200+ Terms
Common Title Terminology
Real estate and title industry terms explained in plain language. Use the search or jump to any letter to find what you need.
Note: These descriptions are general and are not intended to be complete legal definitions. We suggest you consult a real estate professional or an attorney for additional details.
Abstract of Title
A written summary of the history of all recorded documents and proceedings affecting a specific parcel of real property.
Acceleration Clause
A provision in a loan document that allows the lender to demand full repayment if the borrower defaults on certain terms.
Acknowledgment
A formal declaration before a notary public that the signer executed a document voluntarily.
Adjustable Rate Mortgage (ARM)
A mortgage with an interest rate that changes periodically based on market conditions.
Affidavit
A written statement made under oath before a notary public or other authorized officer.
ALTA Policy
American Land Title Association policy; a standardized form of title insurance policy used nationwide.
Amortization
The gradual repayment of a debt through regular installments of principal and interest over time.
Appraisal
A professional opinion of a property's market value, typically required by lenders before approving a mortgage.
Assessment
A charge against real property by a public authority for improvements that benefit the property.
Assignment
The transfer of rights under a contract or mortgage from one party to another.
Assumption
Taking over another person's mortgage obligation, with or without the lender's approval.
Beneficiary
The lender under a deed of trust; also, one who benefits from a trust.
Chain of Title
The chronological history of all conveyances and encumbrances affecting a property from the original grant to the present.
Clear Title
A title free of liens, defects, or other legal encumbrances that would prevent transfer of ownership.
Closing
The final step in a real estate transaction where documents are signed, funds are disbursed, and ownership is transferred.
Cloud on Title
Any claim, lien, or encumbrance that may impair or affect the owner's title to a property.
Community Property
Property acquired by either spouse during marriage that is owned equally by both spouses under California law.
Conveyance
The transfer of title to real property from one person to another by means of a written document.
Covenant
A legally enforceable promise or restriction in a deed relating to the use of property.
Deed
A written document by which ownership of real property is transferred from one party to another.
Deed of Trust
A security instrument that transfers legal title to a trustee to hold as security for repayment of a loan.
Documentary Transfer Tax
A state and/or local tax imposed on the transfer of real property, based on the sale price.
Easement
A right to use another person's land for a specific purpose, such as access or utilities.
Encroachment
A structure or improvement that illegally extends onto another person's property.
Encumbrance
Any claim, lien, or interest that affects or limits the fee simple title to property.
Endorsement
An amendment or addition to an existing title insurance policy that modifies the terms of coverage.
Equity
The difference between a property's market value and the total of all liens against it.
Escrow
A neutral third party that holds funds and documents on behalf of the buyer and seller until all conditions of sale are met.
Fee Simple
The highest form of property ownership, giving the owner full rights to use, possess, and dispose of the property.
Foreclosure
The legal process by which a lender forces the sale of a property to recover an unpaid debt.
Grant Deed
A deed that implies the grantor has not previously conveyed the property and that it is free of encumbrances created by the grantor.
Grantee
The person to whom real property is conveyed; the buyer.
Grantor
The person who conveys real property; the seller.
Homestead
A legal protection that shields a portion of a homeowner's equity from creditors.
Impound Account
An account held by a lender to pay property taxes and insurance on behalf of the borrower.
Joint Tenancy
A form of property ownership by two or more persons with equal interests and right of survivorship.
Judgment
A court order establishing a debt or obligation that may become a lien on real property.
Junior Lien
A lien that is subordinate to prior liens; in foreclosure, junior liens are typically wiped out.
Legal Description
A precise description of real property that identifies its exact boundaries and location.
Lien
A legal claim against property used as security for a debt or obligation.
Lis Pendens
A recorded notice that litigation affecting a property is pending.
Marketable Title
A title free of reasonable doubt as to who the owner is, suitable for sale at fair market value.
Mechanic's Lien
A lien created by law to secure payment for work performed or materials supplied in construction.
Metes and Bounds
A method of describing land using compass directions and distances.
Mortgage
A security instrument that pledges property as collateral for repayment of a loan.
Notary Public
A public officer authorized to witness signatures, administer oaths, and certify documents.
Owner's Policy
A title insurance policy that protects the property owner against loss from defects in title.
Plat Map
A map showing the division of land into lots, blocks, and streets, as recorded with the county.
Power of Attorney
A legal document authorizing one person to act on behalf of another in specified matters.
Preliminary Title Report
A report showing the current ownership and condition of title before a sale closes.
Principal
The amount of debt, excluding interest; also, a party to a transaction.
Proration
The division of ongoing expenses like taxes and insurance between buyer and seller at closing.
Quitclaim Deed
A deed that transfers whatever interest the grantor may have in the property without warranties.
Recording
The act of filing documents with the county recorder to provide public notice of the transaction.
Reconveyance
A document issued when a deed of trust is paid in full, releasing the lien from the property.
RESPA
Real Estate Settlement Procedures Act; federal law governing closing disclosures and practices.
Right of Survivorship
The right of surviving joint tenants to automatically inherit a deceased owner's share.
Subordination
The process of changing the priority of liens on a property.
Survey
A professional measurement and mapping of property boundaries and improvements.
Tenancy in Common
A form of property ownership by two or more persons without right of survivorship.
Title
Legal ownership of real property, including the right to possess, use, and dispose of it.
Title Insurance
Insurance that protects against financial loss from defects in title or liens against property.
Title Search
An examination of public records to determine the history and current status of a property's title.
Transfer Tax
A tax imposed on the transfer of real property, usually based on the sale price.
Trustee
A person or entity that holds property in trust for the benefit of another.
Trustor
The borrower under a deed of trust who transfers title to a trustee as security for a loan.
Vesting
The manner in which ownership of property is held (e.g., joint tenancy, community property).
Warranty Deed
A deed that contains covenants guaranteeing clear title and the right to convey.
Zoning
Government regulations controlling land use and development in specific areas.
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