose

Caveat Emptor - Translation: "buyer beware", meaning that the buyer is responsible for inspecting any real estate or property before purchase for defects, as the seller is not required to disclose any problems to the buyer, though if asked outright, cannot conceal any defects

Certificate of deposit - A document provided by a bank or financial institution that is proof of a deposit of funds with that bank or institution, also promising to return the deposit plus earnings at a specified interest rate within a specified time period

Certificate of Eligibility - A document issued by the U.S. government certifying a veteran's eligibility for a VA guaranteed loan for a home or business

Certificate of occupancy - A city or county document certifying that a building is approved for occupancy, often required by insurance companies to insure the property

Certificate of Reasonable Value (CRV) - A document issued by the Department of Veterans Affairs (VA) establishing the maximum loan amount for a VA mortgage

Certificate of Satisfaction - A document recorded with land records and signed by the Noteholder of a property, showing release of a mortgage, deed of trust, or lien on that property

Certificate of title - A statement of opinion provided by a title company or attorney, based on examining public records, stating that the title to a piece of real estate is legally held by the current owner; because this certification does not cover matters not of record, it is no longer commonly used

Chain - A unit for measuring land equaling 66 feet in length

Chain of Title - The series of all historical title documents showing the succession of owners of a property, as evidenced in the land records, whereby it is proven that the present owner of that property in fact holds the title

Chattel - Personal property

Clear title - A document establishing ownership of a property that is free of any legal questions or controversies as to the current ownership

Closing - Also known as "escrow" or "settlement". The process of finalizing the sale of a property via a meeting of the buyer, seller and lender, at which legally binding documents are executed, money is dispersed, the deed is prepared, and ownership is formally transferred from the seller to the buyer

Closing costs - Expenses over and above the price of the property that are incurred by the buyers and sellers in transferring ownership of property, usually including property insurance, taxes, attorney's fees, an origination fee, an amount placed in escrow, title insurance, the mortgage insurance premium, points, and filing fees

Closing statement - A summary financial accounting of a real estate transaction disclosing all cash incoming, outgoing, and any charges or credits made

Clouded Title, or Cloud on Title - Any conditions revealed by a title search, usually during the sale of the property, that make the title to a piece of real estate controversial; can only be removed by a quitclaim deed, release, or court action

Coinsurance - A sharing of insurance risk between the insurer and the insured, and it depends on the amount of the policy and the actual value of the property insured at the time of the loss

Coinsurance - When more than one insurance company shares the risk of a particular transaction or series of transactions; lenders may require co-insurance on large commercial projects

Collateral - As asset pledged to secure a loan; collateral for a mortgage is typically the property itself

Co-maker - A person who takes on equal responsibility for the repayment of a loan by signing the promissory note along with the borrower

Commission - The fee charged by a broker or agent for negotiating a real estate or loan transaction, usually a percentage of the selling price of the property or amount of the loan

Commitment letter - A formal document issued by the lender, stating the terms under which the lender agrees to lend money to a homebuyer

Common area assessments - Fees levied against individual unit owners in a condominium or planned unit development project to generate additional capital to defray homeowners' association expenses, and to pay for repairs, maintenance and improvements to the common areas of the project

Common Interest Community (CIC) - An arrangement among property owners whereby they have mutual ownership of common areas of a property (e.g., condominiums, townhouses and planned unit developments) often through membership in an association

Common law - An unwritten body of law or ethical agreements, originating from general customs in England

Community Land Trust Mortgage Option - A financing option that enables lower or moderate-income buyers to purchase housing that has been improved by a nonprofit Community Land Trust, as well as to lease the land on which the property stands

Community property - In some US states, a recognized right of ownership, that any property acquired during a marriage as being jointly owned by both spouses, except that acquired as specifically personal for either individual

Comparables, or Comparable Properties - Properties that are similar in size, style, location and amenities to the property under consideration in an appraisal, which are used in the appraisal process to help determine the approximate fair market value of the subject property

Comparative market analysis (CMA) - A comparison of the sale prices of similar properties (e.g., size, style, location, amenities) in a given area, for the purpose of determining the fair market value of a property

Condemnation - The County or City determination that a building is dangerous for occupancy and must be demolished

Conditional-use permit - Written governmental permission given to allow a use of a property that is ordinarily inconsistent with existing zoning laws, but which is deemed necessary for the common good

Condominium - A system of individual ownership of units within a multi-unit structure, as well as joint ownership of certain common areas; each individual may sell or encumber his own unit within the structure

Conservator - An individual designated by the Court to protect and preserve the property of someone who is not able to manage his or her own affairs See Guardian

Construction loan - A short-term loan for financing the cost of construction of a structure, whereby payments are made to the builder usually in increments as the work progresses

Contingency - A condition that must be met before a contract is legally binding, or where one event or agreement is dependent on the fulfillment or completion of another event

Contract - An oral or written, often legally-binding, agreement between two parties

Contract for Deed, or Land Contract - A method of financing whereby the ownership of a piece of property or real estate remains in the seller's name as security until the buyer pays the purchase price in full

Conventional loan, or Conventional mortgage - A real estate loan or mortgage that is not insured or guaranteed by a government agency, such as the VA or FHA

Convertibility clause - A provision offered in some adjustable-rate mortgages giving the borrower the option to change the ARM to a fixed-rate mortgage at a specified point in time after the loan originated

Convertible ARM - An adjustable-rate mortgage that can be converted to a fixed-rate mortgage under specified conditions

Conveyance - Any document by which the title to real property is transferred

Cooperative (co-op) - A system of multiple ownership in which the residents of a multi-unit housing complex own stock in a corporation that then owns the property, and whereby each resident is given the right to occupy a specific unit pursuant to a lease

Cost approach - A method used by appraisers to estimate the value of a property, in which the appraiser's estimate of the replacement cost of the building is added to the estimated land value, minus the depreciation

Cost of funds index (COFI) - An index used to determine changes in the interest rate for certain adjustable-rate mortgage plans, determined by the weighted-average cost of savings, borrowings, and advances of the 11th District members of the Federal Home Loan Bank of San Francisco

Co-tenancy - Ownership of the same piece of property or real estate by more than one person

Counteroffer - A new offer, with different terms and conditions, made in rejection of an original offer received

Covenant - A clause written into mortgages, deeds or other real estate documents that obligates or restricts the borrower's actions, and which, if violated, can result in foreclosure of the property

Credit history, or Credit report - A record, prepared by an independent source, of an individual's debts and status of their payment, useful to a lender in qualifying a potential borrower for a loan

Credit life insurance - A type of insurance that can be purchased by mortgagors that will guarantee payment of the mortgage if the mortgagor dies while holding the policy