A B C D E F G H I J K L M
N O P Q R S T U V X W Z

A

Abstract (Of Title)
A summary of the public records relating to the title to a particular piece of land. An attorney or title insurance company reviews an abstract of title to determine whether there are any title defects which must be cleared before a buyer can purchase clear, marketable, and insurable title.
Acceleration Clause
Condition in a mortgage that may require the balance of the loan to become due immediately, if regular mortgage payments are not made or the sale of the property.
Accretion
The buildup of land from natural forces such as wind or water.
Acknowledgment
As a verb, the confirmation by a party executing a legal document that this is his signature and a voluntary act. This confirmation is made to an authorized officer of the Court or notary public who signs a statement also called an acknowledgment.
Adjustable Rate Mortgage (ARM)
Is a mortgage in which the interest rate is adjusted periodically based on a preselected index. Also sometimes known as the re-negotiable rate mortgage, the variable rate mortgage.
Adjustment Interval
On an adjustable rate mortgage, the time between changes in the interest rate an/or monthly payment, typically one, three or five years, depending on the index.
Agency
A relationship in which the agent is given the authority to act on behalf of another person (Principal).
Amortization
Monthly loan payment calculated to pay off the debt at the end of a fixed period, including accrued interest on the outstanding balance.
Annual Percentage Rate (APR)
An interest rate reflecting the cost of a mortgage as a yearly rate. This rate is likely to be higher than the stated note rate or advertised rate on the mortgage, because it takes into account points and other credit costs. The APR allows homebuyers to compare different types of mortgages based on the total cost for each loan.
Appraisal
An estimate of the value of the property, require the appraiser to be licensed in that state. To comply with lending requirements, lenders/loan originators must order the appraisal.
Assessment
A local tax levied against a property for a specific purpose, such as a sewer or street lights.
Assumption
The agreement between buyer and seller where the buyer takes over the payments on an existing mortgage from the seller. Assuming a loan can usually save the buyer money since this is an existing mortgage debt, unlike a new mortgage where closing costs and new, possibly high, market-rate interest charges will apply.