Common Terminologies
Abstract or Title
A condensed history of the title consists of the various links in the chain of title and
statement of all liens, changes, or encumbrances affecting a particular property
Acceleration Clause
A clause in a contract stating that upon the happening of a certain event, like failure to
pay any installment due shall make all the balance become immediately due and
payable.
Acceptance
When the seller or agent’s principal agrees to the terms of the contract sale, approves
the negotiation on the agent’s part, and acknowledges receipt of the deposit in
subscribing to the sale agreement.
Accretion
In addition to land from natural causes as, for example from gradual action of the ocean or
the rivers waters.
Acknowledgement
A formal declaration before a duly authorized officer by a person who has executed an
instrument that such execution is his act and deed.
Acquired Asset
Usually refers to real state properties that were previously mortgaged to the bank, by
which because the owner failed to pay the mortgage, the ownership of the property was
transferred to the bank through a judicial foreclosure proceeding. Acquired Asset is called
Foreclosed Properties.
Acquisition
The act or process by which a person procures property.
Ad Valorem
According to valuation
Administrator
A person appointed by the probate court to administer the estate of a deceased person.
Adverse Claim
A claim of a person on property owned by another (Good only for 30 days no second adverse
claim is allowed).
Adverse Possession
Right of an occupant of land to acquire title against the real estate owner, where possession has
been actual, continuous, hostile, visible, distinct and in the concept of the owner for the
statutory period.
Note: Statutory period is 30 years adverse possession does not apply on lands titled under the
Torrens System.
Affidavit
A statement or declaration reduced in writing sworn to or affirmed before some officer who has
authority to administer as oath of affirmation.
Affirm
To confirm, to ratify, to verify
Agent
One who acts for and has authority to represent another or known as a principal.
Agreement of Sale
A written agreement or contract between seller and purchaser in which they reach a meeting of
the minds on the terms and conditions of the sale.
Air Right
The right of the property owner to use, control, or occupy the air space over his property,
subject to the requirements of air navigation and government regulation.
Alienation
The transferring of property to another; the transfer of property and possession of lands, or
other things, from one person to another.
Amortization
Staggered payment of the thing purchased. Also known as INSTALLMENT. It refers to the process
of paying off debt (often from a loan or mortgage) over time through regular payments. A
portion of each payment is for interest while the remaining amount is applied towards the
principal balance.
An amortization could be in Equal Payments which has fixed amounts throughout the loan
period. It could also be a Ballooning Payment wherein the monthly due increases through time.
Given a number of pay periods and interest rates, the amortization amount is calculated using
the Amortization Factor Table.
Appointment
Appointment is one way of how an agency relationship is created. It means that the principal
gives express authorization to the agent. Under both common and statutory law, this requires
writing when the sale of real estate is involved.
The report is in acceptable written form. Also known as valuer, refers to a person who conducts
valuation/appraisal; specifically, one who possesses the necessary qualifications, ability, and
experience to execute or direct the valuation/appraisal of real or personal property.
Appraiser
A Real Estate Appraiser is a duly registered and licensed natural person who, for a fee,
compensation, or other valuable consideration, performs of renders, or offers to perform
services in estimating and arriving at an opinion of or acts as an expert on real estate values,
such services of which shall be finally rendered by the preparation of
