Texas Real Estate Principles Glossary

A comprehensive glossary review of foundational real estate principles, legal contracts, property descriptions, valuation methods, and Texas-specific property concepts.

Abandonment

The voluntary surrender or relinquishment of possession of real property with the intention of terminating one's possession or interest but without the vesting of this interest in any other person.

Abatement

Elimination or reduction of real estate taxes to attract new business to an area.

Abstract of Title

The condensed history of a title to a particular parcel of real estate, consisting of a summary of the original grant and all subsequent conveyances and encumbrances affecting the property and a certification by the abstracter that the history is complete and accurate.

Acceleration Clause

The clause in a mortgage or trust deed or note that can be enforced to make the entire amount of principal and interest due immediately if the mortgagor defaults on an installment payment or other covenant.

Accession

Acquiring title to additions or improvements to real property as a result of the annexation of fixtures or the accretion of alluvial deposits along the banks of streams.

Accretion

The increase or addition of land by the deposit of sand or soil washed up naturally from a river, lake, or sea.

Acre

A measure of land equal to $43,560$ square feet, $4,840$ square yards, $4,047$ square meters, $160$ square rods, or $0.4047$ hectare.

Adverse Possession

The actual, visible, hostile, notorious, exclusive, and continuous possession of another's land under a claim of title; possession for a statutory period may be a means of acquiring title.

Alienation Clause

The clause in a mortgage or deed of trust stating that the balance of the secured debt becomes immediately due and payable at the mortgagee's option if the property is sold by the mortgagor; also called a due-on-sale clause.

Allodial System

A system of land ownership in which land is held free and clear of any rent or service due to the government; commonly contrasted with the feudal system. In the United States, land is held under this system.

Appurtenance

Those rights, privileges, and improvements that belong to and pass with the transfer of real property but are not necessarily a part of the property, such as rights-of-way, easements, water rights, and property improvements.

Assemblage

The combining of two or more adjoining lots into one larger tract to increase the total value.

Avulsion

The sudden tearing away of land, as by earthquake, flood, volcanic action, or a sudden change in the course of a stream.

Balloon Payment

A final payment of a mortgage loan that is considerably larger than the required periodic payments because the loan amount was not fully amortized.

Bilateral Contract

A contract where both parties to the contract are legally bound to act as promised.

Blockbusting

The illegal practice of inducing homeowners to sell their properties by making representations regarding the entry or prospective entry of minority persons into the neighborhood.

Bundle of Legal Rights

The concept of land ownership that means ownership of all legal rights to the land—for example, possession, control within the law, and enjoyment—rather than ownership of the land itself.

Capitalization Rate

The rate of return a property will produce on the owner's investment.

Caveat Emptor

A Latin phrase meaning "let the buyer beware."

Chain of Title

The succession of conveyances from some accepted starting point, whereby the present holder of real property derives title.

Cloud on the Title

Any document, claim, unreleased lien, or encumbrance that may impair the title to real property or make the title doubtful; usually revealed by a title search and removed by either a quitclaim deed or suit to quiet title.

Commingle

The illegal act of a real estate broker who mixes the money of other people with his own money instead of maintaining a separate trust account for other parties' funds held temporarily by the broker.

Community Property

A system of property ownership based on the theory that each spouse has an equal interest in the property acquired by the efforts of either spouse during marriage.

Condemnation

A judicial or an administrative proceeding to exercise the power of eminent domain, through which a government agency takes private property for public use and compensates the owner.

Condominium

The absolute ownership of an apartment or a unit based on a legal description of the airspace the unit actually occupies, plus an undivided interest in the ownership of the common elements, which are owned jointly with the other condominium unit owners.

Consideration

Something of value that induces a person to enter into a contract; may be "valuable" (money) or "good" (love and affection).

Constructive Eviction

Actions of the landlord that so materially disturb or impair the tenant's enjoyment of the leased premises that the tenant is effectively forced to move out and terminate the lease without liability for any further rent.

Constructive Notice

Notice given to the world by recorded documents. All people are charged with knowledge of such documents and their contents, whether or not they actually have examined them.

Contract for Deed

A contract for the sale of real estate wherein the purchase price is paid in periodic installments by the purchaser, who is in possession of the property even though title is retained by the seller until final payment; also called an installment contract, land contract, or contract of sale.

Deed

A written instrument that, when executed and delivered, conveys title to or an interest in real estate.

Deed in Lieu of Foreclosure

A deed given by the mortgagor to the mortgagee when the mortgagor is in default under the terms of the mortgage as a way to avoid foreclosure.

Defeasance Clause

A provision in leases and mortgages that cancels a specified right on the occurrence of a certain condition, such as cancellation of a mortgage on repayment of the mortgage loan.

Deficiency Judgment

A personal judgment levied against the mortgagor when a foreclosure sale does not produce sufficient funds to pay the mortgage debt in full.

Dominant Tenement

A property that includes in its ownership the appurtenant right to use an easement over another person's property for a specific purpose.

Easement

A right to use the land of another for a specific purpose, such as for a right-of-way or utilities.

Easement by Prescription

An easement acquired by continuous, open, uninterrupted, exclusive, and adverse use of the property for $10$ years.

Emblements

Growing crops, such as grapes and corn, that are produced annually through labor and industry; deemed to be personal property.

Eminent Domain

The right of a government or public entity to acquire property for public use; the entity must make a good-faith effort to acquire the real property through direct negotiation and purchase from the owner.

Encroachment

A building or some portion of it—a wall or fence, for instance—that extends beyond the land of the owner and illegally intrudes on some land of an adjoining owner or a street or alley.

Encumbrance

Any lien (such as a mortgage, tax, or judgment lien) or an easement or a restriction on the use of the land that may diminish the value of a property; a cloud against clear, free title to property.

Equitable Title

The interest held by a vendee under a contract for deed or an installment contract; the equitable right to obtain absolute ownership to property when legal title is held in another's name.

Escheat

The reversion of property to the state in the event the property is abandoned or the owner dies without leaving a will and has no heirs to whom the property may pass.

Estate for Years

A leased interest in property for a certain, exact period of time and for a specified consideration.

Exclusive Right to Sell

A listing contract under which an owner appoints a real estate broker as her exclusive agent for a designated period of time to sell a property on the owner's stated terms and agrees to pay the broker a commission when the property is sold, whether by the broker, the owner, or another broker.

Fee Simple Estate

The maximum possible estate or right of ownership of real property, continuing forever; sometimes called a fee or fee simple absolute.

Fiduciary Relationship

A relationship of trust and confidence, as between trustee and beneficiary, attorney and client, or principal and agent.

Fixture

An item of personal property that has been converted to real property by being permanently affixed to the realty.

General Warranty Deed

A deed in which the grantor fully warrants good clear title to the premises; offers the greatest protection of any deed.

Habendum Clause

That part of a deed beginning with the words "to have and to hold," following the granting clause and defining the extent of ownership the grantor is conveying.

Highest and Best Use

That possible use of land that would produce the greatest return and thereby develop the highest land value; the optimum use of a site in appraisal.

Homestead

Land that is owned and occupied as the family home; in Texas, it is protected or exempt from forced sale by creditors for payments of most debts, with several exceptions.

Joint Tenancy

Ownership of real estate between two or more parties who have been named in one conveyance as joint tenants, where upon death the deceased's interest passes to surviving joint tenants by right of survivorship; not automatically created in Texas.

League

In Texas, a tract of land that was granted to a settler by the Mexican government; a league consists of $6.919$ square miles.

Leverage

The use of borrowed money to finance the bulk of an investment and to magnify the rate of return.

Lien Theory

Some states' interpretation of a mortgage as being purely a lien on real property where the mortgagee has no right of possession but must foreclose the lien and sell the property if the mortgagor defaults; Texas is a title theory state.

Lis Pendens

A recorded legal document giving constructive notice that an action affecting a particular property has been filed in either state or federal court.

Mechanic's Lien

A statutory lien created in favor of contractors, laborers, materialmen, and others who have performed work or furnished materials in the erection or repair of a building.

Metes-and-Bounds Description

A legal description of a parcel of land that begins at a well-marked point and follows the boundaries, using direction and distances around the tract back to the place of beginning.

Nonhomogeneity

A lack of uniformity; dissimilarity. Because no two parcels of land are exactly alike, real estate is said to be nonhomogeneous; also known as heterogeneity.

Novation

Substituting a new obligation for an old one or substituting new parties to an existing obligation.

Police Power

The government's right to impose laws, statutes, and ordinances, including zoning ordinances and building codes, to protect the public health, safety, morals, and welfare.

Procuring Cause

The effort that brings about the desired result; under an open listing, the broker who is the procuring cause of the sale receives the commission.

Pur Autre Vie

For the life of another; a life estate pur autre vie is a life estate that is measured by the life of a person other than the grantee.

Quitclaim Deed

A conveyance by which the grantor transfers whatever interest she has in the real estate, without warranties or obligations.

Redlining

The illegal practice of a lending institution's denying loans or restricting their number for certain areas of a community.

Severalty

Ownership of real property by one person or one legal entity only; also called sole ownership.

Special Warranty Deed

A deed in which the grantor warrants or guarantees the title only against defects arising during her tenure and ownership of the property and not against defects existing before that time, generally using the language "by, through or under the grantor but not otherwise."

Statute of Frauds

That part of state law that requires certain instruments, such as deeds, real estate sales contracts, and certain leases, to be in writing to be legally enforceable.

Steering

The illegal practice of channeling homeseekers to particular areas, either to maintain the homogeneity of an area or to change the character of an area to create a speculative situation; also called channeling.

Subrogation

The substitution of one creditor for another, with the substituted person succeeding to the legal rights and claims of the original claimant.

Tenancy at Sufferance

The tenancy of a lessee who lawfully comes into possession of a landlord's real estate but who continues to occupy the premises improperly after lease rights have expired.

Tenancy in Common

A form of co-ownership by which each owner holds an undivided interest in real property as if the sole owner; shares need not be equal and pass to heirs upon death.

TRID Rule

Requires the lender to provide the Loan Estimate to the borrower within $3$ business days of submitting a loan application and the Closing Disclosure $3$ business days before closing.

Vara

In Texas, a measurement of length; one vara equals $33\frac{1}{3}$ inches.

Variance

A waiver from compliance with a specific provision of the zoning ordinance; for the benefit of one parcel only.

Zero Lot Line

A term generally used to describe the positioning of a structure on a lot so that one side rests directly on the lot's boundary line with no setback; often used for garden homes.