Real Estate Dictionary

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 |

A

Abandonment
Voluntarily relinquishing the rights of ownership or another interest (such as rights to an easement) by failure to use the property, linked with an intent to abandon (give up interest).

Abatement
Usually applies to a reduction of assessed valuation of property for ad valorem taxes.

Abstract of Judgment
A summary of the essential outlines of a court judgment. (When this summary or abstract is recorded in the county recorder's office, in some states the judgment becomes a lien on the debtor's property, both presently owned or after-acquired.)

Abstract of Title
Relating to the title to a particular piece of land, a summary of the public records. Used to determine whether there are any title defects which must be cleared before a buyer can purchase clear, marketable and insurable title.

Acceleration Clause
A condition in a mortgage that may require the remaining balance of the loan to become due immediately. Can become enforced if regular mortgage payments are not made or for breach of other conditions of the mortgage.

Access
The right to enter and leave a plot of land from a public way. Can include the right to enter and leave over the lands of another.

Accommodation Recording
Recording of instruments by a title company with the county recorder. Merely as a convenience to a customer and without assumption of responsibility for correctness or validity.

Accretion
The progressive addition to the shore or bank of a waterway.

Acknowledgement
An official declaration before a duly authorized officer (such as a notary public) by a person who has executed an instrument that such execution is his own act and deed. Is necessary to entitle an instrument (with certain specific exceptions) to be recorded, to impart constructive notice of its contents and to entitle the instrument to be used as evidence without further proof.

Acre
A measure of land, 43,560 square feet in any shape.

Ad Valorem
A method of taxation using the value of the thing taxed to determine the amount of the tax. "According to value".

Adjustable-Rate Mortgage (ARM)
A loan with a periodically changing interest rate, keeping with a current index. Typically, however, ARMs cannnot jump more than two percentage points per year or six points above the starting rate.

Administrator
A person appointed by the probate court to carry out the administration of an estate whose decedent has left no will. If a woman is appointed, she is called an administratrix.

Adverse Possession
Acquiring title to real property by possession for a certain (statutory) period of time, in addition to fulfilling other conditions.

Affidavit
A written statement sworn to before an officer who has power to administer an oath.

Agent
Person who has authorization, either implied or expressed, to act for or represent another party.

Agreement of Sale
Also known as a contract of purchase, purchase agreement, or sales agreement, according to location or jurisdiction. A contract in which a seller agrees to sell and a buyer agrees to buy, under certain specific terms and conditions formally written and signed by both parties.

Amortization
Payment plan which allows the borrower to diminish his debt gradually through monthly payments of principal and interest.

Annual Percentage Rate (A.P.R.) Yearly interest percentage of a loan. Disclosed as a requirement of federal truth in lending statutes.

Appraisal
Expert estimate of the value of real estate, as of a given date.

Approved Attorney
In states where attorneys review the chain of title before title insurance is issued, the title company will approve certain attorneys as those whose opinion it will accept for the issuance of a title policy.

Appurtenance
A right that is a part of the ownership of property, such as a right of way to a highway across the land of another.

Assessment
(1) Evaluating real estate for purpose of taxes or special improvement charges. (2) The amount of taxes or special improvement charges. The costs of streets, sidewalks, sewers, etc. are usually special improvement charges.

Assignment
(1) The act of transferring an interest, such as a loan secured by a mortgage, from one individual to another. (2) The instrument or paper by which one individual transfers such ownership to another.

Assumable Mortgage
Mortgage which allows a new owner to acquire its obligations.

Attachment
Legal seizure of property to require payment of a debt.

Attorney in Fact
Someone who holds a power of attorney from another, allowing him or her to execute legal documents such as deeds, mortgages, etc., on behalf of the grantor of the power.

Attorney's Opinion
Statement by an attorney that validates title arrived at after investigation of the history of the title as recorded in the official public records.

B

Back Title Letter
Alternate names are "back title certificate" or "starter." A letter that informs current examiners of the condition of the title at the time of the previous examination.

Balloon Note
Form of promissory note that requires the minimum payment of the principal and the payment of interest at regular intervals. This type of note entails a substantial final payment, which represents the entire principal.

Bankruptcy
Special proceeding under federal, or state, laws where the property of a debtor is protected by the court, and may be divided among the debtor's creditors and the debtor.

Beneficiary
(1) One for whose benefit a trust is created. (2) The lender/mortgagee is called the beneficiary in states in which deeds of trust are commonly used instead of mortgages.

Binder
Early agreement to buy a home from a seller (which is usually ensured with earnest money).

Binder
(1) Preliminary report as to the state of a title and a commitment to issue a title insurance policy in a certain way when certain conditions are fulfilled. Sometimes called "preliminary certificate" or "prelim" "commitment." (2) Policy of title insurance (used primarily by investors) requesting a reduced rate for a future policy if the property is sold within a specified period.

Blanket Mortgage
A mortgage or trust deed that encompasses more than one lot or parcel of real property (and often an entire subdivision).

Bona Fide Purchaser
An individual who buys property in good faith, for fair value, and without notice of any adverse claim or right of third parties.

Breach of Contract
Failure to carry out a contract, in whole or part, without legal excuse.

Building Contract
Agreement between an owner/lessee and a building contractor, setting out terms relative to the construction of a proposed structure.

Buydown
Payment to the lender from the seller, buyer, third party, or some combination of these, causing the lender to decrease the interest rate during the initial years of a loan. (See also: Certificate Backed Mortgage).

C

Certificate of Title
A written opinion, executed by the examining attorney, declaring that title is vested as stated.

Chain
66 feet long or 100 links, with each link being 7.92 inches.

Chain of Title
The successive ownerships or transfers in the history of title to a parcel of land.

Claim
An adverse right/interest asserted by one party against another or against an insurer or indemnitor. Unpaid debts or taxes, as well as hidden title defects such as fraud, forgery, missing heirs, etc. may bring about claims.

Clear Title
Real property ownership free of liens.

Closing
Also called "escrow" or "settlement." The process of executing legally binding documents associated with the purchase of real estate and the borrowing of money to assist in the purchase .

Closing Costs
The expenses which buyers and sellers usually incur to complete a transaction in the transfer of ownership of real estate. These costs are in addition to price of the property and are items prepaid on the closing day.

D

Debt
Money owed from one individual to another.

Debtor
Individual who owes a debt.

Decree of Distribution
Probate court decree which regulates how the estate of a decedent shall be allocated.

Dedication
The allocation of certain land by the owner and declaring it to be for public use. Examples: streets, sidewalks and parks.

Deed
Formal written instrument where title to real property is transferred from one owner to another.

Deed of Trust
Like a mortgage, a security instrument whereby real property is given as security for a debt.

Deed Restrictions
Restraints in the deed to a property that mandate certain uses that may or not be made of the property.

Defective Title
(1) Title to a negotiable instrument obtained by fraud. (2) Title to real property which lacks some of the elements necessary to transfer good title.

Delivery
The placing of the property in the actual or constructive possession of the grantee, by delivery of a deed to the buyer or agent of the buyer, or by recording the deed.

Demand Note
A note having no date for repayment, but due when requested by the lender.

Deposit
Money given by the buyer with an offer to purchase.

Depreciation
A decrease in value of a piece of real estate.

Description
The exact location of a piece of real estate, stated in terms of lot, block, tract, part lot, metes and bounds, recorded instruments, or U.S. Government survey.

Devise
Disposition of property made by a will.

Documentary Stamps
A State tax in the forms of stamps. Required on deeds and mortgages when real estate title passes from one owner to another.

Dominant Estate
The property on which a right-of-way easement exists across another's adjoining piece of land. The land across which the easement runs is said to be the servient estate.

Dower
Right that a wife obtains in her husband's property at the time of his death. Does not exist in all states.

Due on Sale Clause
Provision in a mortgage or deed of trust which requires the loan to be paid in full if the property is sold or transferred.

E

Earnest Money
The deposit money given to the seller or his agent by the potential buyer upon the signing of the agreement of sale to show that he is determined to purchase the house.

Easement Rights
Right-of-way granted to a person or company, authorizing access to or over the owner's land.

Effective Demand
Ability to pay as well as desire to buy.

Egress
The right to leave a tract of land.

Eminent Domain
The right of a government to take privately owned property for public use under condemnation proceedings upon payment of its reasonable value. See Condemnation.

Encroachment
An obstruction, building, or part of a building that intrudes beyond the legal boundary, onto neighboring private or public land, or a building extending beyond the building line or into an easement.

Encumbrance
A legal right or interest in land that affects a good or clear title and reduces the land's value.

Endorsement
Addition to or modification of a title insurance policy which expands or changes the coverage of the policy, fulfilling specific requirements of the insured.

Equity
Market value of real property, less the amount of existing liens.

Escheat
Property that is given to the state when an owner dies without leaving legal heirs.

Escrow
Funds paid by one party to the escrow agent to hold until the occurrence of a specified event, after which the funds are dispensed to the designated individual.

Estate
(1) The interest or nature of the interest which one has in property, such as a life estate, the estate of a deceased, or real estate. (2) A large house with substantial grounds surrounding it.

Estoppel
A legal restraint that stops or prevents an individual from retracting his previous position or previous assertions or commitments.

Examination (of Title)
The study of the instruments related to a chain of title to determine their effect and condition. In order to reach a conclusion as to the status of the title.

Exception
A precaution in a title insurance binder or policy that excludes liability for a specific title defect or an outstanding lien or encumbrance.

Execute
Signing a legal instrument. A deed is declared to be executed when it is signed, sealed, witnessed, and delivered.

Execution Sale
Sale of real property due to a writ of execution by a court

Executor
Person appointed in a will and affirmed by the probate court to distribute the decedent's estate in accordance with the will.

F

Fannie Mae (FNMA)
Federal National Mortgage Association is a private corporation, federally chartered to provide financial products and services that expand the availability and affordability of housing by purchasing mortgage loans.

Federal Housing Administration (FHA) Guarantee
An insurance contract in which HUD through FHA insures that the named lender will recover a specific percentage of the loan amount from the insurer (FHA) in the event that the loan becomes delinquent.

Fee Simple
Estate under which the owner is entitled to unrestricted powers to the property, which can be inherited or left by will. A synonym for ownership.

File and Use
Title insurers file rate schedules, title insurance policies and endorsement forms with the State Insurance Department or other state agency and then may use such items or rates starting within a specified period of time after filing.

Financing Statement
Securing the title to personal property by filing a document with the Register of Deeds or Secretary of State.

Fixed-Rate Mortgage
Loan that carries an unchangeable interest rate over its entire term. Typically a period of 15-30 years.

Fixtures
Personal property that is attached to real property and is legally treated as real property.

Flood Certification
A common term for a Federal Emergency Management Agency Standard Flood Hazard Determination Form (FEMA SFHDF). Determines whether a land or a building is located within a Special Flood Hazard Area for purposes of flood insurance requirements under the National Flood Insurance Program.

Foreclosure
A proceeding in or out of court, to abolish all rights, title, and interest, of the owner(s) of property in order to sell the property to repay a lien against it.

Forfeiture of Title
A common penalty for the breach of conditions or restrictions established by the seller upon the buyer in a deed or other proper document.

Forgery
The fraudulent signing of another's name to an instrument, such as a deed, mortgage, or check.

Freddie Mac (FHLMC)
Nickname for the Federal Home Loan Mortgage Corporation, which is a stockholder-owned corporation chartered by Congress that buys mortgage loans.

Full Disclosure
Revealing all the known facts which may sway the decision of a buyer or tenant.

G

General Warranty Deed
Deed which expresses not only all the grantor's interests in and title to the property to the grantee, but also guarantees that if the title is defective or has a "cloud" on it (such as mortgage claims, tax liens, title claims, judgments, or mechanic's liens against it, etc.) the grantee may hold the grantor liable.

Ginnie Mae (GNMA)
Nickname for the Government National Mortgage Association, which is a wholly-owned United States corporation that guarantees privately issued securities, backed by pools of mortgages insured by FHA (Federal Housing Administration), FMHA (Farmers Home Administration), or VA (Veterans Administration).

Good Faith Purchaser or Mortgagee
A person who purchases or lends in good faith. Meaning without knowledge of fraudulent circumstances, or reason to inquire further, where value is paid or lent.

Graduated Payment Mortgage
A loan in which monthly payments are relatively small in the beginning and gradually expand in dollar amount over the entirety of the mortgage.

Grant
To transfer an interest in real property.

Grantee
The party in the deed who is the buyer/recipient.

Grantor
The party in the deed who is the seller/giver.

Guardian
Person designated by a court to oversee the person and/or property of one who is legally unable to handle his/her own affairs.

H

Harbor Line
An arbitrary line set by authorities on navigable rivers, where wharves and other structures are not allowed to be built.

Hazard Insurance
Real estate insurance that safeguards against destruction caused to property by fire, windstorms, and other natural hazards.

Heir
An individual who inherits or succeeds to an interest in land of an individual who dies without leaving a will (intestate).

Home Equity Conversion Mortgage
A reverse or reverse annuity mortgage in which HUD through FHA promises that the borrower will receive monthly payments from the insurer (FHA) in the event where the lender is incapable of making payments to the borrower.

Home Repair Loan
A loan used to make repairs and/or additions to existing structures without affecting the existing mortgage. Also known as a "Home Improvement Loan.”

Homeowner's Insurance
Real estate insurance protecting against loss caused by fire, some natural causes, vandalism, etc. Depends on the terms of the policy.

Homestead
The residence (house and contiguous land) of the property owner.

HUD
U.S. Department of Housing and Urban Development. The federal department responsible for the major housing programs in the United States, such as FHA.

HUD 1
A form settlement (closing) statement required by the U.S. Department of Housing and Urban Development (HUD) where federally related mortgages are being made on residential properties. It is a balance sheet showing the source of funds and the distribution of funds in connection with the purchase and/or mortgaging of residential property.

I

Impounds
A trust type of account created by lenders for the accumulation of borrower's funds to meet periodic payments of taxes, mortgage insurance premiums, and/or future insurance policy premiums, required to protect their security.

Inchoate Dower
The dower interest of a wife throughout the life of her husband. An interest which upon the death of the husband may ripen into possession and use.

Inchoate Courtesy
The courtesy interest of a husband midst the life of his wife. An interest which upon the death of the wife may ripen into possession and use.

Indemnity
Insurance against potential loss or damage. A title insurance policy is a contract of indemnity.

Ingress
The right to enter a tract of land. Usually used as part of the term "ingress and egress" and interchangeably with "access."

Instrument
Writing which has legal form and significance, such as a deed, mortgage, will, or lease.

Insurance
A contract under which, for a consideration, one party (the insurer) agrees to reimburse another (the insured) in the case of a possible loss under specific conditions.

Interest
(1) A share or right in property. (2) A calculated charge paid for borrowing money.

Interim Financing
Temporary or short-term loans. Often used with new construction.

Intestate
When no will is created or a will is invalid, the property of the estate passes according to the laws of succession rather than by instructions of the deceased.

J

Joint Tenancy
An undivided interest in property, by two or more tenants. The interests are equal and begin at the same time. Upon death of a joint tenant, the interest passes to the surviving joint tenants, rather than to the heirs of the deceased.

Judgment
The determination of a court in regards to the rights of the parties in an action.

Judgment Lien
A lien against the property of a judgment debtor. An example of an involuntary lien.

Junior Mortgage
A mortgage whose lien priority is lower than others.

K

L

Land Contract
An installment contract for the selling of land where the seller/vendor holds legal title and the buyer/vendee has equitable title until the sales price is paid in full.

Landmark
Any noticeable object that assists in creating land boundaries.

Lease
A contract where an owner of the real property (lessor) gives the right of possession to another (lessee), for a specific amount of time (term) and for a specific consideration (rent).

Leasehold
Real property held under a lease, for a fixed amount of time.

Legal Description
A detailed description of land that is recognized by law, based on government surveys. It depicts the exact boundaries of the entire lot of land. It identifies a parcel of land in a way that cannot be confused with any other.

Lender
Any individual or entity advancing funds that are to be repaid.

Lender's Policy
A title insurance policy that insures the lender’s lien for validity, enforceability, and priority. This policy does not provide protection for the owner.

Lessee
An individual to whom a lease (the right to possession) is given in return for a consideration (rent).

Lessor
Also known as a landlord. One who gives a leasehold to a lessee.

License
The permission to go upon or use the land of another individual. The permission is a personal privilege and does not constitute an interest in the land.

Lien
A claim by one individual on the property of another as security for money that is owed. Such claims may include obligations not met or satisfied, judgments, unpaid taxes, materials, or labor.

Lien Waver
Also known as "waiver of liens." A waiver of mechanic's lien rights, authorized by contractors or subcontractors so that the owner or general contractor can acquire funds from a construction loan.

Life Estate
A grant of the right of use, occupancy, and ownership for the life of an individual.

Link
A length of 7.92 inches, in surveying.

Lis Pendens
A legal notice documented to show pending litigation relating to real property. It gives notice that anyone acquiring an interest in said property subsequent to the date of the notice may be bound by the outcome of the litigation.

Loan Policy
Also known as a "mortgage policy."

Lock-In
A guarantee, for which a fee is usually charged, that you will receive a specific rate when you close your mortgage.

Loss Payable Clause
A provision included to a Fire and Casualty Policy which states that any loss will be paid to two or more parties as their interest may appear. It is usually the owner and the mortgage lender.

Lot
Any portion or parcel of real property. Usually attributed to a portion of a subdivision.

M

Market Value
The price that a home will likely value on the market, based on comparisons to similar homes that have recently sold.

Marketable Title
The title which allows an owner to sell his property without restriction to others and which others will accept with no objection.

Mechanic's Lien
A lien created by statute for the purpose of securing priority of payment for the price or value of work performed and materials furnished in construction or repair of improvements to land, and which attaches to the land as well as the improvements.

Metes and Bounds
A land description where boundaries are described by courses, directions, distances, and monuments.

Minor
One who is legally incapable of making contracts because of insufficient age or status..

Monument of Survey
Visible marks/indications left on natural or other objects indicating the lines and boundaries of a parcel of land. Examples are: posts, pillars, stones, cairns, and other such objects. May also be fixed natural objects, blazed trees, roads and even a water course.

Mortgage
A lien/claim against real property given by the buyer to the lender as security for money borrowed. Under government-insured or loan-guarantee provisions, the payments may include escrow amounts covering taxes, hazard insurance, water charges and special assessments.

Mortgage-Backed Securities
Securities similar to bonds, but have their value based on a group of mortgages. The rate of return is based on the interest rate of the mortgages, plus early payoffs, which may increase the value of any discounts. The price of the securities will vary as interest rates rise and fall.

Mortgage Banker
Specialized lending institution that lends money solely with respect to real estate. Also secures its loans with mortgages on the real estate.

Mortgage Broker
A person or company that buys and sells mortgages for another on commission. One who also arranges for and negotiates mortgage contracts.

Mortgage Commitment
A written notice from the bank or other lending institution saying it will advance mortgage funds in a specified amount to allow an individual to buy a house.

Mortgage Insurance
Insurance written by an independent mortgage insurance company protecting the mortgage lender against loss incurred by a mortgage default. This enables the lender to lend a higher percentage of the sale price.

Mortgage Note
A written agreement to payback a loan. The agreement is secured by a mortgage, serves as proof of an indebtedness, and states the manner in which it shall be paid. The note states the actual amount of the debt that the mortgage secures and renders the mortgagor personally responsible for repayment.

Mortgage (Open-End)
A mortgage with an arrangement that allows the borrowing of additional money in the future, without refinancing the loan or paying additional finance charges.

Mortgagee
In a mortgage agreement, it is the lender.

Mortgagee Policy
See Lender's Policy.

Mortgagor
In a mortgage agreement, it is the borrower.

Multiple Listing
A database of listings of properties for sale. These listings are held individually by members of a group of real estate brokers, with the agreement that any member of the group may sell the properties, and in the case of a sale, the commission will be divided between the broker making the sale and the broker who filed the listing.

Monuments of Title
Written evidence/documents that an owner acquires to prove his or her title to property.

N

Negative Amortization
A condition that is created when a loan payment is less than the interest payment due. Although payments are given on time, the amount of principal owed still increases.

Notary Public
An individual who is authorized by the state or federal government, to carry out oaths, and to witness to the authenticity of signatures.

Note
A unilateral agreement comprised of an express and absolute promise of the signer to pay to a named person, or order, or bearer, a definite sum of money at a specified date or on demand.

O

Obligee
An individual to whom an obligation/promise is owed to.

Obligor
An individual who legally binds/obligates himself, such as the maker of a promissory note.

Original Cost
Paid by the present owner, it is the purchase price of property. The present owner may or may not be the first owner.

Owner's Policy
A policy of title insurance that usually insures an owner of real estate against loss occasioned by defects in, liens against or lack of marketability of the owner's title.

Ownership
The right to use and possess property to the exclusion of others.

P

Parcel
Any area/parcel of land contained within a single description.

Partnership
An association of two or more persons who have contracted to unite in business and share the profits.

Party Wall
A wall constructed on a property boundary or between two lots for the common use and benefit of the property owners on both sides.

Patent
When the Federal or State Government conveys title to land.

Personal Property
Any property that is not labeled by law as real property (such as money, goods, evidences of debt, rights of action, furniture, automobiles).

Personal Representative
An individual appointed by the probate court to administer a decedent's estate. See also "Executor."

"P.I.Q."
Also known as Property In Question.

PITI
An abbreviation for principal, interest, taxes and insurance. All are lumped together in your monthly mortgage payment.

Plat
Map or chart of a lot, subdivision or community drawn by a surveyor showing boundary lines, buildings, improvements on the land, and easements.

P.M.I.
Also known as Private Mortgage Insurance. An insurance contract which insures that the named lender will recoup a specific percentage of the loan amount from the insurer in the event the loan goes bad.

Points
A one-time-only fee you pay ahead of time to your lender, sometimes in exchange for a slightly lower mortgage rate. One point equals one percent of the total amount you plan to borrow.

Policy
General term used to explain all contracts of insurance.

Power of Attorney
A document where one person (principal) authorizes another person (attorney-in-fact) to act for him/her in a specific manner in designated transactions.

Power of Sale
A clause in a will, mortgage, deed of trust, or trust agreement authorizing the sale or transfer of land in accordance with the terms of the clause.

"PRE," "PRELIM" or Preliminary Title Report
A written report issued by a title company, prior to issuing title insurance, which explains the recorded condition of title of the property in question. See Commitment.

Premium
In an insurance policy, it is the amount paid.

Prepayment
Payment of the mortgage loan or part of it, before its due date.

Principal
The amount upon which interest is paid.

Priority
The order of preference, rank, or position of the various liens and encumbrances affecting the title to a specific parcel of land. Usually, the time and date of recording determine the relative priority between documents.

Priority Inspection
A title term attributing to the type of inspection made in connection with insuring a new construction loan.

Pro rate
Allocating between buyer and seller their proportionate share of an obligation paid or due.

Public Domain
Government-owned land and belonging to the community at large.

Public Records
All documents that are recorded that are necessary to give notice and are available to the public.

Purchase Money Mortgage
A mortgage given by a buyer to a seller on the subject property to secure payment of a part of the purchase price.

Q

Quiet Title
Freeing the title to a piece of land from the claims of other persons by means of a court action called a "quiet title" action.

Quitclaim Deed
A deed which transfers whatever interest the maker of the deed may have in the particular parcel of land. A quitclaim deed is often given to clear the title when the grantor's interest in a property is questionable.

R

Range
A strip of land six miles wide, numbered east or west of a principal median. Part of a government survey.

Real Estate
Also referred to as "real property." (1) Any land or anything permanently affixed to the land, such as building, fences, and those things attached to the buildings, such as light fixtures, plumbing and heating fixtures, or other such items that would be personal property if not attached. (2) May also refer to rights in real property as well as the property itself.

Real Estate Broker
A middle man or an agent who sells and buys real estate for an individual, company, or firm on a commission basis.

Realtor®
A federally registered collective membership mark which identifies a real estate professional who is a member of the National Association of Realtors® and subscribes to its strict Code of Ethics.

Realty
Another term for real estate.

Reconveyance
An instrument used to deliver title from a trustee to an equitable owner of real estate, when title is held as collateral security for a debt.

Recording
A matter of public record. Filing documents affecting real property that’s gives notice to future purchasers, creditors, or other interested parties.

Redeem
Literally means "to buy back." The act of buying back property after a mortgage foreclosure, tax foreclosure, or other execution sale.

Refinancing
When the same mortgagor pays off one loan with the proceeds from another loan.

Reinsurance
A contract in which one insurer makes with another to protect the first insurer, wholly or partially, against the loss or liability by reason of a risk under a separate and distinct contract as insurer of a third party.

REIT
Also known as Real Estate Investment Trust. A business trust or corporation formed under federal and state statutes for the purpose of investing in real estate.

Release
(1) To relieve from debt/security or abandon a right, such as the release of a mortgage lien from a part or all of the land mortgaged. (2) The instrument affecting a release.

REMIC
Also known as Real Estate Mortgage Investment Conduit. A product of a 1986 federal tax legislation in which a business entity such as a corporation, partnership, or trust in which substantially all of the assets consist of qualified mortgages and permitted investments, elects to be treated as a REMIC.

Restrictions
Also called restrictive covenants. They are provisions in a deed or other instrument where an owner of land prohibits or restricts certain use, occupation, or improvement on the land.

Reverse or Reverse Annuity Mortgage A mortgage in which the borrower pledges home equity in return for regular (monthly) payments, rather than a lump sum distribution of loan proceeds.

Right of Way
The right to cross over a property owned by another.

Riparian Rights
The rights of owners of lands bordering watercourses. Relates to the water and its use.

S

Sale Agreement
A contract entered into between a seller and buyer, setting forth the terms, provisions, and conditions of a sale of real estate.

Sale and Leaseback
A situation where the grantor in a deed to a piece of property sells it and keeps possession by simultaneously leasing it from the grantee.

Search
In the title industry, it is a careful examination of the public records in an effort to find all recorded instruments relating to a particular chain of title.

Second Mortgage
A mortgage that ranksin priority immediately below a first mortgage.

Section or Section of Land
A parcel of land comprising of one square mile or 640 acres.

Separate Property
Real property owned by one spouse exclusive of the interest of the other spouse.

Set Back Lines
Those lines which outline the required distances for the location of structures in relation to the perimeter of the property.

Special Assessments
A special tax established on individual lots, property, or all property in the immediate area, for road construction, sidewalks, sewers, street lights, etc.

Squatter
An individual who lives on another's land without authority or legal claim. (See Adverse Possession.)

Starter
A copy of the last policy or report issued by a title insurer which describes the title to land upon which a new search is to be made. In some states it is also called a back title letter or back title certificate.

Street Improvement Bonds
Interest-bearing bonds that are usually issued by a city or county, to secure the payment of assessments levied against land to pay for street improvements.

Subdivision
An area of land planned out and divided into lots, blocks, and building sites. Public facilities are laid out, such as streets, alleys, parks, and easements for public utilities.

Subordination
The act/process by which an individual’s rights are ranked below the rights of others.

Subordination Agreement
An agreement by which one encumbrance (for example, a mortgage) is made below another encumbrance.

Subrogation
The substitution of one individual for another, so that the former may exercise certain rights or claims of the latter.

Subsurface Rights
The rights of ownership to all things lying underneath the physical surface of the property.

Surety
(1) A person who acknowledges responsibility for a debt or obligation of another. (2) The pledge/agreement where an individual undertakes responsibility for the debt or obligation of another.

Surface Rights
Rights to enter and use the surface of a piece of land, usually in connection with an oil and gas lease or other mineral lease.

Survey
A map or plat created by a licensed surveyor showing the results of measuring the land with its elevations, improvements, boundaries, and its relationship to surrounding tracts of land.

T

Tax
Applying to real estate, it is an enforced charge imposed on persons, property, or income, to be used to support the State.

Tax Deed
A deed executed by the tax collector to the state, county, or city after a period of nonpayment of taxes according to statute.

Tax Sale
(1) Property where current county taxes have not been paid and is "sold to the state." No actual sale takes place. The title is transferred to the state and the owner may redeem it by paying taxes, penalties, and costs. If it has not been redeemed within five years, the property is deeded to the state. (2) A public sale of the property at an auction by a governmental authority, after a period of nonpayment of property taxes.

Tenancy by the Entirety
Ownership by married persons, where each owns the entire estate, with the survivor taking the whole ownership upon the other's death.

Tenancy in Common
An estate or interest in land held by two or more persons, each having equal rights of possession and enjoyment, but relinquishing any right of succession by survivorship between the owners.

Tenant
Any individual occupying real property with the owner's permission.

Testate
Someone who leaves a legally valid will at death. See Intestate.

Title
The rights of ownership and possession of particular property.

Title Covenants
Covenants ordinarily inserted in conveyances and in transfers of title to real estate. Used for the purpose of giving protection to the purchaser against possible insufficiency of the title received.

Title Defect
(1) Any possible claim or right outstanding in a chain of title that is adverse to the claim of ownership. (2) Any material irregularity in the execution of an instrument in the chain of title.

Title Insurance
Insurance against loss resulting from defects of title to a specifically described piece of real property.

Title Plant
Also known as "abstract plant" in some areas. It is a geographically filed assemblage of title information that helps in expediting title examinations, such as copies of previous attorneys' opinions, abstracts, tax searches, and copies or take-offs of the public records.

Title Search or Examination A review of all recorded documents affecting a specific parcel of property to determine the present condition of title.

Torrens Title
Instead of being recorded, it is a system where title to land is registered with a registrar of land titles.

Township
A territorial division of land created by federal survey, being six square miles, containing 36 sections or 36 square miles.

Tract
A piece of land.

Trust
A fiduciary relationship where one holds property for the benefit of another.

Trustee
An individual or party who is given the legal responsibility to hold property in the best interest of or "for the benefit of" another.

U

Underwritten Company:/strong> A title firm that conducts title searches, but is not qualified to insure. The company therefore issues policies of a qualified title insurer (underwriter) in return for a portion of the premium.

Underwriter
Insurance company that gives out insurance policies to another insurer or the public.

V

VA Guarantee An insurance contract in which the Veterans Administration (VA) guarantees that the named lender will collect a specific percentage of the loan amount from the insurer in the event the loan goes bad.

Variable Interest Rate An interest rate that fluctuates with the current cost of money; it is subject to adjustment if the prevailing rate moves up or down.

Vendee Buyer or purchaser, especially on a land contract.

Vendor The individual who transfers property by sale. Another word for a "seller".

Vendor's Lien A lien that is either express or implied given to a vendor for the remaining unpaid and unsecured part of a purchase price.

Venue Refers to the county or place in which an acknowledgment is made before a notary; also refers to the county in which a lawsuit may be filed or tried.

Vested Present ownership rights, fixed, and absolute.

W

Waiver
The voluntary relinquishment of a known right, privilege, or claim.

Warranty
A legal and binding promise, given at the time of a sale, where the seller gives the buyer certain assurances as to the condition of the property being sold.

Warranty Deed
Contains provisions under which the seller becomes liable to the purchaser for defects in or clouts on the title.

Will
A written expression of the desire of a person as to the ownership of that person's property after death.

Z

Zoning
Laws enacted by local governments that regulate the size, structure, nature, type, and use of land and/or buildings.