The real estate industry has its own unique language and, without some knowledge of this language, you may find yourself a bit confused if you become involved in a real estate transaction. With this in mind, the experts at Commonwealth Land Title Insurance Company have compiled the following glossary of terms commonly used in the real estate industry. Whether you are entering the real estate market for the first time or have invested in it before, this handy reference will provide an understanding of basic real estate words and phrases.
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Abstract -

A history of all transactions shown in public records affecting a particular tract of land.



Adjustable Rate Mortgage (ARM) –

Mortgage loans under which the interest rate is periodically adjusted, in accordance with some market indicator, to more closely coincide with the current rates. The extent and number of these adjustments are agreed to at the inception of the loan.



Adverse Possession –

The possession, by one person, of land belonging to another in a manner deemed adverse to the interest of the owner. In most states, by operation of law, title to the land becomes vested in such person after a fixed number of years if the owner fails to assert his or her rights.



Affidavit –

A written statement made under oath before a notary public or other judicial officer.



Agreement –

A legally binding contract made between two or more persons.



ALTA (American Land Title Association) –

Trade association of the title insurance industry, which has adopted certain insurance policy forms to standardize coverage on a national basis.



Amortization –

Payment to reduce the principal of a debt in regular, periodic installments.



Appraisal –

A report from an independent third party detailing the estimated value of real estate.



Appurtenance –

A right or privilege that is a part of the ownership of property, such as a right of way to a highway across the land of another. Water rights are also an example.



Assessment –

(1) the valuation of real estate for purposes of taxes or special improvement charges. (2) The amount of taxes or special improvements charges. Special improvement charges are usually for the costs of streets, sidewalks, sewers, ect.



Assignment –

(1) the act of transferring an interest, such as a loan secured by a mortgage, from one person to another. (2) The instrument or paper by which one person transfers such ownership to another.



Attorney’s Opinion –

A statement by an attorney as to the validity of a title, arrived at after investigation of the history of the title as recorded in the public records.