GLOSSARY

We use a lot of industry lingo. Find out what it all means in our glossary below.

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Assignor

For example, the person who transfers ownership of a contract or mortgage to another.

A

Assumption Agreement

Undertaking or adoption of a debt or obligation primarily resting on another person.

A

Assumption Fee

Lender's charge for changing over and processing new records for a buyer who is assuming an existing loan.

A

Assumption of Mortgage (or Deed of Trust)

Agreement by a buyer in which he assumes liability for payment of an existing note secured by a mortgage or deed of trust against the property.

A

Attorney-in-fact

A person who is appointed to act as an agent for another.

A

Balloon Payment

Installment note final payment that is greater than preceding payments and that pays the note in full.

B

Bankruptcy

A proceeding in U.S. District Court wherein assets of a debtor unable or unwilling to pay his debts are applied by an officer of the court in satisfaction of creditor claims.

B

Beneficiary

A person who is entitled to receive funds of property under the terms and provisions of a will or trust or insurance policy.

B

Bequest

A gift of personal property in a will.

B

Bill of Sale

The instrument by which title to personal property is transferred or conveyed.

B

Binder

Memorandum of an agreement to issue insurance giving temporary coverage until such time as a formal policy is issued.

B

Blanket Mortgage or Trust Deed

Mortgage or trust deed that covers more than one lot or parcel of real property: often covers an entire subdivision. As individual lots are sold, a partial release or reconveyance from the blanket mortgage is ordinarily obtained.

B

Bond

(1) A written promise to pay to the bearer or owner a stated sum of money at a specified time, with interest usually represented by interest coupons attached to the bond, which coupons may be clipped as they mature and presented for payment. Bonds are sometimes in the form of certificates of indebtedness. Bonds are often secured by real estate mortgages. (See "Promissory Note.") (2) A written commitment assuring the payment of a stipulated sum of money or the amount of damages in the event of an adverse happening. (3) A certificate of debt issued by a government or corporation guaranteeing payment to bearer of a specified sum of money, plus interest, on a specified future date.

B

Broker

One who acts as an agent for another in negotiating sales or purchases in return for a fee or commission.

B

Brokerage

A fee or commission paid to a broker.

B

Building Code

Laws specifying the type, kind, area and manner of construction of buildings, and prohibiting construction or repair of buildings in violation of such specifications. (Also, see "Zoning Ordinances.")

B

Building Line

Also called set-back line, a line inside the boundary lines of a piece of real estate beyond which no building may be constructed. Building lines may be established by municipal ordinances, restrictions, and subdivision plats.

B

By-laws

Rules adopted by the members of the board of directors of a corporation that govern the internal management of the corporation. Also called the corporate constitution.

B

Cashier's Check

A bill of exchange drawn by the cashier of a bank, for the bank, upon any bank. After the check is delivered or issued to the payee or holder, the drawer bank cannot put a "stop order" against itself. By delivery of the check, the drawer bank has accepted the check, and thus becomes the primary obligor. (Also, see "Draft.")

C

Certificate of Title

Certified statement regarding ownership of land, based on examination of the record title.

C

Certified Check

A depositor's check recognized and accepted by a bank officer as a valid appropriation of the amount specified and as drawn against funds held by the bank.

C

Chain

As regards land measure, a chain equals 66 feet, 100 links, or 4 rods.

C

Chain of Title

Beginning with a conveyance out of an original source of title such as a government, each succeeding deed, will or other medium which conveys and transfers the title to succeeding owners constitutes a link in the chain of title. The chain of title is the composite of all such links.

C

Claim

A right to assert, or the assertion of, a demand for payment of money due, or the surrender or delivery of possession of property or the recognition of some right. A demand for something as one's rightful due.

C

Class Action

Representative lawsuit in which plaintiff files an action to recover money or to redress a wrong not only on his own behalf but also on behalf of all other persons similarly situated.

C

Closing

In some areas a closing is called a "settlement." The process of completing a real estate transaction during which deeds, mortgages, leases and other required instruments are signed and/or delivered, an accounting between the parties is made, the money is disbursed. The documents are recorded, and all other details such as payment of outstanding liens and transfer of hazard insurance policies are attended to. In some areas this procedure is known as the closing of escrow. (See also, "Settlement.")

C

Closing Statement

A summation, in the form of a balance sheet, made at a closing, showing the amounts of debts and credits to which each party to a real estate transaction is entitled.

C

Co-Insurance

When the term "co-insurance" is used in connection with title insurance, as well as in other forms of insurance, it signifies that two or more insurance companies are insuring the same risk. Depending on the type of co-insurance utilized, the insurance may be identical for each company. That is, each company may have and be responsible for the same risks and liability. This is called "joint and several co-insurance," with each company's liability starting at the first dollar and continuing for the full amount of insurance as stated by the policy. This does not mean that the insured could be paid twice the amount of a loss, but does mean that all of the loss could be paid by one company rather than shared by both. The paying company would undoubtedly seek a partial recovery from its co-insurer. (Also, see "Reinsurance.")

C

Co-Operatives

Co-operatives, usually referred to as "co-ops," are typically residential real estate projects which are owned by an entity, an interest in which is, in turn, owned by the "owner." The owner, as a concomitant to owning the interest in the entity, is also entitled to the use of a designated apartment in the building. This possessory interest is commonly evidenced by a proprietary lease.

C

Code

A collection of laws.

C

Commission

The amount due a real estate broker or mortgage loan broker for services performed in their respective capacities. The term also applies to regulatory tribunals such as real estate commissioners.

C

Commitment

A pledge, promise, or firm agreement; also, a form of title evidence issued by a title company establishing a title insurer's contractual obligation to insure title to real property, subject to satisfaction of the requirements set forth therein.

C

Common Area

When used in reference to condominiums or planned unit developments, the common area is that portion of land that is owned in common by all unit or lot owners and which each has an equal right to use. In a condominium the common area includes the buildings surrounding the units but not the unit of air space.

C

Common Law

The system of laws originated and developed in England which was the source of customs, usages and arbitrary court decisions as distinguished from written laws enacted by legislative bodies.

C

Competent

Legally qualified; capable of contracting.

C

Conditions

This term is related to restrictions and reservations. It refers to provisions in deeds and other real estate instruments which provisions make particular right contingent upon the occurrence of some future event.

C

Condominium

An estate in real property consisting of an undivided interest in common in a portion of a parcel or real property together with a separate interest in space in a residential, industrial or commercial building. It may include a separate interest in another portion of real property. The estate may be either 1) an estate of inheritance or perpetual estate, 2) an estate for life, or 3) an estate for years including either a leasehold or subleasehold estate.

C

Condominium Unit

A residential unit in a condominium complex.

C

Confirmation Of Sale

Court approval of the sale of property by an executor, administrator, guardian or conservator.

C

Consideration

Anything of value used to induce another person to enter into a contract. It may be money, services, or a promise, and consists of either a benefit to the promisor, or a loss or detriment to the promisee.

C

Contiguous

In actual or close contact; adjoining or touching, e.g., parcels of land next to each other.

C

Contingent

Dependent on an uncertain future event.

C

Contract

Same as "Agreement", but usually more formal.

C

Conveyance

The transfer of title to property from one person to another.

C

Corporation

A collection of individuals created by statutes as a legal person, vested with powers and capacity to contract, own, control, convey property, and transact business within the limits of the powers granted.

C

Covenant

(1) A formal agreement or contract between two parties in which one party gives the other certain promises and assurances, such as covenants of warranty in a warranty deed. (2) Agreements or promises contained in deeds and other instruments for performance or nonperformance of certain acts, or use or nonuse of property in a certain manner.

C

DBA

Acronym for "doing business as."

D

Decedent

A deceased person.

D

Decree

A judgment by a court.

D

Dedication

The setting aside of certain land by the owner and declaring it to be for some public use, accompanied by acceptance of such use by the public. Example: streets, sidewalks, parks.

D

Deed

A conveyance of realty; a writing signed by grantor, whereby title to realty is transferred from one to another. National Fire Insurance Company vs. Patterson, 170 Okl. 593, 41 p.2d 645, 647.

D

Deed Book

A book among the public records in which deeds are recorded.

D

Deed Of Trust

An instrument used in many states in place of a mortgage. Property is transferred to a Trustee by the borrower (Trustor) in favor of the lender (Beneficiary) as security for a loan. The Deed of Trust is reconveyed upon payment in full.

D

Deed Restriction

A restriction contained in a deed which limits the use or occupancy of the real estate or the type, size, purpose and location of improvements to be constructed on it.

D

Default

Failure to perform a promised task or to pay an obligation when due.

D

Default Judgment

Judgment taken against a defendant who fails to appear in court.

D

Defect

A blemish, imperfection or deficiency. A defective title is one that is irregular and faulty.

D

Defendant

The party who is being sued in a court of law.

D

Description

The exact location of a piece of property stated in terms of lot, block, tract, part lot, metes and bounds, or U.S. Government survey (sectionalized). This is also referred to as a legal description of property.

D

Draft

The common term for a bill of exchange. A written order from one person to another, directing that person to pay to a third person a set sum of money. A draft is distinguishable from a cashier's check in that a draft is payable on demand against money on deposit, while a cashier's check is a primary obligation of the bank that issues it.

D

Due-on-Sale clause

A provision in a trust deed or mortgage calling for automatic maturity at the lender's option in the event of sale or transfer of the real property to a third party; also called an alienation clause.

D

Earnest Money

The advance, by a purchaser, of a small part of the purchase price as evidence of good faith.

E

Easement

A right held by a person to enjoy or make limited use of another's real property.

E

Egress

The right to a path or right-of-way over which a person may leave his own real estate.

E

Eminent Domain

The right of a government to take privately owned property for public purposes under condemnation proceedings upon payment of its reasonable value. (See "Condemnation.")

E

Encroachment

The extension of a structure from the real estate to which it belongs across a boundary line and onto adjoining property.

E

Encumber

To burden the title to real property with a claim, right or lien held by someone other than the owner.

E

Encumbrance

A claim, right, or lien upon the title to real estate, held by someone other than the real estate owner.

E

Endorsement

The act of signing one's name on the back of a check or promissory note to transfer it to a third party. Also, a rider attached to an insurance policy to expand or limit coverage. Also spelled "Indorsement."

E

Equity

A system of jurisprudence supplementing the common law and enacted law under which justice, impartiality, and fairness is applied in circumstances not covered by enacted or common law.

E

Equity in Property

Amount of value of a person's interest above the total of liens or charges; the difference between the market value of the property and the amount of liens against it.

E

Erosion

The wearing away of land surfaces by forces of nature such as winds and water.

E

Escrow

A writing, deed, money, stock, or other property delivered by the grantor, promisor or obligor into the hands of a third person, to be held by the latter until the happening of a contingency or performance of a condition, and then by him delivered to the grantee, promisee or obligee. A system of document transfer in which a deed, bond, or funds is delivered to a third person to hold until all conditions in a contract are fulfilled; e.g. delivery of deed to escrow agent under installment land sale contract until full payment for land is made. Black's Law Dictionary, 5th Edition.

E

Escrow Agreement

A written agreement usually made between buyer, seller and escrow agent, but sometimes only between one person and the escrow agent. It sets forth the conditions to be performed incident to the object deposited in escrow, and gives the escrow agent instructions with respect to the disposition of the object so deposited.

E

Estate

(1) A sizable piece of rural land usually with a large house and other pretentious improvements. (2) The whole of one's possessions, especially all of the property, assets, debts, and liabilities left by a deceased or bankrupt person. (3) The nature and extent of an owner's rights in real estate.

E

Eviction

To expel or oust a person, by legal process, from possession of real estate.

E

Examination

In title industry parlance, to peruse and study the instruments and muniments incident to a chain of title and to determine their effect and condition in order to reach a conclusion as to the status of the title.

E

Examiner

Usually referred to, in title industry parlance, as title examiner. One who examines and determines the condition and status of real estate titles.

E

Exception

In title industry parlance, a provision in a title insurance binder or policy which excludes liability regarding a specified title defect or an outstanding lien or encumbrance.

E

Execute

(1) To create and make valid a real estate instrument. A deed is said to be executed when it is signed, sealed, witnessed and delivered. (2) To perform or do whatever is required.

E

Executor

A person named in a will to carry out its provisions.

E

Exemption

Immunity from a burden or obligation.

E

Falsification

The forging, altering, or counterfeiting of a document, or knowingly making untruthful statements or misrepresentations.

F

Fee Simple Absolute

(Commonly called fee simple) A term describing the total interest a person may have in land. Such an estate is not qualified by any other interest and passes upon the death of the owners to the heirs free from any conditions.

F

Fictitious Name

A name used for business purposes that differs from the true name of the owner of the business.

F

Fiduciary

A person who bears a special relationship of trust, confidence, and responsibility to others, such as a trustee or agent.

F

Filing

In the title industry, this term relates to the delivery of real estate instruments to a recorder for recording.

F

First Mortgage

A mortgage having priority as a lien over any other mortgage or lien on the same property.

F

Fixture

Personal property which is permanently attached to real estate such as plumbing fixtures. So long as a fixture is permanently attached, it is usually regarded as part of the real estate.

F

Foreclosure

A legal proceeding for the collection of real estate mortgages and other types of liens on real estate, which results in cutting off the right to redeem the mortgaged property and often involves a judicial sale of the property to pay the mortgage debt.

F

Foreclosure Sale

Sale of property pledged as security for a debt. The property is sold to pay the debt after a default occurs.

F

Foreshore

Land between the low water mark and high water mark, covered and uncovered by the ebb and flow of the tide.

F

Forfeit

(1) Money or a right which a person loses upon failure to perform an agreement, obligation, or duty. (2) The act of losing money or a right as described.

F

Forged

Fraudulently executed; counterfeited.

F

Forgery

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

F

Fraud

A deception deliberately practiced in order to obtain an unfair or unlawful gain.

F

Fraudulent

Obtained, performed, or characterized by deceit or fraud.

F

Garnishment

Statutory proceeding whereby a debtor's personal property, in possession of a third party, is seized and applied to payment of the debt.

G

Grant

A transfer of real estate between individuals, by deed. A transfer of real estate from a sovereign by patent or royal decree.

G

Grant Deed

One of many types of deeds used to transfer real property. A grant deed contains warranties against prior conveyances or encumbrances.

G

Grantee

One to whom a grant is made.

G

Grantor

One who makes a grant.

G

Ground Lease

Lease covering land only and not improvements which are to be installed by the lessee.

G

Guaranty

An agreement in which a guarantee or assurance of a state of facts or the performance of an objective or obligation is given.

G

Guardian

A person who is legally responsible for the care and management of the person or property of one who is legally incompetent to manage his own affairs.

G

Hazard

A danger, peril or risk. Incident to title insurance, it relates to the risk assumed under a title insurance policy.

H

Heir

A person who inherits or who is entitled to inherit real estate by provisions of law or under the provisions of a will.

H

Homestead

(1) Property designated by the head of a family as his home, which is protected by law from forced sale to pay his debts. (2) Land claimed by a settler under the national homestead act. (3) Under some state laws, the real estate upon which one's home is situated.

H

Improvement Liens

Liens imposed by municipalities on real estate which has been directly benefitted by municipal improvements such as the construction of streets, sidewalks and sewer lines. Such liens secure payment of the proportionate costs of such improvements.

I

Incompetent

Person who is incapable of managing his own affairs because of a disability.

I

Indemnity

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

I

Indenture

A deed or other real estate contract executed between two or more parties.

I

Index

(1) An alphabetical or geographical listing in the public records of the names of parties to recorded real estate instruments together with the book and page number of the record. (2) The listing in abstract and title plants of recorded real estate instruments in groups according to land descriptions, known as a geographic index. (3) The alphabetical listing in abstract and title plants, by names of the parties, of all recorded instruments which affect but do not describe particular real estate, such as judgments, powers of attorney, wills and probate proceedings. These indexes are known by various names such as general index, judgment index, and name index.

I

Instrument

Any written document by which something is done regarding rights or interests in real estate.

I

Insurer

One that insures, sometimes called an underwriter, such as a title insurance company.

I

Interests

Estates, rights, or legal claims in and to real estate.

I

Joint Take-Off

When a group of title companies shares the cost of one take-off made for the use and benefit of each member of the group, it is called a joint take-off. A take-off is an abbreviated copy of the principal features of recorded instruments required for the purposes of indexation in an abstract plant or for purposes of making abstracts or examining titles.

J

Joint Tenants

Two or more persons who hold title to real estate jointly, with equal rights to share in its enjoyment during their respective lives with the provision that upon the death of a joint tenant, his share in property passes to the surviving tenants, and so on, until the full title is vested in the last survivor. A joint tenant cannot legally sell or encumber his interest without the consent or joinder of all of the other joint tenants.

J

Joint Venture

Business undertaking by two or more persons to conduct a single enterprise for profit. Joint venture has characteristics of a partnership, but relates to a single venture.

J

Judgment

A conclusion or determination by a court of law usually awarding the payment of money or relief of some kind to one of the parties to a lawsuit.

J

Judicial

Of or pertaining to courts of law or the administration of justice.

J

Junior Mortgage

A mortgage lower in lien priority than a first mortgage.

J

Jurisdiction

(1) The right and power of courts to interpret and apply the law. (2) The legal power of control over persons and property. (3) A geographical area in which a court has power and authority to act.

J

Kickback

A return of a part of a fee given back because of a confidential agreement or coercion.

K

Land

The solid ground of the earth as distinguished from the sea.

L

Land Contract

A contract between buyer and seller for the purchase and sale of land, the purchase price usually being payable in installments over a considerable period. The seller (vendor) holds legal title and the buyer (vendee) holds the equitable title until the sales price is paid in full.

L

Landlord

(1) A person from whom a tenant leases land or buildings. (2) One who runs a rooming house or inn.

L

Landowner's Royalty

Fractional interest in production of oil and gas created by the owner of the land, either by reservation when an oil and gas lease is entered into or by a direct grant to a third person.

L

Lease

An agreement granting the use or occupancy of land during a specified period in exchange for rent.

L

Leasehold

(1) Property held by lease. (2) The estate or interest in real estate created by a lease.

L

Legacy

A gift of personal property by will.

L

Legal

(1) Relating to or concerned with the law. (2) The conformity with or permitted by law.

L

Legal Description

Description by which property can be definitely located on the ground by reference to government surveys or approved recorded maps; sometimes referred to simply as the legal.

L

Legal Title

Title which is enforceable in a court of law, or title which is perfect in its right of ownership and possession, but carries no beneficial interest in the property.

L

Lessee

A tenant holding a lease.

L

Lessor

One who gives a lease to a lessee.

L

Letters Of Guardianship

Formal written evidence of court appointment of a guardian for the person, estate, or person and estate of a minor or of an incompetent.

L

Levy

A seizure of property by judicial process.

L

Liability

A legal obligation or responsibility for the payment of a loss or damages or a debt.

L

License

In title industry parlance, permission to go upon or use the land of another, the permission being a personal privilege and not constituting an interest in the land.

L

Lien

The liability of real estate as security for payment of a debt. Such liability may be created by contract, such as a mortgage, or by operation of law, such as a mechanics lien.

L

Limited Warranty Deed

A written warranty which fails to meet one or more of the minimum standards for a full warranty. 15 U.S.C.A. Section 2303.

L

Litigation

Legal proceedings, a lawsuit in which a dispute is submitted to a court for determination.

L

Loan Policy

A policy of title insurance intended to protect the party providing a loan.

L

Loss

(1) In the title industry, damage suffered by a person resulting from defects in or liens upon his title to real estate. (2) Money paid by a title insurance company in settlement of policy claims.

L

Lot Split

Sale of part of a pre-existing parcel of land. Lot splitting is generally regulated by local zoning ordinances.

L

Market Value

An average between the highest price which a buyer, willing but not compelled to buy, would pay and the lowest price a seller, willing, but not compelled to sell, would accept.

M

Marshaling

Arranging, ranking, or disposing in order; particularly, in the case of a group or series of conflicting claims or interests, arranging them in such an order of sequence, or so directing the manner of their satisfaction, as shall secure justice to all persons concerned and the largest possible measure of satisfaction to each. Equitable doctrine of "marshaling" rests upon principle that creditor having two funds to satisfy his debt may not, by his application of them to his demand, defeat another creditor, who may resort to only one of the funds. Columbia Bank for Cooperatives v. Lee, C.A.N.C., 368 f2d 934, 939.

M

Meander

To follow a winding course.

M

Mechanic's Lien

A lien on real estate, created by operation of law, which secures the payment of debts due to persons who perform labor or services or furnish materials incident to the construction of buildings and improvements on the real estate.

M

Meridians

Imaginary north-south lines that intersect base lines to form a starting point for measurement of land.

M

Metes And Bounds

A land description in which boundaries are described by courses, directions, distances, and monuments.

M

Monument

Object or mark used by a surveyor to fix or to establish boundaries or land location.

M

Mortgage

(From the latin terms "mors" or "mort" meaning death or dead.) A temporary and conditional pledge of property to a creditor as security for the payment of a debt which may be satisfied or canceled by payment.

M

Mortgage Book

A book in the public records in which mortgages are recorded.

M

Mortgagee

The holder of a mortgage. The party to whom a mortgage is made.

M

Mortgagee Policy

(Sometimes called a mortgage policy.) A policy of title insurance insuring the holder of a mortgage against loss occasioned by the impairment or invalidity of the lien of the mortgage or because of defects in, superior liens upon, or unmarketability of the title.

M

Mortgagor

A person who mortgages property. A person who executes a mortgage.

M

Multiple Listing

The pooling, in a central bureau, of listings of properties for sale, which 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 case of a sale, the commission will be divided among the broker making the sale, the broker who filed the listing, and the bureau.

M

Negligence

The omission or neglect of reasonable precaution, care or action.

N

Negotiable

Capable of being legally transferred by endorsement from one person to another, such endorsement carrying with it, without written provisions, implications of certain contractual obligations.

N

Notarize

To prove execution of a document by means of a notary public's certificate of acknowledgment.

N

Notary Public

A person authorized by law to take acknowledgments and to administer oaths.

N

Note

An instrument containing an express and absolute promise of signer (i.e. maker) to pay to a specified person or order, or bearer, a definite sum of money at a specified time. Two party instrument made by the maker and payable to payee which is negotiable if signed by the maker and contains an unconditional promise to pay sum certain in money, on demand or at a definite time, to order or bearer. U.C.C. Sec. 3-104(1). A note not meeting these requirements may be assignable but not negotiable. Black's Law Dictionary, 5th Edition. (See "Promissory Note.")

N

Nuisance

Anything that is offensive and works an injury or harm to a person or property. May be either a public nuisance (offends the general public) or a private nuisance (offends one property owner.)

N

Nunc Pro Tunc

"Now for then" a tardy act made retroactive to take effect as of the time it should have been done.

N

Obligation

That which a person is bound by a promise, contract or by law to do.

O

Opinion

In the title industry referred to as title opinion. The conclusion and judgment of a skilled person as to the status of a title, based upon a title examination.

O

Option

A right, given for consideration, to purchase or lease a parcel of property within a specified time and on specified terms.

O

Ordinance

A legislative enactment by a city or county.

O

Overriding Royalty

An interest in oil and gas to be produced that a lessee may retain when executing an assignment of an oil and gas lease.

O

Owner's Policy

A policy of title insurance usually insuring an owner of real estate against loss occasioned by defects in, liens against, or unmarketability of the owner's title.

O

Parcel

Any area of land contained within a single description.

P

Partition

In the title industry, a lawsuit between joint owners of real estate in which the court either divides the property between them or orders the property sold and divides the proceeds between them.

P

Partnership

A voluntary association of two or more persons to carry on as co-owners of a business for profit. May be either a general partnership or a limited partnership.

P

Party Wall

A wall built along the boundary line of adjoining properties and shared by the respective property owners or tenants.

P

Patent

(1) (noun) A conveyance, by the federal government, of title to a portion of the public land. (2) (adjective) Apparent, obvious, open to view. (See, also "Latent.")

P

Percentage Lease

A lease of property in which the rental is based upon the volume of sales made by the lessee on the leased property.

P

Perimeter

(1) The boundary lines enclosing a tract of land. (2) The length of the boundary lines enclosing a tract of land.

P

Perpetuity

The taking of property out of the channel of commerce by limiting its capacity to be sold for a period of time longer than that of a life in being plus 21 years and a period of gestation. It is the condition of an estate limited so that it will not take effect or vest within a period fixed by law. Also called the "Rule Against Remoteness of Vesting."

P

Personal Property

Temporary or movable property as distinguished from real estate.

P

Personalty

Personal property.

P

Plaintiff

The party initiating an action.

P

Planned Unit Development

A planned unit development ("PUD") is a project in which, typically, the buildings are built in styles that are sometimes referred to as "cluster housing." PUD is a concept according to which housing, typically a group of townhomes, patiohouses, or row-houses, is built with minimal ground space or yards surrounding each dwelling. The ground which would normally constitute the yard for each dwelling is consolidated into a larger recreational or greenbelt area. This area usually also includes all walks, drives, and parking areas. The individual dwellings and, possibly, a small patio, flower bed, or similar minimal ancillary personal use site, which may be owned with the residence, are individually owned. All of the ancillary land, such as recreation areas, greenbelts, walkways and others ("common area") are owned as an undivided interest, usually indirectly, with others. Because of the typical land ownership divisions, the unit owners are granted easements appurtenant (running with the land) foringress, egress, parking, and recreational use over the common area; otherwise the units would be landlocked.

P

Plat

A map of a town, section, or subdivision showing the location and boundaries of individual parcels of land subdivided into lots, with streets, alleys, easements, etc., Usually drawn to a scale. Black's Law Dictionary, 5th Edition.

P

Plat Book

One in a set of books in the public records in which maps, plats, and copies of surveys are recorded.

P

Police Power

The inherent authority of a government to impose restrictions upon private property or private rights for the sake of public welfare, order, and security.

P

Policy

(See "Owner's Policy", "Mortgagee Policy", and "Loan Policy.")

P

Power Of Attorney

A legal instrument authorizing one to act as another's agent or attorney.

P

Precedent

A previously decided case that can serve as authority to help decide a present controversy.

P

Prelim

See "Preliminary Report".

P

Preliminary Report

A written report issued by a title company prior to issuing title insurance, showing the matters discovered in their title search which would appear as exceptions in a title policy if the policy were issued as of the date of the report.

P

Premium

(1) The amount payable for an insurance policy. (2) A sum of money or bonus paid in addition to the regular price.

P

Prepayment Clause

A provision in a loan agreement permitting the debtor, for consideration, to pay part or all of the balance of the debt before its due date, thus saving interest.

P

Prepayment Penalty

Charge imposed by a lender on a borrower who wants to pay all or part of the loan balance before its due date.

P

Prescription

In the broad sense of modern times, the gaining of some right or interest in real estate through long and continuous adverse use, usually for a period prescribed by statute, such as the acquisition of an easement by the unlicensed and adverse use of a path, roadway, or utility lines across another property.

P

Prescriptive Easement

right to use another's property which is not inconsistent with the owner's rights and which is acquired by a use, open and notorious, adverse and continuous for the statutory period (e.g. Twenty years). To a certain extent, it resembles title by adverse possession but differs to the extent that the adverse user acquires only an easement and not title. To create an easement by "prescription," the use must have been open, continuous, exclusive, and under claim of right for statutory period. (See, also "Adverse Possession.") Black's Law Dictionary, 5th Edition.

P

Presumption

That which may be assumed without proof.

P

Principal

(1) A sum of money owed as debt upon which interest is payable. (2) A person who empowers another to act as his representative or agent. (3) The person having prime responsibility for an obligation as distinguished from one who acts as a surety or endorser.

P

Priority

The relative superiority of competing liens or encumbrances.

P

Probate

A legal procedure in which the validity and probity of a document, such as a will, is proven.

P

Promissory Note

A written promise to pay or repay a specified sum of money at a stated time, or on demand, to a named person. In addition to the payment of principal, a promissory note usually provides for the payment of interest.

P

Property

(1) Something tangible or intangible capable of being owned and controlled. (2) Lands or chattels in which a person owns some right, title or interest to the exclusion of all others.

P

Public Domain

Land of which title still vests in the United States of America.

P

Public Records

The transcriptions in a recorder's office of instruments which have been recorded, including the indexes pertaining to them.

P

Purchase Money Mortgage

A mortgage given by a purchaser to a seller on the subject property to secure payment of all or a part of the purchase price.

P

Quasi

To some degree, almost, partially, somewhat. Also resembling but not quite being the thing in question.

Q

Quit Claim Deed

A deed which does not imply that the grantor holds title, but which surrenders and gives to the grantee any possible interest or rights which the grantor may have in the property.

Q

Range

As used in descriptions, a column of townships running parallel with a principal meridian.

R

Rate

This term, when used in the title industry, usually refers to the rate for title insurance. In this sense it means the cost per dollar unit of title insurance. For example, the rate for ten thousand dollar title insurance policy is (so many) dollars.

R

Rate Schedule

The respective costs of dollar units of title insurance listed on an ascending scale.

R

Real Estate

Land, including all inherent natural attributes and any man-made improvements of a permanent nature placed thereon.

R

Realtor

A copyrighted trade name which can be legally used only by those persons belonging to the national association of real estate boards.

R

Realty

Another name for real estate.

R

Record Title

The aspects of a title which appear in the public records as distinguished from unrecorded title aspects and interests.

R

Recording

The act of a recorder receiving and transcribing in a book or on a film of the public records, instruments affecting the title to real estate.

R

Records

(See "Public Records.")

R

Redemption

A buyback or the ability to buy back. (See "Equity of Redemption.")

R

Reinsurance

Insurance insuring an insurer. When an insurance company has issued a policy and does not want to be fully exposed to loss for the full amount of the policy, the company may purchase reinsurance from another insurance company to insure the first company against a part or all of the loss which the first company may have to pay under its policy.

R

Release

(1) To relieve from debt or 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.

R

Release Of Lien

(1) The instrument by which a lien is released from the real estate which it encumbers. (2) The act of releasing a lien.

R

Rent

The consideration paid for the use of property.

R

Rescission

(1) Court action brought to cancel or annul the effect of executing a contract or other document. (2) The act of canceling or annulling the effect of a document.

R

Reservation

A right or interest retained by a grantor in conveying property.

R

Restrictions

Often called restrictive covenants. Provisions in a deed or other instrument whereby an owner of land prohibits or restricts certain use, occupation, and improvement of the land.

R

Restrictive Covenants

(See "Restrictions.")

R

Rider

Addition, amendment or endorsement to a document, e.g., An insurance contract.

R

Right

A power, privilege, prerogative, estate, or interest incident to real estate.

R

Right Of Way

(1) The right to pass over property owned by another, usually based upon an easement. (2) A path or thoroughfare over which passage is made. (3) A strip of land over which facilities such as highways, railroads, or power lines are built.

R

Risk

Exposure to loss. A title insurance company assumes the risk incident to a possible title loss when it insures the owner of the title.

R

Sale Agreement

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

S

Sale And Leaseback

A situation in which the grantor in a deed to a parcel of property sells it and retains possession by simultaneously leasing it from the grantee.

S

Sales Contract

(See "Sale Agreement.")

S

Satisfaction

(1) The payment of a debt or fulfillment of an obligation. (2) An instrument executed by the holder of a lien, debt or obligation which acknowledges payment or fulfillment. For example, a satisfaction of a mortgage sometimes is referred to as a satisfaction piece.

S

Seal

Impression on a document that lends authenticity to its execution, such as affixing the corporate seal to a document executed by a corporation.

S

Search

In title industry parlance, a careful exploration for and perusal of the public records in an effort to find all recorded instruments relating to a particular chain of title.

S

Second Mortgage

A mortgage ranking in priority immediately below a first mortgage. (See "Junior Mortgage.")

S

Section

Measure of land; one of the divisions employed in a government survey. It measures one mile on each side and contains 640 acres of land (if regular in shape.)

S

Security

Assurance against the default or non-payment of a debt or obligation which makes the enforcement of a promise or an obligation more certain than the personal commitment of the debtor or obligator. Usually the pledge of property.

S

Set Aside

To declare invalid or void; to annul. For example, a court may set aside an erroneous judgment or decree.

S

Setback Line

(See "Building Line.")

S

Settlement

Act or process of adjusting or determining; an adjusting; an adjustment between persons concerning their dealings or difficulties; an agreement by which parties having disputed matters between them reach or ascertain what is coming from one to the other; arrangement of difficulties; composure of doubts or differences; determination by agreement; and liquidation. Sowers v. Robertson, 144 kan. 173, 58 p.2d 1105, 1107. Payment or satisfaction. Ledbetter v. Hall, 191 ark. 791, 87 s.W.2d 996, 999. Black's Law Dictionary, 5th Edition. (See "Closing.")

S

Sky Lease

A lease of air space above a piece of land. The ownership of land extends down to the center of the earth and up to the sky. Space above the land can, therefore, be leased or sold. Cantilever or bridge type buildings which do not depend on the lessor's land for support may be built in such air space.

S

Special Assessment

(See "Improvement Liens.")

S

Speculative Builder

One who constructs buildings for sale without having firm purchase commitments. Speculative building is quite common in residential housing developments and in condominiums.

S

Squatter

One who settles upon unoccupied land without legal claim or authority. (See "Adverse Possession.")

S

Statute Of Limitations

A statute setting a time limit on the enforcement of right or on the collection of a debt in certain cases.

S

Subdivision

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

S

Subordination

Giving a lien or interest an inferior status. For example, an existing mortgage may be subordinated to the lien of a new construction loan mortgage in which case the construction loan mortgage becomes the lien with priority.

S

Suit

Usually meaning a lawsuit.

S

Summons

A court process that directs a defendant to make an appearance in an action filed against him.

S

Survey

(1) To determine the location, boundaries, area, or the elevations of land and structures upon the earth's surface by means of courses in relation to the north star, and the measuring of angles and distances by using the techniques of geometry and trigonometry. (2) The map or plat drawn by a surveyor which represents the property surveyed and shows the results of a survey.

S

Take-Out

A written commitment or agreement given by a permanent mortgage lender to a temporary mortgage lender under which the permanent lender agrees to purchase mortgages made by the temporary lender.

T

Tax Lien

The lien which is imposed upon real estate by operation of law which secures the payment of real estate taxes.

T

Tax Sale

A sale of property by a governmental agency, for nonpayment of taxes.

T

Tenant

(1) Usually one who holds possession of real estate under a lease. (2) In a broader sense, one who holds or possesses lands and tenements by any kind of title.

T

Tenants in Common

Two or more persons in whom title to a single piece of real estate is vested in such a manner that they have a common or equal right to possession and enjoyment of the property, but each holds a separate individual interest or estate in the property. Each owner may sell or encumber his respective interest or dispose of it by will, and if he dies without leaving a will, his heirs inherit his undivided interest.

T

Testament

Commonly used in the phrase "last will and testament" and generally considered synonymous with "will." Technically speaking, it is a document providing for the disposition of one's personal property upon his death.

T

Third Party

A term usually applied to persons who are not principal parties to a contract or other instrument, but who have some right, interest or duty which such contract or instrument affects. For example, where a sale contract between buyer and seller of real estate provides that the money and documents involved in the transaction will be deposited with a title company pending the closing of the deal, the title company becomes a third party to the transaction.

T

Title

(1) A combination of all the elements that constitute the highest legal right to own, possess, use, control, enjoy, and dispose of real estate or an inheritable right or interest therein. (2) The rights of ownership recognized and protected by the law.

T

Title Assurance

Assurance of title through abstracts, attorneys' opinions, title insurance, and surveys.

T

Title Covenants

Covenants ordinarily inserted in conveyances and in transfers of title to real estate for the purpose of giving protection to the purchaser against possible insufficiency of the title received. A group of such covenants known as "common law covenants" includes (a) covenants against encumbrances, (b) covenant for further assurance (in other words, to do whatever is necessary to rectify title deficiencies), (c) covenant of good right and authority to convey, (d) covenant of quiet enjoyment, (See "Quiet Enjoyment."), (e) covenant of seisin, (f) covenant of warranty. (See "Warranty", also see "Covenant.")

T

Title Insurance

Indemnity against loss resulting from defects in or liens upon a title.

T

Title Insurer

A company which insures the title to real estate.

T

Title Plant

(1) In many areas, synonymous with abstract plant. (2) A geographically filed assemblage of title information which is to help in expediting title examinations, such as copies of previous attorneys' opinions, abstracts, tax searches, and copies or take-offs of the public records.

T

Title Report

(See "Preliminary Report.")

T

Title Search

The collection and review of recorded documents affecting a specific parcel of land. An experienced title officer or attorney reviews and analyzes all material relating to the search, then determines the sufficiency and status of title for issuance of a title insurance policy.

T

Title Underwriter

Synonymous with title insurer.

T

Township

Part of a subdivision of United States Public Lands. A township contains 36 sections uniformly numbered starting with the northeast section, and each one mile square.

T

Trade Name

The name or any other designation under which a firm does business.

T

Transfer Tax

The tax payable on the conveyance of real property, measured by the amount of consideration paid.

T

Trespass

Invasion of an owner's rights in his property; wrongful entry onto the land of another.

T

Trust

Fiduciary relationship in which one party (trustee) holds title to property for the benefit of another party (beneficiary).

T

Trustee

Person who holds title in trust for the benefit of another person.

T

Underwriter

An insurance company which issues insurance policies either to the public or to or through another insurer.

U

Underwritten Company

A title firm which conducts title searches but is not qualified to insure, and therefore issues policies of a qualified title insurer (underwriter) in return for a portion of the premium.

U

Undivided Interests

Unsegregated interest of co-owners in the entire property owned in common.

U

Unit

When used with reference to a condominium, a unit is that part of a condominium which is not part of the common area and is owned separately and not in common with the owners of other units in the project. When used in reference to a planned unit development the unit is the separate lot or parcel containing a house or other building.

U

Variable Interest Rate

An interest rate that fluctuates with the current cost of money, subject to adjustment if the prevailing rate moves up or down.

V

Vendor

The seller under a sale contract of real estate.

V

Vendor's Lien

An implied lien given by law to the vendor for the remaining unpaid and unsecured part of a purchase price.

V

Venue

(1) The county in which a lawsuit is brought or tried. (2) The county in which an acknowledgment is taken.

V

Vest

To give an immediate, fixed right in property, with either present or future enjoyment of possession; also denotes the manner in which title is held.

V

Void

Binding on no-one, constituting a nullity. Something which is conclusively of no effect, the defect of which is not subject to being waived, revitalized or cured by confirmation or ratification.

V

Voluntary Lien

A lien intentionally created by a debtor, e.g., mortgage or deed of trust, as contrasted with a judgment lien, which is an involuntary lien.

V

Waiver

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

W

Warehousing

In title industry parlance, the temporary funding and holding by a lending institution of mortgages originated by a mortgage broker, until such time as the mortgage market improves or until the mortgage broker accumulates a sufficient amount of mortgages to sell to a permanent mortgage purchaser.

W

Warranty

In a broad sense, it is an agreement or undertaking by a seller to be responsible for present or future losses of the purchaser occasioned by deficiency or defect in quality, condition, or quantity of the thing sold. In a stricter sense, it is the provision or provisions in a deed, lease, or other instrument conveying or transferring an estate or interest in real estate under which the seller becomes liable to the purchaser for defects in or encumbrances on the title. (See "Title Covenants.")

W

Warranty Deed

A deed containing one or more title covenants. (See "Title Covenants.")

W

Waste

(1) The destruction or injury to premises by a tenant. (2) The impairment in value by a life tenant or by a mortgagor.

W

Will

(1) An instrument executed by a competent person, in the manner prescribed by law, whereby he makes disposition of his property to take effect on and after his death. (2) A holographic will is a will entirely written and signed by the testator in his own handwriting. In some states some of the legal requirements regarding the execution of wills do not apply in the case of holographic wills. (3) A nuncupative will is one made orally before witnesses, usually during the testator's last hours of life. Under English law, sailors and soldiers may make nuncupative wills any time during their military service.

W

Wrap-around Mortgage

A method of financing in which a second lender assumes payment of the present mortgage and gives the mortgagor an increased mortgage at a higher interest rate.

W

Writ

A formal legal document issued by a court ordering or prohibiting the performance of some action. There are at least a hundred deferent kinds of writs each covering a different action or subject. In most writs an officer of the court, such as the sheriff, is directed to serve the writ or carry out its directions.

W

Writ Of Execution

A direct command from the court to the sheriff to carry out the action required in the writ. It may be to hang a convicted criminal, or to seize property and sell it to pay a money judgment.

W

Yield

Ratio of income from an investment to the total cost of the investment over a given period of time.

Y

Zoning Ordinances

Laws passed by local governments regulating the size, type, structure, nature and use of buildings. Zoning ordinances, often referred to as zoning laws and zoning regulations, are divided into two classes: (1) those which regulate the height or bulk of buildings within certain designated zones or districts - in other words, those which relate to structural and architectural design, and (2) those which prescribe the type of buildings which may be constructed, and the use to which buildings within certain designated zones or districts may be put.

Z

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