Vocabulary very likely to appear on ST exam Flashcards
Ad Valorem
A method of taxation using the value of the real estate to determine the amount of the tax.
Agency
Any relationship in which one party (agent) acts for or represents another (principal), under the authority of the latter.
Agent
One who acts for and with authority from another called the principal.
Air rights
The rights in real property to the reasonable use of the airspace above the surface of the land.
Alienation
The transferring of property to another; the transfer of property and possession of land, or other things from one person to another.
ALATA Title Policy
(American land title Association) A type of title insurance policy issued by title insurance companies which expands the risks normally insured against under the standard policy to include unrecorded mechanics lien; on recorded 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.
Appurtenances
Any part of Real Property which passes upon the transfer, either attached or not, such as a barn or an easement.
Assignment
A transfer to another of any property, real or personal, or of any rights or Estates in said property.
Assignor
One who assigns or transfers property.
Assigns, assignees
Those to whom property or interests therein shall have been transferred.
Assumption
Agreement by a buyer to assume the liability under an existing note secured by a mortgage or deed of trust.
Attachment
The process by which real or personal property of a party to a lawsuit is seized and retained in the custody of the court for the purpose of acquiring jurisdiction over the property, to compel an appearance before the court, or to furnish security for a debt or costs arising out of the litigation.
Attest
To affirm to be true or genuine; an official act establishing authenticity.
Balloon note
A note calling for periodic payments which are insufficient to fully amortize the loan, so that a principal sum known as a balloon is due at maturity.
Balloon payment
A lump sum payment, usually at the end of the term of a note with terms insufficient to fully amortize the loan, or due prior to the end of the amortization period.
Band of investment
Used to determine a cap rate using a weighted average of select rates.
Base and Meridian
Imaginary lines used by surveyors to find and describe the location of private or public lands. In government surveys, a baseline runs due east and west, meridians run due north and south, and are used to establish township boundaries.
Basis
(1) Cost basis is the dollar amount assigned to property at the time of acquisition under provisions of the internal revenue code for the purpose of determining gain, loss and depreciation in calculating the income tax to be paid upon the sale or exchange of property. (2) Adjust basis is the cost basis after the application of certain additions for improvements, Etc., and deductions for depreciation, etc.
Beneficiary
(1) The lender on the security of a note and deed of trust. (2) One entitled to the benefit of a trust. (3) One who receives profit from an estate, the title of which is vested in the trustee.
Bill of sale
An instrument by which one transfers personal property.
Block busting
The practice on the part of unscrupulous speculators or real estate agents of inducing panic selling of homes at prices below market value, especially by exploiting the prejudices of property owners in neighborhoods in which the racial make-up is changing or appears to be on the verge of changing. This practice is prohibited by fair housing laws.
Boot
Unlike property used to equalize equities in an exchange that will trigger tax on the amount of the boot.
Bridge loan
An interim loan, generally made between a short-term loan and long-term loan, when the borrower needs to have more time before taking the long term, or permanent, financing.
Build to suit
The building of a structure to meet the specifications of a purchaser.
Bundle of rights
All rights and interests of ownership in Real Property considered together but separable.
Capital gains
Gains realized from the sale of capital assets, and generally the difference between cost and selling price, less deductible expenses. Used mainly for income tax purposes.
Capitalization
The determination of present value of income property by taking the annual net income, and dividing by a rate of return percentage which is commonly acceptable to buyers of similar properties (i.e. $10,000/11% = $90,909).
Capitalization rate
The percentage used to determine the value of income property through capitalization. The selected capitalization rate is the yield rate that is necessary to attract the money of the average investor to a particular kind of investment. The yield rate is used in the process of determining value based upon net income.
Caveat emptor
Let the buyer beware. The buyer must examine the goods or property and buy at his or her own risk, absent misrepresentation.
Chain of title
The chronological order of conveying of a parcel of land, starting from original owner.
Chattel
Personal property. Goods or every species of property movable or immovable which are not real property.
Closing statement
The required computation of financial adjustment between buyer and seller as of the date of closing. The final statement in most real estate transactions is known as a HUD-1 statement.
Collateral
Marketable real or personal property which a borrower pledges as security for a loan. In mortgage transactions, specific land is the collateral to secure the performance of a principal agreement (the promissory note).
Community property
Property acquired by husband and or wife during a marriage when not acquired as the separate property of either spouse. Each spouse has equal rights of management, alienation and testamentary disposition of community property. Washington is a community property state.
Comparables
Similar properties used as a comparison to determine the value of a specific property. Also known as comparable sales.
Comparative analysis
A comparison of similar properties to a subject property for the purpose of evaluating market value and proper pricing.
Condemnation
The taking of private property for public use without the consent of the owner, but only upon payment of just compensation.
Condition
(1) In contract law, a future and uncertain event which must happen to create an obligation or which extinguishes an existent obligation. (2) in conveyances of real property conditions in the conveyance may cause an interest to be vested or defeated.
Condominium
A structure of two or more units, the interior space of which are individually owned, with the balance of the property (both land and building) owned in common by the owners of each unit.
Contract
And agreement to do or not to do a certain thing. It must have four essential elements – parties capable of contracting, consent of the parties, a lawful object or purpose and consideration. A contract for sale of real property must also be in writing and signed by the party or parties to be charged with performance.
Contract for deed
An installment contract for the sale of real estate, where the seller has legal title until paid in full. The buyer only has equitable title during the contract term. Also known as a land sale contract or installment sale contract.
Contribution, principle of
An appraisal term wherin a component part of a property is valued in proportion to its contribution to the value of the home. Holds that maximum values are achieved when the improvements on a site produce the highest (net) return, commensurate with the investment.
Conventional loan
A mortgage or deed of trust not obtained under a government program, i.e. which is not FHA insured or VA guaranteed. Type of loan customarily made by a bank or savings and loan association.
Conveyance
Transfer of title to land. Includes most instruments by which an interest in real estate is created, mortgaged, or assigned.
Cotenancy
Ownership interest in a particular parcel of land by more than one person, I.E., tenancy in common, joint tenancy.
Creative financing
A general term which encompasses any method of financing property going beyond traditional real estate lending.
Dedication
The giving of land by its owner to a public use and the acceptance for such use by authorized officials on behalf of the public.
Deed
A conveying written instrument used to pass title to property upon sale from one person (grantor) to another person (grantee). To be valid a deed must be properly executed and delivered.
Deed of trust
Similar to a mortgage, a security instrument whereby Real Property is given as security for a debt. See trust deed.
Deferred maintenance
Repairs necessary to put a property in good condition.
Depreciation
Loss of value of property brought about by age, physical deterioration or functional or economic obsolescence. The term is also used in accounting to identify the amount of the decrease in value of an asset that is allowed in computing the value of the property for tax purposes.
Discount points
The amount of money the buyer or seller must pay the lender to get a mortgage at a stated interest rate. A point is equal to 1% of the loan amount.
Distress sale
A sale of property when the seller is under extreme pressure to sell, and which generally results in the property selling for less than market value.
Domicile
A person’s legal residence.
Dual agency
The representation by an agent of opposing principals (buyer and seller) at the same time. This practice is legal only if properly disclosed.
Duress
Unlawful constrain exercised upon a person whereby he or she is forced to do some act against his or her will.
Easement
A right created by Grant, reservation, agreement, prescription, or necessary implication, which one has in the land of another.
Economic life
Very profitable life of an improvement, which is generally shorter than the physical life.
Economic obsolescence
Loss of desirability and useful life of a property through economic forces, such as zoning changes, traffic pattern changes, etc., rather than deterioration.
Emblements
Growing crops. Are considered personal property.
Eminent domain
A governmental right to acquire property for public use by condemnation, and the payment of just compensation.
Encroachment
Generally, construction onto the property of another, as of a wall, fence, building, etc.
Encumbrance
A claim, lien, charge, or liability attached to and binding Real Property.
Equitable ownership
Ownership by one who does not have legal title, such as a vendee under a land sales contract.
Equity
Market value of Real Property, less the amount of existing loan balances.
Escheat
A reversion of property to the state in the absence of an individual owner, usually when a property owner dies without a will.
Escrow
A neutral third-party which receives all funds and instruments necessary to a sale, and which processes them according to instructions.
Estate
The interest or nature of the interest which one has in property.
Estate for life
An estate in Real Property for the life of a living person. The estate then reverts back to the grantor or to a third-party.
Estate for years
Any estate for a definite period of time, such as a lease.
Estate from period to period
An interest in land where there is no definite termination date but the rental period is fixed at a certain sum per week, month, or year. Also called a periodic tenancy.
Estate of inheritance
And the state which may descend to heirs.
Estate in remainder
An estate which vests in one other than a grantor, after the termination of an intermediate estate.
Estoppel
A legal theory under which a person is barred from asserting or denying a fact because of the person’s previous acts or words.
Exclusive agency listing
A listing under which the brokers commission is protected against a sale by other agents but not by a sale by the principal.
Exclusive right to sell
A listing contract whereby the owner promises to pay a commission to the broker if property is sold during a stated period, regardless of whether or not the broker is the cause of sale.
Fair housing law
Title VIII of the civil rights act, which for bids discrimination in the sale or rental of residential property because of race, color, sex, religion, or national origin.
Fair market value
This is the amount of money that would be paid for a property offered on the open market for a reasonable period of time with both buyer and seller knowing all the uses to which the property could be put and with neither party under pressure to sell or buy.
Federal housing administration
(FHA) an agency of the federal government that insures private mortgage loans for financing of new and existing homes and home repairs.
Fee
An estate of inheritance in real property.
Fee simple estate
An estate under which the owner is entitled to unrestricted powers to dispose of the property, and can be left by will or inherited. The greatest interest one can have in Real Property.
Fiduciary
One acting in a relationship of trust and confidence. In real estate practice as between a principal (seller or buyer) and a broker. The fiduciary owes the duties of loyalty, accounting, disclosure, care and confidentiality. These duties cannot be breached.
Fiduciary duty
The duty owed by an agent to act in the highest good faith toward the principal and not to obtain any advantage over the principal by the slightest misrepresentation, concealment, duress or pressure. The common law fiduciary duties are loyalty, accounting, disclosure, care and confidentiality.
First mortgage
A mortgage having priority over all other voluntary liens against certain property. The mortgage that is superior to all others, usually determined by the order in which it was recorded.
First trust deed
A legal document pledging collateral for a loan that has first priority over all other claims against the property except taxes and bonded indebtedness. The trust deed that is superior to all others, usually determined by the order in which it was recorded.
Fixtures
Personal property which is attached to Real Property, and is legally treated as Real Property while it is so attached.
Foreclosure
A procedure in or out of court, to extinguish all rights, title, and interest of the owners of property in order to sell the property to satisfy a lien against it.
Fraud
The intentional and successful employment of any cunning, deception, collusion used to circumvent, cheat or deceive another person whereby that person acts upon it to the loss of property and to legal injury. Actual fraud is a deliberate misrepresentation or representation made in reckless disregard of its truth or it’s falsity, the suppression of truth, a promise made without the intention to perform it or any other act intended to deceive.
Free and clear
Real Property against which there are no liens, especially voluntary liens.
Freehold estate
An estate of interminable duration, E.G., fee simple or life estate.
Functional obsolescence
The need for replacement because a structure or equipment has become inefficient because of improvements since discovered or invented.
Goodwill
An intangible but saleable asset of a business derived from the expectation of continued public patronage.
Government patent
Deed of title transferred by the government to a grantee.
Grant deed
A limited warranty deed using the word “Grant” like words that assures a grantee that the grantor has not already conveyed the land to another and that the estate is free from encumbrances placed by the grantor. The most common deed form used in California. Not used in Washington.
Grantee
One to whom property or property rights is given, generally the buyer.
Grantor
One who transfers property or property rights. One who gives a deed.
Gross acre
An acre (43,560 ft), as distinguished from a net (usable) acre.
Gross rent multiplier
A method of obtaining an approximate value of income property by using gross yearly rents. Multiplier amount is calculated by dividing sale price of an investment property by annual rents relating to property.
Habendum clause
The clause in a deed which defines the extent of the estate of the grantee. It is often referred to as the “to have and to hold”clause.
Highest and best use
The use of land which will bring the greatest economic return over a given time.
Hypothecate
To mortgage or pledge without delivery of the security to the lender.
Income (capitalization) approach
An appraisal method to determine the value of rental property by use of the estimated net income over the life of the structure. The calculation of value is a three-step process 1) determine net annual income, 2) set an appropriate capitalization rate or “present” worth factor, and 3) capitalize the income dividing the net income by the capitalization rate.
Involuntary lien
A lien, such as a tax lien or judgment lien, which attaches to property without the consent of the owner, rather than a mortgage lien, to which the owner agrees.
Joint tenancy
An undivided interest in property, taken by two or more joint tenants. The interests must be equal, occurring under the same conveyance and beginning at the same time. Upon the death of a joint tenant, the interest passes to the surviving joint tenants, rather than to the heirs of the deceased.
Land sales contract
An installment contract for the sale of land. The seller (vendor) has legal title until paid in full. The buyer (vendee) has equitable title during the contract term.
Lease
An agreement by which the owner of Real Property gives the right of possession to another, for a specified period of time, and for consideration.
Leasehold estate
An estate held under a lease for the term of the lease. This is a personal property right.
Levy
A seizure of property by judicial process.
Lien
An encumbrance against property for money, either voluntary or involuntary. All liens are encumbrances, but not all encumbrances are liens. A lien affects title.
Lien theory
A theory followed in several states that assumes a mortgage has only a lien on the mortgage property, and the mortgagor has legal title. Nevada is a lien theory state.
Life estate
An estate or interest in real property, which is held for the duration of the life of some certain person. It may be limited to the life of the person holding it or buy the life of some other person.
Lis Pendens
A legal notice recorded to show pending litigation related to Real Property, and giving notice that anyone acquiring an interest in said property subsequent to the date of the notice may be bound by the outcome of the litigation.
Littoral
Land (the shore) that borders a lake or ocean.
Market data approach
Appraising the value of property by comparing the price of similar properties (comparables) recently sold. This is the most widely used of the three methods of appraisal for residential property.
Market price
The price paid for a property regardless of pressures, motives or intelligence.
Market value
The highest price a willing buyer would pay and a willing seller would accept, both being fully informed, and the property exposed for a reasonable period of time.
Mortgage
The instrument by which real estate is hypothecated as security for the repayment of a loan.
Mortgagee
The party lending the money and receiving the mortgage.
Mortgagor
The party who borrows the money and gives the mortgage.
Narrative appraisal
A summary comprehensive appraisal report of all factual materials, techniques and appraisal methods used by the appraiser in setting forth his or her value conclusions.
Note
A unilateral agreement containing an express and absolute promise of the signer to pay a named person a definite some of money at a specified date. Usually provides for interest and is secured by a mortgage or deed of trust.
Notice
(1) Actual notice: express or implied knowledge of a fact. (2) constructive notice: a fact, imputed to a person by law, which should have been discovered because of the persons actual notice of circumstances and the inquiry that a prudent person would have been expected to make. (3) legal notice: information required to be given by law.
Novation
Substitution of a new contract, debt, or obligation, for an existing one, between the same or different parties.
Null and void
Of no legal effect of validity.
Open listing
A written authorization to a real estate broker by a property owner, stating that a commission will be paid to the broker upon presentation of an offer which meets a specified price and terms. However, the broker has no exclusive right to sell, and must bring in his offer before any other offer is accepted.
Option
A right given for a consideration to purchase or lease a property upon specified terms within a specified time, without obligation the party who receives the right to exercise the right.
Ownership
The rights of one or more persons to possess and use property to the exclusion of all others. A collection of rights to use and enjoy a property.
Partition
Any division of Real Property between co-owners, resulting in individual ownership and interests.
Percentage lease
A lease, usually on a retail business property, using a percentage of the gross or net sales to determine the rent. There is usually a minimum base rental, in the event of poor sales.
Personal property
Any property that is not Real Property.
Planned development
A subdivision consisting of separately owned parcels of land together with membership in an association which owns common area. Sometimes the owners of separate interests also have an undivided interest in the common area.
Planned unit development
(PUD). A term sometimes used to describe a planned development. A planning and zoning term describing land not subject to conventional zoning to permit clustering of residences or other characteristics of the project which differ from normal zoning requirements.
Police power
The right of the state to enact laws and enforce them for the order, safety, health, morals and general welfare of the public.
Power of attorney
A written instrument whereby a principal gives authority to an agent. The agent acting under such a grant is sometimes referred to as the principles attorney-in-fact.
Power of sale
Clause in a mortgage or deed of trust giving the mortgagee or trustee the power to sell the property in the event of default.
Prescription
The means of acquiring incorporeal interests in land, usually an easement, by notorious, open and long or continued use.
Prescriptive easement
The granting of an easement by a court, based on the presumption that a written easement was given, although None existed, after a period of open and continuous use of land.
Principal
(1) The person who gives authority to an agent or attorney. (2) debt amount, less the interest.
Prior lien
A lien which is senior or superior to all others.
Priority of lien
The order in which liens are given legal precedence or preference.
Promissory note
Following a loan commitment from the lender, the buyer signs a note, promising to repay the loan under stipulated terms. The promissory note established person liability for its payment and is the evidence of the debt created.
Property
Everything capable of being owned and acquired lawfully. The rights of ownership. The right to use, possess, enjoy and dispose of anything in every legal way and to exclude everyone else from interfering with these rights. Property is classified into the two groups of either real or personal property.
Proration
The dividing of property tax, insurance, rental income, and other items between buyer and seller proportionately to time of use, closing date, or other agreed-upon time.
Purchase agreement
An agreement between a buyer and seller of Real Property, setting forth price and terms of sale.
Purchase money mortgage or trust deed
A mortgage or trust deed given from buyer to seller to secure all or a portion of the purchase price.
Quiet enjoyment
Right of an owner or tenant to the use of the property without interference of possession.
Quiet title
A court action brought to establish title. To remove a cloud on the title.
Quitclaim deed
A deed operating as a release, intended to pass any title, interest, or claim which the grantor may have in the property, but not containing any warranty of a valid interest or title by the grantor.
Real estate
Land and anything permanently affixed to the land, such as buildings, fences, trees, and those things attached to the buildings, such as heating and plumbing fixtures, light fixtures, or other such items.
Real estate settlement procedures act (RESPA) “Regulation Z”
A federal law requiring the disclosure two borrowers of settlement (closing) procedures and costs by means of a pamphlet and forms prescribed by the United States department of housing and urban development (HUD).
Reconveyance deed
An instrument used to transfer title from a trustee to the equitable owner of real estate, when title is held as secured collateral.
Recording
Filing documents affecting Real Property as a matter of public record, giving constructive notice to future purchasers, creditors, or other interested parties.
Redeem
To buy back, re-purchase or recover.
Redemption
The process of canceling a defeasible title to land, such as created by a mortgage foreclosure or tax sale.
Redemption period
A time period during which a mortgage, deed of trust, or contract can be redeemed. Usually set by statute, and after judicial foreclosure.
Redlining
An outlining on a map of certain high-risk areas for real estate loan purposes, meaning that lenders will not extend credit in those areas. Illegal in most states.
Regulation Z
A regulation issued under the truth in lending law, which requires that a credit purchaser be advised in writing of all costs connected with the credit portion of the purchase.
Release
An instrument releasing property from a lien of a mortgage, judgment, etc. When a deed of trust is used, the instrument’s called a reconveyance.
Remainder
An estate which takes effect after the termination of the prior estate, such as a life estate. A future possessory interest in real property.
Replevin
To repossess or a court action to repossess.
Rescission
The cancellation of a contract and restoration of the parties to the same position they held before the contract was entered into.
Reservation
A right, either permanent or temporary, created and retained by a grantor of property.
Restriction
A use or uses prohibited to the owner of land. Restrictions are set forth by former orders in a deed or by a recorded declaration of restrictions by a developer of a subdivision.
Reversion
The right to future possession or enjoyment by a person, or the person’s heirs, creating the preceding estate. Example of the estate that is returned to the lessor at the end of a lease.
Right of survivorship
The right of the survivor of a deceased person to the property of the deceased.
Riparian rights
The right of a land owner whose land borders on a stream or watercourse to use and enjoy the water which is adjacent to or flows over the owners land provide such use does not injure other riparian owners.
Satisfaction
Discharge of an obligation by payment of the amount due, as on a mortgage or trust deed, or payment of a debt awarded, such as satisfaction of a judgment.
Separate property
Property owned by a married person in his or her own right outside of the Community interest including property acquired by the spouse (1) before marriage, (2) buy gift or inheritance (3) from rents and profits on separate property, and (4) with the proceeds from other separate property.
Severalty
An estate of property held by one person alone. Sole ownership.
Sheriffs deed
Deed given at sheriff’s sale in foreclosure of mortgage. The giving of said deed begins a statutory redemption period. Also given at a court ordered sale, pursuant to the execution of a judgment.
Special warranty deed
A deed in which the grantor warrants or guarantees the title only against defects arising during grantors ownership of the property and not against defects existing before the time of grantors ownership.
Statute of frauds
Laws requiring certain types of contracts to be in writing. All contracts for the sale of real property must be in writing, and leases for more than one year must be in writing.
Statute of limitations
Time periods to enforce a claim by court action. After the statutorily defined time period for the type in action has expired, the court will not hear the claim.
Statutory lien
An involuntary lean, created by law rather than by contract, including tax liens, mechanics liens, etc.
Statutory warranty deed
A short term warranty deed which warrants by inference that the seller is the undisputed owner, has the right to convey the property, and will defend the title if necessary. This type of deed protects the purchaser in that the conveyor covenants to defend all claims against the property. If conveyor fails to do so, the new owner can defend said claims and sue the former owner.
Sub agent
A person upon whom the powers of an agent have been conferred, not by the principal, but by an agent as authorized by the agents principal.
Sub lease
A lease, under which the lessor is the lessee of a prior lease of the same property.
Subordinate
To make subject to or junior or inferior to.
Subrogation
Replacing one person with another in regard to a legal right or obligation.
Substitution, principle of
Affirms that the maximum value of a property tends to be set by the cost of acquiring an equally desirable and valuable substitute property, assuming no costly delay is encountered in making the substitution.
Supply and demand, principle of
In appraising, a valuation principle stating that the market value is affected by intersection of supply and demand forces in the market as of the appraisal date.
Tax-free exchange
The trade or exchange of One Real Property for another without the need to pay income taxes on the gain at the time of the trade. The tax on the gain is postponed under the rules of IRS code section 1031. Also known as a 1031 exchange.
Tenancy by the entirety
A form of ownership by husband and wife whereby each owns the entire property. In the event of the death of one, the survivor owns the property without probate.
Tenancy for years
Any estate for a definite time period (a lease).
Tenancy in common
An undivided ownership in real estate by two or more persons. The interests need not to be equal. In the event of the death of an owner, the ownership transfers as defined by the deceased’s will or to his/her heirs if no will exists.
Tenancy in partnership
An undivided ownership interest by partners of a partnership. Right of survivorship applies.
Tenant at sufferance
One who comes into possession lawfully, but who holds over after termination of his interest.
Tenant at will
One who holds possession by permission of the owner or landlord, but without agreement for a fixed term of possession.
Tenant for life
An estate in Real Property for the life of a living person. The estate then reverts back to the grantor or onto a third-party.
Tenant in severalty
One who owns property alone.
Tender
Offer to perform.
Testate
Having written a last will and testament.
Title
Evidence one has of right to land possession. The rights of ownership often referred to as the “bundle of rights”.
Township
A territorial division of land established by federal survey, being 6 mile Square and containing 36 sections, each 1 mile Square.
Trade fixtures
Articles of personal property annexed by a business tenant to Real Property which are necessary to the carrying on of a trade or business and are removable by the tenant.
Trust account
An account used by brokers, escrow agents, or anyone holding money in trust for another.
Trust deed
An instrument used in many states in place of a mortgage. Property is transferred to a trustee by the borrower (trustor), in favor of a lender (beneficiary), and reconveyed upon full payment.
Trustee
One who holds title to real property under the terms of a deed of trust.
Trustee’s deed
A deed by a trustee under a deed of trust, pursuant to foreclosure.
Trustor
The borrower under a deed of trust. One who deeds his property to a trustee as security for the repayment of a loan.
Undivided interest
A partial interest by two or more people in the same property, whether the interest of each is equal or unequal.
Unearned increment
An increase in value of real estate due to no effort on the part of the owner which is most often due to the increase in the population in an area.
Valid
Having force or binding force, legally sufficient and authorized by law.
Valuation
The estimating the value. An appraisal.
Void
To have no force or effect. That which is unenforceable.
Voluntary lien
A lien placed against Real Property by the voluntary act of the owner. Most commonly, a mortgage or deed of trust.
Warranty deed
The primary deed form used in Washington to convey fee title to real property.
Wrap around mortgage
A second or junior mortgage with a face value of both the amount it secures and the balance due under the first mortgage. The mortgagee under the wraparound collects a payment based on its face value and then pays the first mortgagee.
