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A HORIZON - surface layer of soil, the composition of which is effected by water which permeates through it.

A-FRAME - form of construction most often found in resort areas. The external frame of the building's shaplike the letter A.

A.B.A.- American Bar Association is a national organization made up of member state and local bar associations, which control licensing of attorneys.

A.I.R. - American Industrial Real Estate Association is a specialized association of real estate brokers and salesmen who deal mostly in industrial properties. The goal of the association is to further the knowledge and effectiveness of its members.

A.L.T.A. - American Land Title Association is an organization, composed of title insurance companies, which has adopted certain insurance policy forms to standardize coverage on a national basis.

ABA NUMBER - This is the number, originated by the American Bankers Association,(usually in the upper right hand area of a check) that identifies the bank upon which the check is drawn.

ABANDONMENT - Voluntary giving up of rights of ownership or another interest (such as an easement) do to failure to use the property, coupled with an intent to abandon (give up the interest).

ABANDONMENT OF HOMESTEAD - Recorded document which is executed by those claiming a homestead exemption, giving up said homestead. This is not applicable to all states and procedure must be adhere to local statutes.

ABATEMENT - reduction or decrease often used to describe a decrease of assessed valuation of property for ad valorem taxes. In regards to wills, it refers to a reduction of gifts to one or more beneficiaries when the assets left in the will are insufficient to pay all creditors and beneficiaries. There is usually a different formula used for debts than for priorities of gifts.

ABC SOIL - Soil having distinct soil horizons: A (upper), B (middle), and C (lower) horizons (layers of soil).

ABSCISSA - horizontal axis of a curve; the vertical axis being the ordinate. The terms are used in connection with charts and graphs.

ABSENTEE LANDLORD - lessor of real property (usually the owner) that does not occupy all or any portion of the property.

ABSENTEE OWNER - property owner who does not occupy said property.

ABSORPTION - usage of space, such as the rental of units or sale of a tract. The time or rate must be estimated and considered as a portion of the owner's (usually the builder) costs.

ABSTRACT - summary; an abridgement. Before photostatic copying, public records were kept by abstracts of recorded documents.

ABSTRACT OF JUDGEMENT - Summary of the essential provisions of a court judgement, which when recorded in the county recorder's office, creates a lien upon the property of the defendant in that county, both presently owned or after acquired.

ABSTRACT OF TITLE - Written summary of the title history of a piece of real estate.

ABSTRACTER'S CERTIFICATE - Certificate contained in an abstract which shows the time period and scope of the search of public records done by the abstracter.

ABSTRACTION - way of appraising a site (land) by estimation of the depreciated value of the improvements and deducting that amount from the total value (improved value) of the property. Also See: Allocation.

ABUT - To touch, border, or be contiguous to.

ABUTMENTS - Vertical members (walls or heavy columns) which support the load or pressure of the cross member, such as an arch, pier, or similar structure.

ABUTTING OWNER - One whose land is contiguous to (abuts) a public right of way.

ACCELERATED COST RECOVERY SYSTEM (ACRS) - portion of the Economic Recovery Act of 1981 which allowed shorter depreciation of both real and personal property, did not distinguish between new and used property, and disregarded salvage value.

ACCELERATED DEPRECIATION - general term including any method of depreciation greater than straight line depreciation (see which).

ACCELERATION - immediate right to possession of a remainder interest upon the failure of a life estate.

ACCELERATION CLAUSE - provision of a mortgage or note which provides that the entire outstanding balance will become due and payable in the event of default.

ACCEPTANCE - Voluntary agreement to a given offer. (1) Real property acceptance must be unequivocal AKA Mirror Image Rule (2) Acceptance for goods, according to the Uniform Commercial Code, and need not be unequivocal. Offer, acceptance, and consideration form a contact.

ACCESS RIGHT - Expressed or implied right to ingress and egress to and from one's property.

ACCESSIBILITY - Location of a site in terms of the ease at which it may be reached by customers, employees, carriers, and others necessary to the intended use of the property.

ACCESSIBLE - 2 unit + residential building which can be entered and utilized by people who are physically handicapped.

ACCESSION - right of a property owner to an increase in his property by natural means (such as a riparian owner's right to an abandoned river bed, rights of alluvion and reliction, etc.) or artificially, by property improvements.

ACCESSORY BUILDINGS -These are buildings used for the benefit of a central or main building, such as a tool shed, garage, or similar structure.

ACCOMMODATED ROOM NIGHT DEMAND - yearly number of hotel or motel rooms occupied in a given market area.

ACCOMMODATION PARTY - person who lends his name to help secure credit for another, by signing a note or other obligation without receiving consideration.

ACCOMMODATION RECORDING - recording of documents with the county recorder by a title insurance company, without liability (no insurance) on the part of the company, but only as a convenience to a customer.

ACCOMMODATOR - One who acts to facilitate an exchange under the rules of Section 1031 of the Internal Revenue Service Code. The proper terminology is a Qualified Intermediary, but accommodator, facilitator or intermediary are the common terms used.

ACCORD - agreement by which one accepts something different (usually less) than what is owed as full satisfaction. The amount owed may be in dispute or simply accepted as full satisfaction by the creditor or claimant. The agreement and acceptance is called "Accord and Satisfaction".

ACCORD AND SATISFACTION - agreement (accord) and acceptance (satisfaction) by creditors of less than the entire amount owing on a debt.

ACCOUNTS PAYABLE - Money owing. The term is generally used in business rather than personal finances. Usually represents services or materials, such as wood, bricks, payment of subcontractors, etc., to a builder.

ACCOUNTS RECEIVABLE - Money owed to a business for goods or services. Accounts receivable may be sold or borrowed against. Many times the sale of accounts receivable is for less than face value (discounted).

ACCREDITED LAND CONSULTANT - designation conferred by the REALTORS Land Institute. Also See: REALTORS LAND INSTITUTE.

ACCRETION - gradual addition to the shore or bank of a waterway. The land generally becomes the property of the owner of the shore or bank, except where statutes specify otherwise.

ACCRUAL ACCOUNTING - accounting method under which income and expenses are charged to the periods for which they are applicable, rather than when payment is received or made. The method calling for income and expenses to be based on payment being received or made is cash accounting.

ACCRUE - To grow or mature.

ACCRUED DEPRECIATION - Accumulated depreciation. Also See: Depreciation.

ACCRUED INTEREST - Interest on a note, bond, etc. which has been earned but not yet paid. Since interest is usually paid in arrears, accrued interest does not necessarily indicate a delinquency in payment. See also: Accumulated Interest.

ACCRUED ITEMS - Expenses owing but not yet payable. An example is mortgage interest which is paid at the end of the month or property taxes which may be paid after the tax year begins. On a closing statement for a sale, the buyer would be credited with these amounts and would be responsible for their payment.

ACCUMULATED DEPRECIATION - Also See: Accrued Depreciation.

ACCUMULATED INTEREST - Unpaid interest which is past due. See also: Accrued Interest.

ACID SOIL - soil with an acid rather than an alkaline base. This can determine its suitability for farming.

ACID TEST RATIO - formula used by lending institutions to determine if a business can meet its current obligations. The formula adds cash plus receivables plus marketable securities and then divides by liabilities. A ratio of one to one is considered acceptable.

ACKNOWLEDGEMENT - written declaration by a person executing an instrument, given before an officer authorized to give an oath (usually a notary public), stating that the execution is of his own volition.

ACM'S (ASBESTOS CONTAINING MATERIALS) - (See which)

ACOUSTICAL MATERIALS - Materials which absorb sound. Usually installed in walls and ceilings and composed of fiberglass, cork, special plaster, or similar materials.

ACOUSTICAL TILE - Tile which absorbs sound.

ACQUISITION AND IMPROVEMENT LOAN - loan for the dual purpose of purchasing and improving or repairing property.

ACQUISITION APPRAISAL - appraisal to determine market value of a property to be taken by eminent domain, in order to justly compensate the owner.

ACQUISITION COSTS - Costs of acquiring property other than purchase price: escrow fees, title insurance, lenders fees, etc.

ACRE - measure, usually of land, equal to 160 sq. rods (43,560 sq. ft.) in any shape.

ACRE FOOT - volume of water, sand, coal, etc., equal to an area of one acre with a depth of one foot (43,560 cubic ft.). If a liquid, 325,850 gallons.

ACRE-INCH - cubic measure of one acre in area with a depth of one inch.

ACREAGE - Most commonly refers to vacant land, but may refer to any parcel which may be measured in acres. The term is also used to describe land which has not been subdivided.

ACREAGE CONTROL - Federal control setting the number of acres which may be planted with crops which have federal price supports.

ACT OF GOD - Damage caused by nature (floods, winds, etc.) rather than by people.

ACTION TO QUIET TITLE - Modernly used to describe any court action to establish ownership or remove a cloud on title. See also: Cloud on Titlel.

ACTIVE CAPITAL - Capital used on a regular basis for profit-making activities.

ACTUAL AGE - chronological age of a structure as opposed to its effective or economic age.

ACTUAL CASH VALUE - Also See: Market Value.

ACTUAL EVICTION - removal of an occupant or real property through legal action. See also: Constructive Eviction

ACTUAL NOTICE - Notice actually and expressly, or by implication, given and received. See also: Constructive Notice; Statutory Notice.

ACTUAL RECEIPT - Direct receipt of funds from the sale of a relinquished property in a 1031 exchange. The taxpayer will lose the tax free benefit if the funds are received rather than directly reinvested in the replacement property.

AD - By, for, relating to, concerning.

AD HOC - Latin meaning "for this". For a single purpose only.

AD LITUM - For the suit. Example: A guardian "Ad Litum" is one who is appointed to prosecute or defend a suit on behalf of a minor or one who is otherwise incapacitated.

AD VALOREM - "According to value". A method of taxation using the value of the thing taxed to determine the amount of tax. Taxes can be either "Ad Valorem" or "Specific". Example: A tax of $5.00 per $1000.00 of value per house is "Ad Valorem". A tax of $5.00 per house (irrespective of value) is "Specific".

ADD-ON INTEREST - method of computing interest by adding the total interest for the life of the loan to the amount borrowed (principal) and then deducting the full amount of each payment as made. This method creates a higher yield than computing interest on the declining balance of principal.

ADDENDUM - Something added. A list or other material added to a document, letter, contractual agreement, escrow instructions, etc. See also: Amendment.

ADDITION - (1) portion of a building added to the original structure. (2) A synonym for subdivision in certain legal descriptions.

ADDITIONAL DEPOSIT - buyer of real property will generally give a small deposit with an offer, and a more substantial deposit after the offer has been accepted. The second deposit is the "additional deposit".

ADDITIONAL PRINCIPAL PAYMENT - payment of principal above the required amount. Some loans limit the amount that a borrower may pay and impose a penalty for reducing the principal balance in too short a time.

ADJACENT - Close to. May or may not be contiguous (touching).

ADJOINING - Touching or contiguous to.

ADJUDICATION - judgement or decision by a court.

ADJUSTABLE MORTGAGE LOANS (AML'S) - Mortgage loans under which the interest rate is periodically adjusted to more closely coincide with current rates. The amounts and times of adjustment are agreed to at the inception of the loan. Also called: Adjustable Rate Loans, Adjustable Rate Mortgages (ARM's), Flexible Rate Loans, Variable Rate Loans. See also: Indexing, Rate Index.

ADJUSTABLE RATE LOANS - mortgage in which the interest rate is adjusted periodically, based on the movement of a financial index. Also See: Adjustable Mortgage Loans.

ADJUSTABLE RATE MORTGAGE (ARM) - mortgage in which the interest rate is adjusted periodically, based on the movement of a financial index. Also See: Adjustable Mortgage Loan's (ARL'S).

ADJUSTED GROSS INCOME - Total income of property if fully rented, less an adjustment for estimated vacancies and uncollectible rent.

ADJUSTED MORTGAGE - mortgage released after a company has undergone reorganization.

ADJUSTED SALE PRICE - appraisal term used when a comparable property's sale price is adjusted to reflect the value of the subject property. The adjustment is made based on the differences between the subject property and comparable property in time of sale, terms of sale, location, and physical characteristics.

ADJUSTMENT DATE - date for changing the interest on an Adjust-able Rate Mortgage.

ADJUSTMENT PERIOD - time between adjustment dates for an adjustable rate mortgage. If the rate adjusted monthly, for example, one month would be the adjustment period.

ADJUSTMENTS - Also See: Proration.

ADMINISTRATOR - person given authority by a proper court to manage and distribute the estate of a deceased person when there is no will. See also: Administrator C.T.A..

ADMINISTRATOR C.T.A. - Administrator when there is a will but no executor is named or the executor named is unable or unwilling to serve. The C.T.A. stands for Cum Testamento Annexo (with the will attached).

ADMINISTRATOR'S DEED - conveyancing instrument used by an Administrator to transfer property from an estate. Also See: Administrator.

ADMINISTRATRIX - Refers to a female administrator.

ADOBE CONSTRUCTION - structure built of adobe blocks. Adobe blocks are made from adobe mud mixed with straw or a straw-like substance, and then baked. Considered a very good but expensive material.

ADR (THE CLASS LIFE ASSET DEPRECIATION RANGE SYSTEM) - flexible set of guide lines for depreciation which sets up an "asset depreciation period", rather than using the "useful life" of an asset.

ADULT - person old enough to vote and to make contracts. The age in most states is 18, except for contracts to purchase alcohol, for which all states classify an adult as a person over the age of 21.

ADVANCE FEE - fee charged by a broker to a seller to cover all or a portion of the broker's costs of promoting the property. The fee is generally credited against commissions but is not refunded if no commissions are received. Most frequently used in connection with large offerings which require a substantial outlay of funds for promotion.

ADVANCE PAYMENTS - Payments made to a contractor before performance. Not the usual method and when made by HUD or GNMA, there must special approval. See also: Progress Payments; Provisional Payments.

ADVANCEMENTS - Gifts made prior to death to one who would inherit the property. The value of the gifts is deducted from the donee's (recipient's) inheritance upon the death of the donor.

ADVANCES - Money advanced by a lender (mortgagee or beneficiary under a deed of trust) to pay the borrower's (mortgagor's or trustor's) obligations of taxes, insurance, or other items necessary to protect the secured property. The amounts advanced are then added to the balance owing on the mortgage or trust deed.

ADVERSE LAND USE - use which causes surrounding property to lose value, such as an industrial development in a residential area.

ADVERSE POSSESSION - method of obtaining ownership rights by the open, notorious, exclusive, and hostile possession of private real property for a statutory period which varies from state to state (from 5 to 30 years). Some states have additional requirements, such as payment of property taxes by the adverse possessor. The true owner is then barred (statute of limitations) from asserting his/her rights. The adverse possessor has no evidence of title without court action.

ADVERTISING - Usually done by signs on the property and newspaper ads. Ads for the sale of real estate have modernly been required to conform to certain standards regarding disclosure of complete financing information if any financing information is contained in the ad.

AEOLIAN SOIL - Soil composed of materials deposited by the wind.

AERATION ZONE - surface soil to a depth from which plants draw moisture.

AESTHETIC VALUE - value of a property attributable to the beauty of the improvements or surroundings.

AFFIANT - One who makes an affidavit. Also called a deponent, although technically not the same.

AFFIDAVIT - written statement or declaration, sworn to before an officer who has authority to administer an oath.

AFFIDAVIT OF ALIMONY AND CHILD SUPPORT - sworn statement of a separated or divorced person showing the amount (if any) of alimony or child support.

AFFIDAVIT OF TITLE - affidavit by a seller of real property that, as of a certain date, no defects of title exist except those which have been disclosed in the sales contract or deed.

AFFINITY - (1) Relationship not of the blood. Related by marriage. (2) Any group for a specific purpose is called an affinity group, such as clubs, people in the same school, etc.

AFFIRMATION - substitution for an oath when a person objects to taking an oath (Quakers, atheists, etc.). A lie after an affirmation is still perjury.

AFFIRMATIVE EASEMENT - easement described from the benefited estate (dominant tenement). Also called a parcel 2 easement. The same easement described from the burdened estate (servient tenement) would be a negative easement.

AFFORDABILITY ANALYSIS - method to determine the right purchase price and mortgage for a potential home buyer. The price of the home and its future expense, cost to obtain the loan and its future expense, as well as buyers income, expenses and assets are used to determine the financial feasibility of the purchase.

AFFORESTATION - growing of a forest where none previously existed, as opposed to reforestation (the replanting of a harvested or destroyed forest).

AFTER ACQUIRED PROPERTY - As applied to a judgement lien, it means that the lien will attach to property of the debtor acquired after the judgement. See also: After Acquired Title.

AFTER ACQUIRED TITLE - Legal doctrine by which property automatically vests in a grantee when the grantor acquires title to the property after the deed has been executed and delivered.

AGE-LIFE METHOD OF DEPRECIATION - Estimating depreciation by using the ratio of the effective age of improvements to the Economic Life (Economic Age-Life Method) or Physical Life (Physical Age-Life Method).

AGENCY - Any relationship in which one party (agent) acts for or represents another (principal) under the authority of the latter. Agency involving real property should be in writing, such as listings, trusts, powers of attorney, etc.

AGENCY AGREEMENT (AGENCY LISTING) - In some states, the term describing a listing under which the broker's commission is protected against a sale by other agents but not by a sale by the principal. Called a "non-exclusive" listing in some states.

AGENCY BY ESTOPPEL - agency created by operation of law when one who is not an agent acts as an agent or an agent oversteps his/her authority, but action (or failure to act) by the principal leads one to believe that the authority exists. See also: Apparent Authority; Ostensible Agency.

AGENCY COUPLED WITH INTEREST - contractual relationship with consideration going from agent to principal; the agency is given as return consideration. Example: A broker agrees to work to obtain property for a builder in return for a listing after the builder has completed the project. The broker would be entitled to (have an interest in) the listing (agency), provided the broker did obtain the property for the builder.

AGENT - One who is authorized to act for or represent another (principal), usually in business matters. Authority may be express or implied.

AGRARIAN - Relating to land, or to a division or distribution of land.

AGREEMENT - general term usually describing a common view of two or more people regarding the rights and obligations of each with regard to a given subject. Not necessarily a contract, although all contracts are agreements.

AGREEMENT OF SALE - Has two separate meanings, depending on area of the country. In some states it is synonymous with a purchase agreement (Also See: Purchase Agreement). In other states, it is synonymous with a land contract. Also See: Land Contract.

AGRICULTURAL LIEN - lien against crops (only), to secure money or payment for materials used to grow the crop.

AGRICULTURAL PROPERTY - (1) Land which is zoned agricultural, (2) Land used for growing of agricultural products or raising of livestock.

AIR LOT - Any bounded air space which has been legally subdivided into a lot, such as a condominium.

AIR RIGHTS - right to the use of the air space above property without the right to use the surface of the property. However, air rights may restrict surface rights, especially height of improvements.

ALCOVE - recessed part or addition to a room.

ALIAS - Latin for "otherwise". Commonly meaning that a person is known by more than one name. In some states, indicated by the letters AKA (also known as).

ALIENATION - Transfer of property from one owner to another.

ALIENATION CLAUSE - type of acceleration clause, calling for a debt under a mortgage or deed of trust to be due in its entirety upon transfer of ownership of the secured property. Also called a "due-on-sale" clause.

ALKALI - chemical opposite of acid. Heavy concentrations of alkaline salts in soil may damage crops.

ALKALINE SOIL - Soil which has an alkali, rather than an acid base.

ALL-INCLUSIVE DEED OF TRUST - Also See: Wrap-Around Mortgage.

ALLEGATION - assertion or statement of a party to an action, setting forth that which the party expects to prove.

ALLEY - narrow right of way, either public or private, used for access (usually to garages, loading platforms, etc.).

ALLEY INFLUENCE - In appraising, the effect upon value of a property, because of an adjoining side or rear alley.

ALLOCATION - method for appraising a site (land) by comparing other site values as a percentage of total value. Example: An area has a typical land value of 35% of the total value of a site (including improvements). Property X has a total (improved) value of $100,000. The land is worth $35,000. The term is often (and incorrectly) used synonymously with abstraction Also See: Abstraction.

ALLODIUM - Land owned by individuals, as opposed to the feudal system of ownership of all land by a king or ruler.

ALLOTMENT - small parcel of land, sold or given to a farm worker for cultivation as a supplementary source of income. Popular in the 1900's before World War II.

ALLUVIUM - Deposits formed by accretion.

ALTERATIONS - Changes in the interior or exterior of a building, but without changing the exterior dimensions.

AMENDMENT - change, either to correct an error or to alter a part of an agreement without changing the principal idea or essence.

AMENITIES - Those things which enhance the enjoyment (and therefore the value) of real estate but are not necessary for its intended use. Examples: a scenic view, swimming pool, etc.

AMERICAN BANKERS ASSOCIATION - national organization formed in 1875 as a professional association for banks and other financial institutions.

AMERICAN BOND - process in bricklaying by which every 5th, 6th, or 7th layer of bricks is laid with the wide length facing the wall; the other layers have the narrow length facing the wall.

AMERICAN INSTITUTE OF BANKING - educational arm of the American Bankers Association.

AMERICAN SOCIETY FOR TESTING AND MATERIALS - Former name for ASTM. (See which).

AMORTIZATION - Repayment of loan by installment payments. As the payments are made, the debt is reduced so that at the end of fixed period or term, no money will be owed.

AMORTIZATION SCHEDULE - schedule showing each payment of a loan to be amortized (see Amortization) and breaking down the payment into the amount applied to principal and the amount applied to interest.

AMORTIZATION TERM - time required to pay off a mortgage if no additional principal payments are made and all payments are made on schedule. A ten year loan, for example, would have an amortization term of 120 months (ten years).

AMORTIZE - To reduce a debt by regular payments of principal and interest. Modernly, the word has been qualified as fully amortized, partially amortized, and negatively amortized. Also See: Balloon Note; Straight Note; Negative Amortization.

AMORTIZED LOAN - loan repaid in periodic (most commonly monthly) payments of principal and interest. See also: Amortize, Interest Extra Note, Interest Included Note.

AMPERE - measure of electrical current equal to the current produced by the force of one volt through a resistance of one ohm. See also: Coulomb.

ANCESTOR - May denote lineal descent, such as a parent or grand parent, or collaterals, such as an older brother being the ancestor of a younger brother. May also mean one from whom a person inherits. Differs from predecessor in that an ancestor must be a person.

ANCHOR BOLTS - bolt set (anchored) in concrete or other masonry foundation and then attached to the superstructure to prevent movement (anchor it).

ANCHOR TENANT - most reliable, and usually the largest, tenant in a shopping center. The strength of the anchor tenant greatly affects the availability of financing for the shopping center. The term may also be used to describe a tenant in an office building, industrial park, etc.

ANCILLARY - Subordinate.

ANNEX - To add or attach. Usually to join a smaller or subordinate thing to a larger or more dominant thing.

ANNEXATION - Permanently affixing to real property, such as a city adding additional land to increase its size.

ANNUAL - Yearly

ANNUAL DEBT SERVICE - Yearly amount of principal and interest payments of debt service. Also See: Debt Service.

ANNUAL MORTGAGE STATEMENT - yearly statement sent to a borrower showing the remaining loan balance and the interest paid over the year. Used primarily for income tax purposes.

ANNUAL PERCENTAGE RATE (A.P.R.) - yearly interest percentage of a loan, as expressed by the actual rate of interest paid. For example: 6% add-on interest would be more than 6% simple interest, even though both would say 6%. The A.P.R. is disclosed as a requirement of federal truth in lending statutes.

ANNUITY - (1) payment of money yearly for life or a given period of years. (2) A fixed amount given or left by will, paid periodically, not necessarily yearly.

ANNUITY METHOD - Appraisal method for determining present value by future anticipated net income before depreciation, which is then discounted.

ANNUM - Year.

ANTE - Prefix meaning before.

ANTENUPTIAL AGREEMENT - agreement made by a man and woman in contemplation of marriage, setting forth the property rights of each during the marriage, and in the event of divorce or death.

ANTICIPATION - Appraisal method using the principle that value is created by anticipated future benefits.

ANTICIPATORY BREACH - One party to a contract informing the other of his or her intent not to perform before performance is due. A legal action may be brought even though the original contract (not yet due for performance) has not been breached. Example: The buyer informs the seller before the closing date of his or her intent not to buy.

ANTITRUST LAWS - Laws enacted to promote free competition by prohibiting agreements to limit competition. In real property businesses, for example, setting a "standard" commission for all brokers to charge would be a violation.

APARTMENT - One or more rooms of a building used as a place to live, in a building containing at least one other unit used for the same purpose. Usually has, at least, cooking facilities, a bathroom, and a place to sleep. Those who live in these units pay rent for their use, usually on a monthly basis.

APARTMENT HOTEL - building combining the features of an apartment building and a hotel. The units are furnished and may offer hotel facilities such as maid service, a restaurant, etc., but whose residents may stay for months or years, paying on a weekly or monthly basis.

APARTMENT HOUSE - building containing two or more separate residential units, which is under one ownership. The residents of the units pay rent.

APPARENT AUTHORITY - Action (or failure to act) by a principal which leads one to believe that an agent of said principal has authority which in fact the agent does not have.

APPEL LOAN (ACCELERATING PAYOFF PROGRESSIVE EQUITY LOAN) - residential property loan which calls for a payment increase over the first 6 years. Level payments are made for the remaining years and the loan paid off during the 15th year. There is no prepayment penalty and P.M.I. is required.

APPLICATION - first step in the official loan approval process; the form records information about the potential borrower necessary to the underwriting process.

APPLICATION FEE - That part of the closing costs pre-paid to the lender at time of application to cover initial expenses.

APPLICATION SCORING - Using a formula to evaluate credit applications and credit bureau data. See also: Fico Score; Scoring Model.

APPOINTMENTS - Furnishings (mostly thought of as decorative) and equipment in a building.

APPORTIONMENT - proper allocation of income and expenses of property, especially after a division of ownership.

APPRAISAL - opinion of value based upon a factual analysis. Legally, an estimation of value by two disinterested persons of suitable qualifications.

APPRAISAL FEE - amount of money charged by an appraiser. There is no set amount since the work necessary varies with each property.

APPRAISAL INSTITUTE - trade organization designed to establish standards of competency in the appraisal industry. The designations MAI (competent by the institute's standards to appraise all types of real property) and SRA (competent to appraise residential property) are prestigious and heavily relied upon by real estate agents, lenders, governments and others who utilize appraisers. The American Institute of Real Estate Appraisers and the Society of Real Estate Appraisers combined in 1991 to form the Appraisal Institute.

APPRAISAL METHODS - Generally, three major methods of appraisal: Cost Approach, Income Approach, Market Value (comparables) Approach.

APPRAISAL REPORT - written report by an appraiser containing an opinion as to the value of a property and the reasoning leading to this opinion. The factual data supporting the opinion, such as comparables, appraisal formulas, and qualifications of the appraiser, will also be set forth.

APPRAISED VALUE - opinion of the value of a property at a given time, based on facts regarding the location, improvements, etc., of the property and surroundings.

APPRAISER - One who is trained and educated in the methods of determining the value of property through analysis of various factors which determine said value.

APPRECIATION - increase in value to real property due to positive changes or the elimination of negative elements in the surrounding area. Although not within the original meaning, the word has been incorrectly used so often that it is now acceptable to describe an increase in value for any reason, including inflation.

APPROPRIATION - private taking and use of public property, such as water from a river or lake. Not to be confused with condemnation or expropriation.

APPROVED ATTORNEY - In states where attorneys examine the chain of title before title insurance is issued, the title company will approve certain attorneys as those whose opinion it will accept for the issuance of a title policy.

APPURTENANCE - Something belonging to something else, either attached or not, such as a barn to a house, or an easement to land. The appurtenance is part of the property and passes with it upon sale or other transfer.

APPURTENANT - Belonging to, accessory to, or incidental to.

APPURTENANT EASEMENT - Also See: Easement.

APR - Also See: Annual Percentage Rate. The annual percentage rate refers to the total cost of the loan, expressed as a yearly rate.

APRON - Any structure resembling the shape of the apron worn as clothing, such as a protruding lower inside part of a window, the portion of a driveway which connects it to the street, the entrance to a loading dock, and similar structures.

AQUATIC RIGHTS - Individual rights to the use of the sea and rivers, for the purpose of fishing or navigation, and to the soil in the sea and rivers.

AQUEDUCT - large pipe, conduit, or trench to bring water or carry it away.

ARABLE - Land capable of being cultivated for farming.

ARBITRAGE - buying and selling of money or securities in different markets at a profit. For example: The value of 1 pound sterling is selling in New York for $2.00 and in London for $1.98. If one buys in London for dollars and sells in New York, there is a profit of $.02 per pound sterling. The term has come to be used with regard to the interest rate spread between wrap-around and underlying financing.

ARBITRARY MAP - map drawn by a title company to be used in locating property in areas where legal descriptions are difficult and complex. Areas are arbitrarily subdivided usually by ownership at a given time, into lots which are numbered. Recorded documents are then posted to these arbitrary lots by the same "arb" number.

ARBITRATION CLAUSE - clause in a lease calling for the decision of a third party (arbiter) regarding disputes over future rents based on negotiation. Also used in construction contracts, disputes between brokers, etc.

ARCADE - seldom used term describing a series of colonnaded arches, covering a walkway with retail stores on one or both sides. A forerunner of the present shopping center.

ARCH - concave curved span which may be over a doorway or an entire room or building, such as an arched ceiling or roof.

ARCH BIB ROOF - roof used primarily in industrial buildings, and having the shape of an arch or crescent. It is supported by a bow-string truss which spreads the roof load evenly.

ARCHITECTURAL CONCRETE CONSTRUCTION - Concrete poured into a form to produce a design, giving the affect of stone masonry.

ARCHITECTURE - design and construction plans for a structure. Recently the design for landscaping has become known as landscape architecture.

ARCHITRAVE - surrounding molding of a doorway or similar wall opening.

AREA - surface (plane) space of land or a building. Also describes a neighborhood, or large land section (such as the Southern California area). The term may also indicate a use, such as a work area, living area, play area, etc.

AREA ZONING - Mainly residential zoning which regulates the ratio of improvements to land, setbacks, etc. Also called bulk zoning.

AREAWAY - old term referring to a cellar or room under the sidewalk.

ARM (ADJUSTABLE RATE MORTGAGE) - Also See: Adjustable Mortgage Loans.

ARM'S LENGTH - Legal slang meaning that there existed no special relationship between the parties involved in any manner which would taint the result.

ARM'S LENGTH TRANSACTION - transaction without collusion or duress between the parties involved.

ARPENT - French land measure of area used in parts of the South, approximately .84625 acre.

ARREARS - (1) Payment made after it is due is in arrears. (2) Interest is said to be paid in arrears since it is paid to the date of payment rather than in advance, as is rent. Example: A rental payment made July 1 pays the rent to August 1. An interest payment made July 1 pays the interest to July 1.

ARTERIAL HIGHWAY - Any major highway or thoroughfare.

ARTESIAN WELL - well bored into a subterranean body of water, which, being under pressure, rises naturally to the surface without artificial pumping.

ARTICLES OF INCORPORATION - Documentation filed with the state which sets forth general information about a corporation. More specific rules of the corporation would be contained in the by-laws.

ARTIST'S CONCEPTION (RENDERING) - drawing of a proposed real estate project. Not necessarily to scale and generally used to promote the sale of vacant land or the leasing of proposed buildings.

AS IS CONDITION - Premises accepted by a buyer or tenant in the condition existing at the time of the sale or lease, including all physical defects.

ASBESTOS - fire and heat resistant material used in insulation, roofing, etc.

ASBESTOS CONTAINING MATERIALS - environmental term referring to any material containing more than one percent asbestos.

ASHLAR (ASHLER) - stone which is cut in squares and used both as a facing for masonry walls, and in foundations.

ASKING PRICE - price at which the seller is offering property for sale. The eventual selling price may be less after negotiation with a buyer.

ASPECT - position or direction. Exposure.

ASSEMBLAGE - acquisition of contiguous properties into one ownership for a specific use.

ASSEMBLAGE COST - cost above the value of individual properties because of assemblage rather than periodic individual sales.

ASSESS - To fix a value; to appraise. Most commonly used in connection with taxes.

ASSESSED VALUE - value placed on a piece of real estate by the taxing authority for the purpose of taxation. Also called an assessment.

ASSESSMENT - (1) estimating of value of property for tax purposes. (2) A levy against property in addition to general taxes. Usually for improvements such as streets, sewers, etc.

ASSESSMENT BASE - total assessed value of all property in a given assessment (tax) district.

ASSESSMENT DISTRICT - area, the boundaries of which are set for tax assessment purposes only; these boundaries may cross city boundaries.

ASSESSMENT PERIOD - Taxable period. The period during which the tax assessment must be completed.

ASSESSMENT RATIO - assessed value of a property expressed as a fraction in comparison to market value.

ASSESSMENT ROLL - list of taxable persons and property in a given area as compiled by the assessor.

ASSESSOR - One who estimates value of property for tax purposes.

ASSETS - Everything owned by a person or corporation which can be used for the payment of debts.

ASSIGN - To transfer property, or an interest in property.

ASSIGNEE - One who receives an assignment (pl. assigns).

ASSIGNMENT - transfer to another of any property, real or personal, or of any rights or estates in said property. Common assignments are of leases, mortgages, deed of trust, but the general term encompasses all transfers of title.

ASSIGNMENT OF LEASE - transfer by a lessee to a third party of the exact interest of said lessee. Differs and should not be confused with sublease (see which). A lease may legally contain certain restrictions of assignments and/or subleasing.

ASSIGNOR - One who makes an assignment.

ASSUMABLE MORTGAGE - mortgage that allows the obligation of the borrower to be transferred to the buyer of the borrower's property secured by the mortgage. If the loan is truly assumable and the transfer is done properly, the originally borrower is relieved of further obligation. See also: "Subject To" Clause; Alienation Clause.

ASSUMPTION CLAUSE - part (clause) of an assumable mortgage making it assumable. Also See: Assumable mortgage.

ASSUMPTION FEE - Lender's charge for paperwork involved in processing records for a new buyer assuming an existing loan.

ASSUMPTION OF DEED OF TRUST - Also See: Assumption of Mortgage.

ASSUMPTION OF MORTGAGE - purchaser takes over mortgage payments for the balance of the loan, assuming primary liability. Unless specifically released by the lender, the seller remains secondarily liable.

ASTM (AMERICAN SOCIETY FOR TESTING AND MATERIALS) - organization which helps establish environmental standards in products and property.

ATELIER - craftsman's workshop or artist's studio.

ATRIUM - interior court, centrally located in a structure, which is either uncovered or covered with a transparent or translucent material to admit light.

ATTACHMENT - act of seizing persons or property by judicial order to bring them within the custody of the court. Most commonly the seizure of property to furnish security for a debt in connection with a pending action.

ATTEST - To witness, to certify, to affirm to be true or genuine

ATTESTATION CLAUSE - clause in a document (deed, mortgage, etc.) in which the witnesses certify that the document has been properly executed.

ATTIC - space under the roof of a structure but before the top story. May be simply an air space or improved and used.

ATTORN - To turn over; to transfer to another. To agree to recognize a new owner of a property and pay rent to him. See also: Letter of Attornment.

ATTORNEY AT LAW - advocate, counsel, or official agent employed in preparing, managing, and trying cases in court. Must be licensed by the state.

ATTORNEY'S OPINION OF TITLE - statement placed in an abstract of title giving the opinion of the condition of title by an attorney who has examined the abstract. The attorney may be personally liable for mistakes he or she has made. Most abstract examination has modernly been replaced by title insurance.

ATTORNEY-IN-FACT - One who is appointed to act (as agent) for another (principal) under a power of attorney. The scope of the agent's authority is limited to that given by the power of attorney, which may be limited to one specific act or may be broader. See also: Power of Attorney.

ATTRACTIVE NUISANCE - Anything on a property which may attract small children and is dangerous to them. Reasonable care must be used to prevent injury to children.

AUCTION - public sale of land or goods to the highest bidder.

AUTOMATIC EXTENSION - clause in a document such as a lease or listing agreement stating that the terms are extended beyond the expiration date unless cancelled by one of the parties. The clause is usually required to be in large or bold type and, with regard to listings, is not enforceable in some states.

AUTOMATIC LENDER - lender that may process a loan or assumption without submitting the credit package to the insurer or guarantor for underwriting review. Limited to lenders that are regulated and examined by a government agency unless specifically approved by the insurer or guarantor.

AUXILIARY LANE - paved shoulder of a highway, usually designed for emergency stopping.

AVENUE - Originally, a broad passageway bordered by trees. Now synonymous with street or road, and of no special significance.

AVERAGE DAILY BALANCE - sum of the daily balances in a bank account over a monthly period divided by the number of days in a month.

AVERAGE DAILY COLLECTED BALANCE - average daily balance (see which) less the float (uncollected funds).

AVERAGE DAILY TRAFFIC - number of vehicles passing a given point in one day. Usually obtained by finding the number for several days and averaging.

AVIGATION EASEMENT - easement over private property abutting an airport runway, which limits the height of crops, trees, structures, etc., in the aircraft's take off and landing path.

AVULSION - sudden and substantial tearing away of land by water and the deposit of said land as an addition to the land of another owner. The original boundaries apply and ownership of the land in questions remains in the original owner.

AWARD - In condemnation, the amount paid for the property taken.

AWNING - Canvas, metal or other material, which protrudes out over a window or doorway to provide protection from the sun, rain, etc.

AWNING WINDOW - window which, being hinged at the top, forms an awning when open.

AZIMUTH - Distance in degrees from North to an object, or, in the Southern hemisphere, from South to an object. A surveying term.

AZONAL SOIL - Soil which does not contain distinct horizons (layers).

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