A, B, C, D paper
Mortage loans are rated as A, B, C, or D paper. "A" paper loans are the highest quality, lowest risk loans; "B" quality are loans where the borrower has minor credit problems; "C" quality are borrowers with marginal or poor credit; "D" quality indicates very high risk loans.

ABANDONMENT
Abandonment occurs when a person with a right or interest in a property voluntarily gives up that right or interest, either by physically "abandoning" the property or by showing the intention to give up the right or interest.

ABATEMENT
A decrease or reduction in the price of a property (or in rent chargeable to a tenant). Usually occurs as a result of the discovery of a negative fact about the property which decreases its value from the price originally agreed upon by the parties. The removal of a nuisance.

ABLE
Quite literally, being capable. A Purchaser is ready, willing and able to complete a transaction when she has funds and has signed the documents required to transfer title to a property. If the Vendor is not ready, willing and able to complete the transaction on the date set for completion, the Purchaser may tender upon the Vendor and sue as a result of the failure to complete the transaction.

ABSENTEE OWNER
An owner of a property who lives elsewhere, leaving tenants in control and occupation of the property.

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ABSORPTION RATE
Expressed as a percentage, the number of properties that can be bought or sold in a particular market. May be broken down as to types and sizes of properties.

abstract of judgment
A full summary by the court of a judgment. It becomes a general lien on all of a debtor's property in the county where it is recorded.

ABSTRACT OF TITLE
A summary listing of the documents registered in the local land registry office and which affect title (ownership) of a particular property.

abstracter
The person preparing the abstract of title. The abstracter searches the title as recorded or registered with the county recorder, county registrar, circuit court and/or other official sources. He or she then summarizes the various instruments affecting the property and arranges them in the chronological order of recording, starting with the original grant of title.

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ABSTRACTION (EXTRACTION) METHOD
A method by which the value of land may be established. Uses comparable, improved properties and establishes a ratio of their original land value to their value after they have been developed.

ABUT
Adjoin or share a common boundary, or share even a small portion of a boundary.

ACCELERATED DEPRECIATION
Depreciation is the reduction of the value of a property or chattel as a result of the passing of time (i.e. a new car may be worth $20,000.00, $18,000.00 after one year, $16,000.00 after two years etc.). Usually used for tax purposes, the depreciation in the value of a property may be used as a tax deduction. If a property or chattel loses its value quickly, this depreciation rate may be accelerated so that most of the value is lost in the first few years and then the depreciation rate decreases later in the property's life span. Also known as "Writing down" the value of a property (or a chattel).

ACCELERATION CLAUSE
A clause in a mortgage or loan. If the borrower fails to live up to her obligations under the mortgage, the lender has the legal right to demand that the full principal of the mortgage may become due and payable immediately upon the failure.

ACCEPTANCE
A positive response to an offer or a counter-offer that creates a binding agreement between the parties. Acceptance may be conditional upon the occurrence of certain events. The acceptance must be communicated to the offeror.

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ACCESS
The right to enter a property. Access may be restricted to certain times, to certain persons and to certain purposes (i.e. access for the purpose of inspection).

ACCESSIBILITY
The ease with which one can reach a certain place, person or thing. A property may be inaccessible because it is located far back along a winding, mountainous road that is often blocked in winter. A property may also be said to have good accessibility to highways, shopping, schools etc.

accession
Acquiring title to additions or improvements to real property as a result of the annexation of fixtures or the accretion of alluvial deposits along the banks of streams.

ACCESSORY BUILDING:
A structure on a property that serves a specific purpose, complementing the home or main building. A garage or storage shed.

accord and satisfaction
The settlement of an obligation. An accord is an agreement by a creditor to accept less than bargained for from a debtor. The creditor's acceptance of the accord constitutes satisfaction of the debt.

accounting
The agent must be able to report the status of all funds received from or on behalf of the principal. Most state real estate license laws require a broker to give accurate copies of all documents to all parties affected by them and to keep copies on file for a specified period of time. Most license laws also require the broker to deposit immediately, or within 24 to 48 hours, all funds entrusted to the broker (such as earnest money deposits) in a special trust or escrow account. Commingling such monies with the broker's personal or general business funds is strictly illegal.

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ACCREDITED ASSESSMENT EVALUATOR (AAE)
A professional designation. A property evaluator who has achieved the requirements of the International Association of Assessing Officers.

ACCREDITED LAND CONSULTANT (ALC)
A professional designation. A person who has met the requirements of the Realtors Land Institute to aid in the marketing of real property.

ACCREDITED RESIDENTIAL MANAGER (ARM)
A professional designation for a person trained to manage residential properties. A person who has earned the designation by fulfilling the requirements of the Institute of Real Estate Management (IREM), which is an affiliate of the National Association of Realtors.

ACCRETION
The growth in size of a parcel of land as a result of the actions of such natural forces as wind or water.

ACCRUED
An adjective describing something that has come into existence but has not yet been claimed by or distributed to its rightful owner.

ACCRUED DEPRECIATION
From a tax standpoint, the amount of value of a property or chattel which has already accumulated (but has not been claimed) as a result of the decrease in the value of that property due to the passage of time and the use of the property or chattel.

ACCRUED INTEREST
Interest which has already been earned but has not yet been paid.

ACKNOWLEDGEMENT
A statement by a person to the effect that they are aware of a certain fact. May also be a sworn document to the same effect, which further states that the person signing the document did so voluntarily.

ACQUISITION
The process of taking title to or ownership of something.

ACQUISITION COST
The cost to the purchaser of obtaining title to anything, including real property. Acquisition cost includes the cost of the transaction of obtaining title, including legal fees and expenses, interest charges on mortgages, land transfer tax, etc.

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ACRE
An imperial measure for land. Equals 43,560 square feet; 4,047 square meters; or 0.047 hectares.

ACT OF GOD
When used in insurance policies, an event caused by natural forces such as rain, lightning, floods or earthquakes which results in damage to property or chattels.

ACTION TO QUIET TITLE
A legal proceeding begun for the purpose of settling competing claims to property and establishing clear legal title in one party.

ACTUAL AGE
As opposed to effective age. The objective age in years of a building measured simply by the passage of time since it was constructed. Effective age is a subjective measurement of the condition of a building, influenced mostly by the maintenance and upkeep carried out on the building over the years.

ACTUAL AUTHORITY
With reference to an agent or representative. The limits of the power the agent or representative has to bind her principal to an agreement or to a statement.

ACTUAL CASH VALUE
An insurance term, the value of a building calculated by subtracting the decrease in value caused by age and wear and tear from the cost of replacing the building entirely.

ACTUAL DAMAGES
Real, substantial and just damages, or the amount awarded to a complainant in compensation for his actual and real loss or injury. An award of the court to compensate an injured party for losses incurred as a result of the actions or omissions of another party.

ACTUAL EVICTION
The legal process that results in the tenant's being physically removed from the leased premises.

actual notice
Express information or fact; that which is known; direct knowledge.

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ACTUAL POSSESSION
As opposed to constructive possession. When the owner of a property occupies the property on a day-to-day basis. Constructive possession is when the owner takes actions to establish and maintain his ownership of a property without actually occupying it himself (i.e. leasing it to tenants, removing squatters, hiring a security firm).

AD VALOREM
Latin meaning "according to value." Taxes that are said to be ad valorem are assessed according to the value of the property.

ADC LOAN
A loan that finances the three major phases of a land development project: (i) acquisition, (ii) development and (iii) construction.

add-on rate
Interest charged on a principal amount for specified term, regardless of any repayments of principal. The borrower is paying interest on the full principal sum for the entire loan period, even though the principal is being reduced each month.

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ADDENDUM
An addition to a document that forms part of it. Similar to a Schedule to an Agreement of Purchase and Sale. May be used to add specific and detailed information material to the contract or upon which contractual terms are based.

ADDITIONAL PRINCIPAL PAYMENT
A one-time or lump-sum payment made by a borrower in addition to the regular payments on a loan or mortgage which reduces the principal owing on the debt.

ademption
Disposal by a testator in his or her lifetime of a specific property bequeathed in his or her will so the bequest is revoked. (See testator)

ADEQUATE PUBLIC FACILITIES ORDINANCE
An ordinance by the local level of government controlling development by requiring that infrastructure works (roads, sewers, hydro lines) be completed prior to or concurrent with the building of dwellings or commercial buildings in a new development.

ADJACENT LAND
An inexact term used to described any property which is situated near or abutting a certain piece of property. Note, an abutting property will always be adjacent but an adjacent property may not be abutting.

ADJUSTABLE RATE MORTGAGE (ARM)
Also known as a Variable Rate Mortgage, a loan secured against land which has an interest rate that changes according to some outside index -- such as the federal prime rate or the interest rate paid on government bonds -- over the term of the mortgage. The change in interest rate will result in a change in the periodic payments due under the mortgage.

ADJUSTED COST BASE
For the purposes of determining capital gains or losses. The acquisition cost of a property or chattel, plus the cost of any improvements to the property.

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ADJUSTED SALES PRICE
The result of estimating the value of a property by comparison to comparable properties. Take the actual sale price of a property comparable to the subject property, then add the value of any extras which the subject property has but the comparable property did not, then subtract the value of any deficiencies in the subject property not shared by the comparable property.

ADJUSTMENT DATE
Mortgage term usually preceded by the word "Interest" (i.e. "Interest Adjustment Date"). The date soon after the completion of a purchase and mortgage transaction on which the borrower must make a payment of accumulated interest only, usually used to place the periodic payment dates for the mortgage at the first day of the month (i.e. you borrow on March 18, your interest adjustment date is April 1 and your first regular monthly payment is May 1).

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ADJUSTMENT INTERVAL
Also known as Adjustment Period. The period of time (i.e. week, month, year) between changes in the interest rate charged on a adjustable-rate mortgage.

ADJUSTMENT PERIOD
In an adjustable rate mortgage (ARM), the "adjustment period," is the period of time (i.e., one month, three months, six months, one year, etc.) between changes in one interest rate charged and the next interest rate to be charged. (See adjustable rate mortgage (ARM))

ADJUSTMENTS
In real estate sales, the changes made to the selling price to account for the advantages and disadvantages of the subject property, market conditions etc. When closing a real estate transaction, the changes to the purchase price made as a result of realty taxes over- or under-paid by the Vendor, fuel oil provided, tenant's rental payments etc. (Contained on the Statement of Adjustments).

administered price system
Federal National Mortgage Association securities purchasing procedure where required yields are adjusted daily to reflect financial market factors.

administrative agency
A government agency that makes rules and regulations to carry out the law. A state's real estate commission develops regulations to complement license law.

administrative order
A legal document signed by the EPA directing an individual, business, or other entity to take corrective action or refrain from an activity. The order describes the violations and action to be taken and can be enforced in court.

ADMINISTRATOR
A male person appointed by a Court to deal with the estate of a deceased person who died without leaving a will (who dies "intestate"). Note, an executor is a person who is named in a will to deal with the estate of a deceased person.

administratrix
A female person appointed by the court to settle the estate of a person who has died intestate (leaving no will). Sometimes referred to as the personal representative.

advance fee
A fee paid before any services are rendered. Specifically, it is a practice of some brokers to obtain a nonrefundable fee from the seller in advance to cover the advertising of properties or businesses for sale while giving no guarantee that a buyer will be found, which is often held to be improper conduct. Brokers must keep accurate records of expenditures.

advance fee addendum
An agreement specifying services for which an agent or broker will be compensated including a provision for payment of an advance fee.

ADVERSE POSSESSION
A method of acquiring or claiming title (ownership) to a piece of land owned by another by occupying it in defiance of the other's title. Most jurisdictions have statutes that set out a certain period of time throughout which the person claiming adverse possession must occupy the land before title passes to that person by operation of law.

AESTHETIC VALUE
A subjective element in the overall market value of a property created by the physical presentation of the land or buildings.

AFFIANT
One who swears an affidavit.

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AFFIDAVIT
A sworn statement setting out facts which the affiant states are true. Sworn before a Commissioner for swearing Oaths, Notary Public or other public official.

AFFIDAVIT OF TITLE
A Vendor's statement to the effect that title is good and marketable and subject to no defects other than those set out in the Agreement of Purchase and Sale or the Vendor's Deed.

AFFIRMATION
Instead of a sworn oath, a solemn and formal declaration regarding the truth of a statement of facts. Often used when a person's religious convictions preclude swearing an oath.

AFFIRMATIVE FAIR HOUSING MARKETING PLAN
In an initiative sponsored by the Department of Housing and Urban Development (HUD) to foster integration of races in new housing projects, such a Plan is required before a project becomes eligible for certain U.S. programs.

AFTER-TAX CASH FLOW
The net proceeds from an income-producing property, after all costs (taxes, mortgage interest, maintenance costs etc.) of owning and operating the property have been deducted.

AFTER-TAX PROCEEDS FROM RESALE
The net proceeds from the sale of a property. The sale price minus legal fees and expenses, realty commission, any taxes paid, mortgage payout etc.

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AGENCY
The relationship between a person (the Principal) and another person (the Agent) who was appointed, selected, empowered, given authority by the Principal to represent the interests of the Principal in dealings with third parties and to bind the Principal to statements, warranties or contracts.

AGENCY BY ESTOPPEL (OSTENSIBLE AGENCY)
An agency relationship created by the actions, behavior or statements of the Principal and/or the Agent upon which a third party relies. Ostensible Agency may be found by a court where no agency relationship was intended by the Principal.

AGENCY BY NECESSITY
An agency relationship where the authority to represent is imputed to the Agent as a result of an emergency situation to protect the interests of the Principal.

AGENCY BY RATIFICATION
An agency relationship which is created after the fact when the Principal agrees to be bound by the actions of another person who was acting without authority.

AGENT
A person empowered by a Principal to act on behalf of the Principal in dealings with third parties. The third party is entitled to rely upon the agreement, assurances or statements of the Agent as being binding on the Principal.

AGREEMENT OF SALE
Also known as Purchase Agreement, Agreement of Purchase and Sale, Land Agreement etc. A legal contract in which one party agrees to buy and another agrees to sell a property or chattel. Contains terms and conditions of the transaction and is signed by the parties.

AGREEMENT
A legally binding contract between two or more people, representing a meeting of minds on one or more issues.

AGRICULTURAL PROPERTY
Land zoned for agricultural or farming activities.

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AIR RIGHTS
A saleable commodity, the right to occupy or use the air space above a specific property.

ALIENATION CLAUSE
A term of a mortgage which allows the creditor to demand payment in full of principal and interest due upon the sale of the property.

ALLOCATION (ABSTRACTION) METHOD
Estimating the value of land only by deducting the value of the buildings etc. on the land from the actual market value of the property as a whole.

ALLODIAL SYSTEM
The system of ownership of property in the United States, meaning free from any claims or rights of a monarch or a feudal lord.

ALTERATION
A change made to an executed contract which has not been approved by the parties to the contract. An alteration may constitute fraud if it has the impact of significantly affecting the rights of a party to the contract and was intentionally carried out by another party. If fraud is found, the innocent party may void the contract.

AMENITIES
Positive features of a particular property (such as a pool, central air conditioning, etc.) or attractions located near a particular property (highways, school, shopping, etc.) which have the effect of enhancing the property's value. Features that enhance the value or desirability of a property.

AMERICAN LAND TITLE ASSOCIATION (ALTA)
Trade association of American title insurance companies, with a view to standardizing the policies nationwide.

AMERICAN RURAL APPRAISER
A Professional Designation. Awarded by the American Society of Farm Managers and Rural Appraisers.

AMERICAN SOCIETY OF APPRAISERS
A Professional Society, for persons involved in the appraisal of both real and personal property.

AMERICAN SOCIETY OF HOME INSPECTORS, INC. (ASHI)
A Professional Trade Organization, for persons specializing in the inspection of the physical condition of homes.

AMERICAN SOCIETY OF REAL ESTATE COUNSELORS (ASREC)
A Professional Society, for persons specializing in helping people buy and sell homes.

AMORTIZATION
The preparation of a payment plan for a loan which allows for equal payments to be made to the creditor at consistent intervals over the life of the loan (the amortization period). Each payment covers interest accrued over the interval period with the remainder of the payment being applied to reduce the principal owed. If every payment is made on time and in full over the amortization period, the loan will be completely repaid at the end of the amortization period.

AMORTIZATION SCHEDULE
The printed table of the payments to be made on an amortized loan showing the date and amount of each payment, the amount of each payment which will be applied to interest and to principal and the balance of principal still outstanding on the loan after the payment is made.

Amortize
To pay a debt in periodic amounts until the total amount, including any interest, is paid.

ANACONDA MORTGAGE
A specific kind of mortgage. Contains a clause that states that it secures all debts owed to the mortgagee by the mortgagor and applies to rules of the mortgage to all such debts. Clause is also known as a Mother Hubbard clause.

ANCHOR TENANT
Description of a tenant in a shopping mall or center. A "name" store that will draw shoppers to the mall and, therefore, benefit the other mall stores. Usually receives a favourable lease.

ANNUAL DEBT SERVICE
The total amount required to service a loan in a given year.

ANNUAL LOAN CONSTANT
Ratio of Annual Debt Service to original principal of the loan. Also known as a mortgage constant.

ANNUAL MORTGAGOR STATEMENT
Document sent by the lender to the mortgagor each year which sets out amounts paid for principal, interest and taxes in the given year and the amount still owing on the principal of the mortgage at the end of the year.

ANNUAL PERCENTAGE RATE (A.P.R.)
A rate designed to allow for the comparison of one type of loan to another. The annual cost of borrowing under a given form of loan (includes in the calculation compounded interest, cost of borrowing etc.). Required to be disclosed by the lender under the American Truth in Lending Act, Regulation Z.

ANNUITY IN ADVANCE
A form of periodic payment. Payments are made at the beginning of each payment period rather than at the end of each period, as with a normal annuity.

ANNUITY
A form of periodic payment. Made to the recipient at consistent periodic intervals either for life or for a fixed period of time.

ANTICIPATION, PRINCIPAL OF
An approach to assessing the future value of land based on possible contingencies (positive or negative).

ANTITRUST LAWS
Laws requiring competition and a free market, outlawing monopolies in certain businesses.

AO (ACCEPTED OFFER)
A short form used by agents to designate that an offer to purchase has been accepted by the offeree.

APPARENT AUTHORITY
Where an agent compels, by actions, omissions or statements, a third party to believe the agent has the authority to bind a principal. The authority to bind is apparent due to the behavior of the agent but may not actually exist.

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APPLICATION
A form filled out in order to allow a lender to consider a person for a mortgage or loan. Will contain personal and financial and personal information on the applicant.

APPLICATION FEE
The fees the lender charges the applicant. May include costs of a property appraisal and a credit report on the applicant. May be payable by applicant even if loan is not approved.

APPOINTMENTS
Chattels or decorative touches that may affect the value of a property.

APPORTIONMENT CLAUSE
A clause in a policy of insurance. Allows the payment of compensation for a loss to be divided between insurers holding different policies on the same property.

APPORTIONMENT
Also known as adjustment. The division of responsibility for certain costs between the parties to a transaction, such as realty taxes. In many U.S. jurisdictions, the vendor is responsible for the day of closing and all days prior to it.

APPRAISAL
An estimation of the value of a property on a certain date given by a qualified person, usually after an inspection of the property.

APPRAISAL PRINCIPLES
Elements to be considered by an appraiser in appraising the value of a property, such as competition, supply and demand.

APPRAISAL PROCESS
A standardized approach to appraising a property, to allow for accuracy and consistency.

APPRAISAL REPORT
Documentation to support an appraisal of a property. Varies in length but sets out elements considered, positive and negative aspects of property etc.

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APPRAISED VALUE
The estimated market value of a property on a given date, given by a qualified person as a result of an inspection of the property and a consideration of other market forces.

APPRAISER
A professional who has been trained to assess the value of property.

APPRECIATION
The increase over time in the value of a property caused by many factors: market conditions, inflation, changes to area around the property, etc.

APPROACHES TO VALUE
Different methods by which appraisers estimate the value of a property. Include: (1) cost approach, (2) comparison approach, and (3) income approach.

appropriation
Appropriation is the way a taxing body authorizes the expenditure of funds and provides for the sources of funding. Appropriation generally involves the adoption of an ordinance or the passage of a law that states the specific terms of the proposed taxation.

APPROVED ATTORNEY
A lawyer who meets the requirements of title insurance companies to be able to complete transactions involving title insurance and to render title opinions.

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APPURTENANCE or Appurtenant
A right or entitlement which forms part of the ownership of a property and which passes to a new owner when title passes (i.e. an easement or right of way over another property). For example, the garage is appurtenant to the house, and the common interest in the common elements of a condominium is appurtenant to each apartment. Appurtenant items run with the land when the property is transferred.

appurtenant easement
An easement that is annexed to the ownership of one parcel and allows the owner the use of the neighbor's land.

arbitrage
Borrowing at one interest rate and investing at a higher rate.

ARBITRATION
An Alternative Dispute Resolution method. Allows an objective third party to settle disputes between parties without resorting to court. Binding arbitration involves the parties agreeing to be bound by the decision of the arbitrator. This method was either previously agreed to by the disputing parties or stipulated by law.

"ARM'S LENGTH" TRANSACTION
A colloquial description of a transaction where none of the parties are related to each other or have common interests -- they have each other at "arm's length". An arms-length transaction is generally at fair market value; in a "non-arm's-length" transaction, the relationship between the parties may cause one or the other to accept less than they are entitled or pay more than fair market value.

arranger of credit
As defined under the federal Truth-in-Lending Law, a person who regularly arranges for the extension of consumer credit by another person if a finance charge will be imposed, if there are to be more than four installments, and if the person extending the credit is not a creditor. At present, the term does not include a real estate broker who arranges seller financing of a dwelling or real property. (See Truth-in-Lending Law)

ARREARS
Money which is not paid when due, under a payment plan or amortization schedule. Could lead to enforcement of loan agreement by lender

ARTERIAL STREET
A main thorough fare or through road, one which is designed to carry traffic through an area where that area is not the destination of the traffic.

Article 5
The part of the Business and Professions Code governing transactions in real property sale contracts and trust deeds.

Article 6
The part of the Business and Professions Code governing real property securities dealers.

Article 7
The part of the Business and Professions Code governing commissions, loan costs, and payment requirements in loan brokerage activities.

ARTIFICIAL PERSON
As opposed to a natural person. A corporation of other legal entity which has at least some of the legal rights of a human being.

AS IS
Implied in most Agreements of Purchase and Sale, suggests the Purchaser is accepting the property in its current condition and releases the Vendor from any liability for problems found before or after closing.

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"AS-IS" AGREEMENT
A statement in the Agreement of Purchase and Sale that confirms that the Purchaser shall accept the property and all chattels included in the Purchase in the condition in which they are found at the time the Agreement is signed.

ASKING PRICE
The price at which the Vendor advertises a property. When used in the advertisement, may suggest flexibility on the part of the Vendor regarding the price.

assemblage
The combining of two or more adjoining lots into one larger tract to increase their total value.

ASSESSED VALUE
The value assigned to a given property by the municipality for the purpose of establishing realty taxes payable by the owner of the property.

ASSESSMENT
Generally, the apportionment of liability of a general cost among individuals. The act of estimating the value of land for tax purposes or the method by which municipalities raise taxes (property tax assessment).

ASSESSMENT BASE
The total of the assessed values of all properties in a municipality.

ASSESSMENT RATIO
Assessed value as compared to full market value for a particular property or for all properties as set by the municipality. Also the imposition of a tax, charge or lein, usually according to established rates.

ASSESSMENT ROLL
Public record of the assessed values of properties. Also includes Assessment Roll Number for each property, the number by which the property is identified in the municipal records.

ASSESSOR
A person who is employed by the municipality to estimate the value of properties for the purpose of taxes.

ASSET
A thing of value, encumbered or not, owned by a person, corporation or other entity. Assets are financial (cash or bonds), tangible or intangible, or physical (real or personal property).

asset management
The assembly, management and disposition of a portfolio of investment properties.

ASSIGN
To transfer interest in a property, contract, right etc..

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ASSIGNEE
The person to whom an interest is transferred. An assignee of an Agreement of Purchase and Sale may buy the property and enforce the contract in the same fashion as the original party.

ASSIGNMENT
The transfer of any right, claim or interest to another person or corporation. Often used to refer to the transfer of a mortgage from one lender to another. Also a noun describing the document which represents the assignment of the right etc.

ASSIGNMENT OF LEASE
Subject to the terms of the lease, a transfer of either the lessor's or the lessee's interest in a lease.

ASSIGNOR
The person who assigns a right or interest to another person.

ASSOCIATE BROKER
A qualified real estate broker who works with or for another broker. Also called a broker-salesperson, broker-associate or affiliate broker.

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ASSUMABLE MORTGAGE
A mortgage that can be taken over ("assumed") by the buyer when a home is sold. If interest rates have risen, an assumable mortgage at a low rate may prove a selling point for the property.

ASSUMPTION CLAUSE
The paragraph in the mortgage which sets out the borrower's right to have the mortgage assumed by a purchaser.

ASSUMPTION FEE
A charge levied by the lender (usually against the party assuming the mortgage) for the privilege of assuming a mortgage. May be a fixed amount or a percentage of outstanding principal on the mortgage at the time of the assumption.

ASSUMPTION OF MORTGAGE
The agreement of a purchaser to take on personal liability for a mortgage already registered on title to the property and to make payments under the mortgage. Purchaser takes the place of the vendor in the contract with the lender.

assumption "subject to"
When a loan is taken "subject to," the seller agrees to remain liable and the buyer accepts no liability in the event of a deficiency on a foreclosure.

AT-RISK RULE
A limitation of the amount an investor can claim on his incomes taxes as a result of losses from real estate investments, under the Tax Reform Act of 1986.

ATTACHED HOUSING
Duplex, triplex, row housing, or townhouses. Two or more dwellings that are attached physically but are owned and/or occupied by different people.

ATTACHMENT
The binding by a court of a piece of property (real or personal) as security for a debt. The lien is thus created by operation of law, not by private agreement. The plaintiff may recover such property in any action upon a contract, express or implied.

ATTESTATION
A statement by a person who has witnessed another person signing a document to the effect that they did in fact witness the document. May include statements to the effect that the witness knew the person who signed personally, that the person who signed understood the contents of the document when he signed etc. Required in some states for deeds.

ATTORNEY AT LAW
A person who has met the requirements to practice law in a particular state of the United States.

ATTORNEY IN FACT
A person who holds a POWER OF ATTORNEY for another person, which gives the Attorney the power to act on behalf of that other person and bind that other person.

ATTORNEY'S OPINION OF TITLE
A statement of a lawyer's conclusions with regard to the state of the legal title of a property, issued after the lawyer has completed the appropriate investigations of title.

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ATTRACTIVE NUISANCE
"Attractive" refers to the response of children to a feature of land (whether natural or man-made) which has the potential to be harmful (an uncovered well, a swimming pool, a swift moving stream).

AUCTION
The process of selling property to the highest bidder.

AUCTIONEER
A professional (real estate broker or auctioneer, depending on local laws) who sells property at public auctions. Usually paid a percentage of the sale price.

AUGMENTED ESTATE
The assets of a deceased person against which a surviving spouse may claim an interest. Can include property which the deceased person disposed of while still living if the disposal was in the form of a gift or was not for value.

AUTHORITY
The right of an agent, conferred by his principal, to bind the principal in dealings with third parties. See actual authority, implied authority, apparent authority, ostensible authority, inherent authority.

AUTHORIZATION TO SELL
A contract between an property owner and a real estate broker or agent which allows the broker to list the property for sale and which codifies the rights and obligations of the two parties.

automated underwriting
Computer systems that permit lenders to expedite the loan approval process and reduce lending costs.

automatic extension
A clause in a listing agreement that states that the agreement will continue automatically for a certain period of time after its expiration date. In many states, use of this clause is discouraged or prohibited.

avulsion
The sudden tearing away of land, as by earthquake, flood, volcanic action or the sudden change in the course of a stream.

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