Glossary

ABSTRACT OF TITLE A condensed history or summary of all transactions affecting a particular tract of land.

ADJUSTABLE RATE MORTGAGES (ARM) Mortgages with an interest rate that may change up or down depending on an indicator. These are usually based something like the current Treasury bill rate.

AFFIDAVIT A sworn statement in writing.

ANNUAL PERCENTAGE RATE (APR) On some mortgages the APR is higher than your actual mortgage rate.

ASSUMPTION A mortgage that allows a new owner to take over payments. The original borrower remains liable on the mortgage note.

DECREE An authoritative order or judgment of a court of equity.

DEED A written document by which the ownership of land is transferred from one person to another.

DEPOSIT OR EARNEST MONEY Advance payment of part of the purchase price to bind a contract for property.

DUE-ON-SALE CLAUSE A provision in a mortgage or deed of trust, which requires the loan to be paid in full if a property is sold or transferred.

EQUITY The interest or value, which an owner has in real estate over and above the debts against it.

ESCROW (1) A procedure whereby a disinterested third party handles legal documents and funds on behalf a seller and buyer. (2) Money that is kept by the mortgage company to ensure that taxes can be paid in full when due. This is paid up front on settlement...

FEDERAL HOUSING ADMINISTRATION (FHA) 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.

FORECLOSURE Legal process by which a mortgagor of real property is deprived of his interest in that property due to failure to comply with terms and conditions of the mortgage.

GRANTEE A person who acquires an interest in land by deed, grant or other written instrument.

GRANTOR A person who, by a written instrument, transfers to another interest in land.

HAZARD INSURANCE The homeowner’s insurance policy.

HEIR One who might inherit or succeed to an interest in lands under the rules of law applicable where an individual dies without leaving a will.

IN PERSONAM Directed at specific persons rather than against property or generally for all people.

IN REM A legal term, pertaining to property or people in general, describing the power a court may exercise over property.

INSTRUMENT A written document.