Glossary of Terms

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.

Affidavit - A written statement or declaration, sworn to before an officer who has authority to administer an oath.

Agent - 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.

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

Bankruptcy - A special proceeding under federal, or in some instances state, laws by which the property of a debtor is protected by the court and may be divided among the debtor’s creditors and the debtor.

Beneficiary - See Deed of Trust.

Blanket Mortgage or Trust Deed - A mortgage or trust deed that covers more than one lot or parcel of real property, and often an entire subdivision. As individual lots are sold, a partial reconveyance from the blanket mortgage is ordinarily obtained.

Cancelled Order - An inactive order which was opened and subsequently cancelled on the system.

Closed Order - An inactive order which was opened and subsequently closed on the system.

Cloud on Title - An irregularity, possible claim, or encumbrance which, if valid would adversely affect or impair the title.

Commitment - A binding contract with a title company to issue a specific title policy, showing only those exceptions contained in the commitment and any intervening matters after the date of the commitment and prior to the effective date of the policy. The commitment contains all information included in the preliminary title report, plus a list of the title company’s requirements to insure the transaction. It also includes the standard exceptions from coverage that will appear in the policy.

Comparable Sales - Sales that have similar characteristics as the subject property, used for analysis in the appraisal. Commonly called “comps.”

Covenants, Conditions and Restrictions (CC & R’s) - Commonly called “CC&R’s” the term usually refers to a written recorded declaration which sets forth certain covenants, conditions, restrictions, rules or regulations established by a subdivider or other landowner to create uniformity of buildings and use within tracts of land or groups of lots. The restrictions also can be established by deed. CC & R’s are sometimes referred to as private zoning.

Date Down - To update an order from the last date searched through the current date. Also referred to as Order Date Down.

Decree of Distribution - A probate court decree that determines how the estate of a decedent shall be distributed.

Deed - Written document by which an estate or interest in real property is transferred from one person to another. Examples of deeds are grant deeds, administrators’ deeds, executors’ deeds, quitclaim deeds, etc. The type of deed to use depends on the language of the deed, the legal capacity of the grantor, and other circumstances. The titles of the Seller and Buyer will differ depending on the type of deed. For example, with a trust deed, the person who transfers the interest is called the “grantor;” the one who who acquires the interest is called the “grantee.”

Deed of Trust or Trust Deed - A written document by which the title to land is conveyed as security for the repayment of a loan or other obligation. It is a form of mortgage. The landowner or debtor is called the “trustor.” The party to whom the legal title is conveyed (and who may be called on to conduct a sale thereof if the loan is not paid) is the “trustee.” The lender is the “beneficiary.” When the loan is paid off, the trustee is asked by the beneficiary to issue a “recon” or reconveyance. This reconveyance corresponds to the release that the holder of a mortgage executes when the mortgage is paid off.

Easement - A right or interest in the use of the land of another which entitles the holder to some use, privilege or benefit, such as to place pole lines, pipe lines or roads thereon.

Eminent Domain - The right of a government to take privately owned property for public purposes under condemnation proceedings upon payment of its reasonable value. See Condemnation.

Encroachment - The presence of an improvement such as a building, a wall, a fence or other fixture which overlaps onto the property of an adjoining owner.

Encumbrance - A right or claim upon real property (land) held by one other than the property owner. Encumbrances are divided into two classes, as follows: (a) Liens (mortgages, deeds of trust, mechanic’s liens, local taxes, assessments, judgments, attachments, etc.). (b) Encumbrances other than liens which are limitations on the ownership of the land, for example, conditions, restrictions, reservations, easements, etc.

Endorsement - Addition to or modification of a title insurance policy which expands or changes coverage of the policy, fulfilling specific requirements of the insured.

Fallouts - A report generated by the system to inform the user of documents recorded or filed which may affect an open order.

Foreclosure - The sale of property used as security for a debt after default in payment.

Grant Deed - One of the many types of deeds used to transfer real property. Contains warranties against prior conveyances or encumbrances. When title insurance is purchased, warranties in a deed are of little practical significance.

Grantee - The party being granted or assigned a beneficial interest in real property from another. See Deed.

Grantor - The party granting or assigning a beneficial interest in real property to another. Seed Deed.

Homestead - A statutory protection from execution or the establishment of title by occupation of real property in accordance with the laws of various states or the Federal Government.

Instrument Number - A recording number assigned to a legal document by the county recorder.

Judgment Lien - A lien against the property of a judgment debtor. An involuntary lien.

Lease - An agreement by which an owner of real property (lessor) gives the right of possession to another (lessee), for a specified period of time (term) and for a specified consideration (rent).

Legal Description - A description of land recognized by law, based on government surveys, spelling out the exact boundaries of the entire piece of land. It should so thoroughly identify a parcel of land that it cannot be confused with any other.

Lender - Any person or entity advancing funds which are to be repaid. A general term encompassing all mortgagees, and beneficiaries under deeds of trust.

Lien - An encumbrance against property for money, either voluntary or involuntary. All liens are encumbrances but all encumbrances are not liens.

Lot - A portion of a subdivision which describes boundaries of real property.

Mechanics Lien - A lien created by statute for the purpose of securing priority of payment for the price or value of work performed and materials furnished in construction or repair of improvements to land, and which attaches to the land as well as the improvements.

Note - A unilateral agreement containing an express and absolute promise of the signer to pay to a named person, or order, or bearer, a definite sum of money at a specified date or on demand. Usually provides for interest and, concerning real property, is secured by a mortgage or trust deed. Notes are not recorded instruments.

Open Order - An active order which has been opened and not yet closed or cancelled. This refers to the entire order as an entity, not only the search parameters.

Order - A request for a preliminary title report or title insurance policy. One order usually results in the issuance of one to three title insurance policies.

Plat Map - A chart, map, or plan of a tract or town site dividing a parcel of land into lots on which a subdivision is drawn. This term also refers to the number assigned to the map by a county recorder.

Pre, Prelim or Preliminary Report - A written report issued by a title company, preliminary to issuing title insurance, which shows the recorded condition of title of the property in question. See Commitment.

Priority - The order of preference, rank or position of the various liens and encumbrances affecting the title to a particular parcel of land. Usually, the date and time of recording determine the relative priority between documents.

Property in Question (P.I.Q.) - A title term referring to Property In Question.

Public Domain - Land owned by the government and belonging to the community at large.

Public Records - The transcriptions in a recorder’s office of instruments which have been recorded, including the indexes pertaining to them.

Real Property - Land, from the center of the earth and extending above the surface indefinitely, including all inherent (immovable) natural attributes and any human-made improvements of a permanent nature place thereon, for example, minerals, trees, buildings, appurtenant rights.

Reconveyance - An instrument used to transfer title from a trustee to the equitable owner of real estate, when title is held as collateral security for a debt most commonly used upon payment in full of a trust deed. Also called a deed of reconveyance or release.

Recording - The filing of documents affecting real property as a matter of public record, giving notice to future purchasers, creditors, or other interested parties. Recording is controlled by statute and usually requires the witnessing and notarizing of an instrument to be recorded.

Section - A portion of a township and range, approximately one square mile in area, numbered from 1 to 36.

Sectional Property - Property referenced by section, township, and range that has not yet been subdivided.

Starter - An indication that an order was processed and closed on a particular property or name. A copy of the last policy or report issued by a title insurer that described the title to land upon which a new search is to be made. In some states, this is called a back title letter or back title certificate.

Subdivision - An area of land laid out and divided into smaller parcels: lots, blocks and building sites, and in which public facilities are laid out, such as streets, alleys, parks, and easements for public utilities.

Subordination Agreement - An agreement by which one encumbrance (a mortgage) is made subject to another encumbrance (a mortgage) is than made subject to yet another encumbrance (a lease). To “Subordinate” is to “make subject to,” or to make of lower priority.

Survey - The measurement by a surveyor of real property which delineates the boundaries of a parcel of land. An ALTA surey additionally delineates the exact location of all improvements, encroachments, easements and other matters affecting the title to the property in question. A title insurance company may require a survey whenever the company is requested to issue an ALTA Extended Coverage Policy.

Title Insurance - Insured statement of the condition of title or ownership of real property. For a one-time-only premium, the named insured and their heirs are protected against title defects, liens and encumbrances existing as of the date of the policy and not specifically excluded from it. In the event of a claim, the title company provides legal defense from the policyholder and pays any covered losses incurred as a result of such claim.

Title Officer (TOF) - Title company employee(s) designated to maintain order file(s), for example, answer questions, resolve order query problems, perform the last quality assurance on paperwork prior to the issue of a title policy. Employee who may serve as manager of title unit in charge of particular title search(es).

Title Plant - All records of a title company that are assembled and maintained in order to issue title insurance on real property.

Township and Ranges - This usually means a 36 square mile grid that represents the distance from a designated base and meridian.

Vesting - The names, status and manner in which title of ownership is held with a fixed or determinable interest in a particular parcel of real property; also that portion of a title report or policy setting forth the above.

Life of an Escrow
Reasons to Use a Realtor When Buying a Home
Reasons to Use a Realtor When Selling a Home
What is Title Insurance and Why Do You Need It?
Eight Common Ways to Hold Title
Important Property Tax Dates and Information
"Tracking Your Score is About to Get Easier" (article from the "LA Times" 11/28/04)
"Given Up Hope in a Hot Market? There Are Deals." (article from the "LA Times" 1/9/05)
Tax Law Changes for Capital Gains and California Real Estate Witholdings
"Income Tax Time: Value Of Homeownership" (C.A.R. 4/8/05)

Home Listings The Neighborhood Articles About Us Contact