GLOSSARY OF REAL ESTATE TERMS

A - B - C - D - E - F - G - H - I - J - K - L - M - N - O - P - Q - R - S - T - U - V - W - X - Y - Z

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ABSTRACT OF TITLE: A summary of all of the recorded instruments and proceedings which affect the title to the property, arranged in the order in which they were recorded.

ACCRUED INTEREST: Interest that has been earned but not due and payable.

ACRE: A measure of land equaling 43,560 square feet.

ADMINISTRATOR: A person appointed by the court to administer the estate of a deceased person who left no will.

AFFIDAVIT: A statement or declaration reduced to writing, and sworn to or affirmed before some officer who is authorized to administer an oath or affirmation.

AGENCY: That relationship between principal and agent which arises out of a contract either expressed or implied, written or oral, wherein the agent is employed by a person to do certain acts on the persons behalf in dealing with a third party.

AGENT: One who undertakes to transact some business or to manage some affair for another by authority of the latter.

AGREEMENT OF SALE: A written agreement between seller and purchaser in which the purchaser agrees to buy certain real restate and the seller agrees to sell upon certain terms and conditions set forth therein.

ALIENATION: A transferring of property to another.

ALIENATION CLAUSE: Allows the lender to require the balance of a loan to be paid in full if the collateral is sold.

AMORTIZATION: A gradual paying off of a debt by periodical installments.

ANNUITY: An amount of money or its equivalent which represents one of a series of payments.

APPORTIONMENT: Adjustment of the income, expenses or carrying charges of real estate usually computed to the day of closing of the title so that the seller pays all expenses to that date. The buyer assumes all expenses from that day on.

APPRAISAL: An estimate of a property's valuation by an Appraiser who is presumed to be an expert in this work.

APPURTENANCE: Something which is outside the property itself but belongs to the land and adds to its greater enjoyment such as a right-of-way, barn or dwelling.

ASSESSED VALUATION: A valuation placed on the property by a public officer or board, as a basis for taxation.

ASSESSMENT: A charge against real estate made by a unit of government to cover a proportionate cost of an improvement such as a street or sewer.

ASSESSOR: An official who has the responsibility of determining assessed values.

ASSIGNEE: The person to whom an agreement or contract is assigned.

ASSIGNMENT: The method or manner by which a right or contract is transferred from one person to another.

ASSIGNOR: A party who assigns or transfers an agreement or contract t o another.

ASSUMPTION OF MORTGAGE: The taking of title to property by a grantee, wherein the grantee assumes liability for payment of an existing note or bond secured by a mortgage against a property and becomes personally liable for the payment of such mortgage debt.

ATTEST: To witness; by observation and signature.

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BALLOON MORTGAGE PAYMENT: A large payment during the term of a mortgage, often at the end.

BEARER OF THE NOTE: Lender in whose hands the note remains until It is paid in full.

BENEFICIARY: The person that will receive the benefits resulting from certain acts.

BEQUEATH: To give or hand down by will.

BEQUEST: That which is given by terms of the will.

BINDER: An agreement to cover the down payment for the purchase of real estate as evidence of good faith on the part of the purchaser.

BLANKET MORTGAGE: The underlying mortgage on a parcel of land in favor of an original mortgagee which covers various tracts of a subdivision.

BOND: The evidence of a personal debt which is secured by a mortgage or other lien on real estate.

BUILDING CODES: Regulations established by local governments stating fully the structural requirements for building.

BUILDING LINE: A line fixed at a certain distance from the front and/or sides of a lot, beyond which no building can project.

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CANCELLATION CLAUSE: A provision in a lease or contract which confers on one or more or all parties to the lease or contract the right to terminate the party or parties obligations there under upon the occurrence of the condition or contingency set forth in the said clause.

CAPITAL APPRECIATION: The appreciation accruing to the benefit of the capital improvement of real estate.

CAPITAL ASSET: Any asset of a permanent nature used for the production of income.

CAPITAL GAIN: Icome.that results from the sale of an asset not in the usual course of business.

CAPITAL LOSS: A loss form a sale of. an asset not in the usual course of business.

CAVEAT EMPTOR: Let the buyer beware. The buyer must examine the goods or property and buy at the buyer own risk.

CHATTEL: Personal property, such as household goods or fixtures.

CLIENT: The one by whom a broker is employed and by whom the broker will be compensated on completion of the purpose of the agency.

CLOSING DATE: The date upon which the buyer takes over the property.

CLOUD ON TITLE: An outstanding claim or encumbrance which would affect or impair the owner's title.

COLLATERAL: Additional security pledged for the payment of an obligation.

COMMISSION: A sum due a real estate broker for services in that capacity.

COMMITMENT: A pledge or a promise or affirmation agreement.

CONDITIONAL SALES CONTRACT: A contract for the sale of property stating that delivery is to be made to the buyer, title to remain vested in the seller until the conditions of the contract have been fulfilled.

CONSIDERATION: Anything given to induce entering into a contract such as money.

CONSTRUCTIVE NOTICE: Information or knowledge of a fact imputed by law to a person because the person could have discovered the fact by proper diligence and inquiry, (public records)

CONTRACT: An agreement between competent parties to do or not to do certain things which is legally enforceable, whereby each party acquires a right.

CONVEYANCE: The transfer of title of land from one person : to another. The means or medium by which title of real estate is transferred.

CUL-DE-SAC: A blind alley or street with only one outlet.

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DEBT SERVICE: Annual amount to be paid by a debtor on an obligation to repay money borrowed.

DEED: An instrument in writing duly executed and delivered, that conveys title to real property.

DEED RESTRICTION: An imposed restriction in a deed for the purpose of limiting the use of land.

DEFEASANCE CLAUSE: The clause in a mortgage that permits the mortgagor to redeem his property upon the payment of the obligations to the mortgagee.

DEPRECIATION: Loss in value in real property brought about by age, physical deterioration, or functional or economic obsolescence.

DOMICILE: A place where a person lives or has their home; in a legal sense.

DURESS: Unlawful constraint exercised upon a person whereby the person is forced to do some act against the person will.

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EARNEST MONEY: Down payment made by a purchaser of real estate as evidence of good faith.

EASEMENT: A right that may be exercised by the public or Individuals on, over or through the lands of others.

EGRESS: A way out; an outlet.

EMINENT DOMAIN: A right the government has to acquire property for necessary public use by condemnation; the owner must be fairly compensated.

ENCROACHMENT: A building or part of a building or obstruction which intrudes upon or invades upon the property of another.

ENCUMBERANCE: ANy right to or interest in the land interfering with its use or transfer.

EQUITY: The interest or value which the owner has in real estate over and above the liens against it.

EQUITY LOAN: A junior loan based on a percentage of the equity.

ESCHEAT: The reversion to the state of property in the event the owner thereof abandons it or dies, without leaving a will and has no distributees to whom the property may pass by lawful descent.

ESCROW: A written agreement between two or more parties pro¬viding that certain instruments or property be placed with a third party to be delivered to a designated person upon the fulfillment or performance of some act or condition.

ESTATE: The degree, quantity or nature and extent of interest which a person has in real property.

ESTOPPEL CERTIFICATE: An instrument executed by the mortgagee setting forth the present status and the balance due on the mortgage as of the date of execution of the certificate.

EXCLUSIVE AGENCY: An agreement of employment of a broker to the exclusion of all other brokers; if the sale is made by any other broker during the term of employment, broker holding exclusive agency is entitled to commissions in addition to the commissions payable to the broker who effected the transaction.

EXCLUSIVE RIGHT TO SELL: An agreement of employment by a broker under which the exclusive right to sell for a specific amount of time is granted to the broker; if a sale during the term of the agreement is made by the owner or any other broker, the broker holding the exclusive right to sell is nevertheless entitled to compensation.

EXECUTOR / EXECUTRIX: A man/woman or corporate entity or any other type of organization named or designated in a will to carry out its provisions as to the disposition of the estate of a deceased person.

EXTENSION AGREEMENT: An agreement which extends the life of a mortgage or listing agreement to a later date.

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FEE; FEE SIMPLE; FEE ABSOLUTE: Absolute ownership of real property a person has this type of estate where the person Is entitled to the entire property with unconditional power of disposition during the persons life and descending to the person's distributees and legal representatives upon the person's death intestate

FIDUCIARY: A person who on behalf of or for the benefit of another transacts business or handles money on property not the person's own.

FIXTURES: Personal property so attached to the land or improvements as to become part of the real property.

FORCLOSURE: A procedure whereby property pledged as security for a debt is sold to pay the debt in the event of default in payments or terms.

FORFEITURE: Loss of money or anything of value, by way of penalty due to the failure to perform.

FREEHOLD: An interest in real estate, not less than an estate for life.

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GRANT: A term used in deeds of conveyance of lands to indicate a transfer er.

GRANTEE: The party to whom the title of real property is conveyed

GRANTOR: The party who conveys real estate by deed; seller.

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HABENDUM CLAUSE: The "To have and to hold" clause which defines or limits the quantity of the estate granted in the premises of the deed.

HEREDITAMENTS: The largest classification of property; including lands, tenements, and incorporeal property, such as rights-of-way.

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INGRESS: A way or place of entering; entrance.

INSTUMENT: A written legal document; created to effect the rights of parties.

INTEREST RATE: The percentage of a sum of money charged for its use .

INTESTATE: A person that dies having made no will, in which case the person's estate descends to the person's distributees in the manner prescribed by law.

INVOLUNTARY LIEN: A lien imposed against property without consent of the owner.

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JOINT TENANCY: Ownership of realty by two or more person's, of each of whom has an undivided interest with the "right of survivorship."

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LACHES: Delay or negligence in asserting one's legal rights. LIEN: A legal right or claim upon a specific property which attaches to the property until the debt is satisfied.

LIFE ESTATE: The conveyance of title to property for the duration of the life of the grantee.

LIS PENDENS: A legal document, filed in the office of the county clerk giving legal notice that an action or proceeding is pending in the courts affecting the property.

LISTING: An employment contract between principal and agent, authorizing the agent to perform services for the principal involving the latter's property.

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MARKET VALUE: The highest price which a buyer, ready and willing but not compelled to buy, would pay, and the lowest a seller, willing but not compelled to sell, would accept.

MARKETABLE TITLE: A title which a court of equity considers t be so free from debt that it will enforce its acceptance by a purchaser.

MECHANICS LIEN: A lien given by law upon a building or other improvement upon land, and upon the land itself, to secure the price of labor done upon, and materials furnished for the improvement.

MEETING OF THE MINDS: Whenever all parties to a contract agree to the exact terms thereof.

METES AND BOUNDS: A term used to describe boundary lines of land.

MONUMENT: A fixed object and point established by surveyors to establish land locations.

MORTGAGE: An instrument in writing, duly executed and delivered that creates a lien upon real estate as security for the payment of a specified debt.

MORTGAGE COMMITMENT: A formal indication by a lending institution that it will grant a mortgage loan on a property, in a certain specified amount and on specified terms.

MOTRGAGEE: The party who lends the money and takes a mortgage to secure the payment thereof.

MORTGAGOR: A person who borrows money and gives a mortgage on the person's property as security for the payment of the debt .

MULTIPLE LISTING: An arrangement among Real Estate Board of Exchange Members, whereby each broker presents the brokers listings to the attention of the other members so that if a sale results, the commission is divided between the broker bringing the listing and the broker making the sale.

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PERSONAL PROPERTY: Any property which is not real property.

PLAT BOOK: A public record containing maps of land showing the division of such land into streets, blocks and lots and indicating the measurements.

POWER OF ATTORNEY: A written instrument duly signed and executed by an owner of property, which authorizes an agent to act on behalf of the owner to the extent indicated in the instrument.

PREPAYMENT CLAUSE: A clause in a mortgage which gives a mortgagor the privilege of paying the mortgage indebtedness before it becomes due.

PRINCIPAL: The employer of an agent or broker; the brokers or agent's client.

PROBATE: To establish the will of a deceased person.

PROPORTION: Allocation of closing costs and credits to buyers and sellers.

PURCHASE MONEY MORTGAGE: A mortgage given by a grantee in part payment of the purchase price of real estate.

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QUITCLAIM DEED : A deed which conveys simply the grantors rights or interest in real estate, without any agreement or covenants as to the nature or extent of that interest, or any other covenants; usually used to remove a cloud from the title.

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REAL PROPERTY: Land and generally whatever is erected upon or affixed to it.

REALTOR: A registered trademark term reserved for the sole use of active members of local real estate boards affiliated with the National Association of Realtors.

RECORDING: Entering in a book of public record instruments affecting the title to real property.

RECOURSE: The right to a claim against a prior owner of a property or note.

REDEMPTION: The right of a mortgagor to redeem the property by paying a debt after the expiration date and before sale at foreclosure

RELEASE: The act or writing by which a claim or interest is given or surrendered to another.

RESTRICTION: Any limitation placed upon the use of a property, usually found in the deed.

REVERSIONARY INTEREST: The interest which a grantor has in property upon the termination of the preceding estate.

RIGHT OF SURVIVORSHIP: Right of the surviving joint owner to succeed to the interests of the deceased joint owner.

RIGHT -OF-WAY: The right to pass over another's land.

RIPARIAN OWNER: A person that owns land bounding on a river or waterway.

RIPARIAN RIGHTS: An owners rights in land that border on water. These rights include the access to and use of the water.

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SALES CONTRACT: A written agreement by which the buyer and seller have a "meeting of the minds" and agree to terms of sale.

SECOND MORTGAGE: A mortgage in addition to an existing first mortgage.

SETBACK: The distance from a curb or other such line within which no buildings may be constructed.

SPECIAL ASSESSMENT: An assessment against a property to pay for public improvements by which the assessed property will benefit.

SPECIFIC PERFORMANCE: A legal action in a court of equity compelling a defendant to carry out the terms of an agreement or contract.

SUBDIVISION: A parcel of land divided into lots.

SUBORDINATION CLAUSE: A clause which permits the placing of a mortgage at a later date which takes priority over an existing mortgage.

SURETY: One who guarantees the performance of another.

SURVEY: The process or blueprint creating or showing the the measurements or boundaries of an area.

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TENANCY IN COMMON: An ownership of property by two or more persons, with each having an undivided interest, with¬out the right of survivorship.

TENANCY BY ENTIRETY: An estate which exists only between husband and wife with equal rights of possession and with the right of survivorship.

TENANCY AT WILL: A estate which gives one the right to use or occupy land or property at the will of the owner.

TENANT AT SUFFERANCE: One who gains possession of land or property by lawful title and keeps it without any title.

TESTATE: When a person dies without leaving a valid will.

TITLE: Evidence that the owner of land is in lawful possession thereof; evidence of ownership.

TITLE INSURANCE: An insurance policy which protects the holder from any loss sustained by defects in the title.

TRANSFER TAX: Tax stamps required to be affixed to a deed by state and/or local law.

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USURY: Charging interest at a higher rate than the maximum rate established by law.

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VALUATION: Estimated worth.

VARIANCE: Authorization to make changes to a particular property in a manner not permitted by current zoning.

VENDEE'S LIEN: A lien against a piece of property under contract of sale to secure deposit paid by purchaser.

VIOLATIONS: Conditions contrary to law or permissible use of property.

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WARRANTY DEED: A conveyance of land or property in which the grantor warrants the title to the grantee.

WRAPAROUND LOAN: A new loan encompassing any existing loans.

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ZONE: An area set off by the proper authorities for specific use, subject to certain restrictions or restraints.

ZONING ORDINANCE: An act of the proper authorities specifying type and use to which property may be put in to specific areas.