Abstract of title A summary of the history of ownership of a property from public records. This history includes all changes of ownership and claims against the property.

Acceleration clause A provision in a loan document that makes the balance owed on a loan due and payable immediately after a specified event occurs. The event may be missing a payment or violating another provision of the loan.

Acknowledgment A formal declaration before a public official that one has signed a specific document.

Adjustable rate loan Adjustable rate mortgage, ARM; a loan that allows adjustments in the interest rate at specified times based on a named index.

Adjustable rate mortgage See Adjustable rate loan.

Adjusted sales price As a seller, the price for which you sell your home minus closing costs and commission, if applicable.

Agent A person authorized by another, the principal, to act for him or her in dealing with third parties.

AITD See All-inclusive trust deed.

Alienation clause See Due-on-sale clause.

All-inclusive trust deed Wraparound mortgage, AITD; a junior (second, third, and so forth) loan (mortgage or trust deed) at one overall interest rate used to wrap the existing loans into a package. The amount is sufficient to cover the existing loans and provide additional funds for the sellers. Sellers pay on existing loans from buyers payments. Sellers remain primarily responsible for the original loans.

Amortization Gradual paying off of the principal on a loan by payment of regular installments of principal and interest.

Annual percentage rate APR; an interest rate that includes interest, discount points, origination fees, and loan brokers commission.

Appraisal An examination of a property by a qualified professional to estimate its market value as of a specific date.

APR See Annual percentage rate.

ARM See Adjustable rate loan.

Assessment Tax or charge by a governmental body for a specific public improvement covering the property owners portion of costs. Assessments are in addition to normal property taxes.

Assign Transfer.

Assignee The person to whom interest is transferred.

Assignment Transfer of any property to another. Delegation of duties and rights to another.

Assignor The person from whom interest is transferred.

Assume Buyers taking over primary responsibility for payment of existing loan. Sellers then become secondarily liable for the loan and any deficiency judgment.

Assumption fee The fee a lender may charge for work involved in allowing buyers to assume primary liability for payment on an existing loan.

Attorney A person licensed to practice law by giving legal advice or assistance, as well as prosecuting and defending cases in courts.

Authorization to sell A listing contract allowing a real estate professional to act as an agent in the sale of property.

Bankruptcy Relief by a court of an obligation to pay money owed after turning over all property to a court-appointed trustee.

Basis The cost of a home when purchased, including down payment, loans, and closing costs.

Beneficiary The lender of money on a property used in a trust deed type of loan.

Beneficiary statement A statement provided by a lender using a trust deed type of loan that usually lists claims that do not appear on loan documents.

Bridge loan A short-term loan to buyers who are simultaneously selling one house and trying to buy another.

Broker See Real estate broker.

Buyers agent A real estate broker or sales associate who represents the buyer in a transaction.

Buyers broker A real estate broker who represents the buyer.

Buyers market A condition in which there are more sellers than buyers; prices generally decrease.

Call Demand payment of a debt.

Capital asset Property, both real and personal, held by a taxpayer and not excluded by tax laws.

Capital gain Profit from selling or exchanging a capital asset in excess of the cost.

Capital improvements Additions to property that are permanent, increase property value, and have a useful life of more than one year.

Capital loss Loss from selling or exchanging property other than a personal residence at less than its cost.

Cashiers check A banks own check guaranteed to be good by the bank at which it is drawn.

Casualty insurance See Hazard insurance.

CC&Rs Covenants, conditions, and restrictions; a document listing private restrictions on property. Often used when buyers have an interest in common areas.

Certificate of title A report, produced by a party providing abstracts of titles, stating that based on an examination of public records, the title is properly vested in the present owner.