Glossary of Terms A

Terms commonly used in the real estate and title industry. The definitions are based on English Common Law, and while generic, may not be exactly applicable in all countries. Please check with a local real estate attorney prior to making any decisions.

ABSTRACT
The notes made by a title examiner based on his examination of the land records. These notes are a concise summary of the transactions affecting the property. The title agency produces a BINDER from the information in the abstract.

ACCELERATION CLAUSE
A condition in a real estate financing instrument giving the lender the power to declare all sums owing lender immediately due and payable upon the happening of an event, such as the sale of the property, or a delinquency in the repayment of the note.

ACCRETION
The buildup of land from natural forces such as wind or water.

ACKNOWLEDGEMENT
As a verb, the confirmation by a party executing a legal document that this is his signature and voluntary act. This confirmation is made to an authorized officer of the Court or notary public who signs a statement also called an acknowledgment.

ACRE
43,560 square feet of land.

ACQUISITION
By way of purchase, grant, exchange, gift, settlement or otherwise.

ADJUSTMENT INTERVAL
On an adjustable rate mortgage, the time between changes in the interest rate and/or monthly payment, typically one, three or five years, depending on the index.

ADDENDUM
A form/document added to a contract or agreement also known as a Rider.
ADJUSTABLE RATE MORTGAGE (ARM)
A mortgage loan which bears interest at a rate subject to change during the term of the loan.

ADMINISTRATOR
A person appointed by the Court to settle the estate of a person who dies without a will. The feminine form is Administratrix. compare EXECUTOR

ADVERSE POSSESSION
A claim made against land titled to another person based on open, notorious and hostile possession and use of the land to the exclusion of the titled owner.

AGENCY
A relationship in which the agent is given the authority to act on behalf of another person (Principal).

AGREEMENT
A meeting of minds.

AIR RIGHTS
The right to the air space above the real property.

ALTA OWNER’S POLICY (American Land Title Association )
A type of title insurance policy issued by title insurance companies which expands the risks normally insured against under the standard type policy to include unrecorded mechanic’s liens; unrecorded physical easements; facts a physical survey would show; water and mineral rights; and rights of parties in possession, such as tenants and buyers rights under unrecorded instruments.

AMENDMENT
A change to the correct or alteration to the original document/agreement without changing its principal essence.

AMORTIZED LOAN
A loan to be repaid, interest and principal, by a series of regular payments that are equal or nearly equal, without any special balloon payment prior to maturity.

AMORTIZATION
The gradual repayment of a mortgage by installments.

ANNUAL PERCENTAGE RATE (A.P.R.)
Is an interest rate reflecting the cost of a mortgage as a yearly rate. This rate is likely to be higher than the stated note rate or advertised rate on the mortgage, because it takes into account point and other credit costs. The APR allows home buyers to compare different types of mortgages based on the annual cost for each loan.

APPRAISAL
An estimate of the value of property, made by a qualified professional called an “appraiser.” Most states require licenses. Various lenders have their own lists of approved appraisers.

APPROVED ATTORNEY
An attorney authorized by a title insurance company to handle closings and render title opinions.

APPURTENANCE
Anything attached to the land or used with it passing to the new owner.

ASSESSED VALUE
The valuation placed upon a property by a public tax assessor for purposes of taxation.

ASSETS
Items of ownership that are convertible into cash are known as assets. The resources of a person or business like cash, notes and accounts receivable, securities, inventories, goodwill, fixtures, machinery, or real estate are assets.

ASSESSMENT
A local tax levied against a property for a specific purpose, such as a sewer or street lights.

ASSIGN
To transfer interest.

ASSIGNMENT OF LEASE
An existing landlord assigns all the tenancy rights to the new owner who has purchased the property subject to tenancy.

ASSIGNEE
One who receives an assignment or transfer of rights. An assignment of a contract transfers the right to buy property.

ASSIGNOR
The one who assigns to another person.

ASSUMABLE MORTGAGE
A mortgage that can be taken over (“assumed’) by the buyer when a home is sold.

ASSUMPTION
The agreement between buyer and seller where the buyer takes over the payments on an existing mortgage from the seller. Assuming a loan can usually save the buyer money since this is an existing mortgage debt, unlike a new mortgage where closing costs and new, possibly higher, market-rate interest charges will apply.

ATTACHMENT
Seizure of property through Court process to repay a debt.

ATTORNEY IN FACT
A type of agency relationship where one person holds a POWER OF ATTORNEY allowing him to execute legal documents on behalf of another. Decisions made by the attorney in fact are binding on the principal.

AVAILABLE UNIT
Completed housing units that are available for physical occupation, including both occupied and unoccupied units. Also known as stock.

AVAILABLE FLOOR SPACE
Completed, rentable space in non-residential properties, excluding common areas, that is available for physical occupation, including both occupied and unoccupied space. Also known as stock.
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