Real Estate & Investing Dictionary
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A method of recording a document recorded first by the date, then by a number indicating the document’s order in which it was recorded that particular day.

Monetary compensation set by a court for a loss suffered by a party to a lawsuit.

Days on the Market
Period of time a property is listed for sale prior to being sold or removed.

An instrument referring to the military discharge of an individual from the United States Armed Services, providing a description of the accomplishments, awards, duties, discharge status, and disabilities (if any) that occurred during active duty.

De Facto
Latin for "in deed, in fact, in reality" Refers to a fact or an act that occurs as a matter of practice and reality rather than from de jure, meaning a lawfully and rightfully occurring act.

Dead Asset
An asset that an investor does not want-in the investor's eyes it has no value.

Dead End Street
Street that terminates at one end has only one outlet and is not a through street.

An amount owed from one to another.

An amount owed to another.

Debt Financing
The raising of money by loans and borrowing directly from financial institutions, providing increased financial leverage. Interest may be tax deductible.

Debt Service
Annual amount to be paid by a debtor for money borrowed.

Declining Market
Market condition in which there are more sellers than buyers, causing prices to fall.

The final order of a court in many states.

Decree of Distribution
The final declaration of the rights of heirs to receive the property of an estate.

The giving by an owner of private property for public use, and the acceptance by the proper public authority. Most commonly the dedication by a builder of the streets in a subdivision.

The legal document conveying title to a property.

Deed in Lieu of Foreclosure
Instead of waiting until the lender forces the sale of the house in foreclosure, usually to the lender, the borrower just deeds the property to the lender.

Deed in Trust
Instrument of conveyance into a trust; a fiduciary relationship under which one holds property (real or personal) for the benefit of another. The party creating the trust is called the Settlor, the party holding the trust is called the Trustee, and the party for whose benefit the property is held is called the Beneficiary.

Deed of Reconveyance
An instrument that releases and discharges a deed of trust.

Deed of Restriction
A restriction imposed in a deed to limit the use of the land. A deed might include clauses preventing the sale of liquor or defining the size, type, value, or placement of improvements.

Deed of Trust
A deed given by the property owner to secure performance of an act (such as making payments on a loan). A deed of trust is a type of mortgage.

Deed of Trust
Some states, like California, do not record mortgages. Instead, they record a deed of trust which is essentially the same thing.

Deed of Trust (Trustee’s Deed)
Record of conveyance of real estate to a trustee as security for the repayment of money loaned, showing date; names of grantor, grantee, trustee, and beneficiary; description and amount of note; description and location of property; terms of instrument; maturity; acknowledgement; date filed; and certificate of recorder. Arranged chronologically by date.

Short for "deed in lieu of foreclosure," this conveys title to the lender when the borrower is in default and wants to avoid foreclosure. The lender may or may not cease foreclosure activities if a borrower asks to provide a deed-in-lieu. Regardless of whether the lender accepts the deed-in-lieu, the avoidance and non-repayment of debt will most likely show on a credit history. What a deed-in-lieu may prevent is having the documents preparatory to a foreclosure being recorded and become a matter of public record.

Failure to make the mortgage payment within a specified period of time. For first mortgages or first trust deeds, if a payment has still not been made within 30 days of the due date, the loan is considered to be in default.

Failure to fulfill a duty or promise, or to discharge an obligation; omission or failure to perform an act. In property foreclosure, usually the failure to pay loan installment repayments when they become due.

Defeasance Clause
The clause in a mortgage that permits the mortgagor to redeem his or her property upon the payment of the obligations to the mortgagee.

In medieval times ownership rights constituted a fee. To be defeased meant to lose the fee, or today, to lose ownership.

Defendants Original Answer
The first responsive pleading of a defendant in a lawsuit.

Deferred Payments
Money payments to be delayed for a future date or extended period of time.

Money a borrower who has lost real estate in foreclosure still owes to the lender because the foreclosure sale failed to generate enough to pay off the loan. Frequently, lenders acquire title to real estate at foreclosures, in which case they most often give credit only for the fair market value of the property against the balance due on the loan. Any unpaid balance on the loan after all just credits are applied is the usual amount of a deficiency. Many states limit or restrict deficiencies.

Deficiency Judgment
A court judgment that a defaulting borrower owes a deficiency.

The state of affairs when payments on a note or other loan obligation are past due.

Failure to make mortgage payments when mortgage payments are due. For most mortgages, payments are due on the first day of the month. Even though they may not charge a "late fee" for a number of days, the payment is still considered to be late and the loan delinquent. When a loan payment is more than 30 days late, most lenders report the late payment to one or more credit bureaus.

Delinquent Mortgage
A mortgage involving a borrower who is behind on payments. If the borrower does not bring the mortgage to date with a specified amount of time, the lender may begin foreclosure proceedings.

Demand Loan
Loan with no established maturity period, which is callable on the demand of the lender, for repayment. The interest is calculated on a daily basis and paid periodically.

Demand Note
A note that is payable on demand of the holder.

Transfer of an estate by bequest or contract for a stated time period or life. Alternately, the making of a charter or lease for a specified time period.

Money given, along with an offer to purchase property or as security for the performance of some contract. Also called earnest money it is intended to show willingness to follow through with the purchase agreement.

A sum of money given in advance of a larger amount being expected in the future. Often called in real estate as an "earnest money deposit."

A decline in the value of property; the opposite of appreciation. Depreciation is also an accounting term which shows the declining monetary value of an asset and is used as an expense to reduce taxable income. Since this is not a true expense where money is actually paid, lenders will add back depreciation expense for self-employed borrowers and count it as income.

Creator of property improvements by building homes, shopping centers or commercial buildings for a profit on a specific area of land. A developer will organize and plan the development, supervise its construction and manage all the business elements of the project.

Developer's Equity
Financial interest a developer has in a project.

Disposition of land or real property by will.

Discharge of Indebtedness
A lender tells a borrower that a loan doesn't have to be paid back, also called discharge of debt.

Discount Points
In the mortgage industry, this term is usually used in only in reference to government loans, meaning FHA and VA loans. Discount points refer to any "points" paid in addition to the one percent loan origination fee. A "point" is one percent of the loan amount.

Discounting a Note
The process of offering a promissory note for less than its face value to enhance its marketability.

The phase of a lawsuit in which respective parties are permitted to ask each other formal written and oral questions, obtain copies of documents and in general find out the facts related to the lawsuit.

A cancellation or annulment of a contract or business association, such as a partnership or corporation.

Distressed Property
A bargain property that is substantially below its present or projected renovated value.

The location of a recorded document in an office of records, listed chronologically and alphanumerically.

Document ID Number
The identifying number assigned to a document by the local recording agency's office. May be expressed as Daily, Book & Page, Docket & Page, Liber & Page, etc.

Documentary Transfer Tax
A tax applicable to transfers of real property. Notice of payment is entered on the face of the deed or on a separate paper filed with the deed.

Double Whammy
Some lenders refuse to permit assumptions, which is one blow, while at the same time insisting on a hefty prepayment penalty when the non assumable loan is paid off early, which is a second blow.

The legal rights of a widow in her husband's estate. These rights have been abolished in many states.

Down Payment
The part of the purchase price of a property that the buyer pays in cash and does not finance with a mortgage.

Down Payment
The initial cash a borrower pays to the seller to purchase a property. It does not include closing costs.

The system of gutter and drainpipes used to carry water away from the foundation of a home.

Dual Agency
Representation of both parties by the same real estate agent or broker.

Due on Encumbrance
A clause in a mortgage that prevents a borrower from encumbering title to the property with liens, leases or other encumbrances without the lender's consent.

Due on Sale
A clause in a mortgage that demands that the borrower pay off the loan in full if the house is ever sold. The lender can't prevent the sale, but it can demand payment in full on the loan balance, which often has the same practical effect. In the absence of a due on sale clause, the loan is assumable without the lender's consent. Older FHA and DVA loans are assumable without the consent of the lender.

Due On Sale Clause
A provision in a mortgage that allows the lender to demand repayment in full if the borrower sells the property that serves as security for the mortgage.

A two family home where the units share a common divider and are situated either side by side or up and down.

Structure consisting of two separate family units, under the same roof.

Dwelling unit
premises or part thereof occupied, used, or held out for use and occupancy as a place of abode for human beings, whether occupied or vacant
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