Real Estate Glossary "D"

datum - Used to measure elevations. While cities may have several datums, the most commonly used is the USGS datum, which is based on sea level in New York Harbor.

debt-to-income ratio - A ratio used by lenders to qualify borrowers. It is used to calculate the percentage of gross income allowed for the monthly PITI payment.

declaration - A document that legally establishes a condominium. Also known as a master deed or enabling declaration.

deductible - The amount an insured has to pay before the insurance company is liable.

deductions - Expenses that taxpayers are allowed to include on their income tax returns to reduce their taxable income.

deed - A written instrument that transfers title to real property from one owner (the grantor) to another (the grantee).

deed in lieu of foreclosure - A type of nonjudicial fore­closure in which the lender accepts title to the property from the borrower in exchange for ending the debt.

deed of trust - An agreement among three parties for the purpose of securing a real estate loan. Parties to the trust are the trustor (the borrower), the trustee (usually a title company or bank) and a beneficiary (the mortgagee). Used in many states in place of a mortgage.

deed restriction - A clause in a deed that limits the owner's use of the property.

defeasance clause - Stipulates that the mortgage lien is void when the loan is repaid.

defeasible fee estate - An estate in which the holder has a fee simple title to the property that will end on the occurrence or nonoccurrence of some event.

deficiency judgment - A judgment against a debtor's personal assets if the sale of real estate is not sufficient to satisfy the loan.

delivery and acceptance - The time at which title to real estate passes, when a deed is delivered to and accepted by the grantee.

demographics - Refers to characteristics of a population, such as age and economic status.

Department of Housing and Urban Development (HUD) - One of the duties of this federal agency is to administer the FHA loan programs. Primarily responsible for enforcing the Fair Housing Law of 1968.

Department of Veterans Affairs - A federal agency also known as the VA. One of its functions is to administer the guaranteed loan program for loans made to qualified veterans by approved lenders.

depreciable basis - The total monetary value of an asset that is used to calculate depreciation.

depreciation - (1) In appraisal, a loss of property value due to any cause. Depreciation is used in the cost approach to estimating value. See also cost approach, curable depreciation, economic obsolescence,functional obsolescence, incurable depreciation, physical deterioration. (2) For tax purposes, a deduction that allows the cost of assets used in business or as investment property to be recovered over a period of time. Noninvestment property (such as principal residences) cannot be depreciated. The rules for calculating tax-deductible depreciation are established by the IRS.

descent - Rules used by state law to determine how title to property will pass if the owner died leaving no will.

designated agent - A licensed person authorized by a broker to act as the agent for a specific principal in a real estate transaction.

devise - The disposition of real property under a will.

devisee - The party receiving real property under a will.

discount point - Interest points charged by a lender to raise the yield on a loan. One point is equal to 1 percent of the loan amount.

discount rate - The interest rate charged other banks by the Fed for loans. By adjusting the discount rate the Fed can control interest rates and the flow of money in the economy.

disintermediation - The rapid outflow of funds from savings institutions.

dominant tenement - A tract of land that benefits from an easement appurtenant right.

dower - The wife's legal life estate in her husband's property.

downzoning - A change in zoning from higher-density to lower-density use. Often used to prevent overloading of public services in an area.

dual agency - Representing both parties in the same transaction.

due-on-sale clause - See alienation clause.

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