Abstract (of title) - A summary of public records relating to the title to a particular parcel of land.

Acceleration clause (in a mortgage) - Specifies conditions under which the lender may advance the time when the entire debt which is secured by the mortgage becomes due. For example, most mortgages contain provisions that the note shall become due immediately upon the sale of the securing land without the lender's consent or upon failure of the landowner to pay an installment when due.

Acknowledgement - A formal declaration before an authorized officer (usually a notary public) by a person who has executed an instrument that such execution is the individual's act. Administrator. Person appointed by a court to take possession of property of a person who died without leaving a will, to pay debts and to distribute the property to those entitled to it according to the law. Adverse possession. Physical possession of land inconsistent with the right of the owner. In most states, a party in adverse possession, after satisfying fully the requirements of the relevant statutes, thereby acquires the title to the land.

Affiant - One who swears to or affirms the statement in an affidavit.

Affidavi t- A statement in writing sworn or affirmed to before an official (usually a notary public) who has the authority to administer an oath or affirmation.

Affirmative coverage - Provisions in policies by which the insurer affirmatively insures against loss due to specific risks generally not covered by policies; for example, insurance against loss due to violation of usury or truth-in-lending statutes or restrictive covenants.
All inclusive rate- The system of quoting rates for insurance where the stated rate includes the cost of title search, title examination, and the policy. This system is in contrast with the system which quotes the rate charged for the policy only. The cost of search and examination in this latter system is extra.

ALTA - American Land Title Association, a national association of title insurance companies and title abstract organizations. This term is used most frequently as part of the identification of standard policy forms adopted by that association.

Amortize - To reduce debt by means of regular periodic payments which include amounts applicable to both principal and interest. An attorney approved by a title insurance company as one whose opinions of title will be accepted by the company and relied upon for the issuance of title insurance policies.

Appurtenances - Rights which pass with the title to the land itself. These rights may affect other lands; e.g., an appropriate access easement over adjoining land.

Assessed valuation - The valuation placed upon land for purposes of taxation. This valuation does not necessarily correspond to the market valuation.

Assessment - A special tax imposed on owners of land by governing bodies for the purpose of paying for improvements (sewer lines, sidewalks, street paving, etc.) which benefit the land of such owners.

Assignment - A transfer of (or the document transferring) a right and /or interest in land. Used often in transferring interests of a mortgagee or of a lessee. Assignor is the person who transfers the interest; assignee is the person to whom the interest is transferred.

Assumption of mortgage - An obligation undertaking by the purchaser of land to be personally liable for payment of an existing note secured by a mortgage. As between the lender and the original borrower, the original borrower remains liable on the mortgage note.

Attorney in fact - A person who holds a power of attorney from another to execute specified documents on behalf of the grantor of the power. B Back title letter of back title certificate or starter. A letter or certificate furnished to an attorney by a title company authorizing the attorney to base title opinion to the title company concerning a particular parcel of land on an examination of tit le beginning with a specific date or with a specific deed, and giving the attorney the status of title as of that date or deed.

Balloon payment - A large lump sum payment of unamortized premium and accrued interest at the end of the term of a loan in which the consecutive monthly installment payments are insufficient to amortize the entire principal and interest over its terms.

Base title or basic title - Title to an area or tract out of which plats are subsequently conveyed or from which a subdivision or development is made. Thus the title to farm acreage which has been subdivided would be the base title to the entire subdivision .

Beneficiary (of a trust) - A person designated to receive some benefit from the trust estate, binder or commitment. An enforceable agreement that upon satisfaction of the requirements which are stated in the binder the insurer will issue the specified title insurance policy subject only to the exceptions stated in the binder. A binder sets forth status of title as of a particular date. Bond. (1) An insurance agreement under which one party becomes surety to pay, within stated limits, financial loss caused to another by specified acts or defaults of a third party. (2) An interest bearing security evidencing a long term debt, issued by a government or corporation, and sometimes secured by a lien on property.

Building (restriction) line or setback - A line fixed at a certain distance from the front and/or sides of a lot or at a certain distance from a road or street, which line marks the boundary of the area within which no part of any building may project. This line maybe established by a filed plat of subdivision, by restrictive covenants in deeds or leases, by building codes, or by zoning ordinances.

Certificate of title - A written opinion by an attorney that ownership of the particular parcel of land is as stated in the certificate.

Chain of title - The successive ownership or transfers in the history of title to a particular parcel of land. Each deed or other instrument effecting a transfer of the title is called a "link" and all of the links constitute the chain.

Cloud on title - An outstanding claim or encumbrance which adversely affects the marketability of title.

Closing - The day all costs are settled between parties involved in the sale of real estate. The day real property transfers to new owner.

Closing Costs - All costs to be paid by the buyer or seller the day of closing. These costs are in addition to the purchase price of the property.

Coinsurance - Insurance in which more than one insurer shares a part of a single risk. Coinsurance is usually effected by separate contracts of insurance by separate companies, each of which undertakes a fractional part o f the whole risk.

Collatera l- Marketable real or personal property which a borrower pledges as security for a loan. In mortgage transactions, specific land is the collateral.

Clear Title - Real property ownership, clear of liens, encumbrances, defects or claims.

Deed - A conveyance or realty; a writing signed by grantor, whereby title to realty is transferred from one to another.

Deed Restriction - A provision in a deed imposing restrictions or limits, on the use or occupancy on real property.

Easement Rights - A right of way granted to a person or company over or through a persons property/land. Utility companies are a good example, needing access to your property to work on lines or pipes.

Encumbrance - Liens, mortgages, zoning, claims, unpaid taxes, etc. on a title, preventing a clear title.

Endorsement - A form issued by the insurer at the request of the insured which changes term(s) or item(s) in an issued policy or commitment.

Equity - (1) The interest or value which an owner has in real estate over and above the debts against it. (2) A type of court of record.

Equity participation - A type of mortgage transaction in which the lender, in addition to receiving a fixed rate of interest on the loan, acquires an interest in the borrower's land and shares in the profits derived from the land.

Escheat - The transfer of title of property to the state if the owner dies intestate and without heirs.

Escrow - Funds held by an escrow agent with special instructions when to transfer from one party to another.

Estate - The degree, quantity, nature, and extent of interest which a person has in land.

Examination of title - The review of the chain of title as revealed by an abstract of the title or public records.

Exceptions - Those matters affecting title to the particular parcel of realty which matters are excluded from coverage of the particular title insurance policy.

Exclusion - Those general matters affecting title to real property excluded from coverage of a title insurance policy.

Executor - A person named in a will to administer the estate. Executrix is the feminine form.

FNMA (Fannie Mae) - Federal National Mortgage Association, a federally sponsored private corporation which provides a secondary market for housing mortgages.

Fee simple - An estate in which the owner is entitled to the entire property, with unconditional power of disposition during the owner's life, and which descends to the heirs upon the owner's death if the owner dies without a will.

FHA - Federal Housing Administration, an agency of the federal government which insures private loans for financing of new and existing housing and for home repairs under government approved programs.

FHLMC (Freddie Mac) - Federal Home Loan Mortgage Corporation, an affiliate of the Federal Home Loan Bank, which creates a secondary market in conventional residential loans and in FHA and VA loans by purchasing mortgages from members of the Federal Reserve System and the Federal Home Loan Bank System.

Fixture - Personal property that by state law becomes real property upon being attached to real property.

Foreclosure - Legal process by which a mortgagor of real property is deprived of interest in that property due to failure to comply with terms and conditions of the mortgage. General warranty deed-A deed containing a covenant whereby the seller agrees to protect the buyer against being dispossessed because of any adverse claim against the land.

GNMA (Ginnie Mae) - Government National Mortgage Association, a government corporation which provides a secondary market for housing mortgages and special assistance to mortgagee financing housing under special FHA mortgage insurance programs.

Graduated payment mortgage - A mortgage securing a loan in which the initial monthly payments on the loan are insufficient to satisfy interest payments at the stated interest rate, and unpaid amounts of interest are added to the principal balance.

Grantee - The party who is the buyer or recipient in the deed.

Grantor - The party who is the seller or giver in the deed.

HUD - U.S. Department of Housing and Urban Development. Insures homes meet certain governmental standards.

Joint Ownership - Where as two parties are involved in the ownership of property.

Judgment - The judgment of a court against a certain person(s) or company(s) that can cause a lien on the title. In most cases judgments must be satisfied.

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

Owner Policy - A title insurance policy which protect the owner of the property against title defects.

Refinance - Obtaining a new mortgage for a property already owned. Mostly done to get lower interest rates from a competitor.

Survey - A measurement of boundaries of land done by A Surveying Company. To resolve boundary disputes, elevations, and property lines.

Tax Lien - A claim on property due to a tax debt owed.

Title - The ownership of land or property.

Title Insurance - A policy protecting the owner(s) against loss if there is a defect or claim against the ownership/title of the property.

Title plant - A compilation of records maintained by title companies and containing information about specific parcels of land. This information would be ascertained otherwise only by a search of the public records.

Title Search - A search usually conducted in the public records of County Court Houses of a title to a piece of property.

Torrens systems - A governmental title registration system wherein title to land is evidenced by a certificate of title issued by a public official known as the registrar of title.

Turnkey housing - Housing initially financed and built by private sponsors and purchased by housing authorities for use by low-income families under the public housing program.

VA loan - A loan for purchase of land in which the Veteran's Administration guarantees the lender payment of a home mortgage by a qualified veteran.

Variable rate mortgage - A long-term loan having an interest rate which fluctuates with a reference index and generally reflects the current market rate of interest.

Vendee - Buyer.

Vendor- Seller.

Warranty deed - A deed in which the grantor warrants or guarantees that good title is being conveyed.

Wraparound mortgage - A mortgage which secures a debt which includes the balance due on an existing senior mortgage and an additional amount advanced by the wraparound mortgagee. The wraparound mortgagee thereafter makes the amortizing payments on the senior mortgage.