A guide to the implications of specific terminology used in property sale and home loan agreements

A guide to the implications of specific terminology used in property sale and home loan agreements

ASSIGNEE: The person to whom an interest is transferred. An assignee of an Agreement of Purchase and Sale may buy the property and enforce the contract in the same fashion as the original party.

ASSIGNMENT: The transfer of any right, claim or interest to another person or corporation. Often used to refer to the transfer of a mortgage from one lender to another. Also a noun describing the document which represents the assignment of the right etc.

ASSIGNMENT OF LEASE: Subject to the terms of the lease, a transfer of either the lessor's or the lessee's interest in a lease.

ASSIGNOR: The person who assigns a right or interest to another person.

ASSUMABLE MORTGAGE: A mortgage that can be taken over ('assumed') by the buyer when a home is sold. If interest rates have risen, an assumable mortgage at a low rate may prove a selling point for the property.

ASSUMPTION CLAUSE: The paragraph in the mortgage which sets out the borrower's right to have the mortgage assumed by a purchaser.

ASSUMPTION FEE: A charge levied by the lender (usually against the party assuming the mortgage) for the privilege of assuming a mortgage. May be a fixed amount or a percentage of outstanding principal on the mortgage at the time of the assumption.

ASSUMPTION OF MORTGAGE: The agreement of a purchaser to take on personal liability for a mortgage already registered on title to the property and to make payments under the mortgage. Purchaser takes the place of the vendor in the contract with the lender.

ATTACHMENT: The binding by a court of a piece of property (real or personal) as security for a debt.

ATTESTATION: A statement by a person who has witnessed another person signing a document to the effect that they did in fact witness the document.
This may include statements to the effect that the witness knew the person who signed personally, that the person who signed understood the contents of the document when he signed etc.
This is required in some states for land title deeds.

AUCTION: The process of selling property to the highest bidder.

AUCTIONEER: A professional (real estate broker or auctioneer, depending on local laws) who sells property at public auctions.

Blueprint: Construction plans, which contain minute details about a particular building.

Bona Fide: Made in good faith, at fair market value, without deceit or fraud.

Borrower: The person that receives money from a lender (often a bank) in exchange for a written promise to pay and a registered lien on property.

Boundary: Edge or limit of a property.

Build To Suit: An offer by a landowner to develop the land in a manner dictated by a potential tenant, in return for a long-term lease from the tenant for the developed land.

Builder Warranty: An enforceable guarantee of the quality of construction given by a builder or developer.

Building Code: A set of regulations, which is established by a municipal corporation, in order to govern the standards of construction in its jurisdiction.

Building Line Or Setback: This is the minimum distance at which a building or any other improvement may be constructed from a property line. It may be established by agreements, title documents or municipal ordinances.

Building Restrictions: Limiting rules which may appear in building codes or in title documents, which control the size, placement, materials, design or location of new constructions.