Investment Glossary:

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H

Habendum Clause:  The "to have and to hold" clause that defines the quantity of the estate granted in the deed.

Hard Money Loan:  A loan that is underwritten with the condition and value of the property as the primary criteria for approval. Secondary issues may include the credit of the borrower, the ability of the borrower to repay the loan and/or the ability of the borrower to manage the property or successfully complete a rehab and sell the property. Owner occupancy, debt ratios and other issues are seldom a factor. Appraisals rather than purchase prices are used to determine value. Cash out purchases are often allowed and are another key benefit. These loans are usually approved within days and are often funded in two weeks or under with times as short as two or three days not uncommon. The cost for the benefits of speed of funding, lax underwriting and other advantages is typically a moderately high interest rate (usually low to mid teens) and high points (usually 5 to 10).  (See definition of "underwriting" below.)

Hazard Insurance:  Insurance to provide compensation if the improvements are damaged or destroyed. It is almost always a requirement of loans.

Hereditaments:  Personal and real property capable of being inherited

Hiatus:  A gap between two parcels of land that is not included in the legal description of either property.

Highest and Best Use:  The use that is most likely to produce the greatest net return to the land and/or building over a given period.

Holdover Tenant:  A tenant who remains in possession of leased property after the expiration of the lease term.

Home Equity Loan:  In the most literal sense, this expression applies to virtually all loans (first mortgages and second mortgages, fixed and adjustable interest rates, credit lines and fully amortizing loans, etc.) placed on an owner occupied property when the loan-to-value after the Home Equity Loan closes is no higher than 100%. That is, it is a loan secured by the available equity of an owner occupied residential property.

Homeowner Association (HOA):  An organization of the homeowners in a particular subdivision, planned unit development, or condominium created to enforce deed restrictions and manage common elements of the development.

Homeowners\' Warranty:  A special insurance policy that covers certain home repairs for a specified amount of time.

Homeowner\'s Insurance (Hazard Insurance):  Insurance coverage that compensates for physical damage to a property from fire, wind, vandalism, or other hazards. The policy typically combines personal liability insurance and property hazard insurance coverage for a dwelling and its contents. See also homeowner\'s insurance.

Homestead:  Status provided to a homeowner's principal residence by some state statutes to protect the home against judgments up to specified amounts.

Homestead Exemption:  In some jurisdictions a reduction in the assessed value allowed for one's personal residence.

Housing and Urban Development (HUD):  A federal government agency established to implement certain federal housing and community development programs.

Housing Code:  Local government ordinance that sets minimum standards of safety and sanitation for existing residential buildings.

Hypothecate:  To pledge something as security without having to give up possession of it.