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Mortgage Dictionary "A"
Abandonment of Property
To vacate a property with a definite intention never to return.
Accelerated Weekly Payment
A mortgage repayment plan in which the borrower makes 52 payments per year instead of 48 which would be required if the payment plan called for four payments per month. The extra four payments each year have the effect of accelerating the repayment of the mortgage.
Acceleration Clause
A clause in a mortgage which provides that where default has occurred in making any mortgage
payment, the outstanding mortgage amount becomes due.
Acceptance
The offerees consent to enter into a contract and to be bound by the terms of the offer
Accrued Interest
The interest charged for the period of time that has elapsed since the last interest date.
Action for Possession
A legal remedy available to a lender
when a mortgage is in default. It allows the lender to take
possession of the mortgage property.
Action of Receiver
A legal remedy available to a lender when a mortgage is in default, asking the courts to appoint a receiver who takes possession of the property
Action on the Covenant for Payment
A legal remedy available to a lender when a mortgage is in default. It gives the lender the right
to sue the borrower, even if the borrower has since sold the property.
Acquittance
The term for a discharge of mortgage in
Quebec.
Adjustable Rate Mortgage
See variable rate = mortgage.
Adjustment on Sale
A pro-rated division and
distribution of prepaid or accrued taxes, prepaid insurance
premiums, prepaid rents and other income and expenses. This
adjustment usually occurs when a property is sold and is the manner
of determining the amounts due to and from the parties.
Adverse Possession
The right by which someone occupying a
piece of land might acquire title against the real owner, if the
occupants possession has been actual, continuous, hostile, visible,
and distinct for a statutory period. Adverse possession is not
possible under Land Titles or when Crown property is
involved.
Advertising Standards Canada (ASC)
Advertising Standards Canada (ASC) is the Canadian advertising industry self-regulatory body. ASC mission is to ensure the integrity and viability of advertising. They administer The Canadian Code of Advertising Standards.
Affidavit
A statement or declaration in writing and sworn to
or affirmed before some officer who is authorized to
administer an oath or affirmation, such as a notary public, or commissioner of
oaths.
Agency
An agency relationship is created when one person,
called the principal, authorizes another person, called the agent,
to act on behalf of and subject to the control of the
principal.
Agent
One who is authorized to represent and act on behalf
of another person or business, the principal in transactions involving a third party. Unlike an employee who merely works
for the principal, an agent works in place of the principal.
Agreement of Purchase and Sale
A written agreement between vendor and purchaser in which the purchaser agrees to buy certain real
property and the vendor agrees to sell upon terms and conditions set out in that agreement.
Alienation Clause
A type of acceleration clause that demands payment of the entire debt upon sale or other
transfer of the title.
Amending Agreement
An agreement between the lender and
borrower by the lender in which the terms of the registered mortgage
are changed. The amending agreement may or may not be not be registered on title.
Amortization
This refers to the process of paying off a mortgage
in regular payments composed of both interest and
principal.
Amortization Period
The time over which the mortgage is to
be completely repaid, assuming equal payments. This means that when
looking, for example, at a mortgage with a 25-year amortization
period, it would take 25 years to reduce the balance to
zero, if all regular payments were made on time and the terms (payment,
interest rate) remained the same.
Amortization Schedule
A table showing the amounts of
principal and interest which make up each of the periodic level
payments and the outstanding principal balance of the loan after
each level payment is made.
Amortized Mortgage
A mortgage requiring regular payments which include both principal and interest sufficient to
fully repay the loan by maturity.
Anniversary Date
The same date in each calendar year=20
during the term of the mortgage. The first anniversary date
occurs one year from the date interest is adjusted and the periodic repayments begin.
Appointment of a Receiver
A legal remedy available to a lender when a mortgage is in default. The receiver takes possession
of the property, collects rents, and pays any expenses as required.
Appraisal
An independent, unbiased report that uses various
analysis techniques and market research to determine the realistic
value of a property.
Appraisal Institute of Canada (AIC)
The national
professional organization that designates and represents
professional real estate appraisers. The AIC sets the standards and
requirements necessary to earn the designation of
Accredited
Appraiser Canadian Institute (AACI) and Canadian
Residential Appraiser (CRA).
Appraisal Report
An independent assessment of a property
by a qualified individual. A statement giving an opinion of value of
an adequately described property, as at a specific date and
supported by pertinent data.
Appraiser
An appraiser determines the market value
of a house based on its condition and the selling price of comparable houses
recently sold in the area. The licensing requirement for
real estate appraisers varies from province to province.
Arms Length Transaction
A transaction between unrelated parties. A transaction freely arrived at in the open
market unaffected by abnormal pressures as might be the case in a
transaction between related parties.
Arbitration
The determination of a dispute by a disinterested third
party.
Arrears
An overdue payment (in reference to a
mortgage for the purposes of this text).
Assessment (assessed value)
A value placed upon property
(land and buildings) for taxation purposes.
Assessment Roll
An annual list of the assessed
values of all properties in a municipality. The assessment
roll includes the name of the property owners or tenants and
their addresses. Assessment rolls are usually delivered to a municipality
before the end of the year. The term roll comes from
ancient times and refers to the way information used to be stored - on
paper or parchment, rolled up into cylinders.
Assets
Goods of value, either tangible or not, that a
borrower or business owns.
Assignee
One who takes the rights or title of another by
assignment.
Assignment
The act of transferring rights held by one
party, the assignor, to another party, the=20
assignee.
Assignment of Lease
The absolute or conditional
transfer of the rights of either party to a lease.
Assignment of Mortgage
The transfer of
ownership of a mortgage from one party to another.
Assignment of Rentals
A contract in which the borrower
grants the lender the right to collect future rents on a given
occurrence, normally default. This assignment is normally
taken as additional security on rental loans.
Assignor
One who transfers or assigns the rights or
title to another.
Assumable Mortgage
An existing mortgage that can
be taken over (assumed) by the buyer of a property when that property is sold.
Assumption of Mortgage
The act of assuming liability
for an existing mortgage on a property by the purchaser of that
property. With builders loans, the assumption is usually evidenced
by written agreement.
Attachment
The seizure of property by court order.
Attornment of Rents
A legal action available upon default of a mortgage. As a result, tenants are directed to pay
their rents to the lender.
Automated Valuation Models (AVM)
Computer programs that provide
real estate market analysis and estimates of value based on specific
attributes of a property as well as sales information.
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