Real Estate Terms
Glossary
A-Z /
B /
C /
D /
E-F /
G-H /
I-K /
L /
M /
N-O /
P-Q /
R /
S /
T /
U-Z
Words and phrases
you may run into on this site or other real estate websites and
documents. Some are just plain common words but in real estate
have a specific meaning.
Absolute Title
• A title that is clear and free of any liens and/or judgments.
A clear title is necessary before a mortgage is granted.
Abstract of Title • A statement prepared by a
lawyer/attorney that traces the history of previous ownership of
real property to ascertain the current status of title, and
includes items of record that could impair such title, like
liens, charges or encumbrances.
Adjustable Rate Mortgage (ARM) • A mortgage loan whereby
the stated interest rate varies according to changes in rates.
The monthly payments of an ARM varies according to the lenders
pre-established schedule, subject to a mutually agreed upper
limit cap.
Amortization • The amortization is the number of years
whereby the mortgage loan will be repaid. The monthly payments
of both principal and interest will be based according to the
amortization schedule agreed upon with the lender. Generally,
the amortization period is for a length of 15, 20 or 25 years.
In many instances a mortgage will bear an amortization period
with a term period. A term means that the interest rate is set
at a rate for a fixed period, say 3 year term for example,
amortized over 25 years. What this means is that after 3 years
the interest rate is renegotiated for another term period for
the balance of the amortization period remaining - 22 years in
this example.
Amortization Schedule • An amortization schedule depicts
at various interest rates the payment of principle and interest
rate over time, as well as the gradual decreasing balance of the
contracted loan.
Appraised Value • An appraised value of a property is
generally provided by an accredited appraiser. This appraisal is
an opinion of the going market value based on comparable sales
that have occurred in the last 6 months to a year.
Appraiser • An appraiser is a professional individual
accredited by a national Appraisal Institute. (The Appraisers
Association of America in the U.S. and the Appraisal Institute
of Canada in Canada for example).
Appreciation • An appreciation is the increase in value
of a property over a period of time. This increase in value can
be caused by a number of factors, such as • demand for such
property, increasing cost of newly constructed properties, and,
not limited to, general economic growth.
Asset • An asset is an item of value owned by an
individual. An asset is valued by the cash value it would
receive if the individual disposes of the item. There are many
sorts of assets that can be divided by degrees of liquidity. The
more liquid of assets would be cash, bank accounts, bonds,
mutual funds, etc. The less liquid assets would be real estate
holdings, personal property and dents owed to one individual.
Assumable Mortgage • An assumable mortgage is a mortgage
that is transferred to a buyer from a seller, with the
concurrence of the lender. The buyer assumes the responsibility
to continue to pay this mortgage according to the schedule in
place. Generally, both the vendor and buyer are mutually liable
for the remaining balance of the said mortgage. If ever the
buyer defaults on making regular payments on said mortgage, the
lender can and will hold the seller accountable and will sue to
recover all losses.
A-Z / B /
C /
D /
E-F /
G-H /
I-K /
L /
M /
N-O /
P-Q /
R /
S /
T /
U-Z
Next Page B
Home