Declining Balance Method to Default Notice

 

Declining Balance Method

The declining balance method is an IRS-approved method for depreciating investment properties that were purchased, developed and put into service before 1981. Using an IRS-published table, the declining balance method eventually converts to the straight line method. It was replaced by the accelerated cost recovery system, with the Economic Recovery Act of 1981. It calculates the useful life of various property types, for the purpose of determining depreciation.

Deconstruction

Unlike demolition which removes a building or structure the quickest way possible, a deconstruction selectively dismantles the structure or improvement, piece by piece. Often, this is done so that the parts can be re-used and recycled, thereby decreasing the cost of hauling landfill waste. Older buildings with quality timber and bricks can generate additional revenue for the owner or deconstruction company, if it is dismantled rather than demolished. Deconstruction does take more time, but it is also favorable if the property contains asbestos that may be released into the air with a wholesale demolition. Compare with the Demolition entry.

Dedication

In real estate, the dedication is the act of conveying title to real estate or an easement for public use, ownership or benefit. The dedication can be structured to allow the dedicator (and descendants and assigns) to occupy the property, immediately pass to public use upon the death of an identified person, or any combination. In exchange for this donation, the property owner receives tax breaks from the government, as well as possible compensation from conservation groups.

Deed

The deed is a written instrument used to record or transfer property ownership. The basic deed transfers the property from the grantor to the grantee, but various types of deeds are used in different parts of the United States. The most common type of real estate deeds are the general warranty deed, special warranty deed, bargain & sale deed, quitclaim deed and grant deed. A variety of special purpose deeds used in many states to transfer real property ownership, including the administrator’s deed (for bankruptcy- and court-ordered transfers), executor’s deed (used with wills and inheritances), sheriff’s deed (used in sheriff’s sales of foreclosure properties), guardian’s deed, referee’s deed, tax deed (transfer real properties as part of a tax foreclosure), trustee’s deed, trust deed and gift deeds, as well as the deed in trust and deed in lieu of foreclosure. Another deed, the release deed, is typically used to remove the lien of a mortgage holder or lien holder from the property’s title, after the debt has been satisfied.

Deed Book

The deed book is the name used for public or official catalog that records deeds for a county or recording authority. Before organized file sorting (and way before the advent of computerized data recording), the local title company or records office would maintain the record of deeds in its deed book. The deed book is sometimes called a “mortgage book,” particularly when it only lists mortgage deeds.

Deed in Lieu of Foreclosure

The deed in lieu of foreclosure is a real estate deed used to convey title to a property from the current owner to the owner’s lender or creditor. This deed is normally used when the current owner is in default or in the midst of foreclosure proceedings. By voluntarily surrendering the property, both parties avoid the costs and delay of further legal proceedings. The lender receives title without going through the usual court and auction process; in exchange, the loan is terminated. Similar to the power of sale clause, this is a type of non-judicial foreclosure. Compare with the Foreclosure and Power of Sale Clause entries.

Deed in Trust

The deed in trust is a legal instrument used to simultaneously establish a land trust and transfer property into it. The deed grantor conveys the property to the trustee. Note that the deed in trust is different from a deed of trust, which is a type of mortgage deed that creates a separate legal entity to hold the property’s title. Compare with the Deed of Trust and Mortgage entries.

Deed of Conveyance

The deed of conveyance is a legal instrument used to transfer a property’s title.

Deed of Reconveyance

See the Trustee’s Deed entry.

Deed of Release

See the Release Deed entry.

Deed of Trust

The deed of trust is a type of mortgage deed in which a third party holds the title in trust as a security, while the borrower continues to make payments to the lender. Most residential mortgage lenders will not allow the loan to close while the subject property is in a trust. The loan programs that will close with a trust normally use a deed of trust. With a deed of trust procedure, the borrower conveys the legal title to the trustee, who retains the property until the debt to the lender is paid in full. If the borrower defaults, the trustee may sell the subject property to satisfy the debt, without benefit of foreclosure proceedings. Also called a trust deed or a Potomac mortgage, note that the deed of trust is different from the deed in trust. Compare with the Deed in Trust and Mortgage entries.

Deed Restriction

The deed restriction is a clause in the deed of conveyance that restricts the use of the property. For example, a residential property normally cannot be converted into a commercial property. Deed restrictions placed by developers to control the quality or aesthetics of a subdivision are often called restrictive covenants. Note that when zoning and restrictions conflict, whichever is more restrictive is usually followed. Unlawful deed restrictions are unenforceable. So deeds prohibiting the sale of a property to persons belonging or not belonging to a particular race, marital status, gender or religion would be illegal and unenforceable.

Deep Foundation

Deep foundations are necessary to support heavy loads (or very large buildings), compensate for poor soil underneath the structure or to deal with site constraints (such as narrow urban parcels). The most common ways to create deep foundations are with caissons, piers, piles and shafts, which can be drilled or driven into the ground with pile drivers.

Deep Seal Floor Drain

The deep seal floor drain is a basement drain specially designed to drain into the sewer, particularly when the sewer isn’t below the basement’s level.

Default

With mortgage loans and real estate contracts, a default is a failure to meet or perform a contract obligation. With mortgage loans, the lender may declare the loan in default any time after a payment becomes past due beyond the grace period. However, most lenders will not declare default until the borrower is at least one to three months behind. A default notice will activate the foreclosure proscriptions of the mortgage deed.

Default Clause

The promissory notes of mortgage loans typically have default clauses that allow lenders to exercise its option to accelerate scheduled payments or foreclose the subject property.

Default Notice

See the Notice of Default entry.