Real Estate Glossary D

Click on the beginning letter of the real estate term to find the definition.

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

Debt Instrument: The use of borrowed capital to finance the purchase of property.

Debt Service: The sum of money needed each month or year to amortize a loan.

Debtor: One who owes something and makes payments to a creditor.

Declining Principal Loan: A loan for which interest is calculated each month, quarter, etc., on the remaining balance of the loan.

Deed: A written instrument transferring title to real property from one person to another.

Deed of Trust: A written instrument transferring bare legal title to real property to a trustee to be held as security for an obligation. Also called a trust deed. The accepted form is presented to the trustee for approval before the execution thereof by the trustor and beneficiary and before recordation. The trustee is therefore duty-bound to perform if he accepts. The automatic form is the most widely used form. It contains a provision whereby the trustee named will accept his duties when the trust deed is properly executed, acknowledged, and recorded and provided he has approved the promissory note and deed of trust. The trustee is not usually aware of the appointment until called on to act in case of default by the trustor.

Default: The omission or failure to perform or fulfill a legal duty, obligation, or promise (i.e. to pay a debt.)

Deficiency Judgment: A judgment for the amount left unpaid after a property has been sold at a foreclosure sale when the net proceeds are not sufficient to pay off the loan.

Discount: The dollar difference between the unpaid balance of a note and the price for which a note holder sells the note.

Discount Interest: Interest that is deducted from the principal amount of the loan in advance by the lender on the first day of the loan, hence increasing the lender's yield.

Discount Points: A fee, expressed as a percentage of the loan amount, when making a loan. Points increase the yield.

Dragnet Clause: A clause in a deed of trust that makes it security not only for the present loan but also for any other past or future debt to the beneficiary.

Due Diligence: Exhaustive research on a transaction, income stream, client, and/or payor. Due diligence may involve credit checks, appraisals, UCC searches, lien searches, or on-site visits with clients.

Due-On-Sale Clause: A clause in a note or deed of trust giving the holder the right to declare the entire debt due and payable if the owner sells or contracts to sell the property. Also called a due-on-alienation clause.