Real Estate Glossary A


Acceleration Clause

A clause in a deed of trust or note that accelerates or hastens the time when the debt becomes due. For example, most deeds of trust or loans contain a provision that the note shall become due immediately upon the sale or transfer of title of the loan, or upon failure to pay an installment of principal or interest. This is also called a due on sale clause.


A buyer's or seller's agreement to enter into a contract and be bound by the terms of the offer.

Account Termination Fee

A fee that is often charged if you pay in full and terminate your Countrywide home equity line of credit during the first five years. Payment down to a zero balance does not count as termination. See also definition of prepayment penalty.


One acre comprises 4,840 square yards or 43,560 square feet (which can be easily remembered as 44,000 square feet, less 1%). The acre is often used to express areas of land. In the metric system, the hectare is commonly used for the same purpose. An acre is approximately 40% of a hectare

Additional Principal Payment

A payment made by a borrower of more than the scheduled principal amount due, in order to reduce the outstanding balance on the loan, to save on interest over the life of the loan and/or pay off the loan early.

Adjustable Rate Mortgage (ARM)

An adjustable rate mortgage is a home loan that permits the lender to adjust its interest rate periodically during the life of the loan on the basis of changes in a specified financial index.

Adjustment Date

The date on which the interest rate changes for an adjustable-rate mortgage (ARM).

Adjustment period

The period that elapses between the adjustment dates for an adjustable rate mortgage (ARM), typically 6 months or 1 year for Countrywide's most popular ARMs.

affordability analysis (pre-qualification)

A preliminary analysis of a borrower's ability to afford the purchase of a home. An affordability analysis takes into consideration factors such as income, liabilities, and available funds, along with the type of home loan, the likely taxes and insurance for the home, and the estimated closing costs.


The American Land Title Association or ALTA, is a national trade association representing the interests of the abstract of title and title insurance industries. In addition to active members engaged in the title industry, associate members cover a wide range of businesses and occupations relating to real estate law, sales, development, design, construction, and financing.


A feature of real property that enhances its attractiveness and increases the occupant's or user's satisfaction, although the feature is not essential to the property's use. Natural amenities include a pleasant or desirable location near water, scenic views, etc. Man-made amenities include swimming pools, tennis courts, community buildings, and other recreational facilities.


The gradual repayment of a home loan by periodic installments.

amortization schedule

A timetable for payment of a home loan. An amortization schedule shows the amount of each payment applied to interest and principal and the remaining balance after each payment is made.

amortization term (period)

The amount of time it takes to pay off the loan. The amortization term is expressed as a number of months. For example, for a 30 year fixed rate loan, the amortization term is 360 months.


To repay a loan with regular payments that cover both principal and interest.

Annual Maintenance Fee

An amount that is charged each year for having a line of credit made available by Countrywide. It is charged regardless of whether or not the credit line is used. For some programs and in some states, an annual fee is not charged. For all Countrywide programs, the fee is automatically waived the first year of the loan.

Annual percentage rate (APR)

The effective cost of a home loan stated as a yearly rate taking into account such items as interest, mortgage insurance, most closing costs, discount points and loan origination fees. Disclosure of APR is required by the Truth-In-Lending Law.

Application (or 1003)

A form to be completed by a home loan applicant with the lender's assistance to provide pertinent information about a prospective borrower's employment, income, assets, debts and other financial information, about the purpose of the home loan, and about the property securing the home loan. Lenders also sometimes call it a 1003-the form number of Fannie Mae's standard application form.

Application Fee

A fee usually paid at the time an application is given to a lender for helping to complete and review an application. Some lenders collect fees for a property appraisal and a credit report, instead of an application fee, at the time of application.


A appraisal is a written analysis or opinion of the estimated value of a property prepared by a qualified appraiser. Contrast with home inspection.

Appraised value

The dollar figure for a property's estimated fair market value, based on an appraiser's knowledge, experience, and analysis of the property and comparable properties near by.


A person qualified by education, training, and experience to estimate the value of real property.


An increase in the value of a property due to changes in market conditions or other causes. Inflation, increased demand, home improvement, and sweat equity are all causes of appreciation. The opposite of depreciation.

Assessed value

The value used to determine property taxes, based on a public tax assessor's opinion. Contrast with appraised value.


The amount of tax due to local government. May also refer to the amount due to local government or to common owners of a property (e.g., a homeowner's association) for a special payment to cover expenses for improvements or maintenance, such as new sewers or roads.

Assessment rolls

A public record of the assessed value of property in the taxing jurisdiction.


Assessor, A public official who establishes the value of a property for taxation purposes.


Anything of monetary value that is owned by a person. Assets include real property, personal property, and enforceable claims against others (including bank accounts, stocks, mutual funds, and so on).


The method of transferring a right or contract, such as the terms of a loan, from one person to another.

Assumable loan

A home loan that allows a new purchaser of the home to take over ("assume") the loan obligations of the seller when a home is sold.


The buyer's acceptance of liability for the seller's existing home loan. See assumable loan.

Assumption clause

A provision in an assumable loan that allows a buyer to assume responsibility for the home loan from the seller. The loan does not need to be paid in full by the original borrower (seller) upon sale or transfer of the property.

Assumption fee

The fee paid to a lender (usually by the buyer) for the lender's agreement to start collecting payment from the buyer instead of the original borrower (seller).