Title Insurance and Closing Services Since 1954
Terms Defined
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. Wayne County Title Agency, Inc. has compiled the following Definition 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.
Take Out Loan
A permanent mortgage loan which a lender agrees to make to a borrower upon completion of improvements on the borrower’s land. The proceeds of the loan are used principally to pay off the construction loan.
Tax
As applied to real estate, an enforced charge imposed on persons, property or income, to be used to support the State.
Tax Deed
The deed given to a purchaser at a public sale of land for non-payment of taxes. It conveys to the purchaser only such title as the defaulting taxpayer had and does not convey good title to that extent unless statutory procedures for the sale were strictly followed.
Tax Sale
A public sale of property at auction by a governmental authority, after a period of non-payment of property tax.
Tenant
One who has right of possession of land by any kind of title. The word “tenant” used alone in modem times is used almost exclusively in the limited meaning of a tenant of a leasehold estate.
Tenants In Common
Persons who are co-owners of residential interest in the same land. At death of a cotenant, interest passes by will or by laws of intestate succession.
Testate
Having made a will. One who makes a will is known as the testator or testatrix.
Time Share Ownership
A technique for dividing the title to a commercial property or a vacation home among many different owners, with each owner acquiring the right to occupy the premises during a specified portion of each year.
Time Share Unit
An interest in a residential or commercial property which by contract or by conveyance of a real property interest allows a purchaser to occupy the unit during a particular week or weeks for a stated number of years. There are two major forms of time share estate:
(a) Interval ownership. A time share estate where the unit purchaser is deeded an estate for years, giving a right to occupy the unit for a particular week during a stated number of years with a remainder interest in fee as a tenant in common with all other purchasers of the unit.
(b) Time span ownership. A time share estate where the unit purchaser is deeded an undivided percentage interest in the unit as a tenant in common with all other purchasers and the right to occupy the unit for a particular time period is governed by contractual provisions of the time share declaration.
Title
As generally used, the rights of ownership and possession of particular property. In real estate usage, title may refer to the instruments or documents by which a right of ownership is established (title documents), or it may refer to the ownership interest one has in the real estate.
Title Defect
(1) Any possible or patent claim or right outstanding in a chain of title that is adverse to the claim of ownership. (2) Any material irregularity in the execution or effect of an instrument in the chain of title.
Title Insurance
Insurance against loss resulting from defects of title to a specifically described parcel of real property. Insurance benefits will be paid only to the “named insured” in the title policy, so it is important that an owner purchase an “owner’s title policy,” if he desires the protection of title insurance.
Title Plant
A compilation of records maintained by title companies and containing information about specific parcels of land. This information would be ascertained otherwise only by a search of the public records.
Title Search or Examination
A review of all recorded documents affecting a specific piece of property to determine the present condition of title.
Torrens System
A governmental title registration system wherein title to land is evidenced by a certificate of title issued by a public official known as the registrar of title.
Township
A territorial division of land established by federal survey, being six miles square, containing 36 sections or 36 square miles.
Tract
A parcel of land.
Transfer on Death Affidavit
An Affidavit that permits the property owner, property owners or husband and wife to execute an affidavit which provides for the names of beneficiaries upon the passing of the owner and if the named beneficiary does not survive then contingent beneficiaries may be named.
Trust
A fiduciary relationship under which one holds property for the benefit of another.
Trustee
A party who is given legal responsibility to hold property in the best interest of or “for the benefit of” another. The trustee is one placed in a position of responsibility for another, a responsibility enforceable in a court of law.
Truth-in-Lending
A federal law obligating a lender to give full written disclosure of all fees, terms, and conditions associated with the loan initial period and then adjusts to another rate that lasts for the term of the loan.
Turnkey Housing
Housing initially financed and built by private sponsors and purchased by housing authorities for use by low-income families under the public housing program.