Search topic

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
Adjustable-rate mortgage
There are two types of conventional loans: the fixed-rate and the adjustable-rate mortgage. In an adjustable-rate mortgage the interest rate can change over the course of the loan at five seven or ten year intervals. For homeowners who plan to stay in their home for more than a few years this is a risky loan as rates can suddenly skyrocket depending on market conditions.
Assessed value
This is how much a home is worth according to a public tax assessor who makes that determination in order to figure out how much city or state tax the owner owes.
A/I
A contract that is pending with attorney and inspection contingencies.
Accompanied showings
Those showings where the listing agent must accompany an agent and his or her clients when viewing a listing.
Addendum
An addition to; a document.
Adjustable rate mortgage (ARM)
A type of mortgage loan whose interest rate is tied to an economic index which fluctuates with the market. Typical ARM periods are one three five and seven years.
Agent
The licensed real estate salesperson or broker who represents buyers or sellers.
Amended value
The actual sale price after the seller successfully markets and sells his or her home through the broker of his or her choice. The sale is turned over to a third-party relocation company for closing and the guaranteed offer is amended or changed.
Annual percentage rate (APR)
The total costs (interest rate closing costs fees and so on) that are part of a borrower’s loan expressed as a percentage rate of interest. The total costs are amortized over the term of the loan.
Application fees
Fees that mortgage companies charge buyers at the time of written application for a loan; for example fees for running credit reports of borrowers property appraisal fees and lender-specific fees.
Appointments
Those times or time periods an agent shows properties to clients.
Appraisal
A document of opinion of property value at a specific point in time.
Appraised price (AP)
The price the third-party relocation company offers (under most contracts) the seller for his or her property. Generally the average of two or more independent appraisals.
As-is
A contract or offer clause stating that the seller will not repair or correct any problems with the property. Also used in listings and marketing materials.
Assumable mortgage
One in which the buyer agrees to fulfill the obligations of the existing loan agreement that the seller made with the lender. When assuming a mortgage a buyer becomes personally liable for the payment of principal and interest. The original mortgagor should receive a written release from the liability when the buyer assumes the original mortgage.
Abutting
The joining, reaching, or touching of adjoining land. Abutting parcels of land have a common boundary.
Assignment
The transfer in writing of rights or interest in a bond, mortgage, lease, or other instrument.
Abandonment
The voluntary and permanent cessation of use or enjoyment with no intention to resume or reclaim one’s possession or interest. May pertain to an easement of a property.
Abstract of title
A condensed version of the history of a title to a particular parcel of real estate as recorded in the county clerk’s records; consists of a summary of the original grant and all subsequent conveyances and encumbrances affecting the property.
Accelerated depreciation
A method of calculating for tax purposes the depreciation of income property at a faster rate than would be achieved using the straight-line method. Any depreciation taken in excess of what would be claimed using the straight-line rate is subject to recapture as ordinary income to the extent of the gain resulting from the sale.
Acceleration clause
A provision in a written mortgage, note, bond, or conditional sales contract that in the event of default, the whole amount of the principal and the interest may be declared due and payable at once.
Accession
Title to improvements or additions to real property is acquired as a result of the accretion of alluvial deposits along the banks of streams or as a result of the annexation of fixtures.
Accretion
An increase or addition to land by the deposit of sand or soil washed up naturally from a river, lake, or sea.
Accrued depreciation
The actual depreciation that has occurred to a property at any given date; the difference between the cost of replacement new (as of the date of the appraisal) and the present appraised value.
Acknowledgment
A declaration made by a person to a notary public or other public official authorized to take acknowledgments that an instrument was executed by him or her as a free and voluntary act.
Actual eviction
The result of legal action originated by a lessor, by which a defaulted tenant is physically ousted from the rental property pursuant to a court order.
Actual notice
Express information or fact; that which is known; actual knowledge.
Administrator
The party appointed by the county court to settle the estate of a deceased person who died without leaving a will.
Ad Valorem tax
A tax levied according to value; generally used to refer to real estate tax.
Adverse Possession
The actual, visible, hostile, notorious, exclusive, and continuous possession of another’s land under a claim to title. Possession for a statutory period may be a means of acquiring title.
Affidavit
A written statement signed and sworn to before a person authorized to administer an oath.
Agent
One who represents or has the power to act for another person (called the principal). The authorization may be express, implied, or apparent. A fiduciary relationship is created under the law of agency when a property owner, as the principal, executes a listing agreement or management contract authorizing a licensed real estate broker to be her or his agent.
Agreement of sale
A written agreement by which the purchaser agrees to buy certain real estate and the seller agrees to sell, on the terms and conditions set forth in the agreement.
Air lot
A designated airspace over a piece of land. Air lots, like surface property, may be transferred.
Air rights
The right to use the open space above one’s property. It can be sold to build a skywalk or for a utility company to erect power lines.
Alienation
The act of transferring property to another. Alienation may be voluntary, such as by sale, or involuntary, such as through eminent domain.
Alienation clause
Clause in a mortgage instrument that does not all the borrower to sell (without lender approval) on assumption or contract-for-deed. If an attempt is made to do so without prior approval, all of the mortgaged balance becomes due on the sale of the property.
Alluvion
The actual soil increase resulting from accretion.
Amendments
Changes to previously approved and adopted written agreements are amendments.
Amenities
Neighborhood facilities and services that enhance a property’s value. They are always outside of the property. Swimming pools, three-car garages, decks, etc., that are on the property are called features.
Americans with Disabilities Act (ADA)
A federal law, effective in 1992, designed to eliminate discrimination against individuals with disabilities.
Amortization
The liquidation of a financial burden by installment payments, which include principal and interest. This is the process of combining both interest and principal in payments, rather than simply paying off interest at the start. This allows you to build more equity in the home early on.
Amortized loan
A loan in which the principal and interest are payable in monthly or other periodic installments over the term of the loan.
Anticipation
An appraising principle created by the expectation of certain future events causing values to either increase or decrease.
Antitrust laws
The laws designed to preserve the free enterprise of the open marketplace by making illegal certain private conspiracies and combinations formed to minimize competition. Violation of antitrust laws in the real estate business generally involves either price fixing (brokers conspiring to set fixed compensation rates) or allocation of customers or markets (brokers agreeing to limit their trades or dealings to certain areas or properties).
Appraisal
An estimate of the quantity, quality, or value of something. The process through which conclusions about property value are obtained; also refers to the report that sets forth the process of estimation and conclusion of value.
Appraised value
An estimate of a property’s present worth.
Appreciation
An increase in the worth or value of a property, due to economic or related causes, which may prove to be either temporary or permanent.
Appurtenant
Belonging to; incident to; annexed to.
Arbitrage
The simultaneous purchase and sale of a security with the purpose of obtaining a higher yield from the differential between its acquisition and selling price.
Arbitration
A means of settling a controversy between two parties through the medium of an impartial third party whose decision on the controversy (if agreed upon) will be final and binding.
Assessment
The imposition of a tax, charge, or levy, usually according to established rates.
Assumed name statute
The law, in effect in most states, that stipulates that no person shall conduct a business under any name other than his or her own individual name, unless such person files the desired name with the county clerk in each county where the business is conducted. In the case of brokers and salespeople, statement of such filing should be submitted to the state’s real estate commission.
Assumption of mortgage
The transfer of title to property to a grantee, by which the grantee assumes liability for payment of an existing note secured by a mortgage against the property. Should the mortgage be foreclosed and the property sold for a lesser amount than that due, the grantee/purchaser who has assumed and agreed to pay the debt secured by the mortgage is personally liable for the deficiency. Before a seller may be relieved of liability under the existing mortgage, the lender must accept the transfer of liability for payment of the note.
Attorney-in-fact
The holder of a power of attorney.
Attorney’s opinion of title
An instrument written and signed by the attorney who examines the title, stating her or his opinion as to whether a seller may convey good title.
Avulsion
A sudden tearing away of land by the action of natural forces. Real estate terms that begin with B
Annual Percentage Rate
The annual rate charged for borrowing.