Acceleration Clause: A provision in a loan that lets the lender demand all sums owed be immediately due and payable if certain things happen. Those events can include a default or a transfer of the property in violation of the due-on-sale clause.
Ad Valorem Tax: A tax based upon on a property’s assessed value.
Adjustable Rate Mortgage (ARM): A loan in which the lender periodically adjusts the interest rate after a time period during which the rate is fixed.
Agent: A person legally authorized to act on the behalf of another.
Assignment Fee: A fee paid when the rights under a purchase and sale agreement are transferred from one person to another. The fee is paid at the time of assignment or at closing.
Closing: The ceremony during which all documents involved in transferring real property from one person to another are signed.
Closing attorney: The person responsible for all aspects of the closing. Duties include preparing all documents and preparing and recording deeds, as well as disbursing all money.
Closing Protection Letter (also known as Insured Closing Letter, CPL, or ICL): A document that a title insurance company issues that sets out the that company’s responsibility if a closing agent is negligent, commits fraud or makes other errors. Most lenders require such a letter.
Deed: A document that transfers ownership of property from one person to another.
Due-On-Sale Clause: A provision in a loan that lets the lender call the balance of the loan due if the property is sold.
FiFa (Fi. Fa. or Writ of Fieri Facias): A court order issued after a judgment in a civil lawsuit. The FiFa becomes a lien against all real property owned by the debtor in the county where the order was recorded.
HUD-1 (HUD, Settlement Statement, Uniform Settlement Statement): A form that discloses all financial details of a real estate transaction. The details include commissions, lender charges, initial escrow reserves and title charges.
Intangible Tax: A state tax imposed on loans with terms of three years or longer that are secured by real property. The tax is $1.50 for each $500 of the loan.
Joint Tenants with Rights of Survivorship: Co-ownership of real property where each owner holds an equal interest. Upon the death of one owner, that share automatically passes to the survivors
Owner’s title insurance: A one-time charge, typically paid at closing, for insurance that protects the new property owner if problems later are discovered with the title to the property.
POC (P.O.C., Paid Outside of Closing): Items such as inspections or appraisals that are disclosed on the settlement statement even though they already have been paid.
Promissory Note (Note). The written agreement by which one person promises to pay another. The note lays out important details such as the principal, the interest rate and the date by which the borrower must repay the full amount.
Transfer Tax. A tax the seller must pay when a title is transferred. The amount is $1 for every $1,000 the seller receives.