Glossery Terms

Question 1

Acceleration clause

Answer 1

The acceleration clause is a contract provision that allows a lender to require a borrower to repay all of an outstanding loan if payments are not being made or there is a breach of contract

Question 2

Abutting

Answer 2

Abutting means an area of land or a building has a common boundary with another.

Question 3

Accretion

Answer 3

Accretion is the slow process of growth or acquisition of land, typically when soil is deposited by the natural action of water. Long-term accretion can actually increase the size of a property.

Question 4

Active property

Answer 4

If you or your client sees a home listing with just “active” as their status, this indicates that the property is available for sale.

Question 5

Actual fraud

Answer 5

Actual fraud is an intentional misrepresentation of fact; or in plain terms lying.

Question 6

Ad valorem

Answer 6

The Latin phrase ad valorem means “according to value.”

Question 7

Adjustable-rate mortgage (ARM)

Answer 7

An adjustable rate mortgage has a flexible interest rate. Adjustable rate mortgages have a fixed period during which the initial interest rate remains the same, after that the interest rate adjusts at a pre-arranged frequency. The fixed-rate period can vary significantly anywhere from one month to 10 years.

Question 8

Adverse possession

Answer 8

Adverse possession is the legal principle in which a person who does not have the legal right to a property acquires legal ownership based on the continuous occupation of the land without the permission of its real owner.

Question 9

Agent

Answer 9

An agent is one who speaks for or represents someone.

Question 10

Agreement of sale

Answer 10

A form that states the buyer consents to purchase a property and the seller agrees to sell that property with the terms and conditions illustrated in from both parties.

Question 11

Air rights

Answer 11

Air rights are the rights to use the space above the earth.

Question 12

Alienation

Answer 12

Alienation is the act of transferring title, ownership, an estate, or an interest in real estate from one party to another.

Question 13

Alienation clause

Answer 13

The provision in a mortgage or deed of trust signed with the lender that states that the borrower must pay the mortgage in full before the borrower can transfer the property.

Question 14

Amendments

Answer 14

Add on’s, or fixes to contracts.

Question 15

Amenities

Answer 15

Amenities are a useful feature or add on to a house that typically adds value to the property.

Question 16

Amortization

Answer 16

Amortization is when payments divide into equal amounts for the duration of the loan.

Question 17

Antitrust laws

Answer 17

Antitrust Laws are a collection of federal and state government laws that regulate the conduct and organization of business corporations, normally to promote fair competition for the benefit of consumers.

Question 18

Appraisal

Answer 18

An appraisal is an estimate of approximate worth of something.

Question 19

Appraisal contingency

Answer 19

Most big lenders or banks require the buyer to have an appraisal done to the property before the loan is granted. This is to ensure the house is worth somewhat close to the price of the accepted offer.

Question 20

Appraiser

Answer 20

Although brokers and agents usually have some understanding of the valuation process, usually they bring in an appraiser to do the job. Appraisers must have detailed knowledge of the methods of valuation and many states require a specific license or certification to perform those duties.