Appendix: Glossary of Title Insurance Terms

Definitions and Explanations of Key Terminology

1. Abstract of Title: A summarized history of the ownership and transfers of a property, including relevant documents and transactions.
2. Accession: The acquisition of additional property or rights that become part of the titleholder’s ownership.
3. Adverse Possession: The legal concept in which someone gains ownership of a property by occupying it openly and without permission for a specified period, typically meeting certain requirements.
4. Affidavit of Title: A sworn statement by the seller or grantor of a property, declaring that the title is clear of any liens, encumbrances, or other defects.
5. Appurtenance: A right or privilege that belongs to and passes with the property, such as an easement or water rights.
6. Assessor’s Parcel Number (APN): A unique number assigned to a specific parcel of land by the local tax assessor’s office for identification and tax purposes.
7. Certificate of Title: A document issued by a title company or attorney that certifies the ownership and status of the title to a property.
8. Chain of Title: The chronological order of ownership transfers and recorded documents that establish the current ownership of a property.
9. Clear Title: Ownership of a property without any liens, encumbrances, or other claims that could affect the transfer of ownership.
10. Closing: The final stage of a real estate transaction where the transfer of ownership occurs, and all necessary documents are signed and funds are exchanged.
11. Cloud on Title: Any claim, encumbrance, or defect that may cast doubt on the clear ownership of a property.
12. Conveyance: The act of transferring ownership of real property from one party to another, typically through a deed.
13. Deed: A legal document that transfers ownership of a property from one party to another.
14. Deed of Trust: A legal document that pledges a property as collateral for a loan, creating a lien on the property until the loan is repaid.
15. Easement: A right granted to a person or entity that allows them to use a specific portion of another person’s property for a particular purpose, such as a shared driveway or utility access.
16. Encroachment: A trespass or intrusion of a structure or improvement onto the property of another, typically resulting in a boundary dispute.
17. Encumbrance: Any claim, lien, or restriction that affects the title or use of a property, such as mortgages, easements, or leases.
18. Escheat: The transfer of property to the state or government when the owner dies without leaving a will or any known heirs.
19. Fee Simple: The highest form of property ownership, granting the owner absolute and unrestricted rights to the property.
20. Grantee: The person or entity receiving ownership of a property through a deed or other legal document.
21. Grantor: The person or entity transferring ownership of a property through a deed or other legal document.
22. Homestead Exemption: A legal protection that allows homeowners to declare a portion of their property as a homestead, providing certain benefits and protections from creditors.
23. Ingress and Egress: The right to enter and exit a property, typically associated with easements or access rights.
24. Joint Tenancy: A form of property ownership where two or more individuals hold equal shares and have rights of survivorship.
25. Land Survey: The process of measuring and mapping a property to determine its boundaries, dimensions, and any encroachments.
26. Leasehold: The interest or right to use a property for a specified period under a lease agreement.
27. Legal Description: A detailed and precise description of a property’s boundaries and location, typically found in recorded documents.
28. Lien: A legal claim or encumbrance on a property, usually as security for the payment of a debt or obligation.
29. Lis Pendens: A notice filed in public records indicating that a lawsuit is pending that may affect the title or ownership of a property.
30. Marketable Title: A title that is free from significant defects or encumbrances, allowing for a clear transfer of ownership.
31. Merger: The joining of two or more properties or interests into a single ownership, typically through a purchase or consolidation.
32. Mortgage: A loan secured by real property, where the lender holds a lien on the property until the loan is fully repaid.
33. Notary Public: A public official authorized to witness and certify the signing of legal documents, including deeds and affidavits.
34. Parcel: A specific portion or piece of land that is identified by its boundaries and legal description.
35. Plat: A map or survey that shows the division of land into lots, blocks, and other designated areas, often used for recording purposes.
36. Power of Attorney: A legal document that authorizes someone to act on behalf of another person in legal or financial matters, including real estate transactions.
37. Quiet Title Action: A legal proceeding to establish clear and marketable title when there are competing or conflicting claims to the ownership of a property.
38. Real Estate Settlement Procedures Act (RESPA): A federal law that sets guidelines and requirements for real estate transactions, including disclosures and the handling of settlement funds.
39. Reconveyance: The transfer of property back to the borrower once a mortgage or deed of trust has been fully repaid.
40. Recording: The process of filing or registering legal documents with the appropriate government office, usually the county recorder’s office, to give public notice and establish priority.
41. Right of Survivorship: The right of joint tenants or co-owners to inherit the interest or share of a deceased owner, automatically and without the need for probate.
42. Subdivision: The division of a larger parcel of land into smaller lots or tracts for development or sale.
43. Subordination Agreement: An agreement that changes the priority of liens or encumbrances on a property, typically to allow a new loan or mortgage to take precedence.
44. Tenancy in Common: A form of property ownership where two or more individuals hold undivided interests in the property, with no rights of survivorship.
45. Title Insurance: Insurance that protects against financial loss due to defects, liens, or other issues affecting the ownership of a property.
46. Title Search: An examination of public records and other sources to verify the ownership history, liens, encumbrances, and other matters that may affect the title of a property.
47. Torrens System: A system of land registration where title to property is determined and guaranteed by a government agency, providing a simplified method of transferring ownership.
48. Trustee: A person or entity that holds legal title to property for the benefit of another, as in a trust agreement.
49. Unrecorded Deed: A deed that has not been officially filed or recorded in the appropriate public records, potentially creating issues with establishing clear ownership.
50. Warranty Deed: A type of deed that provides a guarantee or warranty from the seller to the buyer, promising that the title is clear and free from defects.
51. Abstract Plant: A collection of abstracts of title and related information organized by property and maintained by a title company.
52. Constructive Notice: The legal principle that all persons are presumed to have knowledge of recorded documents and information affecting the title of a property.
53. Conveyancing: The legal process of transferring ownership of real property from one party to another, including all necessary documents and procedures.
54. Marketable Record Title Act (MRTA): A state law that shortens the time period required for establishing marketable title and extinguishing certain old or dormant claims.
55. Mortgagee: The lender or financial institution that holds a mortgage or deed of trust on a property.
56. Mortgagor: The borrower or property owner who grants a mortgage or deed of trust as security for a loan.
57. Open-End Mortgage: A mortgage that allows for additional borrowing on the same property without requiring a new loan or mortgage.
58. Personal Property: Property that is not permanently affixed to land or structures and is movable or detachable, such as furniture or appliances.
59. Power of Sale: A clause in a mortgage or deed of trust that authorizes the lender to sell the property in the event of default by the borrower, without requiring a foreclosure lawsuit.
60. Quitclaim Deed: A type of deed that transfers any interest or claim the grantor may have in a property, without making any warranties or guarantees about the title.
61. Rescission: The cancellation or annulment of a contract or transaction, typically due to a material misrepresentation or violation of the law.
62. Special Assessment: A fee or charge imposed by a government entity on property owners to fund specific public improvements or services, such as road repairs or sewer systems.
63. Special Warranty Deed: A type of deed that warrants or guarantees the title only against defects or encumbrances that occurred during the grantor’s ownership.
64. Tax Lien: A claim by the government or taxing authority against a property for unpaid taxes, which may take precedence over other liens or encumbrances.
65. Tenancy by the Entirety: A form of joint tenancy that is available only to married couples, providing certain protections and rights of survivorship.
66. Title Plant: A collection of title records, abstracts, and related information organized by property and maintained by a title company.
67. Title Report: A document provided by a title company or attorney that summarizes the findings of a title search, including any defects, liens, or other issues affecting the title.
68. Trust Deed: A legal document that conveys title to a trustee as security for a loan, allowing the trustee to sell the property in the event of default by the borrower.
69. Usufruct: The right to use and enjoy the fruits or benefits of a property owned by another, without owning the underlying property itself.
70. Variance: A zoning exception or permission granted by a local government, allowing a property owner to deviate from certain zoning regulations or restrictions.
71. Vesting: The way in which ownership or title is held or transferred, such as in the name of an individual, corporation, or trust.
72. Zoning: The division of land into specific zones or districts with prescribed regulations and restrictions regarding land use, density, and building requirements.
73. Marketable Title Act: A state law that simplifies and clarifies the process of establishing marketable title by extinguishing certain old or dormant claims.
74. Title Insurance Agent: A licensed individual or entity authorized to sell title insurance and provide related services on behalf of a title insurance company.
75. Title Plant Index: A comprehensive index or database that contains information on property titles, recorded documents, and related records maintained by a title company.
76. Escrow Officer: A neutral third party responsible for facilitating the closing process, including the receipt and disbursement of funds, documents, and instructions.
77. Indemnification: The act of compensating or protecting against loss, damages, or liabilities, typically provided by a title insurance policy.
78. Chain of Title Certification: A document issued by a title company or attorney certifying the ownership history and status of the title to a property.
79. Closing Disclosure: A document provided to the buyer and seller before the closing, detailing the final terms and costs of the transaction, as required by the RESPA.
80. Marketable Title Standard: A standard used by title insurers to determine if a title is marketable, typically requiring the absence of defects, liens, or encumbrances that could affect the ownership or transfer of the property.
81. Insurable Title: A title that meets the criteria and requirements set by a title insurance company for issuing a policy, typically free from significant defects or risks.
82. Title Defect: Any issue, claim, or encumbrance that could cloud or affect the ownership or transfer of a property, potentially requiring resolution or insurance coverage.
83. Release of Lien: A document that releases a lien or encumbrance on a property, typically provided by the lienholder or creditor once the debt or obligation has been fully satisfied.
84. Title Examination: The process of reviewing and analyzing the title records, documents, and related information to determine the status and validity of a property’s title.
85. Marketable Record Title: A title that is free from significant defects, encumbrances, or claims that could adversely affect the ownership or transfer of a property, as determined by applicable state laws.
86. Title Curative: The process of resolving or correcting title defects, issues, or encumbrances to establish a marketable title.
87. Title Opinion: A written legal opinion provided by an attorney, typically based on a title examination, addressing the status, validity, and marketability of a property’s title.
88. Chain of Title Break: An interruption or gap in the chain of ownership or recorded documents that raises questions about the continuity and validity of the title.
89. Title Escrow: The holding of funds, documents, and instructions by a neutral third party in a real estate transaction until all closing conditions and requirements are satisfied.
90. Prior Lien: A lien or encumbrance that has a higher priority or precedence over other liens or claims, typically based on the date of recording or filing.
91. Title Commitment: A preliminary document provided by a title insurance company outlining the conditions, requirements, and exceptions for issuing a title insurance policy.
92. Title Searcher: A person or professional who conducts title searches and examines public records to determine the ownership and status of a property’s title.
93. Title Underwriter: The company that assumes the financial risks and liabilities associated with issuing a title insurance policy, typically responsible for assessing and mitigating risks.
94. Title Guaranty: An assurance or guarantee provided by a title insurance company, promising to compensate or indemnify the insured against certain losses or damages arising from title defects.
95. Title Plant Recorder: An individual or department within a title company responsible for recording and indexing title-related documents and maintaining the title plant index.
96. Title Reserve: A fund or reserve account set aside by a title insurance company to cover future claims or losses related to issued policies.
97. Title Producer: An individual or entity authorized and licensed to produce or issue title insurance policies on behalf of a title insurance company.
98. Title Premium: The fee or cost charged by a title insurance company for issuing a title insurance policy, typically based on the property’s value or loan amount.
99. Title Reinsurance: The practice of transferring or sharing the risk associated with issuing title insurance policies to another insurance company or reinsurer.
100. Title Agent Errors and Omissions (E&O) Insurance: Insurance coverage that protects title insurance agents against claims and losses resulting from errors, omissions, or negligence.