Glossary

Shortcut: [A-C] [D-H] [I-L] [M-N] [O-S] [T-Z]

 

A-C [top]

Abstract of Title

A concise statement of the substance of documents or facts appearing on the public land records that affect the title to a particular tract.

Acceptance

Action of offeree in agreeing to terms of an offer that results in a binding contract.

Acknowledgment

Notary signature and seal; appears on deeds and some contracts as well as on wills.

Administrator

Male party responsible for the probate of an intestate estate.

Adminstratrix

Female party responsible for the probate of an intestate estate.

Adverse Possession

Method of acquiring title to land by openly taking possession of and using another’s property for a certain period of time.

Appraisal

Process of valuing property; what a willing buyer would pay a willing seller when neither is forced to contact.

Assignment

Process of transferring contract rights to another; e.g., assignment of a mortgage or lease.

Assumption

Process whereby a buyer of real property agrees to assume responsibility for payments on an existing mortgage on the property.

Attachment

Process of creating a lien, security interest, or other creditor’s interest in property; results when the creditor has complied with all requirements.

Bargain & Sale Deed

Deed that transfers title but carries no warranties.

Bequest

A gift of personal property by will.

Broker

Party who is licensed to handle property listings.

Capital Gains

The amount of net gain made on the sale of property.

Citation (Cite)

Legal shorthand for referring to cases, statutes, regulations and ordinances.

Commitment

In real property, an agreement in advance to loan a certain sum of money.

Consideration

The detriment given by each party to a contract; e.g. the land by the seller and the money by the buyer.

Contract for Deed

Another name for an installment contract; financing transaction in which seller carries the buyer and holds on to title until the buyer has paid in full.

Cooperative

Form of multiunit housing in which a corporation owns the property and owners of the shares in the corporation live in each of the units.

Co-ownership

Label given to ownership of property by more that one person.

Corporation

Form of doing business that provides limited liability to the owners, continuity of operation and centralized management.

Counterclaim

Claim made by the Defendant against the Plaintiff in a lawsuit.

Covenant

Promise in a deed that affects or limits the use of the conveyed property.

Curtesy

Right of a husband to a life estate in all real property owned by his wife during their marriage provided they had children.D-H [top]

Declaration of Condominium

Master Deed for condominium project; the document recorded to reflect the units involved on the real property.

Deed

Instrument used to convey title to real property.

Deed in Lieu of Foreclosure

Process of borrower-property owner surrendering title to property to prevent lender foreclosure.

Deed of Trust

Security interest in real property in which title is held by a trustee until the borrower and occupant of the land repays the beneficiary (lender) in the amount of the loan.

Devise

Gift of real property by will.

Dower

Rights of a wife to one-third interest in all real property owned by her husband during the course of the marriage; wife must survive husband to be entitled to dower rights.

Due Process

Constitutional protection requiring full adjudication of issues and rights before property may be taken.

Easement

Right to use another’s property for access, light, etc..

Easement Appurtenant

Easement that benefits a particular tract of land; generally an access easement or right of way.

Easement in Gross

An easement that does not benefit a particular tract of land; e.g. utility easements that run through all parcels of land in an area.

Eminent Domain

Process of governmental entity taking title to private property for public purposes.

Environmental Protection Agency (EPA)

Governmental agency responsible for the enforcement of environmental laws.

Escheat

Process whereby property of a decedent is given to the state because of no available heirs.

Escrow

Process whereby details of property transfer, payments, and deed conveyance are handled by a third party.

Executor

Male party responsible for the probate of a decedent’s estate pursuant to the decedent’s will.

Executory Interest

Future interest that is not a remainder and not an interest in the grantor.

Executrix

Female party responsible for the probate of a decedent’s estate pursuant to the decedent’s will.

Fee

Term to refer to an inheritable interest in land.

Fee simple

Highest land interest; full title; right to convey or transfer by will or mortgage without restriction.

Fee simple absolute

Another term for fee simple.

Fee simple defeasible

A fee simple estate that can be lost by violation of a condition or use restriction placed in the transfer by the grantor.

Fee simple determinable

Full title to land so long as certain conduct is avoided; e.g., “To A so long as the premises are never used for a bar.”

Fee simple subject to a condition subsequent

Full title provided that there is compliance with a condition; e.g., “To A upon the condition that the property is used for school purposes.”

Fee tail

Full title restricted in its passage to direct descendants of the owner.

Fiduciary

Party in position of trust and confidence with another; agent or trustee.

Financing Statement

Document filed to protect a security interest; must contain information about the parties and description of the collateral.

Fixtures

Personal property that becomes attached to and is so closely associated with real property that it becomes a part of the real property.

Foreclosure

Process of selling mortgaged property to satisfy the debt owed by the defaulting mortgagor.

Forfeiture

Loss of rights; in a contact for deed, the loss of all interest in the property for nonpayment.

Freehold

Estates uncertain or unlimited in their duration.

Gift

Transfer of property without consideration with donative intent and by actual or constructive delivery.

Grantee

Person to whom land is conveyed.

Grantor

Person conveying title to land.

Hazardous Substance Response Trust Fund

Fund created under federal environmental laws; known as the Superfund for use in clean-up of toxic waste.

Heirs

Persons entitled to a portion of a decedent’s estate.

Homestead

Debtor protection that entitles the debtor to a certain amount in real property that is exempt from attachment by creditors.I-L [top]

Injunction

Equitable remedy; court order requiring a party to perform an act or cease certain conduct; e.g. to stop trespassing.

Installment Land Contract

A contract for deed; method of selling property in which the seller serves as the financier for the buyer and the purchase; seller holds onto the title until there has been payment in full under an installment payment plan.

Interstate Land Sales Full Disclosure Act (ILSFDA)

Federal law regulating the sale of property across state lines; requires advance filing of sales of minerals, mandatory disclosure of certain information, and prohibitions on promises about the land’s future development.

Inter Vivos

During the life; while alive; e.g., an inter vivos gift.

Intestate

Death without a will.

Intestate succession

Statutory method for distributing the property of those who die without a will (intestate).

Involuntary lien

Lien that does not result from a contractual arrangement; e.g., a tax lien or a judicial lien.

Joint tenancy

Method of co-ownership that gives title to the property to the last survivor.

Lease

Agreement between the owner of land and another for the use and occupation of the land.

Lease-purchase

Financing method that permits potential buyers to lease property for a period with an option to buy.

Legacy

Gift of money by will.

License

Revocable right to enter another’s property.

Lien

Interest in real property that serves as security for repayment of debt.

Life Estate

Interest in land that lasts for the life of the grantee.

Life tenants

Those who hold a life estate in property.

Limited partnership

A partnership with at least one general partner in which limited partners can purchase interest and be held liable only to the extent of their interest and not risk personal liability.

Lis pendens

“Suit or action pending”; document recorded with the land records to indicate a suit involving the land is pending.M-N [top]

Marketable Title

Form of title generally required to be delivered at the sale of property; property is free from liens and no defects in title other than those noted or agreed to.

Master Deed

In a condominium development, the document recorded to reflect the location of the project and the individual units.

Master Plan

General plan for zoning.

Mechanic’s liens

Liens placed on real property to secure the amount due to those who performed the work or supplied materials for improvements or other projects on the land.

Metes and bounds

Method of land description that begins with a permanent object and then through distances and directions describes the parcel of land.

Mortgage

Lien on real property used to secure a debt.

Mortgagee

Lender, or party who holds the mortgage lien.

Mortgagor

Borrower, or party occupying land that is mortgaged.

Mutual will

Wills of parties that are reciprocal in their distribution; usually based on a contract to make a will; generally enforceable.

National Pollution Discharge Elimination System

Permit system that requires EPA approval for water discharges.

Negative Easement

An easement that prohibits a property owner from doing something that affects the property of another.

Nonconforming use

In zoned areas, a use that does not comply with the area’s zoning but that existed prior to the time the zoning was effective.

Noncumulative classifications

Method of zoning in which use in a particular area is limited to the zoned use; e.g., industrial zones cannot include residential buildings and apartment areas cannot include single-family dwellings.

Nonfreehold estates

Land interests that are limited and certain in their duration.

Notice statute

Form of recording statute that gives later bona fide purchasers priority in the case of multiple purchases for the previous purchaser’s failure to give notice by recording their transactions.O-S [top]

Offer

Initial communication in contract formation that, if accepted, results in the formation of a contract.

Open listing

Listing that pays commission to whichever broker or salesperson sells the property; permits the owner to list with more that one broker and be liable for only one commission.

Option

Right to purchase property during a certain period of time. This right is paid for with consideration.

Ordinances

Laws passed on a local level of county, state or city governments.

Per stirpes

Method of distributing property to heirs whereby those closer in relation to the decedent receive greater shares.

Plat map

Method of land description that relies on a recorded map of a subdivision, with each deed making reference to the map and the particular lot being conveyed.

Posthumous heirs

Heirs born after the death of the decedent.

Premises

The words of conveyance in a deed; e.g., “do hereby grant and convey.”

Prepayment penalty

Clause in mortgage or promissory note that requires the mortgagor to pay an additional charge for paying off the loan early.

Prescription

Process of acquiring an easement through adverse use of the easement over a required period of time.

Probate

Process of collecting the assets of a decedent; paying the decedent’s debts, determining the decedent’s heirs, and distributing the property to the heirs.

Promissory note

Two-party debt instrument that, in real estate, is generally secured by a mortgage or a deed of trust or some other interest in real estate.

Purchase money mortgage

A mortgage used to secure a debt for the funds used to buy the mortgaged property.

Quasi-easement

A right-of-way as it existed when there was unity of ownership in a parcel of land.

Quiet title action

Court action brought to determine the true owner of a piece of land.

Quitclaim deed

Deed that serves to transfer title if the grantor has any such title; there are no guarantees that the grantor has any title or good title.

REIT

Real estate investment trust – form of real estate syndication in which investors hold trust estates and enjoy profits of trust’s real estate holdings.

RESPA

Real Estate Settlement Procedures Act – federal statute regulating disclosure of closing costs in advance and prohibiting kickbacks for referring customers to title companies.

Recording

Process of placing a deed or other document on the public records to give notice of a transaction or interest in land.

Refinancing

Negotiating a new loan for real estate; generally done to obtain a lower rate or in the case of a sale to allow the buyer to purchase the property.

Regulation Z

Truth in Lending – The Federal Reserve Board’s regulations on disclosures in all types of credit transactions.

Remainders

Future interests in someone other that the grantor; a remainder follows a life estate.

Recession

Right to treat a contract as if it never existed; rescind contract rights; generally appropriate in cases of fraud and misrepresentation.

Reversion

Future interest in grantor that results after life estate terminates and no remainder interest was given.

Right of Entry

Future interest in grantor that results after the life estate terminates and no remainder interest was given.

Right of Redemption

In mortgage foreclosures, the right of the mortgagor to redeem his or her property for six months after the foreclosure sale by paying off the debts and costs of the foreclosure.

Rule against perpetuities

Rule that prohibits the control of estates from the grave; provides a cap on use restrictions on contingent remainders and executory interests.

Security deposit

In a lease, the amount of money prepaid by the tenant to secure performance of a lease and often provides the amount of liquidated damages if the tenant does not perform.

Self-proving will

A will that is acknowledged or notarized and thereby enjoys the presumption of validity.

Servient estate or tenement

Land through which an easement runs or which is subject to the easement.

Sheriff’s Deed

Form of title given to a buyer at a mortgage foreclosure sale; carries no warranties.

Soldier’s and Sailor’s Civil Relief Act

A Federal law that provided time limitations on foreclosures involving those in active military service.

Special Warranty Deed

Deed that provides warranty of title only for the period during which the grantor owned the property.

Specific performance

Equitable remedy that requires a party to a contract to perform the contract promise or promises.

Statute of Frauds

Statue dictating what types of contracts must be in writing to be enforceable. Contracts concerning real estate must comply with the statute of frauds.

Subdivision

Parcel of land developed with building lots, streets, homes, parks, etc…

Sublease

Arrangement in which a tenant leases rental property to another, and the tenant becomes the landlord to the subtenant.

Subordinate mortgage

Mortgage with a lesser priority than a preexisting mortgage.

Surety

One who stands as a guarantor for an obligation; as in payment or performance bond.T-Z [top]

Taking

Term used to describe the government action of using private property for public purposes.

Tax Deed

Form of title given in the event property is sold to satisfy taxes; carries no warranties.

Tax lien

Lien placed on property for amount of unpaid taxes.

Tax sale

Foreclosure sale on property for nonpayment of taxes.

Tenancy by the entirety

Form of co-ownership between a husband and wife; a joint tenancy. Husband and wife each own the entire property.

Tenancy in common

Simplest form of co-ownership. Each owner owns their percentage of the property.

Testamentary

Disposition by will.

Time-sharing properties

Form of multiunit housing in which owners own the unit for a limited period of time during each year.

Title abstract

Summary of the history of title to a parcel of land.

Title Insurance

Insurance that pays the buyer of property in the event certain title defects arise.

Title Theory

Theory of mortgage law that puts title in the mortgagee and possession in the mortgagor.

Torrens system

System for recording land titles designed to prevent the selling of the same parcel of land to more that one person.

Tract Index

Form of land record that keeps history of title through identifications within the particular tract.

Trustee

Third party responsible for handling the property of another; as in deed of trust or real estate investment trust.

UCC

Uniform commercial code – uniform statute adopted in most states that governs commercial transactions; Article IX deals with security interests and fixtures.

Usury

Charging interest rates in excess of the statutory allowed maximums.

Variances

Approved uses of land outside the scope of an area’s zoning.

Vested remainder

A remainder that will automatically take effect when the life estate ends.

Voluntary lien

A lien created because of a contract as opposed to a tax lien, which is involuntary.

Warranty Deed

Deed that conveys title and carries warranties that the title is good, the transfer is proper, and there are no liens and encumbrances other than the ones noted.

Warranty of habitability

Warranty given by landlords in residential leases that the premises are in good living condition, and by builder of new homes that the homes are free of major defects.

Will

Document used to specify the transfer of property after the testator’s death.

Wrap-around mortgage

Mortgage given to a seller wherein the buyer will make the amount of existing payments on property to the seller along with payments on the amount of the selling price that is in excess of the mortgage amount.

Zoning

Process of regulating land-use by designating areas of a community for certain uses.