Title & Escrow Glossary

A quick A-Z reference for the title and escrow vocabulary you may encounter before, during, and after closing.

Abstract of Title: A written history of the documents recorded against a property, including past owners, liens, easements, and court actions.
Acknowledgment: The notary's certification that a signer appeared, was identified, and signed willingly.
ALTA: The American Land Title Association, the national trade association for title insurers and agents.
Appurtenance: A right or improvement that belongs to the land and passes with it, such as a driveway easement.
Assessment: A charge levied against a property, often by a municipality or homeowners association.

Bill of Sale: The document transferring personal property, such as appliances, separately from the real estate.
Boundary Survey: A survey establishing the legal edges of a parcel.
Breach of Contract: A failure to perform an obligation required by the purchase agreement.

Chain of Title: The recorded sequence of ownership transfers for a property.
Closing Coordinator: The person who schedules the signing and helps make sure documents, instructions, and parties are ready.
Closing Disclosure: The federal form given to a borrower showing final loan terms and closing costs.
Cloud on Title: Any claim, lien, or defect that calls ownership into question.
Commitment: The title insurer's document showing what it will insure and what must be cleared first.
Conveyance: The act of transferring ownership from one party to another.
Covenant: A promise recorded in land records that binds current and future owners.
Curative Work: The work of resolving liens, judgments, or record defects so title can close.

Deed: The legal document used to transfer ownership of real property.
Deed Restriction: A recorded limitation that controls how a property may be used.
Defect: Anything in the record that impairs clear ownership.
Doc Stamps: A tax some states charge when a deed or mortgage is recorded.
Due Diligence: The buyer's investigation period for reviewing the property, documents, and transaction details.

Easement: A right for someone else to use part of the property for a defined purpose.
Encroachment: A structure that extends over a boundary line onto a neighboring parcel.
Encumbrance: Any claim or liability attached to a property, such as a lien, easement, or restriction.
Escheat: The reversion of property to the state when an owner dies with no heirs.
Escrow: A neutral arrangement in which funds and documents are held until transaction conditions are met.
Escrow Officer: The professional who coordinates closing documents, funds, and communication among the parties.
Exception: An item the title policy specifically does not cover.

Fee Simple: The most complete form of ownership interest in real property.
FinCEN Reporting: Federal reporting requirements for certain real estate transfers intended to help prevent financial crime.
Foreclosure: The legal process a lender may use to take and sell property after a borrower defaults.
Forced Placed Insurance: Coverage a lender buys and bills to the borrower when required insurance lapses.
Funding: The moment the lender releases loan money and the transaction can be completed.

Habendum Clause: The part of a deed defining the extent of the interest granted.
Homestead Exemption: A reduction in taxable value available for an owner-occupied home in qualifying jurisdictions.
HUD-1: An older settlement statement form still used in some commercial and cash transactions.

Indemnity: An agreement to cover another party's loss under stated circumstances.
Insured Closing Letter: The underwriter's letter protecting a lender against certain acts of the closing agent.
Instrument: Any formal document that can be recorded, such as a deed, mortgage, or release.

Joint Tenancy: Co-ownership with a right of survivorship, so a deceased owner's share passes to the surviving owner or owners.
Judgment Lien: A lien arising from a court money judgment against an owner.

Legal Description: The formal description identifying a parcel in the records; it is not the street address.
Lien: A claim against property securing a debt.
Lis Pendens: A recorded notice that litigation affecting the property is pending.

Marketable Title: Title free enough of defects that a reasonable buyer would accept it.
Mechanic's Lien: A lien filed by a contractor or supplier who was not paid for work or materials.
Metes and Bounds: A legal description using distances and directions.
Mortgage: A loan secured by real property.

Notary Public: A state-authorized official who verifies identity and witnesses signatures.
Notice of Commencement: A recorded notice that construction work is beginning, which can affect lien priority.

Owner's Policy: Title insurance protecting the buyer's own interest, distinct from the lender's policy.

Parcel Number: The county's identifier for a property.
Payoff: The exact amount needed to satisfy an existing loan as of a specific date.
Plat: A recorded map dividing land into lots.
Power of Attorney: Authority for one person to sign on another's behalf.
Premium: The one-time charge for a title policy.
Priority: The order in which liens are paid, generally set by recording order.
Proration: The split of shared expenses between buyer and seller as of the closing date.

Quiet Title Action: A lawsuit to resolve competing ownership claims.
Quitclaim Deed: A deed conveying whatever interest the grantor has, with no warranties.

Recording: The filing of a deed or mortgage in county land records, making the transfer public.
Release: The document showing a lien has been satisfied.
Restrictive Covenant: A recorded rule limiting how property may be used.

Schedule A: The part of a title commitment describing the transaction and property.
Schedule B: The part of a title commitment listing requirements and exceptions.
Settlement Statement: The itemized accounting of every dollar in and out of the transaction for each party.
Special Warranty Deed: A deed warranting only against defects arising during the grantor's ownership.
Subordination: An agreement moving one lien behind another in priority.
Survey: A measured drawing of boundaries and improvements on a property.

Tenancy in Common: Co-ownership without a right of survivorship.
Title: The legal right to own, use, and transfer property.
Title Search: A review of public records to identify ownership history and issues affecting title.
Torrens: A land registration system used in a few jurisdictions.

Underwriter: The title insurance company that backs the policy.
Utility Easement: A right allowing utility providers to use part of the property for lines or equipment.

Warranty Deed: A deed in which the seller guarantees clear title against all claims.
Wire Fraud: Criminals may impersonate a party by email and send altered wiring instructions. See the Wire Fraud at Closing walkthrough before sending funds.

Still Have Questions?

Our team can walk you through anything on your commitment or settlement statement.