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The Mortgage Group®


Canadian Financial, Real Estate and Mortgage Glossary

Words categorized under Legal-contracts

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Burden of ProofDivision of Property
Currently Displayed — Page 3
Document Needs List — Land Contract
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Land TitlePre-payment Clause
document needs listDefinition (Mortgages, Legal-contracts)
An inventory of papers a lender needs to underwrite a loan, usually including pay-cheque stubs, bank statements and tax returns.
documentary creditDefinition (Financial-banking, Legal-contracts)
Written undertaking by a bank on behalf of an importer authorizing an exporter to draw drafts on the bank up to a specified amount under specific terms and conditions. They are used to facilitate international trade. In the United States these instruments are called commercial letters of credit.
domicileDefinition (Real-estate, Legal-contracts)
A person's permanent residence.
due-on-sale clauseDefinition (Mortgages, Financial-banking, Legal-contracts)
A condition of a mortgage that states that the loan must be paid when the house is sold. Commonly used in reverse mortgage lending.
easementDefinition (Real-estate, Legal-contracts)
Giving persons other than the owner access to or over a property.
Employment Equity Act (EEA)Canada
A federal statute that requires employers with 100 or more employees to eliminate any practices in the workplace discriminating against four designated groups of people who have historically been disadvantaged in the labour market: women; people who, by reason of race or colour, are members of visible minority groups; aboriginal peoples; and persons with disabilities.
encroachmentDefinition (Real-estate, Legal-contracts)
An improvement, such as a fence, that illegally extends onto another property or impedes the neighbour's use of that property.
encumbranceDefinition (Mortgages, Real-estate, Financial-banking, Legal-contracts)
Anything that affects or limits the clear and free title to a property, such as mortgages, leases, easements, or restrictions.
environmental impact statement (EIS)Definition (Real-estate, Financial-banking, Legal-contracts)
A government-required evaluation of how construction will affect the environment surrounding a site.
equityDefinition (Investments, Mortgages, Insurance, Financial-banking, Legal-contracts)
The value of a property minus outstanding mortgage debt and other liens.
escrow agentDefinition (Mortgages, Real-estate, Financial-banking, Legal-contracts)
A neutral third party who holds the documents and money in a real-estate transfer until all conditions are met.
estateDefinition (Investments, Estate-management, Real-estate, Financial-banking, Legal-contracts)
The ownership interest of an individual in real property.
evictionDefinition (Real-estate, Legal-contracts)
The act of kicking someone out of a property, usually for violating terms of a lease.
examination of titleDefinition (Real-estate, Legal-contracts)
A review of public records and title abstracts to determine the chain of ownership of a property.
exclusive listingDefinition (Real-estate, Legal-contracts)
A legal agreement giving one real-estate agent the right to sell a property for a specified period, but owners retain the right to sell their property themselves without paying the agent commission.
extended warrantyDefinition (Automotive, Financial-banking, Legal-contracts)
A service contract that covers certain vehicle repairs or problems after the manufacturer's or dealer's warranty expires. Extended warranties are sold by vehicle manufacturers, dealers, and independent companies. With a new vehicle, the extended warranty must be purchased by the end of the first year of ownership.
fee simpleDefinition (Real-estate, Legal-contracts)
Outright ownership of real estate, free of any liens or other claims against title.
fee simple defeasibleDefinition (Real-estate, Legal-contracts)
When a person has outright ownership of real estate (free of any liens or other claims against title), but the use of the property is restricted.
fiduciaryDefinition (Estate-management, Financial-banking, Legal-contracts)
An individual, company, or association that manages assets for another party. Fiduciaries include executors of wills and estates, trustees, receivers in bankruptcy, and those responsible for managing the finances of a minor.
fiduciary dutyDefinition (Estate-management, Financial-banking, Legal-contracts)
A requirement that someone in a position of trust, such as a banker, real-estate agent, or title agent, must act in good faith and trust on behalf of a client.
filing extensionDefinition (Taxation, Financial-banking, Legal-contracts)
An additional amount of time to file your return. A filing extension, however, does not give you more time to pay your taxes.
financial responsibility lawsDefinition (Automotive, Insurance, Legal-contracts)
A type of law that requires an entity to be capable of paying for damages in the event of a potential claim.
first lienDefinition (Mortgages, Legal-contracts)
Primary claim by the lender for satisfaction of outstanding debt. A first mortgage creates a first lien.
first mortgageDefinition (Mortgages, Legal-contracts)
A mortgage that is the primary lien against a property.
forbearanceDefinition (Mortgages, Financial-banking, Legal-contracts)
Delaying foreclosure, usually because the borrower has arranged to pay the amount in arrears.
foreclosureDefinition (Mortgages, Financial-banking, Legal-contracts)
The legal process by which a borrower in default under a mortgage is deprived of his or her interest in the mortgaged property. This usually involves a forced sale of the property at public auction with the proceeds of the sale being applied to the mortgage debt.
forfeitureDefinition (Financial-banking, Legal-contracts)
Loss of property because of violation of law or contract.
franchiseDefinition (Investments, Financial-banking, Legal-contracts)
The right to sell products or services under a corporate name or trade mark (established by someone else). This right is usually purchased for cash in addition to a royalty fee on, or a percentage of, all sales.
friendly takeoverDefinition (Investments, Financial-banking, Legal-contracts)
When a company purchases another and both parties' management approve.
guaranteeDefinition (Financial-banking, Legal-contracts)
An enforceable warranty on the promise of quality of a product or formal promise by one person to take responsibility for the debts or obligations of another person if that person fails to meet them.
guarantorDefinition (Mortgages, Real-estate, Legal-contracts)
Someone who guarantees something.
home owners warranty (HOW)Definition (Real-estate, Legal-contracts)
A policy that guarantees workmanship on construction of a home and functionality of some appliances, and which pays for repairs for a specified period.
homeowners insurance binderDefinition (Real-estate, Insurance, Legal-contracts)
A document accompanying a homeowner's insurance policy that verifies the property is properly insured.
hostile takeoverDefinition (Investments, Financial-banking, Legal-contracts)
When a company purchases another but the target company's management does not approve.
housing discriminationDefinition (Real-estate, Legal-contracts)
The illegal practice of discriminating against buyers or renters of dwellings on the basis of race, colour, religion, national origin, sex, family status or disability.
illiquid assetDefinition (Automotive, Investments, Financial-banking, Legal-contracts)
An asset that cannot be sold easily or in a timely manner for its full value.
incontestability clauseDefinition (Insurance, Legal-contracts)
A clause that places a time limit on how long an insurer has to void a policy due to a policyholder's accidental misstatement in his or her life insurance application.
incorporated businessDefinition (Investments, Financial-banking, Legal-contracts)
A company that exists as a corporation.
indefeasibleDefinition (Insurance, Legal-contracts)
That which cannot be forfeited or done away with. Indemnity Protection or exemption from loss or damage.
indexDefinition (Investments, Mortgages, Real-estate, Insurance, Financial-banking, Legal-contracts)
A table of yields or interest rates being paid on debt (such as Treasury notes or bank deposits) that is used to determine interest-rate changes.
initial public offering (IPO)Definition (Investments, Financial-banking, Legal-contracts)
When shares of a corporation become available to the public for the first time.
injunctionDefinition (Legal-contracts)
A court order that prohibits a party from taking a specific course of action.
inspection reportDefinition (Real-estate, Legal-contracts)
The documentation of a thorough examination of a house's visible structural parts and systems, conducted before purchase.
insurance attorneyDefinition (Insurance, Legal-contracts)
An attorney who works with insurance law.
interest rate capDefinition (Mortgages, Legal-contracts)
A limit to the interest rate increases and decreases on an adjustable rate loan; either from one adjustment period to the next or over the life of the loan.
interest rate differential (IRD)Definition (Mortgages, Financial-banking, Legal-contracts)
The penalty one pays for breaking a mortgage.
irrevocableDefinition (Legal-contracts)
joint liabilityDefinition (Mortgages, Financial-banking, Legal-contracts)
The responsibility of two or more people to repay a debt
judgementDefinition (Legal-contracts)
A determination by a court of law or a judicial decision.
land contract (LC)Definition (Real-estate, Legal-contracts)
An agreement for sale of property in which the buyer takes possession while making payments, but the seller holds title until full payment is made.
Previous Page
Burden of ProofDivision of Property
Currently Displayed — Page 3
Document Needs List — Land Contract
  Next Page
Land TitlePre-payment Clause

Search the Glossary

Index of Legal-contracts Terms

Page 1: Abandonment Clause
Bundle of Rights
Page 2: Burden of Proof
Division of Property
Page 3: Document Needs List
Land Contract
Page 4: Land Title
Pre-payment Clause
Page 5: Pre-payment Penalty
Page 6: Tort Law

Notable Terms

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