Failure to occupy and use property, which may resultin a loss of rights.


A reduction or decrease. Usually applies to a decrease of assessed valuation of ad valorem taxes after the assessment, and levy.

Abstract of Title

Historical summary of all of the recorded instruments and proceedings that affect title to a property.


To touch, border on, be adjacent to, or share a common boundary with.

Acceleration Clause

A loan provision giving the lender the right to declare the entire amount immediately due and payable upon violation of another specific loan provision, commonly referred to as the Due on Sale Clause.


Agreeing to the terms of an offer to enter into a contract, thereby creating a binding contract. 2. Taking delivery of a deed from the grantor.


The acquisition of title to additional property by its annexation to real estate already owned. Tis can be the result of human actions (as in the case of fixtures)or natural processes (such as accretion or reliction).

Accommodation Recording

Recording of instruments with the county recorder by a title company merely as a convenience to a customer and without assumption of responsibility for correctness or validity.


The gradual addition to the shore or bank of a waterway by deposits of sand or silt.

Accrued Interest

Interest that has been earned but not paid.

Accumulated Depreciation

In accounting, the amount of depreciation expense that has been claimed to date.


A declaration by a person who has signed a document that such signature is a voluntary act, made before a duly authorized person.

Acquisition Cost

The price and all fees required to obtain a property.

Acquisition Loan

Money borrowed for the purpose of purchasing a property.


A two dimensional measure of land equaling 4,840 square yards or 43,560 square feet.

Ad Valorem

A Latin phrase meaning "according to value", used to refer to taxes that are based on the value of the property.


Something added as an attachment to a contract.


Nearby, next to, bordering, or neighboring; may or may not be in actual contact.


Contiguous, attached, sharing a common border.

Adjustable Rate Mortgage (ARM)

A mortgage that permits the lender to adjust the mortgage's interest rate periodically on the basis of changes in a specified index. Interest rates may move up or down, as market conditions change. This interest rate is generally less than a fixed rate mortgage, but can become higher in the future.

Adjusted Tax Basis

The original cost or other basis of the property, reduced by depreciation deductions and increased by capital expenditures.


A person appointed by a court to administer the estate of a deceased person who left no will.

Adverse Possession

A means of acquiring title to real estate where an occupant has been in actual, open, notorious, exclusive and continuous occupancy of property for the period required by state law.


A written statement, sworn to or affirmed before an officer who is authorized to administer an oath or affirmation.


1. To confirm or ratify. 2. To makea solemn declaration that is not under oath.

Age, Actual

The age of a structure from a chronological standpoint (as opposed to its effective age); how many years it has been in existence

Age, Effective

The age of a structure indicated by its condition and remaining usefulness (asoposed to its actual age). Good maintenance may increase a buildings effective age, and poor maintenance may decrease it


The legal relationship between a principal and his agent arising from a contract in which the principal engages the agent to perform certain acts on behalf of the principal.

Agency coupled with an Interest

An agency in which the agent holds a legal interest in the subject of the agency.

Agency, Apparent

When third parties are given the impression that someone who has not been authorized to represent aanother is that person's agent, or else given the impression that an agent has been authorized to perform acts which are in fact beyond the scope of his or her authority.   Also called 'Ostensable Agency'.

Agency, Dual

When an agent represents both parties to a transaction, as when a broker represents the buyer and the seller.


One who has authorization, either expressed or implied, to act for or represent another party, usually in business matters, such as issuing title insurance policies on behalf of a title insurer for a portion of the premium.

Agent, General

An agent authorized to handle all the principal's affairs in one area or in specified areas.

Agent, Gratuitous

An agent that does not have legal right to claim compensation for his or her services.

Agent, Special

An agent with limited authority to do a specific thing or conduct a specific transaction.

Agent, Universal

An agent authorized to do everything  that can be lawfully delegated to a representative.

Agreement for Deed

see Contract for Deed.

Agreement of Sale

A written contract entered into between the seller (vendor) and buyer (vendee) for sale of real property (land) on an installment or deferred payment plan. It is also known as an agreement to convey, a long form Security Agreement or a real estate installment contract.

Air Lot

A parcel of property above the surface of the earth, not containing any land;  i.e. - a condominium unit on the fourth floor

Air Rights

The right to undisturbed use and control of the airspace over a parcel of land; may be transferred separately from the land.

Alien Ownership Law

A state statute that provides that purchasers of agricultural land in Minnesota must be U.S. citizens or permanent resident aliens.


To convey or transfer title and possession of property.

Alienation Clause

A provision in a security instrument that gives the lender the right to declare the entire loan balance due immediately if the borrower sells or otherwise transfers the property.  Also called a 'Due on sale clause'.

Alienation, Involuntary

Transfer of an interest in property against the will of the owner, or without the action of the owner, occuring through operation of law (foreclosure), natural processes, or adverse possession.

Alienation, Voluntary

Voluntary transfer of an interest in property from one person to another.

Allloidal System

A system of individual ownership of land (as opposed to the feudal system, in which all land was owned by the sovereign).


The solid material deposited along the shoreline or riverbank by accretion.  Also called Alluvium.

ALTA: (American Land Title Association)

Organization composed of title insurance firms which sets standards for the industry, including title insurance policy forms used on a national basis.


A feature of the home or property that serves as a benefit to the buyer but that is not necessary to its use; may be natural (like location, Woods, water) or man-made (like a swimming pool or garden).

Amortization, Negative

The addition of unpaid interest to the principle balance of a loan, thereby increasing the amount owed.


The process of paying the principal and interest on a loan through regularly scheduled installments.


Attaching personal property to real property, so that it becomes part of the real property (a fixture) in the eyes of the law.

Annexation, Actual

The physical attachment of personal property to real property.

Annexation, Constructive

The association of personal property with real property in such a way that the law treats it as a fixture, even though it is not physically attached.  For example, a house key.

Annual Cap

Maximum amount the interest rate on an adjustable rate mortgage can be raised or lowered in the course of one twelve month period.

Annual Percentage Rate (APR)

Effective rate of interest rate for a loan per year including fees and points, disclosure of which is required by the Truth-in-Lending Law.

Anticipation, Principle of

An appraisal principle holding that the balue is created by the expectation of benefits to be received in the future.


When one of the parties in a lawsuit asks a higher court to review the judgment ir verdict reached by a lower court.


The first step in the official loan approval process; this form is used to record important information about the potential borrower necessary to the underwriting process.


A division of property (as among tenants in common when the property is sold or partitioned)  or liability (as when responsibility for closing costs is allocated between the buyer and seller) into proportionate, but not necessarily equal parts.


An estimate of value of property resulting from analysis of facts about the property; an opinion of value.

Appraised Value

Opinion or estimate of a value of a property, values are determined by one of three methods: comparable sales (residential), replacement cost (insurance), or income approach (commercial).


One who estimates the value of prop­erty, especially an expert qualified to do so by training and experience


Is the increase in the value of real property. Real estate can appreciate for a number of reasons, including inflation, improvements, and increased demand in the area.


Taking property, or reducing it to personal property, to the exclusion of other people.

Appropriation, Prior

A system of allocating water rights, under which a person who wants to use water from a certain lake or river is required to apply for a permit; a permit has priority over other permits that are issued later.

Approptiative Rights

The water rights of a person who has a prior appropriation permit.


Anything that is incident to, attached to, or pertains to the land, but is not necessarily a part of it.  An appurtenance is ordinarily transferred with the land, but some appurtenances may be transferred separately.

Appurtenances, Intangible

Rights that go with ownership of a piece of property that do not involve physical objects or substances; for example, an access easement (as opposed to mineral rights).


1. Locale or region. 2. The size of a sur­face, usually in square units of measure, such as square feet or square miles.

Arm's Length Transaction

1. A transaction in which both parties are informed of the property's merits and shortcomings, neither is acting un­der unusual pressure, and the property has been exposed on the open market for a reasonable length of time. 2. A transaction in which there is no preexisting family or business relation­ship between the parties.


Amount of money behind in payments. Includes back payments, late penalties, legal fees and accrued interest.


Mortgage payment includes interest for prior month, or overdue payments in default.

Artificial Person

A legal entity such as a cor­poration, which the law treats as an individual with legal rights and responsibilities, as distin­guished from a natural person, a human being. Sometimes called a legal person.


Without guarantees as to condition.


Combining two or more adjoin­ing properties into one tract.

Assessed Value

The value established for property tax purposes.


1. The valuation of property for purposes of taxation. 2. A non-recurring specific charge against property for a particular purpose, such as the installation of street lights or sewers.


An official who determines the value of property for taxation.


Anything of value that a person owns.

Assets, Liquid

Cash and other assets that can be readily turned into cash (liquidated), such as stock.


1. (verb) To transfer rights (especially contract rights) or interests to another. 2. (noun) A successor in interest to property, other than an heir. See: Heirs and Assigns.


The person to whom an agreement or contract is sold or transferred.


1. A transfer of contract rights from one person to another. 2. In the case of a lease, the transfer by the original tenant of his or her entire leasehold estate to another. Com­pare: Sublease.

Assignment of Contract and Deed

The in­strument used to substitute a new vendor for the original vendor in a contract for deed.


The person who assigns or transfers an agreement or contract to another.

Assumable Mortgage

An existing mortgage, which allows the next purchaser of a property to be liable for the payments and other obligations of the note and mortgage. Depending on the type of loan, the assumption of the obligation by this next purchaser may or may not require a qualification and approval process and may or may not release the original mortgagor (borrower) from further liability. A written release from the mortgagee (lender) is required to relieve the original mortgagor of responsibility.


To take on legal responsibility for a debt or other obligation that was formerly the responsibility of another.


When a property buyer takes on personal liability for paying off the seller's ex­isting mortgage.

Assumption Fee

A fee paid to the lender, usu­ally by the buyer, when a mortgage is assumed.


Court-ordered seizure of property belonging to a defendant in a lawsuit, so that it will be available to satisfy a judgment if the plaintiff wins. In the case of real property, attachment creates a lien.

Attachments, Natural

Plants growing on a piece of land, such as trees, shrubs, or crops. See: Emblements; Fructus Industrials; Fructus Naturales.

Attorney in Fact

Any person authorized to rep­resent another by a power of attorney; not nec­essarily a lawyer (an attorney at law).


Verification and examination of records, particularly the financial accounts of a business or other organization.

Authority, Actual

Authority actually given to an agent by the principal, either expressly or by implication.

Authority, Apparent

Authority to represent another that someone appears to have and that the principal is estopped from denying, even though no actual authority has been granted.

Authority, Implied

An agent's authority to do everything reasonably necessary to carry out the principal's express orders.

Avigation easement

An easement over private property near an airport that limits the height of structures and trees.


1. A sudden (not gradual) tearing away of land by the action of water. 2. A sud­den shift in a watercourse.

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