Principles of real estate 5-10

Notice Jurisdiction

"A conveyance of an interest in land shall be valid against any subsequent purchaser for value, without notice thereof, unless the conveyance is recorded." If, at the time B takes, he is a BFP, he wins. It won't matter that A may ultimately record first, before B does. It won't matter, in the A v. B contest that B never records. In a notice system, the last BFP to take, wins because B didn't have record notice of A when he took.

Privity of Estate

A "mutual or successive relation to the same right in property"

Acceleration Clause

A condition in a real estate financing instrument giving the lender the power to declare all sums owing lender immediately due and payable upon the happening of an event, such as sale of the property, or a delinquency in the repayment of the note.

insurance

A contract between the insurer and the insured

Express Contract

A contract that has been put into words, either spoken or written.

mortgage

A contract whereby a mortgagor agrees to use real property as security for the repayment of debt

Constructive Notice

A fact, imputed to a person by law, which should have been discovered because of the person's actual notice of circumstances and the inquiry that a prudent person would have been expected to make.

lien

A form of encumbrance which usually makes specific property security for the payment of a debt or discharge of an obligation. Example judgments, taxes, mortgages, deeds of trust, etc.

acknowledgement

A formal declaration made before an authorized person (notary public) by a person who has executed an instrument stating that the execution was his or her free act.

Mechanic's Lien

A lien created by statute which exists against real property in favor of persons who have performed work or furnished materials for the improvement of the real property.

Involuntary Lien

A lien imposed against property without consent of the owner, e.g., taxes, special assessments.

General Lien

A lien on all the property of a debtor.

Adverse Possession

A method of acquiring title to real property by confirming to statutory requirements; a form of involuntary alienation of title.

Mortgage Banker

A person whose principal business is the originating, financing, closing, selling and servicing of loans secured by real property for institutional lenders on a contractual basis.

economic index

A piece of statistical data that is used to assess the health or condition of the overall economy.

Easement appurtenance

A right of use in the adjoining land of another that moves with the title to the property benefiting from the easement.

Easement in Gross

A right of use in the land of another without the requirement that the holder of the right own the adjoining land

Alta Insurance

A title insurance policy that protects the interest in a collateral property of a mortgage lender who originates a new real estate loan. This is usually a buyer's expense.

assignment

A transfer of benefits and obligations within a contract to a 3rd party who is not originally a party to the contract.

Package Loan

A type of loan used in home financing covering real property, improvements, and moveable equipment/appliances.

due on sale clause

An acceleration clause granting the lender the right to demand full payment of the mortgage upon a sale of the property.

Specific Performance

An action to compel performance of an agreement (ex: sale of land as an alternative to damages of rescission)

Implied Contract

An agreement that has not been put into words, but is implied by the actions of the parties.

Real Property Sales Contract

An agreement to convey title to real property upon satisfaction of specified conditions which does not require conveyance within one year of formation of the contract.

return on investment

Any additional amount after the return of the investment

encumbrance

Any charge, claim, right, Biden (otherwise called a cloud on title), and/or interest in real property other than the owners, including but not limited to, any restriction upon the title to real property, affecting and/or limiting any interests or its use.

Voluntary Lien

Any lien placed on property with consent of, or as a result of, the voluntary act of the owner.

Punitive Damages

Damages simply for the purpose of punishment

secured debt

Debt that is backed or secured by collateral to reduce the risk associated with lending

Easement by necessity

Exists when a landowner has no access to roads and is landlocked.

Actual Notice

Express or implied knowledge of a fact.

prommisory note

Following a loan commitment from the lender, the borrower signs a note, promising to repay the loan under stipulated terms. It establishes personal liability for its payment.

Validity

Having mutual assent and consideration.

Race Jurisdiction

In a race jurisdiction, the first to record prevails, regardless of knowledge of prior conflicting interests.

Title Insurance

Insurance to protect a real property owner or lender up to a specified amount against certain types of loss (ex: defective or unmarketable title)

Dominant Tenement

Land benefiting from an easement appurtenant.

Servent tenement

Land encumbered by an easement

Privity

Mutual relationship to the same rights of property, contractual relationship.

Trustor

One who borrows money from a trust deed lender, then deeds the real property securing the loan to a trustee to be held as security until trustor has performed the obligation to the lender under terms of a deed of trust.

Trustee

One who holds property in trust for another to secure the performance of an obligation.

Equitable Remedies

Remedies for the purpose of 'fairness and justice'

return of investment

Return or recapture of the original investment amount

Tax Sale

Sale of property after a period of nonpayment of taxes.

Voidable

That which is capable of being adjudged void, but is not void unless action is taken to make it so.

Enforceability

The ability to sue for the enforcement of the contract.

Tax Deed

The deed given to a purchaser at a public sale of land held for nonpayment of taxes. It conveys to the purchaser only such title as the defaulting taxpayer had.

Escrow

The deposit of funds with a neutral third party who is instructed to carry out the provisions of an agreement or contract.

Damages

The indemnity recoverable by a person who has sustained and injury, either in his/her person, property, or relative rights through the act or default of another

CLTA

The minimum standard title insurance policy in California that does Not require a property survey

privity of contract

The relationship which exists between the persons who are parties to a contract

Novation

The substitution or exchange of a new obligation or contract for an old one by the mutual agreement of the parties.

Alienation

The transferring of property to another; the transfer of property and possession of lands, or other things, from one person to another.

Equity

The value of an asset minus the debt

tresspass

The wrongful entry onto the land of another, either in person or by instrumentality.

Assignees

Those to whom property or interests therein shall have been transferred.

hypothecate

To pledge a thing as security without the necessity of giving up possession of it.

Anticipatory Repudiation

When a breach occurs before performance is due as a result of one party's unequivocal intention not to substantially perform.

prepayment penalty

penalty for full pay-off of loan before maturity date

Security Instrument

A contract whereby a debtor agrees to use property as security or collateral for the repayment of debt.

Bilateral Contract

contract in which both parties exchange promises

Mortgage Broker

A broker who arranges a mortgage loan between a lender and a borrower for a fee.

Judgement Lien

A legal claim on all of the property of a judgement debtor which enables the judgement creditor to have the property sold for payment of the amount of judgement.

Specific Lien

A lien that attaches only to a particular piece of property (as opposed to a general lien, which attaches to all of the debtor's property).

Grant Deed

A limited warranty deed using the word "grant" or like words that assures a grantee that the grantor has not already conveyed the land to another and that the estate is free from encumbrances placed by the grantor.

debt instrument

A paper or electronic obligation that enables the issuing party to raise funds by promising to repay a lender in accordance with terms of a contract.

Statute of Frauds

A state law requiring certain contracts to be in writing and signed before they will be enforceable by law Ex: contracts for the sale of real property, contracts performed within one year.

negotiable instrument

An unconditional promise or order, to pay a fixed amount of money, with or without interest, or other charges described in the promise or order.

encroachment

An unlawful intrusion onto another's adjacent property by improvements to real property, e.g. a swimming pool built across a property line.

face value

The amount borrowed that is displayed on the promissory note

Rescission

The cancellation of a contract and restoration of the parties to the same position they held before.

maturity date

The date in which a loan is to be paid in full

interest rate

The percentage of a sum of money charged for its use. Rent or charge paid for its use of money, expressed as a percentage per month or year of the sum borrowed

Unilateral Contract

promise in exchange for an act

debt

something, typically money, that is owed or due

Probate

the official proving of a will

contract

A agreement to do or not to do a certain thing. It must have 4 essential elements: parties capable of contracting, consent of the parties, a lawful object, and consideration.

Deed in Lieu of Foreclosure

A deed to real property accepted by a lender from a defaulting borrower to avoid the necessity of foreclosure proceedings by the lender.

Easement

A right, privilege or interest limited to a specific purpose which one party has in the land of another.

injunction

A writ or order issued under the sale of a court to restrain on or more parties to a suit or proceeding from doing an act which is deemed to be inequitable

deed

A written instrument that, when executed and delivered, conveys title to real property from one person (grantor) to another (grantee)

Interpleader

An equitable proceeding brought by a third party acting in the capacity of a stake holder wherein there are rival claimants to the same money and/or property requesting the court to determine such properties disposition

unsecured debt

An obligation or debt that does not have specific property serving as collateral for payment of the debt.

Annual Percentage Rate (APR)

The relative cost of credit as determined in accordance with Regulation Z of the Board of Governors of the Federal Reserve System for implementing the Federal Truth in Lending Act.

Race-Notice Jurisdiction

a subsequent bona fide purchaser for value is protected only if records before the prior grantee records AND has NO notice of the prior transfer.

bond

A debt instrument that represents debt

fixed interest mortgage

A mortgage in which the interest does not change.

Consideration

Anything given or promised by a party to induce another to enter a contract.

Quitclaim Deed

A deed to relinquish any interest in property with the grantor without interference of possession.

Reconveyance Deed

A deed used by a trustee under a deed of trust to return title to the trustor.

DEFINCIENCY JUDGMENT

A judgement given by a court when the value of the security pledged for a loan is insufficient to pay off the debt of the defaulting borrower

Foreclosure

Procedure whereby property pledged as security for a debt is sold to pay the debt in event of default in payments or terms.

stock

represents ownership in a corporation

yield

the return on an investment

Intercontinental exchange London interbank offered rate (LIBOR)

A benchmark rate that some of the worlds leading banks charge each other for short term loans

variable interest rate

An interest rate in a real estate loan which by the terms of the note varies upward and downwards over the term of the loan depending on the money market conditions.

Assignor

One who assigns or transfers property.

Warranty Deed

A deed used to convey real property which contains warranties of title and quiet possession, and the grantor thus agrees to defend the premises against the lawful claims of third persons. It is commonly used in many states but in others the deed has supplanted it due to the modern practice of securing title insurance policies which have reduced the importance of express and implied warranty in deeds.

Bankruptcy

A legal proceeding by an individual or company who are no longer able to pay off their respective debts.

promissory note

Following a loan commitment from the lender, the borrower signs a note, promising to repay the loan under stipulated terms. The promissory note establishes personal liability for its payment. The evidence of the debt.

Easement by Prescription

Obtained by use of land of another for the legal prescribed length of time