California License Real Estate Terms Glossary

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A.L.T.A. TITLE POLICY

A title insurance policy issued by title insurance companies that expands the risks insured against under the standard type of policy to include unrecorded physical easements, facts a physical survey would show, water and mineral rights, and rights of parties in possession (such as tenants and buyers under unrecorded instruments).

 

ABATEMENT OF JUDGMENT

A document containing a condensation of the essential provisions of a court judgment.

ABATEMENT OF NUISANCE

The act of ending or teminating a nuisance; a type of legal action brought to end a nuisance.

ABSTRACT OF JUDGMENT

A summary of money judgment. The summary is usually prepared so that it may be recorded, thereby creating a (judgement) lien on real estate owned by the judgment debtor.

ABSTRACT OF TITLE

A summary of the instruments affecting title to a parcel of real property as shown by the public records.

ACCELERATE

To make a note all due and payable at one time.

ACCELERATION CLAUSE

A clause in a deed of trust or mortagage giving the lender the right to call all sums owing him or her to be immediately due and payable upon the occurrence of a certain event. It is also a clause that permits a debtor to pay off a loan before the due date.

ACCELERATION CLAUSE b

A clause in a promissory note, deed of trust, or mortgage that provides that upon default of a payment or some other stated event, the entire unpaid balance becomes immediately due and payable.

ACCEPTANCE

An essential element of every contract, it is the consent to be bound by the offer. In deeds, it is the consent to accept a grant of real property.

ACCESS RIGHT

The right of an owner to go into and out of his or her property.

ACCOMMODATION PARTY

A person who, without receiving value, signs a promissory note to help another person borrow money or get credit.

ACCORD AND SATISFACTION

The discharge of an existing contract by accepting the performance under a substitute contract. Generally, consideration under the new contract is different from and of lesser value than under the original contract, and satisfaction is the performance of that contract; the combinationn discharges the original contract.

ACCRETION

A gradual addition to land from natural causes; for example, from gradual action of ocean or river waters.

ACCRUED DEPRECIATION

1. The difference between the cost of replacement new as of the date of the appraisal and the present appraised value.
2. The accumulated losss in value that has affected the improvements on real property

ACKNOWLEDGEMENT

A formal declaration before an officer duly authorized as a notary public by a person who has executed an instrument,?stating that the execution is his or her act and deed. A formal statement (usually before a notary public) by the person signing a deed or document that the instrument was actually and freely signed.

ACOUSTICAL TILE

Blocks of fiber, mineral, or metal with small holes or a rough-textured surface to absorb sound, used as covering for interior walls and ceilings.

ACQUISITION

The act or process by which a person procures property. ACRE A measure of land equaling 160 square rods, 4840 square yards, 43,560 square feet, or a tract about 208.71 feet square.

AD VALOREM

According to value.

ADA

Refers to the Americans With Disabilities Act. The ADA applies to equal access to employment, public services, public accomodations, public transportation and telecommunications. ADA Refers to the Americans With Disabilities Act. The ADA applies to equal access to employment, public services, public accomodations, public transportation and telecommunications.

ADJACENT

Located next to or near an object or parcel of property.

ADJOINING

Located so as to touch an object or share a common property line.

ADJUSTED COST BASIS

For tax purposes it is the cost of the property plus improvements and minus depreciation, amortization, and depletion.

ADMINISTRATOR

A person appointed by the probate court to administer the estate of a deceased person. His or her duties include making an inventory of the assets, managing the property, paying the debts and expenses, filing necessary reports and tax returns, and distributing the assests as ordered by the probate court.

ADULT

Any person 18 years of age and older.

ADVERSE POSSESSION

A method of acquiring property based on open and notorious possession, under a claim of right, color of title, continuous use for five years, and the payment of taxes. A method of acquiring property through continuous use of that property while paying taxes on it.

AFFIDAVIT

A statement or declaration reduced to writing, sworn to or affirmed before some officer who has authority to administer an oath or affirmation, such as a notary public or a commanding officer in the service.

AFFIRM

To confirm, swear, ratifying, verity.

AGENCY RELATIONSHIP

A special relationship of trust by which one person (agent) is authorized to conduct business, sign papers, or otherwise act?on behalf of another person (principal). This relatoinship may be created by expressed agreement, ratification, or estoppel.

AGENT

One who represents another called a principal and has authority to act for the principal in dealing with third parties. The relationship is referred to as an agency. Someone authorized to act for another (called the principal) in business matters.

AGREEMENT

A mutual understanding or compact between parties. Althought often used a synonymous with contract, technically it denotes mutual promises that fail as a contract for lack of consideration.

AGREEMENT OF SALE

1. A written contract between a buyer and seller setting out the terms of sale.
2. An installment sales contract covering real property, especially a long-term contract

AIDS

The seller of real property, his agents or his sub agents do not have to disclose that somebody died of AIDS or had AIDS in said property.

ALIENATION

The transferring of property to another. Conveyance or transfer of title to real estate from one person to another person.

ALIENATION CLAUSE

In a deed of trust or mortgage, a provision that if the secured property is sold or transferred, the lender has the option of accelerating the loan and declaring the entire unpaid balance immediately due and payable. Also called a "due-on-sale" clause.

ALLIGATOR

Purchasing lower priced properties will limit the appetite of the alligator. The alligator is an expensive piece of property that gobbles up all the profits. Negative cash flow on a keeper property is reffered to as an alligator.

ALL-INCLUSIVE DEED OF TRUST

A financing device whereby a lender makes payments on the existing trust deeds of a borrower and takes from the borrower a junior trust deed with a face value in an amount equal to the amount outstanding on the old trust deeds and the additional amount of money borrowed.

ALLUVION (ALLUVIUM)

Soil that has been deposited by accretion on the shore of a river or body of water and that increases the real property.

ALTA POLICY

The title insurance policy issued to institutional lenders. The initials stand for American Land Title Association, an organization that regulates and standardizes the provisions within title policies.

ALTER EGO

A doctrine which holds that a corporation is really owned by shareholders as their own property, and therefore it should not be considered as a separate entity. Usually used to try to hold shareholders liable for corporate debts.

AMBULATORY

Capable of being changed or revoked. In wills, it refers to the concept that a will may be revoked or modified at any time up to the testator's death.

AMELIORATING WASTE

Improvements to property that, while not damaging the value of the property, technically qualify as waste. For example, an apartment building constructed on property designated only for single-family structures is considered ameliorating waste.

AMENITIES

As used in the real estate business, the features that make a piece of real property, especially a home, enjoyable.

AMORTIZATION

1. The liquidation of a financial obligation on an installment basis, which includes both principal and interest.
2. Recovery of cost or value over a period of time. The method or plan for the payment of a debt, bond, deed of trust, etc., by installments or sinking fund.

ANNUAL PERCENTAGE RATE (APR)

The cost of credit as determined in accordance with Regulation Z of the Board of Governors of the Federal Reserve System for implementing the Federal Truth in Lending Act.

ANNUITY

A sum of money received or paid yearly or at other fixed periods.

ANTICIPATION

Affirms that value is created by the anticipated benefits to be derived in the future.

ANTICIPATORY BREACH

Advance notice of intention to violate the terms of a contract.

APPEAL

The review or rehearing by a higher court of a low (inferior) court's decision.

APPELLANT

The party appealing a court decision. Either party may appeal; hence, the appellant could have been either the plaintiff or the defendant in the trial court.

APPRAISAL

An estimate and opinion of value. An opinion or estimate of the fair market value of a property.

APPRAISER

One qualified by education, training, and experience, who is hired to estimate the value of real and personal property on the basis of experience, judgment, facts, and use of formal appraisal processes.

APURTENANT

Attached to or considered part of land, because of being considered necessary and incidental to the use of that land. Commonly applied to easements that are considered part of property.

ASSESSED VALUE

Value placed on property as a basis for taxation. A value used by the tax assessor before July 1978. It represented 25 percent of the assessor's fair market value. After deducting any exemptions from assessed value, one applied the tax rate to the net figure to determine annual property taxes.

ASSESSMENT

The valuation of property for the purpose of levying a tax, or the amount of tax levied.

ASSESSOR

The official who has the responsibility of determining the assessed values.

ASSIGNEE

One to whom property is assigned or transferred.

ASSIGNMENT

A transfer to another of any property or right. The transfer of one's entire interest in property. Generally, the term is limited to intangible personal property (that is, stocks, bonds, promissory notes) and to leasehold estates.

ASSIGNMENT OF RENTS CLAUSE

A clause in a deed of trust or mortgage, providing that in the event of default, all rents and income from the secured property will be paid to the lender to help reduce the outstanding loan balance.

ASSIGNMENT OF RENTS

An assignment of future rents form property as security for a debt.

ASSIGNOR

One who assigns or transfers property.

ASSUMPTION

Acceptance of personal liability for another's debt or obligation. In the case of the sale of real estate, the buyer personally accepts and promises to pay off the existing deed of trust.

ASSUMPTION OF AGREEMENT

A contract by which a person agrees to pay a debt or obligation owed by someone else.

ASSUMPTION OF MORTGAGE OR DEED OF TRUST

The taking of title to property by a grantee in which he or she assumes liability for payment of existing note secured by a mortgage or deed of trust against the property.

ATTACHMENT

Seizure of property by court order before judgment, usually done to have it available in the event a judgment is obtained in a pending law suit. The actual or constructive seizure of property by court order during a lawsuit. The usual purpose is to hold the assests as security for the satisfaction of a judgment.

ATTACHMENT LIEN

A lien on property arising because of an attachment of that property.

ATTEST

1. To affirm to be true or genuine.
2. An official act establishing authenticity.

ATTORNEY-IN-FACT

An agent authorized to perform certain acts for another under a power of attorney. (See Power of Attorney.)

AVULSION

The sudden tearing away or removal of land by the action of water flowing over or through it.