Mortgages Question & Answer

Heres an A to Z list of commonly asked questions from home buyers and sellers about real estate transactions and real estate terms. Feel free to contact us with any other questions you may have. We would be happy to answer them for you.

Abandonment: The giving up of the possession and control of property with the intention of relinquishing all claim to it. Losing property is an involuntary act. The abandonment of property is a voluntary act.

Abatement: A termination of or the elimination of, the act of abating.

Abstract: A history of all transactions shown in the public records affecting a particular tract of land.

Abstract of Judgment: Summary of essential provisions of a money judgment. When recorded, it creates a general lien on the real property of the judgment debtor in the county in which the abstract is recorded.

Adjustable Rate Mortgage (ARM): Mortgage loans under which the interest rate is periodically adjusted,in accordance with some market indicator, to more closely coincide with the current rates. The extent and the number of these adjustments are agreed to at the inception of the loan.

Adverse Possession: The possession, by one person, of land belonging to another in a manner deemed adverse to the interest of the owner. In most states, by operation of law, title to the land becomes vested in such person after a fixed number of years if the owner fails to assert his or her rights.

Affidavit: A written statement made under oath before a notary public or other judicial officer.

Agreement: A legally binding contract made between two ormore persons.

ALTA (American Land Title Association): The trade association of the title insurance industry, which has adopted certain insurance policy forms to standardize coverage on a national basis.

Amortization: Payment to reduce the principal of a debt in regular, periodic installments.

Annual Percentage Rate (APR): The total cost of credit, including one-time fees, is known as the annual percentage rate of a loan. It can be considered the effective interest rate for a borrower and is used to standardize how rates are expressed and to compare loan options. Lenders are require to disclose the APR before the loan is finalized.

Application: A printed form used by mortgage lenders to record necessary information concerning a prospective mortgage

Application Fee: A sum of money paid toward the estimated initial mortgage processing expense such as appraisal and credit report

Appraisal: A report from an independent third party detailing the estimated value of real estate.

Appreciation: The increase in value of a property caused by changes in the market, inflation or other factors.

Appurtenance: A right or privilege that is a part of the ownership of property, such as a right of way to a highway across the land of another. Water rights are also an example.

Assessment: The valuation of real estate for purpose of taxes or special improvement charges. The amount of taxes or special improvement charges. Special improvement charges are usually for the costs of streets, sidewalks, sewers, etc.

Assignment: The act of transferring an interest, such as a loan secured by a mortgage, from one person to another. The instrument or paper by which one person transfers such ownership to another.

Assumable Mortgage: Assumable Mortgage: A loan that can be taken over by the buyer is known as an assumable mortgage. This is an alternative to the traditional method of a buyer obtaining a mortgage directly from a lender.

Attorney's Opinion: A statement by an attorney as to the validity of a title, arrived at after investigation of the history of the title as recorded in the public records.

Back Title Letter: Also called 'back title certificate' in some areas, and 'starter' in others. When titles previously have been examined up to a certain date by reliable examiners, title companies sometimes give subsequent examiners of such titles a letter that sets forth the condition of the title at the time of the previous examination and authorizes them to begin their subsequent examination with the terminal date of the previous examination.

Balloon Note: A form of promissory note that calls for the minimum Payment of principal and the payment of interest at regular intervals. This type of note requires a substantial final payment, which represents all the principal.

Bankruptcy: A proceeding in U.S. District Court wherein assets of an insolvent debtor are protected and distributed in an equitable manner.

Binder: Sometimes called 'preliminary certificate' or 'commitment.' (1) A preliminary report as to the condition of a title and a commitment to issue a title insurance policy in a certain manner when certain conditions are met. (2) A deposit in escrow of a small part of the purchase price of real estate as evidence of good faith and to bind an agreement to purchase.

Bridge Loan: Also known as a swing loan or interim financing, a bridge loan is a short-term loan used until permanent financing is secured. Bridge loans can be used for up to one year and carry relatively high interest rates. A bridge loan might be used, for instance, to purchase a new property when the homebuyer hasn't yet sold his or her current dwelling.

Buydown: A seller can assist a buyer in qualifying for a mortgage and making payments to the lender for the first several years of the loan. The buyer benefits by having lower monthly payments initially; the seller will increase the price of the home to offset the buy down costs.

Certificate of Title: A certificate issued by a title examiner stating the condition of a title.

Chain: In real estate measurements (surveying), a chain is 66 feet long or 100 links, each link being 7.92inches. The measurement may change when used in fields other than surveying.

Chain of Title: The successive ownerships or transfers in the history of title to a tract of land.

Claim: An adverse right or interest asserted by one party against another or against an insurer orindemnitor. Claims may arise from unpaid debts or taxes, as well as from hidden title defects such as fraud, forgery, missing heirs, etc.

Clear Title: Real property ownership free of liens, defects, encumbrances or claims.

Closing: Also called 'settlement.' A meeting of all parties involved in a property transaction during which the transaction is consummated.

Clouded Title: An irregularity, possible claim or encumbrance that, if valid, would adversely affect or impair the title.

Coinsurance: Two or more policies of title insurance issued by different insurers, each covering a portion of the same risk, which together provide total coverage of the risk.

Commission: The sales commission from a real estate transaction, usually a percentage of the sales price, divided in some fashion among the buyer's agent, the seller's agent and the broker. The percentage of the sales price typically applied as commission varies by region and can be negotiated by the consumer.

Commitment: Also called "binder." A document issued by a title insurance company that contains the conditions under which a policy of title insurance will be issued.

Comparative Market Analysis (CMA): An estimate of the value of property using indicators taken from sales of comparable properties, such as price per square foot, combined with expert market commentary and information on the importance of marketing a home properly. A CMA is not the same as an appraisal report of the market value of the subject property prepared by a licensed professional appraiser.

Condemnation: The taking of private property for a public purpose, with compensation to the owner under the right of eminent domain. Governmental units, railroads and utility companies have the right to condemn and take private property. The destruction by government of private property that imperils the life, health or safety of the public.

Conventional Loan: A loan secured by a mortgage or deed of trust for which the loan-to-value ratio is within an acceptable range for a particular lending institution.

Convevance: The transfer of title to property from one person to another.

Courtesy: A right that a husband has in his wife's property at her death. It does not exist in all states.

Covenant: A formal agreement or contract between two parties in which one party gives the other certain promises and assurances, such as covenants of warranty in a warranty deed.

Dedication: The setting aside of certain land by the owner and declaring it to be for public use. Examples: streets, sidewalks and parks.

Deed: A document through which a conveyance of property is effected.

Deed of Trust: A deed of trust conveys title to particular land to a neutral third party (trustee) with limited powers (such as power of sale) for the purpose of securing a loan (debt).

Deed Restriction: A covenant contained in a deed imposing limits on the use or occupancy of the real estate or the type, size, purpose or location of improvements to be constructed on it.

Defect: A blemish, imperfection or deficiency. A defective title is one that is irregular and faulty.

Depreciation: Loss in value occasioned by ordinary wear and tear, destructive action of the elements, or functional or economic obsolescence.

Devise: A gift of real estate made by a will.

Dominant Estate: The property for the benefit of which a right-of-way easement exists across another's adjoining piece of land is said to be the dominant estate. The land across which the easement runs is said to be the servient estate.

Dower: A right that a wife has in her husband's property at the time of his death. Does not exist in all states.

Earnest Money: A deposit of funds by the purchaser of a piece of real estate as evidence of good faith.

Easement: A right to use all or part of the land owned by another for specific purposes such as public utilities, roads, or ingress and degress.

Eminent Domain: The right of a government to take privately owned property for public purposes under condemnation proceedings subject to payment of its fair market value.

Encroachment: Any building, improvement or structure located on one property (such as a wall, fence or driveway) that intrudes upon the property of another.

Encumbrance: Any interest, right, lien or liability attached to a parcel of land (such as unpaid taxes or an unsatisfied mortgage) that constitutes or represents a burden or charge upon the property.

Escheat: The reversion of property to the state when an owner dies leaving no legal heirs, devisees or claimants.

Escrow: A method of closing a real estate transaction then all required documents and funds are placed with a third party for processing and disbursement.

Estoppel: A legal restraint that stops or prevents a person from contradicting or reneging on his previous position or previous assertions or commitments.

Examination: The study of the instruments incident to a chain of title to determine their effect and condition in order to reach a conclusion as to the status of the title.

Exception: A provision in a title insurance binder or policy that excludes liability for a specific title defect or an outstanding lien or encumbrance.

Execute: To sign a legal instrument. A deed is said to be executed when it is signed, sealed, witnessed and delivered.

Fair Market Value: The highest price that a willing buyer would pay, and the lowest price a willing seller would accept.

Fannie Mae (FNMA): Federal National Mortgage Association. A private corporation dealing in the purchase of first mortgages.

Fee Simple Deed: The absolute ownership of a parcel of land. The highest degree of ownership that a person can have in real estate, which gives the owner unqualified ownership and full power of disposition.

FHA (Federal Housing Administration): A federal agency that insures first mortgages, enabling lenders to lend a very high percentage of the sale price.

Fixed Rate Mortgage: A mortgage having a rate of interest that remains the same for the life of the mortgage.

Fixtures: Personal property that is attached to real property and is legally treated as real property while it is so attached. Examples: medicine cabinets, window blinds and chandeliers.

Foreclosure: A legal proceeding in which real estate secured by a mortgage or deed of trust is sold to satisfy the underlying debt.

Forgery: The fraudulent signing of another's name to an instrument such as a deed, mortgage or check.

Freddie Mac (FHLMC): Federal Home Loan Mortgage Corporation. A federal conventional and federally insured first mortgages from members of the Federal Reserve System and the Federal Home Loan Bank System.

Ginnie Mae (GNMA): Government National Mortgage Association. A federal association working with the FHA that offers special assistance in obtaining mortgages and purchases mortgages in the secondary market agency that purchases both.

Grant: To bestow or confer, with or without compensation, a gift such as land or money by one having control or authority over the gift.

Grantee: One to whom a grant is made.

Grantor: One who makes a grant.

Hazard Insurance: Real estate insurance protecting against fire, some natural causes, vandalism, etc., depending upon the policy. Buyer often adds liability insurance and extended coverage for personal property.

Hereditaments: Any and all kinds of estates, interest and rights in real estate that can be inherited.

Home Owner's Association: An association of people who own homes in a given area, formed for the purpose of improving or maintaining the quality of the area. An association formed by the builder of condominiums or planned developments, and required by statute in some states. The builder's participation as well as the duties of the association are controlled by statute.

Homeowners Insurance: Real estate insurance protecting against loss caused by fire, some natural causes, vandalism, etc., depending on the terms of the policy. Also includes coverage such as personal liability and theft away from home.

Homestead: A statutory protection from execution or the establishment of title by occupation of real property in accordance with the laws of various states or the Federal Government.

HUD: Department of Housing and Urban Development. The federal department responsible for the major housing programs in the United States.

Impounds: A trust type of account established by lenders for the accumulation of borrower's ftmds to meet periodic payments of taxes, mortgage insurance premiums, and/or future insurance policy premiums, required to protect their security.

Indemnity: Insurance against possible loss or damage. A title insurance policy is a contract of indemnity.

Index: An alphabetical listing in the public records of the names of parties to recorded real estate instruments together with the book and page number of the record. The listing in abstract and title plants of recorded real estate instruments in groups according to land descriptions, known as a geographic index. The alphabetical listing in abstract and title plants, by names of the parties, of all recorded instruments that affect but do not describe particular real estate, such as judgments, powers of attorney, wills and probate proceedings. Such indexes are known by various names, such as "general index," "judgment index" and "name index."

Instrument: Any written document having a legal effect.

Internet Data Exchange (IDX): These websites allow homebuyers to search for information on available properties in a market. Usually the information is more limited than what the searcher could find through the Multiple Listing Service (MLS). Rules about what information can and cannot be displayed by the IDX are set by the local MLS organization.

Intestate: Without leaving a will, or leaving an invalid will so that the property of the estate passes by the laws of succession rather than by the direction of the deceased.

Judgment: The determination of a court regarding the rights of parties in an action. A judgment of debt on a property owner can create a lien on all of that owner's land within a certain jurisdiction.

Jumbo Loan: A loan which is larger (more than $214,600 as of 1/1/97) than the limits set by the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation. Because jumbo loans cannot be fimded by these two agencies, they usually carry a higher interest rate.

Kickback: A return of a part of a fee - given back because of a confidential agreement or coercion.

Kite Checks: To execute and deliver a check in payment of a debt at a time when the drawer has insufficient money in the bank, but with the intention of making a deposit to cover the shortage before the check is presented for payment.

Leasehold: The right to possession and use of land for a fixed period of time. The lease is the agreement that creates the right.

Lender: A term that can refer to the institution making the loan or to the individual representing the lending institution.

Lessee: A tenant holding a leasehold.

Lessor: A landlord; one who gives a leasehold to a lessee.

License: Permission to go upon or use the land of another, the permission being a personal privilege and not constituting an interest in the land.

Licensee: A person licensed by the state to engage in real estate brokerage, either as a broker or as a salesperson.

Lien: A monetary charge imposed on a property, usually arising from some debt or obligation.

Lien Waver: Also called "waiver of liens." A waiver of mechanics' lien rights, signed by contractors or subcontractors.

Link: In surveying, a length of 7.92 inches.

Lis Pendens: A legal notice intending to bind third parties of litigation claiming an interest in real estate.

Loan Policy: Also called "mortgage policy." A title insurance policy insuring a mortgagee, or beneficiary under a deed of trust, against loss caused by invalidity or unenforceability of a lien, or loss of priority of the mortgage or deed of trust.

Loan-to-Value Ratio (LTV): The ratio between the amount of a mortgage and the appraised value of a property is the loan-to-value ratio. For instance, a $200,000 mortgage on a $275,000 home equates to an LTV of 73%. The higher the percentage, the riskier the loan; the lower the percentage, the more equity a homeowner has in the property. Lenders examine this ratio before approving a loan and may require a borrower to purchase mortgage insurance or charge more for the mortgage if the ratio is above 80 percent.

Lot: Generally, any portion or parcel of real property. Usually refers to a portion of a subdivision.

Market Value: The average of the highest price that a buyer, willing but not compelled to buy, would pay and the lowest price a seller, willing but not compelled to sell, would accept.

Mechanic's Lien: A lien on real estate, created by operation of law, that secures the payment of debts due to persons who perform labor or services or furnish materials incident to the construction of buildings and improvements on the real estate.

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

Mortgage: A conditioned pledge of property to a creditor as security for the payment of a debt.

Mortgage Insurance: Insurance written by an independent mortgage insurance company protecting the mortgage lender against loss incurred by a mortgage default, thus enabling the lender to lend a higher percentage of the sale price.

Mortgagee: The holder of a mortgage. The party to whom a mortgage is made, generally the lender.

Mortgagor: A person who mortgages property. A person who executes a mortgage, generally the property owner.

Multiple Listing: The pooling in a central bureau of listings of properties for sale. These listings are held individually by members of a group of real estate brokers, with the agreement that any member of the group may sell the properties and, in the case of a sale, the commission will be divided between the broker making the sale and the broker who filed the listing.

Multiple Listing Service (MLS): A local or regional service that compiles available properties for sale by member brokers. Detailed information about properties is provided to brokers, agents and the public, generally online. Local MLS organizations have their own rules and systems for providing listing information.

Muniments of Title: Written evidence (documents) that an owner possesses to prove his or her title to property.

Negative Amortization: Occurs when your monthly payments are not large enough to pay all the interest due on the loan. This unpaid interest is added to the unpaid balance of the loan. The danger of negative amortization is that the home buyer ends up owing more than the original amount of the loan.

Net Effective Income: The borrower's gross income minus federal income tax.

Non Assumption Clause: A statement in a mortgage contract forbidding the assimiption of the mortgage without the prior approval of the lender.

Note: The signed obligation to pay a debt, as a mortgage note.

Nonconforming Use: A property which does not conform to the zoning of the area. Usually, the property was built in conformity and then the zoning was changed.

Owner's Policy: A policy of title insurance insuring an owner of real estate against loss occasioned by defects in, liens against or un-marketability of the owner's title.

Plat: Also called "plat map." A map dividing a parcel of land into lots, as in a subdivision. A plat book contains the plat maps for a given area.

Point: Also called "commission points" or "discount points." One percent of the amount of the loan.

Preliminary Report: The Preliminary Report or "PR" is an offer to issue a policy of title insurance covering a particular estate or interest in land subject to stated exceptions. A Preliminary Report provides a list of the matters which will be shown as exceptions to coverage in a designated policy or policies of title insurance, if issued currently, covering a particular estate or interest in land. It is designed to provide an interim, or "preliminary" response to an application for title insurance and is intended to facilitate the issuance of the designated policy or policies. It is normally prepared after application (order) for such policy(ies) of title insurance on behalf of the principals to a real property transaction, for the purpose of facilitating requirements relative to closing and policy issuance in form and content approved by those parties. The Preliminary Report states on its face that it is made solely to facilitate the subsequent issuance of a title insurance policy and that the insurer assumes no liability for errors in the report. Accordingly, any claim arising from a defect in title must be made imder the title policy and not the Preliminary Report.

Premium: The amount payable for an insurance policy.

Prescriptive Easement: A right to use another's property that is not inconsistent with the owner's rights and that is acquired by an open, notorious, adverse and continuous use for the statutory period, for example 20 years.

Principal: A sum of money owed as a debt on which interest is payable; A person who empowers another to act as his representative or agent; The person having prime responsibility for an obligation as distinguished from one who acts as a surety or endorser.

Purchase Monev Mortgage: A mortgage given by a purchaser to a seller on the subject property to secure payment of a part of the purchase price.

Quasi: To some degree, almost, partially, somewhat. Also resembling but not quite being the thing in question.

Quasi Contract: Contract implied by law, based on conduct.

Quiet Enjoyment: Right of an owner to enjoy his property without distiirbance or interference of possession.

Quiet Title Suit: A lawsuit brought by an owner of real estate for the purpose of canceling, wiping out, and putting a quietus upon supposedly immaterial, inconsequential and unenforceable claims and interests which cloud his title.

Quietus: Final disposition, settlement, or elimination of a claim or debt.

Quit Claim Deed: A deed that does not imply that the grantor holds title, but that surrenders and gives to the grantee any possible interest or rights that the grantor may have in the property.

Real Estate: Also called "real property." Land and anything permanently affixed to the land, such as building, fences and those things attached to the buildings, such as light fixtures, plumbing and heating fixtures, or other such items that would be personal property if not attached. May refer to rights in real property as well as the property itself.

Real Estate Agent: Salespeople who assist buyers and sellers in the purchase and disposition of property are real estate agents. Most states require that prospective agents take a number of classes and pass a licensing exam in order to function in this role.

Real Estate Broker: Experienced real estate agents can become licensed as real estate brokers (also known as "principal" or "qualifying" brokers) so they can manage or own their own brokerage. Brokers usually must pass a state exam on real estate law to qualify.

Real Estate Qwned (REQ): Properties that revert to a lender, typically a bank, after an unsuccessful foreclosure auction are Real Estate Qwned. Banks commonly become owners of foreclosed properties because properties for sale at auctions often are worth less than the total amount owed to the bank via the mortgage. The minimum bid — the outstanding loan amount — is above market value. Banks try to sell REO properties at lower prices on their own or through an agent.

REALTOR®: A real estate broker or an associate holding active membership in a local real estate board affiliated with the National Association of REALTORS®.

Recision: The cancellation of a contract. With respect to mortgage refinancing, the law that gives the homeowner three days to cancel a contract in some cases once it is signed if the transaction uses equity in the home as security.

Recording: The noting in a public office of the details of a legal document - such as a deed or mortgage - affecting the title to real estate. When such an instrument is properly recorded, it is considered to be a matter of public record. Legally, that means that all subsequent purchasers are deemed to have constructive knowledge of that information.

Recording Fees: Money paid to the lender for recording a home sale with the local authorities, thereby making it part of the public records.

Reinsurance: A contractual relationship between two insurance companies under which one insurer assumes a portion of the risk of the insurance policy written by the other.

Release: To relieve from debt or security or abandon a right, such as the release of a mortgage lien from a part or all of the land mortgaged. The instrument effecting a release.

RESPA: Short for the Real Estate Settlement Procedures Act. RESPA is a federal law that allows consumers to review information on known or estimated settlement cost once after application and once prior to or at a settlement. The law requires lenders to furnish the information after application only.

Restrictions: Limitations on the use of property imposed or created by deeds or other documents in the chain of title. A restriction, for example, may prohibit the placement of trailer or the construction of a commercial structure on the property.

Reverse Annuity Mortgage (RAM): A form of mortgage in which the lender makes periodic payments to the borrower using the borrower's equity in the home as Satisfaction of Mortgage: The document issued by the mortgagee when the mortgage loan is paid in full. Also called a "release of mortgage".

Riparian Rights: The rights of owners of lands bordering watercourses which relate to the water and its use.

Sale Agreement: A contract entered into between a buyer and seller, setting forth the terms, provisions and conditions of a sale of real estate.

Sale and Leaseback: The sale of an asset to a buyer who immediately leases it back to the seller.

Search: A careful exploration and perusal of the public records in an effort to find all recorded instruments relating to a particular chain of title.

Second Mortgage: A mortgage ranking in priority immediately below a first mortgage.

Statement of Information: This information statement is confidential and is used to enable the title company to eliminate title problems which may arise through similarity of the name of Seller or Buyer

Subordination: The act or process by which a person's rights are ranked below the rights of others. For example, a second mortgagee's rights are subordinate to those of the first mortgagee.

Surety: A person who agrees to be responsible for a debt or obligation of another. The pledge or agreement by which one undertakes responsibility for the debt or obligation of another.

Take-off: Photo copies of instruments filed each day in the Recorder's Office which affect the title to real property.

Takeout Loan: Long term, permanent loan that replaces a short term, interim construction loan.

Tax Deed: A deed issued to the purchaser at a tax sale of real property.

Tenancy by the Entirety: Modification of a join tenancy between husband and wife. Has the quality of survivorship, but neither spouse can convey his or her interest to the break the joint tenancy. Recognized in many states.

Tenant: Usually one who holds possession of real estate under a lease. In a broader sense, one who holds or possesses lands and tenements by any kind of title.

Tenant at Sufferance: One who continues to hold possession of real estate after his authorized term of occupancy has expired.

Title: A combination of all the elements that constitute the highest legal right to own, possess, use, control, enjoy and dispose of real estate or an inheritable right or interest therein. The rights of ownership recognize and protected by the law.

Title Covenants: Covenants ordinarily inserted in conveyances and in transfers of title to real estate for the purpose of giving protection to the purchaser against possible insufficiency of the title received. A group of such covenants known as "common law covenants" includes: covenants against encumbrances; covenants for further assurance (in other words, to do whatever is necessary to rectify title deficiencies); covenants of good right and authority to convey; covenants of quiet enjoyment; covenants of warranty. (See Warranty or Covenant.)

Title Defect: Any possible or patent claim or right outstanding in a chain of title that is adverse to the claim of ownership. Any material irregularity in the execution or effect of an instrument in the chain of title.

Title Insurance Policy: A contract of title insurance under which the insurer, in keeping with the terms of the policy, agrees to indemnify the insured against loss arising from claims against the insured interest.

Title Plant: Also called "abstract plant" in some areas. A geographically filed assemblage of title information that helps in expediting title examinations, such as copies of previous attorneys' opinions, abstracts, tax searches and copies or take-offs of the public records.

Trustee: A neutral third party in the deed of trust with limited powers. When the loan is paid in full the property is reconveyed by the trustee back to the person or persons legally entitled to the land, or, if delinquent, the property will be conveyed pursuant to non-judicial foreclosure proceedings, to the highest bidder in a public sale.

Trustor: The borrower, owner and grantor of the property conveyed in a deed of trust.

Truth-In-Lending: A federal law requiring disclosure of the Aimual Percentage Rate to home buyers shortly after they apply for the loan. Also known as Regulation Z.

Two-Step Mortgage: A mortgage in which the borrower receives a below-market interest rate for a specified number of years (most often seven or 10), and then receives a new interest rate adjusted (within certain limits) to market conditions at that time. The lender sometimes has the option to call the loan due with 30 days notice at the end of seven or 10 years. Also called "Super Seven" or "Premier" mortgage.

Ultra Vires: Beyond their powers. A corporation is said to act ultra vires when it exceeds the authority given it by its charter and by-laws.

Underlying Fee: A title concept in which ownership of all interest or estates in real property are less than or inferior to the most absolute interest one can have that of fee ownership. It lies beneath all the other interests; it is basic, fundamental and implicit.

Underwriter: An insurance company that issues insurance policies to the public or to another insurer.

Undivided Interests: Unsegregated interests of co-owners in the entire property ovmed in common.

Unities: As related to join tenancy, four unities are necessary to create a valid join tenancy: time, title, interest and possession.

Unjust Enrichment: Legal doctrine designed to prevent a person fi-om taking advantage of another person's mistake, such as overpayment of an amount due. It is based on a rule of fairness.

Unlawful Detainer: Action to recover possession of real property.

Usury: Any premium, profit, bonus, fee or charge which is demanded, required or exacted by a lender in excess of legal interest on money loaned.

Valid: That which is sufficient in law; effective.

Valuation: Also known as "home evaluations," they are an analysis of the value of land or property based on market trends and the sales history of similar properties. Valuations are not the same as appraisal reports of the market value of the subject property prepared by licensed professional appraisers.

Vara: A measure of length used in Mexican land grants. It is approximately 33 inches.

Variable Interest Rate: Also called "flexible interest rate." An interest rate that fluctuates as the prevailing rate moves up or down. In mortgages, there are usually maximums as to the firequency and amount of fluctuation.

Variance: A departure from the general rule, an exception.

Vendee: The purchaser of property.

Vendor: The seller of property.

Vendor's Lien: An implied lien given by law to the vendor for the remaining unpaid and unsecured part of a purchase price.

Venue: The county in which a lawsuit is brought or tried. The coimty in which an acknowledgment is taken.

Verification: A sworn statement before a duly qualified officer, e.g., a notary public, that the matters set forth in a pleading or other document are true.

Vest: To give an immediate, fixed right in property, with either present or future enjoyment of possession; also denotes the maimer in which title is held.

Vested Interest: An interest in a property that is fixed or determined.

Vestee: The present record owner.

Veterans Administration (VA) Loans: Housing loans to veterans by banks, savings and loans, or other lenders that are guaranteed by the Veterans Administration, enabling veterans to buy a residence with little or no down payment.

Void: Binding on no one, constituting a nullity. Something which is conclusively of no effect, the defect of which is not subject to being waived, revitalized or cured by confirmation or ratification.

Voidable: Sufficiently defective to make void; the deficiency, however, being curable by confirmation or ratification.

Voluntary Lien: A lien intentionally created by a debtor, e.g., mortgage, deed of trust, as contrasted with a judgment lien, which is an involimtary lien.

Waiver: The voluntary and intentional relinquishment of a known right, claim or privilege.

Warranty: In a broad sense, an agreement or undertaking by a seller to be responsible for present or future losses of the purchaser occasioned by deficiency or defect in the quality, condition or quantity of the thing sold. In a stricter sense, the provision or provisions in a deed, lease or other instrument conveying or transferring an estate or interest in real estate imder which the seller becomes liable to the purchaser for defects in or encumbrances on the title. (see Title Covenants.)

Warranty Deed: A deed containing express covenants of varying kinds, e.g., covenants of seisin and the right to convey, against all encumbrances, for quite enjoyment, etc., commonly used in many states.

Waste: The destruction or injury to premises by a tenant. The impairment in value by a life tenant or by a mortgagor or trustor.

Water Right: Right of a landowner to use water bordering on or imdemeath his land.

Way of Necessity: Generally, a easement for a roadway which the owner of a landlocked tract is entitled to acquire across adjoining land in order to provide a means of ingress and egress with respect to the landlocked property.

Will: A testamentary disposition of property, usually in a form prescribed by law, that takes effect upon death.

Wrap-around Mortgage: A method of refinancing in which a second lender assumes payment of the present mortgage and gives the mortagagor an increased mortgage at a higher interest rate. See also "All-Inclusive Deed of Trust."

Write of Execution: A direct command from the court to the sheriff to carry out the action required in the write, usually to seize property and sell it to pay a money judgment.

Zone: Area in community set off by the zoning authority for specified uses, e.g., single-family residence.

Zoning: Laws passed by local governments regulating the size, type, structure, nature and use of land or buildings

Zoning Ordinances: Laws passed by local governments regulating the size, type, structure, nature and use of buildings. Zoning ordinances, often referred to as zoning laws and zoning regulations, are divided into two classes: Those which regulated the height or bulk of buildings within certain designated zones or districts - in other words, those which related to structural and architectural design; and those which prescribe the type of buildings which may be constructed and the use to which buildings within certain designated zones or districts may be put.

So there you are. We hope this helps answering most of your question, but if you have any more questions, just give us a call or drop us an email and we will be happy to help you in any way we can with the sale or purchase of your home.