D

     - Glossary

 

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Damages   the indemnity recoverable by a person who has sustained an injury, either in his/her person, property, or relative rights, through the act or default of another. (also see liquidated damages)

DD 214 Form -  officially is known as DD Form 214 "Certificate of Release or Discharge from Active Duty", but generally referred to as a "DD 214" -  is a document of the United States Department of Defense, it is issued upon a military service member's retirement, separation or discharge from active-duty military.

Data Plate - HUD (Label Tags) The Data Plate is a paper label affixed inside the home (most often Manufactured Home) and is the size of a standard sheet of paper (8 ½” x 11”).  The Data Plate can be found in a kitchen cabinet, an electrical panel, or a bedroom closet.  The Data Plate will contain the following information: (a) The name and address of the manufacturing plant in which the manufactured home was manufactured; (b) The serial number and model designation of the unit, and the date the unit was manufactured; (c) The statement: This manufactured home is designed to comply with the Federal Manufactured Home Construction and Safety Standards in force at the time of manufacture; (d) A list of the certification label(s) number(s) that are affixed to each transportable manufactured section under §3280.8; (e) A list of major factory-installed equipment, including the manufacturer’s name and the model designation of each appliance; (f) Reference to the roof load zone and wind load zone for which the home is designed and duplicates of the maps as set forth in §3280.305(c). This information may be combined with the heating/cooling certificate and insulation zone map required by §§3280.510 and 3280.511.

Debtor   the one who owes money; a borrower (Trustor), a maker of a note; a mortgagor.

Debt ratio   the relationship between a person's long term debt payments and their monthly income.

Debt-to-income ratio   a borrower's monthly long term debt payments divided by the borrower's gross monthly income and expressed as a percentage. This ratio is used by lenders to determine if a loan applicant is qualified for the amount of the loan.

Decedent   a deceased person, especially one who has died recently.

Declaration of Condominium   the declaration includes: 1. A legal description of the condominium units and the common elements (including limited common elements-those that serve only one particular unit); 2. A copy of the condominium's bylaws, drafted to govern the operation of the owners' association; 3. A survey of the property; 4. An architect's drawings, illustrating both the vertical and horizontal boundaries of each unit; and 5. Any restrictive covenants controlling the rights of ownership.

Declaration of restrictions   a statement of all the covenants, conditions and restrictions (CC&Rs) that affect a parcel of land. A subdivider may note the restrictions on the map or plan when recording the subdivision plat. If the restrictions are numerous, the subdivider may also prepare a separate document called a declaration, listing all the restrictions, and then record this declaration. (Also see CC&R’s)

Deed   a written instrument, when executed and delivered, conveys title to or an interest in real estate. This document transfers ownership of Real Estate. It contains the names of the "old" and "new" owners as well as the legal description of the property and is executed by the parties transferring the property. (also see Title)

Deed executed pursuant to court order   Executors' and administrator' deeds, masters' deeds, sheriffs' deeds and many other types are all deeds executed pursuant to a court order. These deeds are established by state.

Deed in lieu of foreclosure   voluntarily signing over to a lender the property pledged as collateral on a defaulted loan.  It is an alternative to a foreclosure action. Its main disadvantage to a lender is that the deed does not wipe out junior liens, as a foreclosure action would.  Also called a "voluntary conveyance." Regardless of whether the lender accepts the deed in lieu, the avoidance and non-repayment of debt will most likely impact the borrower's credit history.

Deed Quitclaim   A deed that transfers whatever ownership interest the transferor (grantor) has in a particular property without warranties or obligations.  The Quitclaim Deed does not guarantee anything about the extent of what is being transferred …. A legal document which is used to transfer (convey) rights in real property from one entity (the grantor) to another (the grantee), however what is being conveyed is "only the interest" that the grantor holds currently in the property. Quitclaim Deeds are commonly used in transfers of title or interests in title, quitclaims are often made to family members, divorcing spouses, or in other transactions between people well-known to each other.

Deed in trust   an instrument that grants a trustee (property in trust of Trustee) under a land trust full power to sell, mortgage and subdivide a parcel of real estate. The beneficiary controls the trustee's use of these powers under the provisions of the trust agreement.

Deed of Trust  A written instrument legally conveying "the interest in land" to a trustee often used to secure an obligation such as a mortgage or promissory note.  (Deed of Trust) A document that embodies the agreement between (1)a lender and (2) a borrower to transfer an interest in the borrower's land to (3) a neutral third party, a Trustee ..A deed of trust, also called a trust deed.  A deed of trust is an arrangement among three parties: the borrower, the lender, and an impartial trustee. In exchange for a loan of money from the lender, the borrower places legal title to real property in the hands of the trustee who holds it for the benefit of the lender, named in the deed as the beneficiary. The borrower (buyer) retains equitable title, is considered the owner and possession of, the property.  If the borrower defaults in the payment of the mortgage debt, the Trustee is empowered by the deed to sell the property.

Deed of Reconveyance   is used in conjunction with a Deed of Trust and its purpose is to clear the title of any liens pertaining to the note and Deed of Trust which secures the note.  The parties involved in the Deed of Trust are the Trustor (borrower), the Trustee (title company, bank or a 3rd-party), and the Beneficiary (the lender).  Once the Deed of Reconveyance is recorded, the title becomes clear of any liens. Commonly when a mortgage is paid-in-full, this Deed of Reconveyance/document is used to transfer legal title from the Trustee back to the borrower (trustor).  Again this is done after a debt/mortgage secured by a deed of trust has been paid to the lender (beneficiary).

Deed restrictions   provisions placed in deeds to control future uses of the property. (see  covenants, conditions & restrictions, restrictive covenants)  Deed restrictions is/are an agreement that restricts the use of real property such as a house or condominium, as well as what you’re allowed to build on the property.  These restrictions, also know as restrictive covenants, are listed within the recorded deed relating to the property and can also take the form of Declaration of Covenants, Conditions, and Restrictions (CC&Rs).  The deed restrictions are created by the builder/developer and enforced by the current homeowners.  These restrictions also “run with the land”, which means that they automatically transfer to all future owners.

Deed Restrictions Types - there are many different types of "deed restrictions", from building and renovation restrictions, to rules about running a business out of your home. Landscaping choices and even the exterior paint color of your property are commonly listed in deed restrictions. These types of deed restrictions can be viewed as an annoyance to some homeowners, but they don’t impact your ability to get a loan on the property.

Default   the nonperformance of a duty or obligation that is part of a contract. The most common occurrence of default on the part of a buyer or lessee is nonpayment of money when due. A default is normally a breach of contract, and the nondefaulting party can seek legal remedies to recover any loss. Defaults in long-term leases or contracts for deed other than nonpayment might be failure to pay real estate taxes, damage to the property and so forth

Defect   a condition that materially affects the value or use of residential property in an adverse manner.

Defect of record   any encumbrance on a title that is made a part of the public record. Recorded defects include judgments, deeds of trust, mortgages, other liens and easements. (See  encumbrance)

Deferred capital gain   the part of the realized gain that is tax deferred. (See capital gains, excluded capital gain, realized capital gain (loss), recognized capital gain)

Deferred maintenance   physical deterioration of a building resulting from postponed maintenance.

Deficiency  The remaining unpaid balance on a mortgage after a foreclosure sale or, in some cases, a short sale.  Whether it be a foreclosure or a short sale ,  it is the difference between what the home sells for and what you still owed on the mortgage.

Deficiency judgment - a personal judgment rendered against any person liable for the mortgage debt… in the event of a deficiency on a Short Sale or Foreclosure where the sale of property does not produce sufficient funds to pay the mortgage debt in full (Real Estate only)

Delayed exchange   a three way exchange in which the properties close at different times.

Delinquent   the status of a financial obligation, such as a mortgage loan, when it is past-due.

Delivery    the final and absolute transfer of a deed from seller to buyer in such a manner that it cannot be recalled by the seller.  A necessary requisite to the transfer of title.

Demand   request for payoff; a note payable on demand of the holder.

Demand for Payoff - (also known as a "Payoff Statement") is a statement prepared by a lender showing the remaining terms on a mortgage or other loan. The payoff statement shows the remaining loan balance and number of payments and the rate of interest. It also states the amount of interest that will be rebated due to prepayment by the borrower.  Also referred to as "letters of demand."  Payoff statements are prepared whenever a borrower considers paying off a loan early. Although payoff statements can apply to any type of loan, they are most commonly prepared for mortgages.

Demand Letter  (Notice of Intent to Foreclose)  is a Letter notifying borrower of a payment delinquency, a default and/or  possibly a notice of intent to foreclose.

Demand Letter Assessment   is a Fee for sending the demand letter or notice of intent to foreclose.

Department of Real Estate  (California)   an agency that administers the California Real Estate Law, including the licensing of real estate brokers and agents; headed by the Real Estate Commissioner, who is appointed by the Governor.

Deposit    money offered by a prospective buyer as an indication of good faith in entering into a contract to purchase; earnest money; security for the buyer's performance of a contract. An earnest money deposit is not necessary to create a valid purchase contract because the mutual promises of the parties to buy and to sell are sufficient consideration to enforce the contract.  If there is an earnest deposit and buyer completes the purchase,  the earnest deposit money is applied toward the purchase price.

Depreciation   the decrease in the value of an asset allowed when computing property value for tax purposes.  It can also be a loss in the appraised value of a property due to physical deterioration. This latter type of depreciation is curable when it can be remedied by repair or an addition to the property, and incurable when there is no easy or economic remedy.

Depreciable Basis   The initial acquisition cost of an improvement on land, used for income tax purposes. Land may not be depreciated but the improvements (buildings, etc.) may fall into the category where it can be depreciated. In investment real estate, only structures can be depreciated. The depreciable basis is the original basis less the value of the land

Desktop Underwriter® (DU) - helps lenders make informed credit decisions on Conventional conforming, non-conforming, and Government loans. But,  it is an “automated program” used by loan originators/officers and mortgage brokers to qualify a borrower through Fannie Mae guidelines.  Keep-in-mind that the DU is only as good as the information supplied and inputted into the program.  A DU shows the borrowers housing expense ratio and debt-to-income ratio, including 3 FICO scores.  The DU also reveals a borrowers assets (source of funds to buy) and liabilities as reported to the loan originator/loan officer.  In short,  Mortgage brokers and/or loan officer will enter your information and get a preliminary answer about whether you qualify or not for a particular mortgage loan. A key word in this process is  the word "preliminary".   Just know that all the information put into the automated desktop underwriting (DU) system still has to be verified, and will still be looked at by an actual underwriter (a live person). The underwriter has the ultimate decision whether one qualifies or not.

Disclaimer   a statement denying legal responsibility, frequently found in the form of the statement, "There are no promises, representations, oral understandings or agreements except as contained herein." Such a statement, however, would not relieve the maker of any liabilities for fraudulent acts or misrepresentations.

Disclosure   it is the agent's duty to keep the principal informed of all facts or information that could affect a transaction. Duty of disclosure includes relevant information or material facts that the agent knows or should have known.

Discount points   prepaid interest assessed at closing by the lender. Each point is equal to 1% of the loan amount (ie: 2-points on a $100,000 loan would equal $2,000). The purpose of the discount points charged is to reduce the interest rate.

Discount rate   two definitions  1. An annual competitive rate of return on total invested capital necessary to compensate the investor for the risks inherent in a particular investment. 2. The rate at which the Federal Reserve lends money to its eligible banks. These are short-term loans to fulfill immediate cash needs.

Discretionary income  - is disposable income minus living expenses, such as mortgage payments, utility bills, clothing, groceries, transportation expenses, and other bills needed to maintain one’s lifestyle.  Discretionary is what people use to pay for vacations, entertainment and other forms of recreation and leisure.  Disposable Income - is the money a person has left over after all taxes have been paid.  For most people who receive a paycheck, disposable income is the net amount they receive in their check.

Disposable income - is the money a person has left over after all taxes have been paid.  For most people who receive a paycheck, disposable income is the net amount they receive in their check.  Disposable income is often confused with discretionary income. Discretionary income is disposable income minus living expenses, such as mortgage payments, utility bills, clothing, groceries, transportation expenses, and other bills needed to maintain one’s lifestyle.  Discretionary is what people use to pay for vacations, entertainment and other forms of recreation and leisure.

Distressed Asset Stabilization Program (DASP) - is an expansion of an FHA disposition program that sells pools of defaulted mortgages headed for foreclosure and provides the opportunity for the purchaser and borrower to avoid a costly foreclosure.  This program provides the opportunity for borrowers to potentially stay in their home under a new sustainable mortgage.  This not only benefits the homeowner but also reduces the costs to FHA and ultimately benefits the entire community.  Here is how it works: Under the program, loans are SOLD competitively at a market-determined price generally below the outstanding principal balance.  FHA then processes an insurance claim, removes the FHA insurance and transfers the loan to the investor.  Once the note is purchased, foreclosure is delayed for a minimum of six additional months, giving the new servicer time to work through alternatives with the borrower, possibly finding an affordable solution to allow the borrower to remain in their home.  Because the loans are generally sold for less than what the borrower currently owes,  the purchaser has the ability to  reduce or modify the loan terms while still making a return on the initial investment.  If no viable alternatives exist, the purchaser (whom bought from FHA) may be able to help the borrower sell the property through a short sale and avoid the costs of foreclosure.  “This program creates the opportunity for all parties involved to benefit – the homeowner,  the new mortgage holder,  FHA,  including the community”

Divided agency   an agent acting for more than one party in a transaction without the knowledge and consent of all parties thereto. This situation is considered unlawful and may be grounds for revocation or suspension of license.

Devise   the disposition of real property by will.

Domicile   from domus, Latin for "house." The state where an individual has his or her true fixed permanent home and/or principal business establishment

Dominant tenement   the estate that is said to attach to and derive benefit from the servient estate in reference to an easement appurtenant. For example, an easement road passes over an owner's land (the servient tenement) to give access to an adjacent parcel (the dominant tenement). The dominant tenement usually adjoins the servient tenement.

Down spout  (down drain)   a drain pipe or similar conduit to allow water to flow from the rain gutter at the edge of the roof to the ground.

Down payment    cash paid upfront towards the purchase of a home, the difference between the down payment and purchase price will be what is financed as a mortgage loan.

Down Zoning   a change in zoning from a higher to a lower classification or from a more active to less active classification, such as from residential to conservation, or multifamily to single-family use. In these cases, there is no taking under eminent domain and thus no compensation paid to the affected landowner who helplessly sees the property reduce in value.

"Drag me down"  facility:  Certain "neighborhood features" and/or facililities near a home that have the tendency and/or potential to drag down a home’s price. Such as.. near a Bad school,  Strip club,  Power plant,  Funeral home,  High Renter concentration,  a Homeless shelter,  a Cemetery and/or nearby a Shooting range.

Drain Out plug - (most often refered to "clean-out plug")... A cleanout plug is a cap or lid used to close off a drain cleanout pipe. The term cleanout or cleanout pipe may refer to any branch of a plumbing pipe that is used for cleaning or unclogging the system. These pipes can be found at the main sewer pipe leading out of a home or building. If this sewage pipe becomes clogged and the drain fails, a plumbing snake may be required to clear the clog.

Drywall   a construction material used as a basis for interior walls in a home. Drywall is composed of an inner core of chalk with a paper facing on each side.

Dual Agent   (dual representation)   a real estate professional who represents both the buyer and the seller in the same transaction

Dual agency  can carry a different meaning in different states – (1) it can refer to the practice of a single agent representing both buyer and seller in the same transaction, and (2) it can also refer to the practice of two agents from the same office who separately represent a buyer and seller in the same real estate transaction.  Licensing laws may permit dual agency only if the buyer and seller are informed and consent to the broker's representation of both in the same transaction. Although the possibility of conflict of interest still exists, disclosure is intended to minimize the risk for the broker by ensuring that both principals are aware of the effect of dual agency on their respective interests. The disclosure alerts the principals that they may have to assume greater responsibility for protecting their interests than they would if they had independent representation. The broker must reconcile how, as agent, he or she will discharge the fiduciary duties on behalf of both principals, particularly providing loyalty and protecting confidential information.

Due diligence - refers to the care a reasonable person should take before entering into an agreement or a transaction with another party.

Due-on-sale-clause   a form of acceleration clause found in some mortgages, especially savings and loan mortgages, requiring the mortgagor to pay off the mortgage debt when the property is sold, resulting in automatic maturity of the note as the lender's option. This clause effectively eliminates the possibility of the new buyer's assuming the mortgage unless the mortgagee permits the assumption, in which case the mortgagee might increase the interest rate or charge as assumption fee.

Duplex   a structure that provides housing accommodations for two families and supplies each with separate entrances, kitchens, bedrooms, living rooms and bathrooms. It is usually a units for-family dwelling with the units either side by side or one above the other.

 Dwelling   any building, structure or part thereof used and occupied for human habitation and intended to be so used as their domicile. 

 

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