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So many terms are used in the commercial real estate and title industry that it can be confusing. I have put together a shortlist of acronyms and commonly used terms that are specific to the commercial side of the business that will hopefully be helpful next time you see something you may have a question on!

PSA – Purchase and Sale Agreement. 

This is the written agreement made between the parties with the terms and conditions of the purchase regarding the real and personal property being transferred.

EMD – Earnest Money Deposit. 

These are the funds or collateral being deposited as part of a binding portion of a contract. This is typically money that is deposited with the escrow holder. Since this comes up every once in a while, escrow will typically not hold personal property as collateral for a deal or as earnest money.

COE – Close of Escrow. 

Also known as the closing or settlement. Typically this is when documents have all been signed, funds are disbursed, documents are recorded/submitted for recording, and ownership changes hands.

EI – Escrow Instructions. 

The escrow holder is an impartial third party who acts upon instructions for the buyer and seller or borrower and lender in carrying out the terms of the contract and/or instructions by delivering documents and disbursement of funds.

IBA – Interest Bearing Account. 

Earnest money and other funds being held can be placed into an account earning interest instead of the escrow holder’s non-interest-bearing trust account.

Prelim – Preliminary Title Report. 

A report was prepared that shows the ownership along with the current liens and encumbrances of a specific parcel of land.

ALTA – American Land Title Association. 

This is a trade association and is a commonly used term to refer to an extended owner policy or a lender policy.

CLTA – California Land Title Association. 

Another trade association but is commonly used to refer to a standard owner title insurance policy.

HOA – Homeowner Association. 

In commercial real estate, this is technically an Owners Association but it is still often referred to as an HOA. This is an organization on property that makes and enforces rules for the property owners and their tenants. Property within an association’s jurisdiction is typically required to pay dues and abide by rules and restrictions.

CC&R’s – Covenants, Conditions, and Restrictions. 

These are the detailed limitations applying to the use or enjoyment of real property. These can be recorded on a property by developers or property owners to impose upon how future owners may use the property.

REA – Reciprocal Easement Agreement. 

An agreement is used to establish the legal right to share areas between two or more property owners. They are typically used by owners of adjoining land or businesses to share an area, such as a large parking lot or driveway.

SOS – Secretary of State. 

In escrow terms, this is referring to the state office that regulates corporate business filings and UCC (see below).

UCC – Uniform Commercial Code. 

The UCC is a standardized set of Federal laws and regulations for transacting business. Then UCC code helps companies transact business across state lines more efficiently and navigate various state laws. Often refers to documents filed with the Secretary of State.

SI – Statement of Information. 

Generally, an escrow-generated document requests specific information such as, but not limited to, the party’s name, date of birth, social security number, current and previous addresses. Identity confirmation helps assist the Title Company in resolving issues that can be filed against individuals with the same or similar names. Items such as liens, judgements, and bankruptcies can show up against the associated real property.

FIRPTA – Foreign Investment in Real Property Transfer Act. 

This is a tax law to ensure income tax resulting from the sale of real property is paid at the time of closing in the event Seller is a foreign person or entity. Under the law, the responsibility falls on the buyer; however, the escrow holder typically assists in the process.

GBSD – Grant Bargain and Sale Deed. 

A statutory form of conveyance document used in Nevada. This is a recorded document that is created at the time any interest in a property is passed from one party to another. Other states have different forms for conveyance, please contact me for questions regarding specific states.

DOT – Deed of Trust. 

Sometimes referred to as a mortgage. It is a legal document that is recorded in the public records secure a note.

SNDA – Subordination, Non-Disturbance and Attornment Agreement. 

This is a document typically recorded that benefits both the property owner’s lender and the tenant. Simply put, the document protects the lender by placing the loan in a priority position over the lease and protects the tenant by confirming the lease will not be wiped out in the event of foreclosure so long as the lease is not in default.

STDR – Substitution of Trustee and Deed of Reconveyance. 

This is recorded when the loan is paid off or satisfied. The beneficiary substitutes in as trustee and reconveys the deed of trust. There are other forms of release, but this is the most commonly used in Nevada.

APN – Assessor’s Parcel Number. 

A string of numbers issued by the county assessor is used to identify a property on a parcel map. Can be changed by the county.

CPL – Closing Protection Letter. 

Also sometimes called an Insured Closing Letter is a contract between a title insurance underwriter and a lender, in which the title insurance company indemnifies the lender for losses caused by certain misconduct of the closing agent.

LOI – Letter of Intent. 

A document that outlines the basis for an agreement between two or more parties that they intend to formalize into a legally binding agreement.

POA – Power of Attorney. 

Legal authorization for one person to act as an agent on another’s behalf in a designated transaction or transaction.

LLC – Limited Liability Company. 

A commonly used type of business for holding real estate. The structure can combine pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation.

POC – Paid Outside of Closing. 

The fees or payments rendered outside of normal title insurance and underwriting fees are due at the time of closing. Examples are due diligence such as land surveys, appraisals, and inspections.

OA – Operating Agreement. 

A governing document utilized by limited liability companies outlining the business’ financial and functional operating decisions including rules, regulations, managers, members, and authorities to contract and sign on behalf of the company.

Have questions about terms in your own transaction? Shoot us an email,