Real Estate Finance and Investments

Abstract of Title

a historical summary of the publicly recorded documents that affect a title.

Bargain and Sale Deed

conveys a property without seller warranties. "As is" deed

Deed

title is conveyed from one person to another with a written instrument called a deed

Deed Restrictions

an owner can incorporate these to limit the use of a property by all subsequent owners of that property.

Easement

is the right to use land that is owned or leased by someone else for some special purpose.

Estate

all that a person owns

Estate for Years

type of leasehold estate that is created by a lease that specifies an exact duration for the tenancy.

Estate from Year to Year

Continues for successive periods until one party gives proper notice as to its intent to terminate at the end of one or more periods.

Fee Simple Estate

This is a type of freehold estate that represents the highest form of ownership. Owner is free to do whatever they want

Freehold Estate

estate that lasts for an indefinite amount of time. No limit on how long it lasts.

Future Estate

estate that is not yet in possession that conveys the right to enjoy the property on some future time period

General Warranty Deed

most desirable type of deed in a real estate transaction. offers the most comprehensive warranties about the quality of the title.

Leasehold Estate

an estate that expires on a specific date. Implies the right to possess or use a property

Lenders Policy

a type of title insurance that insures the interest of the lender. (mortgagee)

Lessee

a person who leases land and has the right to possession

Lessor

Someone who holds the title and leases it to a lessee

Life Estate

type of freehold estate that gives someone the right to own a home until the end of ones life.

Mechanics Lien

this gives unpaid contractors, workers, and suppliers the right to attach a lien to a piece of property to which they added their labor or materials. They may foreclose on the property and be paid with the proceeds of the sale

Nonpossessory Interest

It is the right to use the land that is owned or leased by someone else for a special purpose

Owner's Policy

type of title insurance that insures the interest of a new property owner.

Ownership Rights

are referred to as real property.

Personal Property

any property that is not real property

Property Rights

the right of a person to possess use, enjoy, and dispose of his or her property.

Quitclaim Deed

a deed that has no warranty what so ever.

Real Estate

is used to refer to things that are not movable such as land and their improvements that are permanently attached to them.

Real Property

The rights and interests associated with real estate

Recording acts

These provide a public ally accessible system for system for assessing and establishing claims or interests in real estate

Remainder

...

Reversion

exists when the holder of an estate of land, conveys to another person a present estate in the property that has fewer ownership rights than the grantors own estate and retains for the grantor or his heirs to be able to take back the full estate that the

Secured Interest

the lender has a secured interest. The lender may not use the property but will need to be paid back for it. This is their secured interest.

Sheriff's Deed - Trustee's Deed

type of dead received by a buyer from a foreclosure or a forced sale. no warranties added

Special Warranty Deed

one step below a general warranty deed. This type of deed ensures that no defects and encumbrances occurred while the grantor held title of the property.

Title

term used to link a person or entity to a property itself. if someone has this they have all the elements needed to prove full ownership

Title Assurance

refers to the means by which buyers of real estate 1) learn in advance whether their sellers have and can convey the quality of title they claim to possess, and 2) receive compensation if the title after transfer turns out not to be as represented.

Interest

Broad legal term denoting a property right

Promissory Note

evidence that their is debt on a certain piece of property between a borrower and lender and contains the terms under which the loan must be repaid and rights and responsibilities of both parties.

Recourse Loans

The borrow is personally liable for the payment of all amounts due under the terms of the note.

Mortgage Document

created in a transaction whereby one party pledges real property to another party as security for an obligation that is owed to taht party. two parts of this - obligation to pay, and pledge of property as security

Covenants

mortgages include this ...... they are promises, duties, and responsibilities of the borrower, in addition to payments required under the term of the note.

Due-On-Sale Clause

allows the mortgagee to accelerate the debt.(make outstanding loan payment and accrused interest payment immediatly due). This is to get people to not sell interest without the mortagee first knowing who is being sold the interest

Future Advances / Open Ended Mortgage

mortgage may be written that it will protect several successive loans under a general line of credit extended by the mortgagee to the mortgagor.

Subordination Clause

first mortgage holder agrees to make its mortgage junior in the priority to the mortgage of another lender.

Assumption of the Mortgage

Mortgage that will contain a clause that stating that the grantee (buyer) agrees to pay the amount of the obligations owed to the mortgagee as part consideration for the conveyance of title

Subject To a Mortgage

This allows someone to sell you a property and you assume the mortgage but if you do not make the payments you are not personally responsible for the loan the other person is.

Fixture

an item of tangible personal property that has become affixed to or is intended to be used with real estate. Fixtures are covered by the mortgage

Mortgage Default

breach of a mortgage contact. Failure of payments or failure to adhere to the clauses

Workout

various activities undertaken to deal with a mortgagor who is in financial trouble

Mortgage Extension Agreement

mortgagor may request a longer amortization period for remaining principal balance, or temporary grace period for payment of principal and interest

Transfer of Mortgage

form of workout that allows the mortgagor that is unable to make their payments able to transfer their mortgage to someone else.

Voluntary conveyance

Type of workout where the mortgagor gives or sells the title to the mortgagee. Usually done if the cost of foreclosure is greater than the expected benefit of the home

Deed in lieu of foreclosure

conveyance to the mortgagees in exchange for a release from the mortgage debt.

Friendly Foreclosure

borrower submits to the jurisdiction of the court, waives any right to assert defense or to attack any judgement and agrees to cooperate with the lender.

Prepackaged Bankruptcy

before filing the bankruptcy petition, borrowers agree with all their creditors to the terms in which they will turn their assets over in exchange for the discharge of liabilities.

Short Sale

Home is sold for less than the loan balance and the proceeds go to the lender.

Judicial Foreclosure

sue on the debt, obtain judgement, and execute judgement against the property of the mortgagor. need a judge to do this. if there is no sale clause

Redemption

process of canceling or annulling a title conveyed by a foreclosure sale by paying the debt or fulfilling the other conditions in the mortgage.

Deed of Trust

Sometimes this is used instead of a mortgage. Three parties to a loan secured by this, borrower(creator of the trust) conveys the title to the property to be used as security to a trustee, who holds it as security for the benefit of the holder of the note

Deficiency Judgement

any deficit remaining after a forclosure and sale of the property is known as this. they are unsecured claims and take their place alongside other debts of the mortgagor.

After acquired Property Clause

mortgage will contain this as a part of its description of the type of property to be covered by the mortgage. it will cover any improvements that take place while there is still debt on the property.

Bankruptcy

proceeding in which the court takes over the property of a debtor to satisfy the claims of a creditor. Goal is to relieve the debtor of all liabilities so that he or she may become financially solvent

Land Contract

The seller holds the title and conveys it to the buyer once the contract is complete.