CA Real Flashcards
(500 cards)
1
Q
Abandonment
A
A surrender of rights; point when a broker makes no effort to service or sell listed property; failure to perform.
2
Q
Absentee owner
A
A property holder who does not reside on the property and who usually relies on a property manager to supervise the investment.
3
Q
Abstract of title
A
Condensed history of title to real property consisting of a summary of the links in the “chain of title” extracted from documents bearing on the title status.
4
Q
Acceleration clause
A
Stipulation in a mortgage that the entire unpaid balance of the debt may become due and payable if a default of expressed conditions should occur.
5
Q
Acceptance
A
Voluntary receipt of an item offered by another.
6
Q
Acceptance
A
Gradual addition of land caused by natural forces, such as wind, tide, flood, or watercourse deposits.
7
Q
Acknowledgment
A
Formal declaration before an authorized official, by the person who executed the instrument, that it is a free act.
8
Q
Actual notice
A
Information a person has actually learned by reading, seeing, or hearing.
9
Q
Adjudication
A
A judicial or court decision.
10
Q
Adjustable-rate mortgage (ARM)
A
A financing technique in which the lender can raise or lower the interest rate according to a set index.
11
Q
Adjusted basis
A
A judicial or court decision.
12
Q
Administrative law judge
A
An attorney employed by the Division of Administrative Hearings, Department of Administration, to hear complaints and issue recommended orders.
13
Q
Ad valorem
A
According to the value; in proportion to worth.
14
Q
Advance fees
A
Up-front money collected by a broker for the listing of real property.
15
Q
Adversary
A
Opponent; a person or group that opposes another.
16
Q
Adverse interest
A
A purpose in opposition to the interest of another party (as, for example, with a buyer and a seller).
17
Q
Adverse possession
A
A method of obtaining title to real property by occupying it in an open and hostile manner contrary to the interests of the owner.
18
Q
Affidavit
A
A sworn statement written down before a notary or public official.
19
Q
Agency
A
Express or implied authorization for one person to act for another.
20
Q
Agent
A
A representative; one who is authorized to act on behalf of another.
21
Q
Agricultural
A
Defined in Chapter 475, F.S., to mean property zoned as such, consisting of more than ten acres.
22
Q
Affidavit
A
The freedom to use the open space above a property.
23
Q
Alienation
A
The act of transferring ownership, title, or an interest or estate in real property.
24
Q
Allodial system
A
A theory of land ownership that individuals may own land free of the rights of an overlord.
25
Alluvion (alluvium)
The increase of land by the gradual and imperceptible action of natural forces (e.g., deposits of sand and mud on a riverbank).
26
Amortized mortgage
A loan characterized by payment of a debt by regular installment payments.
27
Anniversary date
The freedom to use the open space above a property.
28
Annual debt service
The amount of money required each year for the payment of all mortgage interest and principal.
29
Annual percentage rate (APR)
Total yearly cost of credit.
30
Appeal
A request to some authority for a decision or judgment.
31
Applicant
A person who applies for something; a candidate.
32
Appraisal
Professional service provided by a registered, licensed, or certified appraiser or real estate licensee to produce an estimate of value.
33
Appraisal plant
Copies of current statistics and publications kept by appraisers in their library or record room.
34
Appraised value
Estimated worth of a property determined by someone qualified in valuation
35
Appraiser, real estate
One who is a registered, licensed, or certified by the DBPR and provides an estimate of value.
36
Appreciation
An increase in value.
37
Arbitration
The act of having a third party render a binding decision in a dispute between two parties.
38
Applicant
The state of being behind in the discharge of an obligation; paid at the end of the period for which due (the opposite of in advance).
39
Assemblage
The combining of two or more adjoining properties into one tract.
40
Assessed value
Worth established for each unit of real property for tax purposes by a county property appraiser.
41
Assessment
The imposition of a tax or charge according to a preset rate; the allocation of the proportionate individual share of a common expense in a condo or co-op building.
42
Asset
Anything of value.
43
Assignee
One who is a registered, licensed, or certified by the DBPR and provides an estimate of value.
44
Assignment
Written instrument that serves to transfer the rights or interests of one person to another.
45
Assignment of mortgage
A legal instrument that states that the mortgagee assigns (transfers) the mortgage and promissory note to the purchaser.
46
Assignor
Person who gives his or her legal rights or interests to another person.
47
Associate
Person working for a broker.
48
Association
An organization of persons having a common interest.
49
Assumption of mortgage
The taking over of an existing mortgage by a buyer.
50
Attachment
A legal writ obtained to prevent removal of property that is expected to be used to satisfy a judgment.
51
Attorney-in-fact
One who is authorized to perform certain acts for another under a power of attorney.
52
Attorney, power of
Designation of another person to act for a principal who may not be present.
53
Automated underwriting
A service that enables lenders to obtain a credit risk classification using applications software in the loan underwriting process.
54
Assignment
A financial report that shows the company's financial position at a stated moment in time.
55
Balloon payment
A single, large payment made at maturity of a partially amortized mortgage to pay off the debt in full.
56
Bargain and sale deed
A type of deed in which title is transferred and a limited number of warranties are made respecting title to or use of the property.
57
Base industries
Businesses that attract outside money into the area; primary.
58
Base lines
Imaginary lines running east and west and crossing a principal meridian at a definite point; used by surveyors for reference in locating and describing land under the government survey system.
59
Before-tax cash flow (BTCF; cash throwoff; gross spendable income)
An organization of persons having a common interest.
60
Biennium (biennial)
A period of two years.
61
Bilateral contract
An agreement wherein both parties are legally obligated to each other to perform.
62
Binder
A memorandum given subject to the writing of a formal contract for sale, usually acknowledging receipt of a portion of the down payment for purchase of real property.
63
Blanket mortgage
One debt instrument covering two or more parcels.
64
Blind advertisement
An advertisement of a principal's property providing only a telephone number, a post office box, and/or an address without the licensed name of the brokerage firm.
65
Blockbusting
The illegal practice of inducing homeowners to sell their property by making misrepresentations regarding the entry or prospective entry of minority persons in order to cause a turnover of properties in the neighborhood; discriminatory acts against sellers.
66
Bona fide
Without deceit or fraud; genuine; in good faith.
67
Boot
Money or other property that is not like-kind, which is given to make up any difference in value or equity between exchanged properties.
68
Borrower (debtor)
The mortgagor; one who gives a mortgage as security for a debt.
69
Branch office
A business location other than the real estate broker's principal place of business.
70
Base industries
Failure to do or perform what has been promised.
71
Broker
A licensee who acts as an intermediary between two parties and negotiates contracts between them.
72
Broker associate
An individual who is qualified to be issued a broker's license but who operates as a sales associate in the employ of another.
73
Buffer zone
A strip of land separating one land use from another.
74
Building codes
Government ordinances regulating construction practices and materials.
75
Business brokerage
An agreement wherein both parties are legally obligated to each other to perform.
76
Business broker
Real estate licensees who engage in the sale, purchase, or lease of businesses.
77
Business opportunity brokerage
The real estate activity dealing in the sale, purchase, or lease of businesses.
78
Business trust (syndicate)
A group of people who associate with each other for the purpose of purchasing shares or units at a specified amount per unit, with the money raised to be used to purchase the real property, often for subdividing and resale.
79
Buydown
A financing technique in which points are paid to the lender by the seller or builder that lowers (buys down) the effective interest rate paid by the buyer/borrower, thus reducing the amount of the monthly payment for a set period of time.
80
Buyer brokerage agreement
An employment contract with a purchaser.
81
Buyer's market
The supply of available properties exceeds the demand.
82
Bylaws
Rules that govern the administration of the condominium.
83
Canceled
A license ceases to exist, effective as of the date approved by the Commission, and does not involve disciplinary action.
84
Capital
The collective wealth (money and property) of a person or business; the investment in a property. (See also Equity.)
85
Capital asset
Certain property held by a taxpayer, not including inventory for sale to customers.
86
Breach
A region where the total amount of local savings is not sufficient to finance economic development already under way in that area.
87
Capital gain
The profit from the sale of an asset, including real property.
88
Capitalization rate
The relationship between the net income from a real estate investment and the present value.
89
Cash flow (after-tax cash flow)
The resulting amount when annual debt service, tax liability, and capital improvement costs are subtracted from net operating income.
90
Caveat emptor
Let the buyer beware!
91
Cease and desist order
Government ordinances regulating construction practices and materials.
92
Censure
An official act of strong disapproval.
93
Certificate of occupancy
An occupancy permit issued by the local government after construction is completed and the final inspection is approved.
94
Certificate of title opinion (opinion of title)
A document signed by a title examiner (attorney or title company agent) stating the judgment that, based on an examination of the public records, the seller has good title to the property being conveyed to the buyer (not to be confused with title insurance).
95
Certiorari, writ of
An order to bring from a lower court to an appellate court an action or record of proceedings in a case.
96
Chain of title
A successive listing of all previous holders of title (owners) back to an acceptable starting point.
97
Chattel
Any item of personal property. (See also Personal property.)
98
Check
A square measuring 24 miles on each side and representing the largest unit of measure in the government survey system.
99
Circuit breakers
Devices that will shut off the flow of electricity if more electrical current is flowing through the wire than the wire can handle.
100
Citations
Statements of alleged violations and the penalties to be imposed.
101
Civil Rights Act of 1866
A federal act that prohibits any type of discrimination based on race in any real estate transaction (sale or rental) without exception.
102
Canceled
A distinct provision in a written document.
103
Closing
Final settlement between the buyer and seller; the date on which title passes from the seller to the buyer
104
Cloud on title
Any defect, valid claim, or encumbrance that serves to impair the title or curtail an owner's rights.
105
Collateral
Real or personal property pledged as security on a debt.
106
Collusion
Two or more parties jointly attempting to defraud a third party.
107
Color of title
The profit from the sale of an asset, including real property.
108
Commercial
A classification of real estate that includes income-producing properties such as office buildings, gasoline stations, restaurants, shopping centers, hotels and motels, and parking lots. Commercial property usually must be zoned for business purposes.
109
Commingle
To mix together money or a deposit with personal funds; combine; intermingle.
110
Commission
Compensation paid to a broker or sales associate for successfully concluding a real estate transaction; short form for the Florida Real Estate Commission (FREC).
111
Common elements
The parts of a multiple-ownership property not included in the units; those parts in which each unit owner holds an undivided interest.
112
Common law
A system of law based on accepted customs and traditions.
113
Community property
Real property acquired during a marriage. (Florida is not a community property state.)
114
Comparable property (comparable; comp)
A recently sold property similar to one being evaluated.
115
Comparative market analysis (CMA)
An informal estimate of market value performed by a real estate licensee for the seller to assist in arriving at an appropriate listing price, or if working with the buyer, an informal estimate of market value to assist the buyer in arriving at an appropriate offering price.
116
Compensation
Anything of value or a valuable consideration, directly or indirectly paid, promised, or expected to be paid or received.
117
Competent
A party to a contract who possesses the legal capacity to enter into a binding contract.
118
Chain of title
A person who makes an allegation or a charge against another (the respondent). (See also Plaintiff.)
119
Complaint
Formal allegation or charge.
120
Comprehensive plan (master plan)
A statement of policies for the future physical development of an area (e.g., city, county, region).
121
Concealment
The act of keeping from sight or keeping secret.
122
Concurrency
A provision in Florida's Growth Management Act that mandates that the infrastructure, such as roads and water and waste treatment facilities needed to support additional population, be in place before new development is allowed.
123
Condemnation
Statements of alleged violations and the penalties to be imposed.
124
Condominium
A multiunit project consisting of individual ownership of a dwelling unit and undivided ownership of common areas.
125
Conflicting demands
When different parties each make claims that are inconsistent with one another.
126
Consideration
Inducement offered to conclude a contract.
127
Construction lien
A claim based on the principle of "unjust enrichment"; favors parties who have performed labor or delivered materials or supplies for the repair or building of an improvement to real property.
128
Constructive notice
The recording of a document or an instrument in the public records designed to give adequate notice to all.
129
Consumer Price Index (CPI)
A measurement of average price changes of goods and services using a base period.
130
Contract
An agreement between two or more competent parties to do, or not do, some legal act for a legal consideration.
131
Contract for deed
A financing technique wherein the seller agrees to deliver the deed at some future date and the buyer takes possession while paying the agreed amount (also called land contract, an installment sale contract, and an agreement for deed).
132
Conventional mortgage
A real estate loan granted that is neither FHA-insured nor VA-guaranteed.
133
Conversion
Unauthorized use or retention of money or property that rightfully belongs to another person.
134
Commingle
A financing instrument allowing a change from an adjustable-rate to a fixed-rate mortgage.
135
Conveyance
Written instrument that serves to transfer an interest in real property from one party to another.
136
Cooperative
A multiunit project consisting of individual dwelling units owned by the corporation in which the individual apartment tenants own stock rather than owning their respective units.
137
Co-ownership (concurrent or multiple ownership)
Title to real property held by two or more persons at the same time.
138
Corner lot
A lot bounded with streets on two sides (intersecting).
139
Corporation
Real property acquired during a marriage. (Florida is not a community property state.)
140
Corporation not for profit
An artificial or fictitious person organized for business purposes and similar to a corporation for profit.
141
Corporation sole
An artificial or fictitious person formed by an ecclesiastical body.
142
Cost
The amount to produce or acquire something.
143
Cost-depreciation approach
A method for estimating the market value of a property based on the cost to buy the site and to construct a new building on the site, less depreciation.
144
Counselors
Professionals who analyze existing or potential real estate problems and recommend a course of action.
145
Counteroffer
A rejection of the original offer by proposing a new offer, thereby terminating the original offer.
146
Covenant
A warranty, guarantee, or promise formally given in a legal document.
147
Credit
As a verb, to make an entry on the right or credit side of an account; as a noun, payment or value received.
148
Creditor
A lender; person or business entity to whom a debt is owed.
149
Cul-de-sac lot
A lot located where a street is open at one end only and the street has a circular turnaround at the other end.
150
Concurrency
Inadequate attention to duties and obligations by one who knows, or should know, what is required of him or her.
151
Curable
When the correction of a defect results in as much added value as the cost to correct the defect.
152
Curbstone operation
Conducting business without maintaining an office.
153
Current mailing address
Where a licensee receives letters and so forth through the U.S. Postal Service.
154
Customer
One with whom the broker or sales associate hopes to be successful in accomplishing the purpose of employment. Per Section 475.01, F.S., a member of the public who is or may be a buyer or seller of real property and may or may not be represented by a real estate licensee in an authorized brokerage relationship.
155
Damages
Inducement offered to conclude a contract.
156
Debit
As a verb, to make an entry on the left or charge side of an account; as a noun, a charge or expense.
157
Decedent
A deceased person, usually one who has recently died.
158
Declaration
The legal document that the developer of a condominium must file and record in order to create a condominium under state law.
159
Declaration of trust
A formal instrument filed by a business trust with the Department of State as a prerequisite for creating the trust.
160
Declaratory judgment
A course of action declaring rights claimed under a contract or statute intended to prevent loss or to guide performance by the party or parties affected.
161
Dedication
An offer of land for some public use, by an owner, together with acceptance by or on behalf of the public.
162
Deed
A type of conveyance; a written instrument to transfer title to real property from one party to another.
163
Deed in lieu of foreclosure
A friendly foreclosure (nonjudicial procedure) in which the mortgagor gives title to the mortgagee.
164
Deed restrictions
Provision placed in deeds to control future uses of the property.
165
Default
Failure to comply with the terms of an agreement or to meet an obligation when due.
166
Conveyance
A provision in a mortgage that specifies the terms and conditions to be met in order to avoid default and thereby defeat the mortgage.
167
Defendant
The person or party being sued or charged.
168
Deficiency decree
Judgment brought when a mortgage is foreclosed and the sale proceeds fail to cover the costs of the sale, taxes, and the unpaid mortgage balance.
169
Demand
The quantity of goods or services wanted by consumers.
170
Demand deposits
Checking accounts; payable on demand by holder.
171
Denial
An artificial or fictitious person formed to conduct specified types of business activities.
172
Density
The number of homes or lots per acre.
173
Deposit
Earnest money or some other valuable consideration given as evidence of good faith to accompany an offer to purchase or rent. (See also Binder and Earnest money.)
174
Deposition
Written testimony of a witness under oath.
175
Depreciation
A loss in value for any reason; a deduction for tax purposes.
176
Descent
The passage of title to real property upon the death of the owner to his or her legal descendants.
177
Designated sales associates
Two real estate licensees designated to represent the buyer and the seller as single agents in a nonresidential transaction. The buyer and seller must have assets of $1 million or more and sign disclosures stating their assets meet the required threshold.
178
Development of regional impact (DRI)
A large project affecting more than one county.
179
Devise
A gift of real property by a will.
180
Devisee
One who receives real property under a will.
181
Devisor
One who gives real property through a will.
182
Creditor
A method for increasing a lender's yield. (See also Point, Mortgage discount.)
183
Discount rate
The amount of interest the Federal Reserve charges to lend money to its eligible banks.
184
Disintermediation
A disengagement process when depositors withdraw money from savings for direct investment in stocks, money market funds, and other securities.
185
Doc stamps
An abbreviated term for documentary stamp tax.
186
Document
Any written paper that provides information or evidence.
187
Documentary stamp tax on deeds, state
Conducting business without maintaining an office.
188
Documentary stamp tax on notes, state
Tax required on all promissory notes. The cost is based on the face value of the note.
189
Dormer
A projection built out from the slope of a roof, used to house windows on the upper floor and to provide additional light and ventilation.
190
Double-hung
A window consisting of two sashes that move up and down in a pair of channels and are held open by tension springs.
191
Down payment
A portion of a purchase price paid prior to closing the transaction. Earnest money may be part of or the entire down payment.
192
Draw (installment)
Disbursement made by a lender to a builder.
193
Dual agency
Representing both principals in a transaction (not a legal agency relationship in Florida).
194
Dual agent
A broker who represents both the buyer and the seller of a transaction in a fiduciary capacity.
195
Due-on-sale clause
A provision in a conventional mortgage that entitles the lender to require the entire loan balance to be paid in full if the property is sold.
196
Dynamic risk
The risk that arises from the continual change in the business environment and therefore dynamic risk cannot be transferred to an insurer.
197
Earnest money deposit
A type of money that a broker may handle for others in the ordinary course of business; also referred to as good-faith deposit or binder deposit.
198
Dedication
A right, privilege, or interest in real property that one individual has in lands belonging to another; a legal right to trespass; right-of-way authorizing access to or over land.
199
Economic base studies
An analysis of employment in the primary industries of a region.
200
Economic life
The period of time a property may be expected to be profitable or productive; useful life.
201
Effect a sale
A provision in a listing contract requiring the broker to obtain a signed contract from a ready, willing, and able buyer on the terms specified.
202
Effective gross income (EGI)
The resulting amount when vacancy and collection losses are subtracted from potential gross income. (See also Vacancy and collection losses.)
203
Elective share
Failure to comply with the terms of an agreement or to meet an obligation when due.
204
Eminent domain
The constitutional right given to a unit of government to take private property involuntarily if taken for public use and a fair price is paid to the owner.
205
Employer
The individual who hires the services of another.
206
Empty nester
Older parents whose housing needs change after their children have moved away.
207
Encroachment
Unauthorized use of another person's property.
208
Encumbrance
Any lien, claim, or liability affecting the title or attaching to real property.
209
Encumbrance clause
A provision in a deed to real property that warrants that no liens, claims, or liabilities exist on the property being conveyed, except as specified.
210
Equitable title
The right of a vendee to obtain absolute ownership of property to which the vendor has legal title; the interest held by a vendee under a sale contract or contract for deed; beneficial interest.
211
Equity
The market value of a property less any debt against it; in a business entity, assets minus liabilities equals capital (owner's equity); a system of legal rules administered by a court of chancery.
212
Equity of redemption
The right of a mortgagor, before a foreclosure sale, to reclaim forfeited property by paying the entire indebtedness.
213
Erosion
Gradual loss of land due to water or other natural causes.
214
Deposition
A provision in a mortgage permitting the lender to increase the interest rate that is usually tied to an event or a contingency.
215
Escheat
Reversion of property to the state when an owner dies without leaving a will or any known heirs.
216
Escrow account
An account in a bank, title company, credit union, savings association, or trust company used solely for safekeeping customer funds and not for deposit of personal funds; impound account or trust account.
217
Escrow disbursement order (EDO)
A course of action for determining the disposition of a contested deposit.
218
Estate
Tenancy; the interest one holds in real property; the total of one's property and possessions.
219
Estate by the entireties
A large project affecting more than one county.
220
Estate for years
A tenancy measured from a starting date to a termination date (may be for a few days or longer than any natural life; e.g., a leasehold is an estate for years).
221
Estate in reversion
An estate that comes back to the original grantor.
222
Estate in sole
Real property owned by a corporation sole.
223
Estate of remainder
An estate that can become effective only after another estate has terminated.
224
Estoppel
A principle of law that prohibits (stops) a person from defending himself or herself against his or her own acts or lack of action.
225
Estoppel certificate
A written statement that bars the signer from making a claim inconsistent with the instrument (commonly used with a mortgage assumption).
226
Ethics
The moral obligations and duties that a member of a profession or craft owes to the public, to a client, or to other members of the profession or craft.
227
Evidence
Any proof that may legally be admitted in settlement of an issue.
228
Exclusion
The right of an owner to control entry onto the property.
229
Exclusive-agency listing
Employment contract given to one real estate broker as the sole agent for the sale of an owner's property.
230
Documentary stamp tax on deeds, state
An employment contract given to one real estate broker as the sole agent for the sale of an owner's property, with the commission going to that broker regardless of who actually sells the property during the employment contract period.
231
Exculpatory clause
A provision in a mortgage or note in which the lender waives the right to a deficiency judgment against the borrower and the borrower is relieved of personal liability to repay the loan.
232
Executed contract
An agreement in which the terms have been fully performed by all parties; a signed document
233
Executive power, FREC
Duties related to the education of licensees, the regulating of professional practices, and the publishing of materials.
234
Executory contract
An agreement containing some act or condition that remains to be completed.
235
Exempt property
A portion of a purchase price paid prior to closing the transaction. Earnest money may be part of or the entire down payment.
236
Express contract
An agreement wherein the terms are specifically stated by the parties, either orally, in writing, or by a combination of the two.
237
Facsimile ("fax")
An exact copy.
238
Factor market
A resource pool representing the four major elements (factors) of production that are bought and sold.
239
Fair Housing Act
An act contained in Title VIII of the Civil Rights Act of 1968 that created protected classes of people and prohibits discrimination when selling or renting residential property when based on race, color, religion, sex, national origin, familial status, or handicap status.
240
Familial status
As defined in the Fair Housing Act, a situation in which one or more individuals younger than 18 live with a parent or legal guardian. Pregnant women are also specifically covered under the Act.
241
Fannie Mae
A private institution in the secondary mortgage market that buys and sells mortgages.
242
Farm area
A selected and limited geographical district to which a sales associate devotes special attention and study; to farm an area or neighborhood.
243
Federal Deposit Insurance Corporation (FDIC)
A federal agency that insures deposits of member banks and savings associations.
244
Federal Housing Administration (FHA)
Insures mortgage loans made by FHA-approved lenders on homes that meet FHA standards in order to make mortgages more desirable investments for lenders.
245
Federal Housing Finance Board (FHFB)
Supervises regional Federal Home Loan Banks and oversees their mortgage lending.
246
Economic life
A central banking authority that influences the cost, availability, and supply of money.
247
Federal Trade Commission (FTC)
A federal agency that investigates and eliminates unfair and deceptive trade practices.
248
Federally related transaction
Any sale transaction that ultimately involves a federal agency in either the primary or secondary mortgage market. Under FIRREA, state-certified or state-licensed appraisers must be used for certain loans in federally related transactions.
249
Fee simple estate
The most comprehensive and complete interest one can hold in real property; freehold estate. Also known as fee or fee simple absolute.
250
Fiduciary
A person in a position of trust and confidence with respect to another person.
251
Fiduciary relationship
The constitutional right given to a unit of government to take private property involuntarily if taken for public use and a fair price is paid to the owner.
252
Final order
A decision rendered by the FREC.
253
Find a purchaser
A provision in a listing contract requiring a broker to produce a ready, willing, and able buyer or offer on the terms specified.
254
Fixture
An object that was once considered to be personal property but has become real property because of attachment to, or use in, improvements to real property.
255
Flag lot
A lot characterized by a long access road or driveway leading back to the main part of the lot.
256
Follow-up
What a sales associate does after a sale to maintain customer contact and goodwill.
257
Foreclosure
A court process to transfer title to real property used as security for debt as a means of paying the debt by involuntary sale of the property.
258
Formal complaint
An outline of the charges against a licensee that must be answered within the statutory time limit.
259
Formal contract
Any agreement that contains all the essentials of a contract, including that it is in writing and under seal; a contract dependent on a particular form.
260
Fraud
The intent to misrepresent a material fact or to deceive to gain an unfair advantage or to harm another person.
261
Freddie Mac
Formerly called the Federal Home Loan Mortgage Corporation (FHLMC). A secondary mortgage market institution that buys and sells conventional, FHA, and VA loans.
262
Erosion
Title to real property that is absolute and unencumbered.
263
Freehold estate
A tenancy in real property with no set termination date that can be measured by the lifetime of an individual or can be inherited by heirs.
264
Further assurance
A provision in a deed containing a covenant or warranty to perform any further acts the grantee (buyer) might require to perfect title to the property.
265
Gable
A roof design that peaks at the center ridge and extends downward on two opposite sides.
266
General agent
A representative authorized by the principal to perform only acts related to a business or to employment of a particular nature.
267
General lien
A course of action for determining the disposition of a contested deposit.
268
General partnership
An association of two or more persons for the purpose of jointly conducting a business, each being responsible for all the debts incurred in the conducting of that business.
269
General warranty deed
An instrument of conveyance containing the strongest and most comprehensive promises of further assurance possible for a grantor (seller) to convey to a grantee (buyer).
270
Going concern value
The worth of a business, including real estate, goodwill, and earning capacity.
271
Good consideration
A promise that cannot be measured in terms of money, such as love and affection.
272
Good faith
A party's honest intent to transact business, free from any intent to defraud the other party; each party's faithfulness to one's duty or obligations set forth by contract.
273
Goodwill
An intangible asset (value) of a business.
274
Government lot
Fractional piece of land less than a quarter section resulting from geographical features (e.g., lakes, streams) interfering with land surveying.
275
Government National Mortgage Association (GNMA) ("Ginnie Mae")
A federal agency that is part of the Department of Housing and Urban Development (HUD). Ginnie Mae plays an important role in achieving the HUD's goal of providing low-cost mortgage credit to traditionally underserved sectors of the housing market.
276
Government survey system
A type of land description, developed by the federal government for subdividing lands utilizing surveying lines.
277
Grantee
Party who receives a deed or grant; buyer.
278
Ethics
The provision in a deed that specifies the names of the parties involved, the words of conveyance, and a description of the property.
279
Grantor
Party who signs and gives a deed; seller.
280
Green Belt Law, Florida
Legislation that authorizes county property appraisers to assess land used for agricultural purposes according to its current value as agricultural land.
281
Gross income multiplier (GIM)
A rule of thumb for estimating the market value of commercial and industrial properties; the ratio to convert annual income into market value.
282
Gross lease
An agreement for the tenant to pay a fixed (base) rent and the landlord pays all of the expenses associated with the property.
283
Gross rent multiplier (GRM)
An employment contract given to one real estate broker as the sole agent for the sale of an owner's property, with the commission going to that broker regardless of who actually sells the property during the employment contract period.
284
Ground lease
An agreement for the tenant to lease the land only and erect a building on the land.
285
Group license
A right granted a sales associate or broker associate to work various properties owned by affiliated entities under one owner developer.
286
Habendum
A provision in a deed to real property that stipulates the estate or interest the grantee is to receive and the type of title conveyed.
287
Handbook
Published by the Florida Real Estate Commission for study and guidance of students, applicants, licensees, and members of the general public on Florida Statute 475 and other laws, acts, rules, and regulations. (Available on the DRE's Web site.)
288
Handicap status
As defined in the Fair Housing Act, a physical or mental impairment that substantially limits one or more major life activities.
289
Hazard insurance
Coverage by contract whereby one party undertakes to guarantee another party against loss resulting from physical damage to real property.
290
Health ordinances
Local codes that regulate maintenance and sanitation of public spaces.
291
Hearing
A session in which testimony and arguments are presented, especially before an official.
292
Highest and best use
A principle of value that focuses on the most profitable legal use to which a property can be put.
293
Hip
Pitched roof with sloping sides and ends.
294
Fair Housing Act
A mortgage secured by a personal residence. It provides a line of credit available for draws when needed by the homeowner. It is sometimes used as a home improvement loan.
295
Homestead
Term used to describe three separate but related situations: (1) a tax exemption, (2) a tract of land limited in size, and (3) a statutory condition designed to protect the interests of a spouse and lineal descendants.
296
Household
One individual, or a group of individuals, living in one dwelling unit.
297
Hypothecation
To pledge real or personal property as security for a debt or obligation without giving up possession of the property.
298
Immune
Real property that is owned by a unit of government and is not subject to taxation.
299
Implied
A federal agency that insures deposits of member banks and savings associations.
300
Implied contract
An agreement wherein the terms are not stated but are inferred from the conduct of the parties.
301
Implied listing
An employment contract that arises from the conduct of the broker and seller and may be enforceable even though not clearly spelled out in words.
302
Improvement
Addition that increases the value of real property (not repairs).
303
Income
Amount earned or gained, not return of capital.
304
Income capitalization approach
A method for estimating the market value of a property based on the present and future income the property can be expected to generate.
305
Income statement
A summary of all income and expenses of a business for a stated period of time.
306
Incurable
When the cost to correct a defect is greater than the value added by the cure.
307
Ineffective
Status of a license when it is inactive or has been suspended.
308
Industrial
Properties that include (1) sites in industrial parks or subdivisions, (2) redeveloped industrial parcels in central areas, and (3) industrial acreage.
309
Informal hearing
A respondent who does not dispute allegations of material fact in the administrative complaint may request an informal hearing before the FREC for final action on the complaint.
310
Final order
A writ or order by a court forbidding a party from doing something.
311
In-migration
Movement into a community or region by new residents
312
Instrument
Any legal or formal writing, such as a will, option, lease, contract, or deed.
313
Insurance clause
A provision in a mortgage that requires the mortgagor to obtain and keep current a hazard insurance policy.
314
Intangible asset
Something of value lacking physical substance; existing only in connection with something else (e.g., the goodwill of a business).
315
Intangible tax on mortgages, state
What a sales associate does after a sale to maintain customer contact and goodwill.
316
Intensity
The concentration of activity (pedestrian and vehicular traffic) used as a means of designating land for commercial zones.
317
Interest
The price paid for the use of borrowed money; estate.
318
Interest rate
The percentage charged for the use of borrowed money.
319
Interior lot
A lot that is bounded on either side by another lot (lots in the middle of the block---not on the corner).
320
Intermediation
The process whereby financial middlemen consolidate many small savings accounts belonging to individual depositors and invest those funds in large, diversified projects.
321
Intermingle
See Commingle
322
Interpleader
A course of action when two contesting parties cannot reach an arbitrated agreement; A legal proceeding whereby the broker, having no financial interest in the disputed funds, deposits with the court the disputed escrow deposit so that the court can determine who is the rightful claimant.
323
Interval ownership
Fee simple possession, for the limited time purchased (one or more weeks), of a time-share unit, complete with deed, title, and equity.
324
Intestate
Without a will.
325
Investment
The outlay of money in anticipation of income or profit; the sum risked or the property purchased.
326
Gable
A type of security using the sale of real property as the investment.
327
Investment value
The worth of a property to a particular investor based on his or her desired rate of return, risk tolerance, etc.
328
Involuntarily inactive
The license status that results when a license is not renewed at the end of the license period.
329
Involuntary liens
Claims imposed against real property without the consent of the owner (e.g., taxes, special assessments).
330
Joint tenancy
An estate or interest owned by more than one person, each having equal rights to possession and enjoyment; the interest a deceased tenant conveys to surviving tenants by specific wording in the deed establishing the joint tenancy.
331
Joint venture (joint adventure)
An instrument of conveyance containing the strongest and most comprehensive promises of further assurance possible for a grantor (seller) to convey to a grantee (buyer).
332
Judgment
Decree of a court that not only declares that one party owes another party a debt but also fixes the debt amount.
333
Judicial review
The power of a court to reexamine statutes or administrative acts and to determine their validity; a rehearing or appeal to a higher court.
334
Just value
The fair market value.
335
Key lot
A long skinny lot similar to the shaft of a key that is often bounded by as many as five or six lots (the term also refers to a lot that has added value because of its strategic location).
336
Kickback
Payment of money from someone other than the buyer or seller associated with real estate business.
337
Laissez-faire
Allow to act; noninterference by government in trade, industry, and individual action generally.
338
Land
The surface of the earth and everything attached to it by nature.
339
Land description (legal description)
A definite and positive written identification of a specific parcel of land and its location without additional oral testimony.
340
Lay member
One not belonging to or connected with a particular profession.
341
Lease
An estate for years; an agreement that does not convey ownership but does convey possession and use for a period of time and for compensation.
342
Granting clause
A tenancy in real property held under a lease arrangement for a definite number of years; nonfreehold.
343
Legal description
A series of boundary lines on the earth's surface.
344
Legally sufficient
A complaint that contains facts indicating that a violation has occurred of a Florida statute, a DBPR rule, or a FREC rule.
345
Lender's policy
Title insurance issued for the unpaid mortgage amount to protect the lender against title defects.
346
Lessee
A tenant or leaseholder; party given a lease.
347
Lessor
An agreement for the tenant to pay a fixed (base) rent and the landlord pays all of the expenses associated with the property.
348
Level-payment plan
A method for amortizing a mortgage whereby the borrower pays the same amount each month.
349
Leverage
The use of borrowed funds to finance the purchase of an asset; the use of another's money to make more money.
350
Liabilities
Debts; financial obligations; drawbacks.
351
License
A privilege granted by the state to operate as a real estate broker, broker associate, or sales associate; a type of time-share interest.
352
Licensee
An individual who has qualified for, and been registered as, a real estate broker, broker associate, or sales associate.
353
Licensure
Certification as a licensee; the granting by the state of a license to practice real estate.
354
Lien
A claim on property for payment of some obligation or debt.
355
Lienee
One whose property is subject to a claim or charge by another.
356
Lienor
One who has a claim or charge on the property of another.
357
Lien theory
Legal concept that regards a mortgage as a just claim on specific property pledged as security for a mortgage debt.
358
Hearing
Tenancies whose durations are limited to the life of some person; freehold.
359
Limited liability company (LLC)
An alternative, hybrid business entity with the combined characteristics and benefits of both limited partnerships and S corporations.
360
Limited liability partnership
A business entity that features protection from personal liability but with fewer legal restrictions compared with other business entities.
361
Limited partnership
A business entity consisting of one or more general partners and one or more limited partners.
362
Lineal
Descended in a direct family line; relating to or derived from ancestors
363
Liquidated damages
Term used to describe three separate but related situations: (1) a tax exemption, (2) a tract of land limited in size, and (3) a statutory condition designed to protect the interests of a spouse and lineal descendants.
364
Liquidation
The process of determining liabilities and apportioning the assets in order to discharge the indebtedness of a business to be sold.
365
Liquidity
The ability to convert noncash assets into cash quickly; refers to a firm's cash position and its ability to meet obligations.
366
Lis pendens
A pending legal action.
367
Listing
Oral or written employment agreement between a broker (or a sales associate employed by a broker) and the property owner; authorization to sell, rent, or exchange.
368
Litigation
A lawsuit; the act of carrying on a lawsuit; a case before a court of law.
369
Littoral rights
Legal rights related to land abutting an ocean, sea, or lake, usually extending to the high-water mark.
370
Loan correspondent
Generally, a mortgage banker or company that provides services for lending institutions
371
Loan-to-value (LTV) ratio
Relationship between amount borrowed and appraised value (or sale price) of a property.
372
Lot and block
A type of legal description of land.
373
Majority
A person having attained 18 years of age, or having married, or by court order; no longer a minor; a number greater than half the total.
374
Income capitalization approach
The committing of an unlawful act, especially by a public official.
375
Mandamus, writ of
An order of a superior court directing a lower court or body to do some specified act.
376
Mandate
Directive from a higher authority to a lower body.
377
Marketable title (merchantable title)
Rights to real property that are so clear that a buyer may have peaceful and quiet enjoyment of the property free of litigation.
378
Market value
The most probable price a property will bring from a fully informed buyer, willing but not compelled to buy, and the lowest price a fully informed seller will accept if not compelled to sell.
379
Master in chancery
Properties that include (1) sites in industrial parks or subdivisions, (2) redeveloped industrial parcels in central areas, and (3) industrial acreage.
380
Mediation
The act of having a third party attempt to reconcile a dispute between two parties.
381
Meeting of the minds
The point when two people, thinking of the same thing, reach an agreement through an offer and acceptance.
382
Meridian
Any of the imaginary lines of longitude on the earth's surface; in land description, the vertical lines running in a north-south direction parallel to the principal (prime) meridian and separating the various ranges.
383
Metes-and-bounds description
A method of legal description that identifies a property by specifying the shape and boundary dimensions of the parcel. A metes-and-bounds description starts at the point of beginning and follows the boundaries of the land by compass direction and linear measurements and returns to the point of beginning.
384
Middleman
An intermediary who merely brings two parties together.
385
Mill
A unit of money used to specify a property tax rate ($1 for each $1,000 of taxable value).
386
Millage
A tax rate, expressed as the number of mills to be applied.
387
Misdemeanor
Any crime punishable by fine or imprisonment other than in a penitentiary.
388
Misfeasance
A lawful act done in a negligent or unlawful manner.
389
Misrepresentation
A false or misleading statement of a material fact; concealment of a material fact.
390
Interest
The actions undertaken by the Fed to influence the availability and cost of money and credit.
391
Monument
Man-made or natural object used to establish boundaries of land
392
Moral turpitude
An act of corruption, vileness, or moral depravity; a disgraceful action or deed.
393
Mortgage
A written agreement that pledges property as security for payment of a debt.
394
Mortgage banker
An individual (or company) who makes loans with the expectation of reselling them to institutional lenders. (See also Mortgage company.)
395
Mortgage broker
See Commingle
396
Mortgage company
A mortgage loan company that originates, services, and sells loans to investors.
397
Mortgagee
A lender who holds a mortgage on specific property as security for the money loaned to the borrower.
398
Mortgage insurance premium (MIP)
Fee paid by FHA borrowers to obtain a loan (up-front and annual).
399
Mortgagor
A borrower who gives a mortgage on his or her property in order to obtain a loan from a lender.
400
Multiple licenses
Licenses held by a broker in two or more real estate brokerage firms.
401
Multiple-listing service (MLS)
An arrangement among members of a real estate board or exchange that allows each member broker to share listings with other members so that greater exposure is obtained and a greater chance of sale will result.
402
Negative amortization
A financing arrangement whereby monthly mortgage payments are less than required to pay both interest and principal. The unpaid amount is added to the loan balance.
403
Net income
Profit from property or business after expenses have been deducted; effective gross income less operating expenses.
404
Net lease
An agreement for the tenant to pay fixed rent plus property costs such as taxes, insurance, and utilities.
405
Net listing
An agreement or contract to sell or rent a property for a specified minimum net amount for the owner.
406
Joint tenancy
The resulting amount when all operating expenses are subtracted from effective gross income.
407
Nolo contendere
A pleading of no contest by a defendant; a plea in a criminal action not admitting guilt but subjecting the defendant to punishment as if it were a guilty plea.
408
Nonconforming use
Continuing land use that is not in compliance with zoning ordinances.
409
Nonfreehold estate (leasehold interest)
An estate in real property in which ownership is for a determinable time period, as in a lease.
410
Note
Legal evidence of a debt that must accompany a mortgage in Florida; a legally executed pledge to pay a stipulated sum of money. (See also Promissory note.)
411
Notice of noncompliance
The fair market value.
412
Novation
The substitution of a new party and/or new terms to an existing obligation.
413
Obligee
A lender or mortgagee.
414
Obligor
A borrower or mortgagor.
415
Obsolescence
A cause of loss in value.
416
Offer
An intentional proposal or promise made by one party to act or perform, provided the other party acts or performs in the manner requested.
417
Offeree
One who receives an offer, usually the seller.
418
Offeror
One who makes an offer, usually the buyer.
419
Office of Thrift Supervision (OTS)
A branch of the U.S. Treasury Department that replaced the Federal Home Loan Bank Board as regulator of the thrift industry.
420
Open-end clause
A provision in a mortgage allowing the borrower to increase the loan amount as long as the total debt does not exceed the original mortgage loan amount, with the lender often reserving the right to adjust the interest rate to current market rates; a mortgage for future advances.
421
Open listing
An employment contract given to any number of brokers who work simultaneously to sell the owner's property.
422
Legal description
Purchase and sale of U.S. Treasury and federal agency securities.
423
Opinion of title
A formal statement by an attorney regarding the status of a title after examination of the chain of title.
424
Opinion of value
An estimate of a property's worth given by a licensee for the purpose of a prospective sale.
425
Option contract
A right or privilege to purchase or lease real property at a specified price during a designated period based on a sufficient consideration.
426
Optionee
The party who takes an option and pays a consideration.
427
Optionor
The landlord or owner; party granting a lease.
428
Origination fee, loan
A charge by a lender for taking a mortgage in exchange for a loan.
429
Ostensible partnership
One or more parties cause a third party to be deceived into believing that a business relationship exists when no such arrangement exists.
430
Overage (secret profit; secret commission)
Retaining more than the agreed amount of sales commission, without the express knowledge and consent of the parties involved; a form of fraud.
431
Overall capitalization rate (OAR)
The relationship between annual net operating income and the value or sale price of a property.
432
Overimprovement
An addition or change to property not in line with its highest and best use, or a betterment that exceeds that justified by local conditions.
433
Owner-developer
An unlicensed entity that sells, exchanges, or leases its own property.
434
Owner's policy
Title insurance issued for the total purchase price of the property to protect the new owner against unexpected risks.
435
Package mortgage
A loan covering both real and personal property.
436
Parol contract
An agreement that is not in writing.
437
Partially exempt
Property subject to taxation, but the owner is partially relieved of the burden.
438
Lienor
Stipulates the conditions under which the mortgagee will grant freeing building lots from a mortgage lien upon payment of a certain amount of money.
439
Partnership
Two or more competent individuals each of whom agrees to share in the profits and losses of the business.
440
Pass-through securities
Certificates pledging a group (pool) of existing government-backed mortgages used for the purpose of channeling funds into housing markets.
441
Penalty clause
A provision in a mortgage that requires the borrower to pay a penalty in money if the mortgage payments are made in advance of the normal due date or if the mortgage is paid in full ahead of schedule.
442
Percentage lease
An agreement for the tenant to pay rent based on the gross sales received by doing business on the leased property.
443
Per diem
A business entity that features protection from personal liability but with fewer legal restrictions compared with other business entities.
444
Performance
Point when a party or parties to a contract fulfill the promises or obligations in the contract.
445
Personal property
Tangible and movable property (transferred by bill of sale); property not classified as real property. Also known as personalty or chattel.
446
Personal representative
Administrator of a deceased person's estate.
447
Petition for review
A request to a court of appeal (appellate court) asking it to examine the record of the proceedings in a specific case. (See also Judicial review.)
448
Pier
A type of building foundation that uses columns of masonry to support the structure.
449
Pitch
The slope of a roof.
450
Plaintiff
The person or party bringing suit or charges; the complaining party; complainant.
451
Planned unit development (PUD)
A residential project with mixed land uses and high residential density.
452
Planning
Devising ways and means for achieving desired goals.
453
Planning commission (board)
An official agency, usually made up of appointed lay citizens, that directs and controls the use, design, and development of land in a city, county, or region.
454
Littoral rights
Subdivision plat map
455
Plottage
The added value as a result of combining two or more properties into one large parcel.
456
Point, mortgage discount
A charge of 1 percent of the mortgage value; assessment by a lender to increase the interest yield to compete with the interest yield from other types of investments. (See also Discount points.)
457
Point of beginning (POB)
The starting (and ending) place in a land survey using the metes-and-bounds method of property description.
458
Point of contact information
Any means by which to contact the brokerage firm or individual licensee including mailing address(es), physical street address(es), e-mail address(es), telephone number(s), or facsimile telephone number(s).
459
Police power
A person having attained 18 years of age, or having married, or by court order; no longer a minor; a number greater than half the total.
460
Policy manual
The notebook of written rules and regulations that set desired standards and procedures in an office.
461
Potential gross income (PGI)
The total annual income a property would produce with 100 percent occupancy and no collection or vacancy losses.
462
Premises section
(See Granting clause.)
463
Prepayment clause
A provision in a mortgage that allows the mortgagor to pay the mortgage debt ahead of schedule without penalty.
464
Prepayment penalty
The amount set by the creditor that the debtor is charged for retiring the debt early.
465
Prescription, easement by
A method of acquiring an interest in real property through long and continued use.
466
Present value
The worth of all future benefits of an investment in terms of today's dollars.
467
Price
The amount paid for something.
468
Prima facie evidence
Requiring no further proof; acceptable on the face of.
469
Primary lender
Financial institution that makes mortgage loans directly to borrowers (e.g., savings association, bank).
470
Meridian
A source for the purchase of a mortgage loan by a borrower.
471
Principal
The party employing the services of a real estate broker; amount of money borrowed in a mortgage loan, excluding interest and other charges.
472
Principal meridians
Imaginary lines running north and south and crossing a base line at a definite point; used by surveyors for reference in locating and describing land under the government survey system.
473
Private mortgage insurance (PMI)
Needed to insure all of the mortgage representing more than 80 percent of appraised value or purchase price.
474
Probable cause
Reasonable grounds or justification for prosecuting.
475
Probation
A tax rate, expressed as the number of mills to be applied.
476
Procuring cause
The person whose efforts are the cause of an executed sale contract, regardless of who actually writes the contract.
477
Professional Association (PA)
A business corporation consisting of one or more individuals engaged in a primary business that provides a professional service (e.g., lawyer, doctor).
478
Profit
The amount one makes over and above one's cost.
479
Pro forma statement
An estimate of the economic results of a proposed project; a projected income statement.
480
Progression
The principle that states that the value of an inferior property is enhanced by its association with superior properties of the same type.
481
Promissory note
A written promise to pay a specific amount.
482
Property
A bundle of legal rights.
483
Property management
The leasing, managing, marketing, and overall maintenance of property for others.
484
Proprietary lease
A written agreement between the owner-corporation and the tenant-stockholder in a cooperative apartment.
485
Prorate
To divide or assess proportionate shares of charges and credits between the buyer and the seller according to their individual period of ownership.
486
Mortgage broker
Comments or opinions not made as representations of fact and thus not grounds for misrepresentation.
487
Purchase-money mortgage (PMM)
Any new mortgage taken as part of the purchase price of real property by the seller.
488
Quadrant
Quarter; any of the four quarters into which something is divided.
489
Qualification
The process of reviewing prior to approval (of a buyer's housing needs and financial abilities, of a borrower's mortgage loan application, or of an application for licensure). (See also Underwriting.)
490
Quasi
As if; of a similar nature; seemingly.
491
Quasi-legislative
A borrower who gives a mortgage on his or her property in order to obtain a loan from a lender.
492
Quasi-judicial
Powers delegated to the FREC to discipline real estate licensees for violations of real estate license law and FREC administrative rules.
493
Quiet enjoyment
A provision in a deed guaranteeing that the buyer may enjoy possession of the property in peace and without disturbance by reason of other claims on the title by the seller or anyone else.
494
Quiet title
A suit or action in a court to remove a defect, cloud, or claim against the title to real property.
495
Quitclaim deed
A type of deed that will effectively convey any present interest, claim, or title to real property that the seller (grantor) may own.
496
Quorum
The minimum number of persons who may lawfully transact the business of a meeting (51 percent or four of the members of the Florida Real Estate Commission).
497
Range
In the government survey system of land description, a vertical strip of land six miles wide located between two consecutive submeridians or range lines.
498
Range lines (submeridians)
The surveyed north-south lines running every six miles east and west of the principal meridian.
499
Ratio
The relationship in quantity, size, or amount between two things; proportion.
500
Ready, willing, and able?
Ready" indicates the buyer is in a position and of a mind to complete the transaction; "willing" implies that the buyer desires to do so at the price and terms agreed; "able" refers to the buyer's financial ability to produce the required money when necessary.
