Bankruptcy

A proceeding in U.S. District Court wherein assets of an insolvent debtor are protected and distributed in an equitable manner.

Binder

Sometimes called 'preliminary certificate' or 'commitment.' (1) A preliminary report as to the condition of a title and a commitment to issue a title insurance policy in a certain manner when certain conditions are met. (2) A deposit in escrow of a small part of the purchase price of real estate as evidence of good faith and to bind an agreement to purchase.

Bridge Loan

Also known as a swing loan or interim financing, a bridge loan is a short-term loan used until permanent financing is secured. Bridge loans can be used for up to one year and carry relatively high interest rates. A bridge loan might be used, for instance, to purchase a new property when the homebuyer hasn’t yet sold his or her current dwelling.

Buydown

A seller can assist a buyer in qualifying for a mortgage and securing a lower interest rate by making payments to the lender for the first several years of the loan. The buyer benefits by having lower monthly payments initially; the seller will increase the price of the home to offset the buydown costs.

Certificate of Title

A certificate issued by a title examiner stating the condition of a title.

Chain

In real estate measurements (surveying), a chain is 66 feet long or 100 links, each link being 7.92 inches. The measurement may change when used in fields other than surveying.

Chain of Title

The successive ownerships or transfers in the history of title to a tract of land.

Claim

An adverse right or interest asserted by one party against another or against an insurer or indemnitor. Claims may arise from unpaid debts or taxes, as well as from hidden title defects such as fraud, forgery, missing heirs, etc.

Clear Title

Real property ownership free of liens, defects, encumbrances or claims.

Closing

Also called 'settlement.' A meeting of all parties involved in a property transaction during which the transaction is consummated.

Clouded Title

An irregularity, possible claim or encumbrance that, if valid, would adversely affect or impair the title.

Coinsurance

Two or more policies of title insurance issued by different insurers, each covering a portion of the same risk, which together provide total coverage of the risk.

Commission

Commitment

Also called "binder." A document issued by a title insurance company that contains the conditions under which a policy of title insurance will be issued.

Comparables

Comparative Market Analysis (CMA)

An estimate of the value of property using indicators taken from sales of comparable properties, such as price per square foot, combined with expert market commentary and information on the importance of marketing a home properly. A CMA is not the same as an appraisal report of the market value of the subject property prepared by a licensed professional appraiser.

Condemnation

The taking of private property for a public purpose, with compensation to the owner under the right of eminent domain. Governmental units, railroads and utility companies have the right to condemn and take private property. The destruction by government of private property that imperils the life, health or safety of the public.

Conventional Loan

A loan secured by a mortgage or deed of trust for which the loan-to-value ratio is within an acceptable range for a particular lending institution.

Conveyance

The transfer of title to property from one person to another.

Courtesy

A right that a husband has in his wife's property at her death. It does not exist in all states.