Terms of Foreclosure and Their Definitions!

The Terms of Foreclosure and their definitions will help you understand the foreclosure process and better handle the situation you are in or are about to experience. Get a step ahead of the lenders by understanding what's going on and how to deal with it.

Most people enter a foreclosure blind, not knowing anything about the process. By that time, it's almost too late to figure out what's going on and you are susceptible to scams and expensive legal fees when all you have to do is ask for help.

The first step in learning the process of foreclosure is to learn the terms of foreclosure.

We will keep it as basic as we can so you can understand all of the terms of foreclosure you are learning.

Terms of Foreclosure
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A B C D E F G H I-K L M N-P Q-R S T U-Z

Terms of Foreclosure Beginning With "A"

Abstract

Abstract is an article or document of a text summarized for simplicity.

• Abstract of Judgment

A summary of a court judgment that creates a lien on a property when it is filed with the county recorder. An abstract judgment is a written summary of the judgment that states how much money a losing defendant will owe to the person who has won a lawsuit...

• Abstract of Title

An Abstract of Title is a condensed breakdown of the history of a property title consisting of a summary of the original loan and all subsequent transfers of the title from one person to another and liens affecting the property. It also contains a certification by the one who made the abstract that the history of the title is complete and accurate. This is why (in most cases, you must purchase title insurance when you purchase or refinance a home. A lender will not lend you money if there is a lien or additional money is owed on the property other than what you owe with your current mortgage.

• Abstract Plant

An Abstract Plant is a collection of specific information and documentation relating to the title of a particular piece of real estate. It is also called a "title plant".

Acceleration Clause

The Acceleration Clause is a clause in your mortgage or deed of trust that can and will be enforced to make your entire debt due immediately if you, the borrower, miss a payment or other requirement such as insurance or taxes related to that property.

Acceptance

Acceptance is the written approval that is made by a seller from a buyer's offer or work out.

Accrued

Accrued has 2 meanings. The first on is items that are added on a closing statement to be added as a matter of periodic gain or advantage, such as interest on money owed or taxes. It also means to become a current and enforceable right or demand (ie. you have accrued $500.00 in late fees on your loan.)

Addendum

An addendum is any addition or subtraction (change) to a contract or other legal document.

Adjustable Rate Mortgage (ARM)

If you don't know what an Adjustable Rate Mortgage is, you must learn as much about it as you can. You want to avoid these evil loans at all costs.

Agent

An agent is a licensed representative of a state who can conduct real estate transactions within that state.

Agreement of Sale

An Agreement of Sale is also known as an agreement to convey (back or carry). It is a written contract between the seller (lender) and the buyer (purchaser) for the sale of real estate (property or land) spelling out certain terms and conditions, signed by both parties who are in agreement with the contract.

Alienation

Alienation is the legal transfer of real property from one person to another. Alienation may in the form of a gift or sale (voluntary) or through force (involuntary) such as a repossession.

• Alienation Clause

The Alienation Clause is a term used with a mortgage that requires the borrower to pay the full principal and interest of  their mortgage upon the sale of the property.

All-Inclusive Deed of Trust

The All Inclusive Deed of Trust is a form of deed of trust that, includes any amount of all prior deeds of trust that were involved with that real property. This is also known as a "wrap-around" or "over-riding trust deed".

Amortization

The repayment of any non-interest or interest bearing loan in regular installments for a set amount of years. It is usually broken down showing the total payment each month, interest paid each month, and principle paid down each month.

Appraisal

An Appraisal is a valuation or estimation of the value of a property by people who are neutral (have no ties to the property) and who possess proper qualifications. It is the process of best guessing the value of an asset or liability that requires an "expert" opinion.

• Appraise

Appraise is to determine the value of assets and liabilities.

Appreciation

Appreciation is the difference between your property value from when you purchased it if the value of the property goes up over time.

Arrears

Arrears is another word for late, in default, or being overdue in payments of a loan. Usually when you have filed bankruptcy (Chapter 13), you may make all of your monthly bankruptcy payments on time as well as your regular mortgage payments on time, but you may remain in arrears throughout the time you are making those payments. This can cause you to go back into the foreclosure process right after satisfying the Chapter 13.

Assessor

An assessor is a city employee who estimates the value of real property for the purpose of local property taxes.

Asset

An Asset is any property, entity, or object that has earnings (a value or produces cash flow every month) that exceeds its monthly expenses.

Assignment

Assignment is the process by which a contract or a right is transferred from the original owner (the assignor) to a new owner (the assignee).

• Assignee

An Assignee is a person to which a transfer of interest is made. For instance, if an Assignee of an Agreement of Purchase and Sale purchases a property. they can enforce the contract in the same fashion as the original party.

• Assignor

Assignor is the person who makes an assignment to the assignee.

Assumable Mortgage

An Assumable Mortgage is a mortgage that can be transferred or taken over ("assumed") by a buyer when a home is sold. A time when an Assumable Mortgage would be a great deal is if interest rates have risen. If the original loan was fixed at a low rate, you can use the selling point to get the buyer to purchase your home at that same low fixed rate.

Terms of Foreclosure Beginning With "B"