| GLOSSARY
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:
To relinquish or give up a right or any further interest.
ABSTRACT OF JUDGMENT: A condensation or summary
of the essential provisions of a court judgment.
ABSTRACT OF TITLE: A condensed history or
a summary of the condition of title based on an examination of public
records.
ACCELERATION CLAUSE: A clause in an installment
note or trust deed permitting the payee or beneficiary to declare
the entire unpaid balance immediately due and payable upon the occurrence
of a stated event, such as the failure to pay an installment when
due.
ACCESS RIGHT: The right of an owner of land
to have ingress and egress to and from his property to a public
street.
ACTUAL NOTICE: Notice which a party has received
in fact or in reality, as compared with constructive notice which
is implied or inferred.
ADMINISTRATOR: A person appointed by a probate
court as the representative of a decedent’s estate where the
decedent left no will.
ADVANCES: Money advanced by the beneficiary
under a trust deed to pay real estate taxes, hazard insurance premiums,
and other items needed to protect the beneficiary’s interest
under the trust deed.
AFFIDAVIT: A written sworn statement made
before an authorized official.
AFFIDAVIT OF DEATH OF JOINT TENANT: The sworn
statement recorded to evidence the death of a person whose title
to property is held in joint tenancy.
AGENCY: The contractual relationship between
a principal and an agent in which the agent is employed to act on
behalf of the principal in dealings with third parties.
AGENT: A person who acts on behalf of a principal.
A.K.A.: This abbreviation refers to “also known as”
and is used in instances where confusion exists concerning the identity
of a party on the vesting.
ALIENATION CLAUSE: A clause in a note or trust
deed permitting the payee or beneficiary to declare the entire balance
immediately due and payable upon a transfer of the property. Also
referred to as a "due on sale" clause.
A.L.T.A.: American Land Title Association,
commonly used in reference to a form of title policy required by
lenders.
AMORTIZATION: Paying on an installment basis
at stated times for a stated period until the debt is paid in full.
APPRAISAL: An opinion as to the fair market
value of property.
ASSESSED VALUE: Value placed on property as
a basis for taxation.
ASSESSMENTS: Special taxes imposed to pay
for public improvements beneficial to a limited area.
ASSIGNEE: The person being assigned the position.
For example, in a sale transaction, the Buyer’s Assignee will
complete the transaction in place of the Buyer.
ASSIGNMENT: A transfer in writing of a person’s
interest.
ASSIGNOR: The person who assigns or transfers
property.
ASSUMPTION: The taking over by one party of
an obligation that was originally incurred by another, as in the
assumption of an existing trust deed by the new owner when property
is sold.
ATTORNEY-IN-FACT: An agent authorized to act
for another as granted in a Power of Attorney document.
return to top
B
BALLOON PAYMENT: The final
payment on an installment note which is greater than the preceding
payments and which pays the note in full. Also, a payment that exceeds
the normal payment program.
BENEFICIARY: As used in a trust deed loan,
the Beneficiary is the lender. The Beneficiary is the party who
obtains the benefit of the security.
BENEFICIARY DEMAND: A statement setting forth
the amount required to payoff a loan in full.
BENEFICIARY STATEMENT: A statement supplied
by a lender for purposes of verifying the loan balance, present
status, and terms of the loan. In the case of a sale transaction
in which the buyer is assuming the loan, the statement will often
provide the lender’s loan transfer requirements and a list
of required transfer fees.
BILL OF SALE: A written instrument evidencing
the transfer of title to personal property.
BINDER: A report issued by a title insurance
company binding or committing the title insurance company to issue
a policy within a specified time.
BLANKET MORTGAGE OR TRUST DEED: A mortgage
or trust deed which covers more than one lot or parcel of real property,
often an entire subdivision.
return to top
C
C.A.R.: California Association
of Realtors. This Association guides the activities of the real
estate licensees in the State of California.
C.C. & R’s: Covenants, Conditions
and Restrictions are those matters that limit the use and enjoyment
of property usually by agreements contained in deeds and other documents.
C.E.A.: California Escrow Association. An
active, State-wide organization providing guidance and services
for escrow personnel, including training seminars and materials.
CHAIN OF TITLE: The sequence of ownership
or title on the property as evidenced by a chronological list of
recorded instruments affecting the title to land.
CLOUD ON TITLE: A defect in chain of title
or in documentation keeping the title from being clear and easily
conveyed.
COLLATERAL: The item used to secure a loan
to assure the lender of repayment or provide a source of repayment
in the event of default.
COMMUNITY PROPERTY: Property acquired by husband
or wife or both during marriage when not acquired as separate property.
CONDOMINIUM (CONDO’S): A form of ownership
of a property wherein certain parts (units) of the property are
in fee title to individuals and a portion of the property is owned
“in common” with the other owners.
CONFIRMATION OF SALE: Court approval of the
sale of property by an executor, administrator, guardian or conservator.
CONSERVATOR: A person appointed by the court
to take care of the person or property of an adult person needing
such care.
CONSIDERATION: The inducement for entering
into a contract sometimes known as the sales price.
CONSTRUCTIVE NOTICE: Notice given by the public
records of a claim of ownership or interest in property.
CONTINGENCY: A condition of closing which
is dependent upon an uncertain future event. Such conditions may
prevent close of escrow by one of the principals in the event the
contingency cannot be removed, such as Buyer obtaining a new loan,
a Seller being able to purchase a new house, or a Buyer being able
to sell an existing house.
CONTRACT: An agreement by which a person undertakes
to do or not to do a certain thing.
CONVENTIONAL LOAN: A mortgage loan which is
not insured or guaranteed by a governmental agency.
CONVEYANCE: A written instrument transferring
the title to or interest in real estate from one person or entity
to another.
CORPORATION: An artificial being, created
by law, possessing certain rights, privileges, and duties of natural
persons.
return to top
D
DECLARATION OF HOMESTEAD: Document
recorded by a homeowner to protect his home from a forced sale up
to a prescribed amount in satisfaction of certain types of creditors.
DECREE: A type of court order.
DEED: Written instrument by which the ownership
of land is transferred from one person to another.
DEED OF TRUST: Written instrument by which
title to land is transferred to a trustee as security for a debt
or other obligation. Also known as a trust deed.
DEFAULT: Failure to perform a duty or to discharge
an obligation.
DEPOSIT RECEIPT: A document used when accepting
“earnest money”
DOCUMENTARY TRANSFER TAX: A State tax on the
sale or conveyance of real property located in any county in the
state. Applies when the consideration exceeds $100. Tax is computed
at the rate of $.55 for each $500.00 of consideration or fraction
thereof. Some cities have their own City Transfer Taxes.
D.R.E.: Department of Real Estate. The agency
which regulates real estate licensees and the sale of property by
developers in the State of California.
DUE-ON-SALE CLAUSE: A provision in a real
estate loan calling for automatic maturity at the lender’s
option upon the sale or transfer of the real property to a third
party. Also called an alienation clause or acceleration clause.
return to top
E
EARNEST MONEY: Funds given
as a part of the purchase price to bind a bargain, usually the initial
good faith deposit of the Buyer.
EASEMENTS: A right or interest in the land
of another which exists apart from the ownership of the land, such
as a right to cross over another person’s property. Examples
include utilities easements and ingress and egress easements.
EGRESS/INGRESS: An easement right of way for
egress (exit) and ingress (entry) to a property owned by another.
EMINENT DOMAIN: The right or power of the
government to take property for a public purpose upon payment of
just compensation.
ENCROACHMENT: The extension of an improvement
onto the property of another, for example, a garage, fence or driveway
that crosses over a lot line.
ENCUMBRANCE: A lien or charge on a property
encumbering the subject parcel.
ENDORSEMENT: As to a title insurance policy,
a rider or attachment forming a part of the insurance policy expanding
or limiting coverage. Endorsement also refers to the act of signing
a name of the back of a check or promissory note to evidence its
transfer.
EQUITY: Property value in excess of mortgages and other liens.
ESCHEAT: The transfer of unclaimed funds to
the State of California.
ESCROW: A transaction in which an impartial
third party (escrow holder) acts upon written instructions for both
seller and buyer (or for borrower and lender) by holding and delivering
documents and disbursing funds when certain conditions have been
fulfilled.
ESCROW ACCOUNT: An account in which the borrower’s
monthly deposits for taxes, hazard insurance, and mortgage insurance,
if any, are held in trust by the lender for the future payment of
these items as they become due. Also known as an Impound Account.
ESCROW ANALYSIS: The periodic examination
of escrow accounts to determine if monthly deposits will provide
sufficient funds to pay tax and insurance bills when due.
ESCROW HOLDER: The escrow officer, escrow
company or escrow agent.
EXECUTOR: A person who is designated in a
will as the representative of a decedent‘s estate.
EXECUTRIX: Feminine of executor.
return to top
F
FIDUCIARY: One who holds
a position of trust and confidence. As an example: an escrow holder.
FORECLOSURE: A proceeding to enforce a lien
by a sale of the property in order to satisfy the debt.
return to top
G
GRANT: A transfer of real
property.
GRANT DEED: A written instrument transferring
title to real property.
GRANTEE: The person to whom a grant is made.
GRANTOR: The person who makes a grant.
GUARDIAN: A person appointed by the court
to care for the person or estate of a minor or incompetent person.
return to top
H
HOMESTEAD: A residence upon
which the owner has recorded a Declaration of Homestead under California
law.
HYPOTHECATE: To mortgage or pledge without
delivery of the security to the lender. To give something as security
without parting with possession.
return to top
I
IMPOUND ACCOUNT: Funds retained
by a lender to cover such items as taxes and hazard insurance premiums.
Also known as Escrow Account.
INDEMNITY: Insurance against possible loss
or damage. A title insurance policy is a contract of indemnity.
INSTALLMENT NOTE: A promissory note providing
for payment of the principal in two or more fixed amounts at different
stated times.
INSURANCE CERTIFICATES: On condominium or
townhome properties, an insurance certificate is the evidence that
the unit owner and lender, if any, are insured under the terms of
a Master Insurance Policy.
return to top
J
JOINT TENANCY: Title held
by two or more persons in equal shares with right of survivorship.
JOINT VENTURE: A business undertaking by two
or more persons to conduct a single enterprise for profit.
JUDGMENT LIEN: A statutory lien created by
recording an abstract of judgment.
JUNIOR LIEN: A subordinate lien.
JURAT: The sworn statement form of the notary
public certificate. The clause at the end of an affidavit with the
date, location and person before whom the statement was sworn.
return to top
L
LAND SALES CONTRACT: A contract
used in connection with the sale of real property where the seller
retains legal title until all or a certain part of the purchase
price is paid by the buyer.
LEASE: A contract for the possession of land
in consideration of payment of rent.
LEASEHOLD INTEREST: Having possession of a
property by virtue of a Lease.
LESSEE: The tenant under a lease.
LESSOR: The landlord under a lease.
LIEN: A charge, claim, or liability upon property
for the payment of a debt or performance of an obligation. Examples
include taxes, special assessments, judgments, mortgages, and mechanic's
liens.
LIFE ESTATE: An estate measured by the life
of a natural person.
LIMITED PARTNERSHIP: A partnership composed
of partners whose contribution and liability are limited.
LIQUIDATED DAMAGES: An agreed-to sum of money
to be paid under a contract in the event of a breach where it would
be difficult to prove the amount of actual damages.
LIS PENDENS: A legal notice recorded against
property to show that litigation is pending, typically used to control
or stop the transfer of the property when a conflict arises between
parties in a transaction.
return to top
M
MECHANIC'S LIEN/CONTRACTOR'S LIEN:
A statutory lien in favor of laborers and suppliers who have
contributed to a work of improvement.
MORTGAGE: A written document executed by the
owner of land by which the land is given as security for the payment
of a debt or performance of an obligation.
MORTGAGEE: The party who obtains the benefit
of a mortgage.
MORTGAGOR: The party who executes a mortgage.
MUTUAL WATER COMPANY: A water company organized
by or for the benefit of water users in a given district with the
object of securing an ample water supply at a reasonable rate. Shares
of stock are issued to the users.
return to top
N
NOMINEE: A party designated
to act in place of the original buyer in a real estate transaction.
NOTE: A written acknowledgment of a debt by
a borrower including a promise of payment in accordance with specified
terms. Also known as Promissory Note.
NOTICE OF DEFAULT: Recorded notice that a
default has occurred under a deed of trust.
NOTICE OF SALE: A notice recorded by the Trustee
of a Deed of Trust stating that a foreclosure action has begun and
giving the date of the proposed foreclosure sale.
return to top
O
OFFSET STATEMENT/ESTOPPEL CERTIFICATE:
Statement obtained to verify or substantiate terms of an
agreement or sums of money. As an example: A Tenant Offset or Estoppel
is a statement signed by the Tenant giving monthly rental sum, security
deposits, last month rent paid, and describing any special agreements
with the Lessor (Landlord).
return to top
P
PARTNERSHIPS: A voluntary
association of two or more persons to carry on as co-owners of a
business for profit.
PERSONAL PROPERTY: Movable property such as
furniture, clothing, or a car. Property which is not real property.
PLAT MAP: A drawing giving the general physical
lay-out of the land covered and included in the preliminary title
report.
P.M.I.: Private Mortgage Insurance. It is
obtained by a lender at the borrower's expense as insurance covering
the payment of the loan.
POWER OF ATTORNEY: A document authorizing
another to act on one's behalf as his agent.
PRELIMINARY TITLE REPORT: The initial report
issued by a title insurer reflecting results of the search of title.
This report sets out the terms upon which a title insurer is willing
to insure the title, provides a description of the property, the
vesting of the title, and any liens and encumbrances against which
the company is not willing to insure.
PREPAYMENT PENALTY: A provision in a note
providing for the payment of a penalty in the event the note is
paid off prior to its due date
PRINCIPAL: One who employs an agent to act
on his behalf, such as the seller and buyer in an escrow transaction.
Also, an amount of debt or the face value of a note or mortgage.
PROBATE: The official proving of a will as
authentic or valid in a probate court.
PROPERTY PROFILE: A informational package
furnished by title companies to real estate agents which usually
provides copies of the current vesting deed, the tax parcel number,
copies of trust deeds, and a plat map.
PRORATE: To divide equally or proportionately
as to the time of use. In a sales escrow, it is the custom to prorate
taxes, interest, rents, and hazard insurance premiums between buyer
and seller in accordance with the respective periods of ownership.
PUBLIC REPORT: A report issued by the Department
of Real Estate containing information of interest to a buyer about
newly subdivided property.
PURCHASE MONEY DEED OF TRUST: A deed of trust
to secure payment of all or a portion of the purchase price of real
property.
return to top
Q
QUALIFIED INTERMEDIARY: A
person or entity serving as an intermediary in an exchange transaction.
QUIET TITLE: A legal action to establish title
to real property usually used to obtain clear title on a property
that is clouded by an issue of title.
QUITCLAIM DEED: A deed which conveys whatever
present right, title or interest the grantor may have in real property
but not containing any warranty of a valid interest on title in
the grantor.
return to top
R
REAL PROPERTY: Land and
buildings affixed to the land, including the air space above and
mineral rights below, as opposed to personal property or chattels.
RECONVEYANCE: A document releasing the lien of a deed of trust.
RECORDATION: Filing a document for record
in the office of the county recorder, thereby making the document
part of the public record.
RENT STATEMENT: A detailed statement provided
by the seller covering the rental income of a property and amounts
of deposits. The statement is used in escrow for rent proration
purposes and for making adjustments between the parties for deposits.
REQUEST FOR NOTICE OF DEFAULT: A notice recorded
by the holder of a junior lien requesting that he be notified in
the event that a Notice of Default is recorded under a senior deed
of trust. If the deed of trust is foreclosed, the person requesting
the notice will be notified of the foreclosure by the trustee processing
the foreclosure.
R.E.S.P.A.: The Real Estate Settlement Procedures
Act enacted by Congress in 1974, provides protective measures for
borrowers, including establishing the manner in which closing costs
are disclosed. Lenders are required to use the R.E.S.P.A. settlement
statement at closing. In common usage, this form is called a 'H.U.D."
statement.
RIGHT OF WAY: A right to cross over a parcel
of land.
return to top
S
SATISFACTION OF JUDGMENT:
Evidence of the payment in full of a judgment lien.
SECURITY DEPOSIT: A deposit made to assure
performance of an obligation, usually by a lessee.
STATEMENT OF INFORMATION FORM: A brief statement
of facts relied upon by title insurers to assist in the proper identification
of persons.
SUBESCROW AGENT: An approved agent to receive
and disburse funds on behalf of the escrow holder or a lender, usually
the title company named in the escrow.
SUBORDINATION: The procedure of allowing a
new loan or obligation to take priority over an existing encumbrance.
SUBORDINATION AGREEMENT: An agreement under
which a prior lien is given a lower priority to an otherwise junior
lien.
SURVEY: A map or plat containing a statement
of courses, distances and quantity of land and showing boundary
lines of real property. Also, a process of measuring a parcel of
land and ascertaining its area and boundaries.
SWING LOAN: A short-term loan obtained on
a Seller's equity for the purpose of purchasing a second property.
return to top
T
TAX SERVICE: A service which
provides notification to a lender of whether or not a borrower is
paying the real property taxes. Companies who perform this service
audit the tax rolls and issue notices to lenders when taxes are
delinquent.
TENANCY IN COMMON: Ownership of property by
two or more persons in an undivided interest without right of survivorship.
TITLE: The evidence of ownership.
TITLE INSURANCE: An insured statement of the
condition of title or ownership of real property. For a one-time-only
premium, the named insured and their heirs are protected against
title defects, liens, and encumbrances existing as of the date of
the policy and not specifically excluded from coverage. In the event
of a claim, the title company provides legal defense for the policyholder
and pays any covered losses incurred as a result of such claim.
TRUST: A fiduciary relationship in which one
party (trustee) holds the title to property for the benefit of another
party (beneficiary).
TRUST AGREEMENTS: A fiduciary relationship
in which a trustee holds title to property for the benefit of a
beneficiary.
TRUST DEED: A three-party security instrument
conveying title to land as security for the performance of an obligation.
The three parties are the Trustor (borrower), Trustee (acts only
at time of payoff and in case of foreclosure), and Beneficiary (lender).
TRUSTEE: The acting principal named in a Trust
Agreement or the third party named in a trust deed.
TRUSTEE'S DEED: In a case of a foreclosure,
the deed given by the trustee under a deed of trust when the property
is sold under the power of sale. TRUSTOR: The person who conveys
property in trust or the borrower under a deed of trust.
return to top
U
UNINCORPORATED AREA: Property
located outside the limits of any city.
UNLAWFUL DETAINER: A legal action to recover
possession of real property.
USURY: Charging more interest than the law
allows on a loan.
return to top
V
VEST: To give title to
or to pass ownership to property.
return to top
W
WILD DOCUMENT: A commonly
used expression for a document that is recorded against a property
but seems to have no basis for application or connection with the
property.
WILL: A disposition of property effective
upon the maker's death often referred to as a "last will and testament".
return to top
Z
ZONING: Governmental regulations
relating to the use of real property.
return to top
|
