Glossary of Terms - C

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Chain of Title
The chronological order of conveyance of a parcel of land from the original owner to the present owner.

Closing
Conclusion of a real estate sale where the title of the property is transferred to the new owners and funds are transferred to the appropriate parties ( seller, old lender, real estate broker, etc.).

Closing Agent
A neutral third party that facilitates the closing of a real estate transaction. The closing agent can be an escrow company, title company or attorney.

Closing Costs
Expenses incurred by the buyer/borrower and the seller in a real estate sale or mortgage transaction. There can be non-recurring costs that include a one time charge for points, appraisal fees, etc. or a proration of recurring costs such as taxes and insurance incurred when the new buyer/borrower purchases the real estate or refinances their existing mortgage.

Closing Statement
Statement prepared for the buyer and seller itemizing all of the costs of a real estate transaction commonly known as a HUD-1.

Cloud on Title
An outstanding claim or encumbrance which, if valid, adversely affects the marketability of title.

Commercial Property
Property intended for use by all types of retail and wholesale stores, office buildings, hotels and service establishments.

Commission
Fee paid to a broker or other entity for services rendered. Real estate brokers and mortgage brokers receive a commission for the services they provide; a real estate broker secures a buyer for a property that is for sale and a mortgage broker secures a mortgage loan for the buyer to finance the purchase of a property. Commissions are generally paid as a percentage of the sales price in a real estate transaction or the loan amount in a mortgage transaction.

Commitment
A written promise to make or insure a loan for a specified amount and on specified terms.

Condemnation
The taking of private property for public use by a government unit, against the will of the owner, but with payment of just compensation under the government's power of eminent domain. Condemnation may also be a determination by a governmental agency that a particular building is unsafe or unfit for use. (see "Eminent Domain", in this Glossary)

Condominium
A structure of two or more units, the interior space of which are individually owned, but the exterior area of the buildings and the surrounding land are jointly owned by the unit owner as a group.  Created and regulated in according with state law.

Consideration
Anything of value given to induce another to enter into a contract. Earnest money deposit on a sales contract is consideration.

Construction Loan
Short-term financing for real estate construction. Generally followed by long-term financing called a "take out" loan issued upon completion of construction.

Contingency
Condition which must be satisfied before the buyer can consummate the purchase of a property. Contingencies are generally outlined in the purchase contract between the buyer and seller.

Contract of Purchase
An agreement between parties for the sale of real estate. In some states it is synonymous with a Purchase Agreement, Sales Agreement, or Land Contract. In Texas it is known as an Earnest Money Contract.  It is also sometimes used to denote the document which creates an installment sale of real estate which, in that instance, resembles a mortgage.

Contract of Sale
A purchase transaction in which the buyer receives possession of the property, but the seller retains title, also known as an installment sales contract. (See "Contract of Purchase" above and "Installment Sales Contract" in this Glossary)

Contract Sales Price
The full purchase price as stated in the contract.

Conventional Loan
A mortgage loan that is not guaranteed or insured by the government. FHA and VA loans are not conventional loans.  Typically, also denotes a fixed rate loan, as opposed to a variable or adjustable rate loan.

Convertible ARMs
ARMs that have a provision allowing the borrower to convert the mortgage to a fixed rate term. The conversion feature is outlined in the mortgage note and has certain restrictions.

Conventional Mortgage
A loan neither insured by the FHA nor guaranteed by the VA. (See "Conventional Loan", above)

Counteroffer
A new offer made as a result of another offer, which cancels the original offer.

Covenant
An agreement written into deeds and other instruments promising performance or nonperformance of certain acts or stipulating certain uses or nonuses of the property.

 

 

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