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Flashcards in modern real estate book vocabularyy Deck (167):
1

easement

a right to use the land of another for a specific purpose, such as for a right-of-way or utilities; an incorporeal interest in land because it does not include a right of possession

2

easement appurtenant

an easement that follows along with the land

3

easement by implication

an easement that occurs when a party's actions reflect the intention to create an easement

4

easement by necessity

an easement allowed by law as necessary for the full enjoyment of a parcel of real estate (e.g., a right of ingress and egress over a grantor's land)

5

easement by prescription

an easement acquired by open, notorious, continuous, hostile and adverse use of the property for the period of time prescribed by state law

6

easement in gross

an easement that is not created for the benefit of any land owned by the owner of the easement but that attaches personally to the easement owner. for example, a right granted by a property owner to a friend to use a portion of the property for the rest of the friend's life would be an easement in gross

7

economic life

the number of years during which an improvement will add value to land

8

electronic contracting

a process of integrating information electronically in a real estate transaction between clients, lender, and title and closing agents

9

Electronic Signatures in Global and National Commerce Act (E-Sign)

an act that makes contracts (including signature) and records legally enforceable regardless of the medium in which they are created

10

emblements

growing crops, such as corn, that are produced annually through labor and industry; also called fructus industriales

11

eminent domain

the right of a government or municipal quasi-public body to acquire property for public use through a court action called condemnation, in which the court decides that the use is a public use and determines the compensation to be paid to the owner

12

employee

for tax purposes, someone who works as a direct employee of an employer and has employee status. the employer is obligated to withhold income taxes and social security taxes from the compensation of employees. see also independent contractor

13

employment agreement

employment contract

14

employment contract

a document evidencing formal employment between employer and employee or between principal and agent or representative. in the real estate business, this generally takes the form of the agreement between broker and sales associate, client representation agreement (including a listing agreement or buyer representation agreement), or property management agreement

15

enabling acts

state legislation that confers zoning and other powers on municipal governments

16

encapsulation

a method of controlling environmental contamination by sealing off a dangerous substance, such as asbestos

17

encroachment

a building or some portion of it - a wall or fence, for instance - that extends beyond the land of the owner and illegally intrudes on the land of an adjoining owner or public street or alley

18

encumbrance

anything - such as a mortgage, tax, or judgment lien; an easement; a restriction on the use of the land; or an outstanding dower right - that may diminish the value or use and enjoyment of a property

19

enforceable contract

a contract that meets all the elements of a valid contract, including compliance with any applicable statute of frauds or other law that requires it to be in writing and signed by the parties

20

environmental impact statement (EIS)

a statment that details the impact a project will have on the environment

21

environmental site assessment (ESA)

an evaluation of property to show that due care was exercised in the determination of environmental impairments

22

equal credit opportunity act (ECOA)

the federal law that prohibits discrimination in the extension of credit because of race, color, religion, national origin, sex, age, marital status, or receipt of public assistance

23

equalization

the raising or lowering of assessed values for tax purposes in a particular county or taxing district to make them equal to assessments in other counties or districts

24

equalization factor

a factor (number) by which the assessed value of a property is multiplied to arrive at a value for the property that is in line with statewide tax assessments. the ad valorem tax would be based on this adjusted value

25

equitable lien

satutory lien

26

equitable right of redemption

the right of a defaulted property owner to recover the property before its sale by paying the appropriate fees and charges

27

equitable title

the interest held by a vendee (buyer) under a contract for deed or an installment contract in which title is not immediately transferred; the equitable right to obtain absolute ownership to property when legal title is held in another's name

28

equity

the interest or value that an owner has in property over and above any indebtedness

29

equity buildup

that portion of the loan payment directed toward the principal rather than the interest, plus any gain in property value due to appreciation

30

erosion

the gradual and sometimes imperceptible wearing away of the land by natural forces, such as wind, rain, and flowing water

31

escheat

the reversion of property to the state or county, as provided by state law, in cases in which a decedent dies intestate without heirs capable of inheriting, or when the property is abandoned

32

escrow

the closing of a transaction through a third party called an escrow agent, or escrowee, who receives certain funds and documents to be delivered upon the performance of conditions outlined in the escrow instructions

33

escrow account

the trust account established by a real estate professional under the provisions of the license law for the purpose of holding funds on behalf of the real estate professional's principal or some other person until the consummation or termination of a transaction; trust account established by the escrow agent to hold funds pending distribution at the closing of a transaction

34

escrow closing

occurs when a disinterested third party is authorized to act as escrow agent (escrow holder) and to coordinate the closing activities on behalf of the buyer and the seller

35

escrow contract

an agreement between a buyer, a seller, and an escrow holder setting forth rights and responsibilities of each

36

escrow instructions

a document that sets forth the duties of the escrow agent, as well as the requirements and obligations of the parties, when a transaction is closed through an escrow

37

estate (tenancy) at sufferance

the tenancy of a lessee who lawfully comes into possession of a landlord's real estate but who continues to occupy the premises improperly after the lease rights have expired

38

estate (Tenancy) at will

an estate that gives the lessee the right to possession until the estate is terminated by either party; the term of this estate is indefinite

39

estate for term

estate for years

40

estate (tenancy) for years

an interest for a certain exact period of time in property leased for a specified consideration

41

estate (tenancy) from period to period

an interest in leased property that continues from period to period - week to week, month to month, or year to year

42

estate in land

the degree, quantity, nature, and extent of interest a person has in real property

43

estate tax

federal tax on a decedent's real nad personal property

44

estoppel

method of creating an agency relationship in which someone states incorrectly that another person is his agent and a third person relies on that representation

45

estoppel certificate

a document in which a borrower certifies the amount owed on a mortgage loan and the rate of interest

46

ethics

the system of moral principles and rules that becomes the standard for professional conduct

47

eviction

a legal process to oust a person from possession of real estate

48

evidence of title

proof of ownership of property; commonly a certificate of title, an abstract of title with lawyer's opinion, title insurance, or a torrens registration certicate

49

exception

the exclusion of a part of the property conveyed

50

exchange

a transaction in which all or part of the consideration is the transfer of like-kind property (e.g., real estate for real estate)

51

exclusive agency listing

a listing contract under which the owner appoints a real estate professional as her exclusive agent for a designated period of time to sell the specified property, on the owner's stated terms, for a commission. the owner reserves the right to sell the property without paying anyone a commission if the sale is to a prospect who has not been introduced or claimed by the real estate professional

52

exclusive buyer representation agreement

agreement in which the buyer works with only one broker, although the broker is free to represent other buyer clients

53

exclusive right-to-sell listing

a listing contract under which the owner appoints a real estate professional as his exclusive agent for a designated period of time to sell the specified property on the owner's stated terms and agrees to pay the real estate professional a commission when the property is sold, whether by the real estate professional, the owner, or another real estate professional

54

executed listing

a contract in which all parties have fulfilled their promises and thus performed the contract

55

execution

the signing and delivery of an instrument. also, a legal order directing an official to enforce a judgment against the property of a debtor

56

executor

an appointed person who carries out the directions of a will. a woman might be referred to as executrix, although executor is the term most commonly used to refer to either a man or a woman

57

executory contract

a contract under which something remains to be done by one or more of the parties

58

express agency

an agency relationship based on a formal agreement between the parties

59

express agreement

an oral or written contract in which the parties state the contract's terms and express their intentions in words

60

express contract

express agreement

61

external depreciation

reduction in a property's value caused by outside factors (i.e., those that are off the property)

62

external obsolescence

incurable depreciation caused by factors not on the subject property, such as environmental or economic factors

63

facilitator

nonagent

64

fair housing act

the federal law that prohibits discrimination in housing based on race, color, religion, sex, disability, familial status, and national origin

65

fair housing amendments act of 1988

expansion of the fair housing act to include families with children and those with physical or mental disabilities

66

familial status

one or more individuals under age 18 living with a parent or guardian; also included a woman who is pregnant and anyone who is in the process of assuming custody of a child under age 18

67

Fannie Mae

a government-supervised enterprise established to purchase any kind of mortgage loans in the secondary mortgage market from the primary lenders

68

Farmer Mac

the federal agricultural mortgage corporation - a privately owned and publicly traded company established by congress to create a secondary market for agricultural mortgage and rural utilities loans and the portions of agricultural and rural development loans guaranteed by the us department of agriculture (USDA)

69

federal deposit insurance corporation ( FDIC )

an independent federal agency established by congress to exaxamine and supervise financial institutions, manage receiverships, and insure deposits (currently up to $250,000 per depositor per financial institution)

70

federal emergency management agency (FEMA)

a federal agency that is responsible for assisting the nation in preparing for, protecting against, responding to, and recovering from hazards

71

federal funds rate

the rate recommended by the federal reserve for the member banks to charge each other on short-term loans. these rates form the basis on which the banks determine the percentage rate of interest they will charge their loan customers

72

federal home loan mortgage corporation

freddie mac

73

federal national mortgage association

fannie mae

74

federal reserve system (fed)

the country's central banking system, which establishes the nation's monetary policy by regulating the supply of money and interest rates

75

fee-for-service

arrangement by which a consumer asks a real estate professional to perform specific real estate services for an agreed-upon fee

76

fee simple

the highest interest in real estate recognized by the law; the holder is entitled to all rights to the property

77

fee simple absolute

the maximum possible estate or right of ownership of real property, continuing forever

78

fee simple defeasible

defeasible fee estate

79

fee simple determinable

a fee simple estate qualified by a special limitation. language used to describe the limitation includes the words "so long as", "while", or "during"

80

fee simple subject to a condition subsequent

an estate carrying the limitation that, if it is no longer used for the purpose conveyed, it reverts to the original grantor by the right of reentry

81

feudal system

a system of ownership usually associated with precolonial England, in which the king or other sovereign is the source of all rights. the rights. the right to possess real property was granted by the sovereign to an individual as a life estate only. upon the death of the individual, title passed back to the sovereign, not to the decedent's heirs

82

FHA-insured loan

a loan insured by the federal housing administration and made by an approved lender in accordance with fha regulations

83

fiduciary

one in whom trust and confidence is placed; a reference to a real estate professional employed under the terms of a listing contract or buyer representation agreement

84

fiduciary relationship

a relationship of trust and confidence, as between trustee and beneficiary, attorney and client, or principal and agent.

85

financial institutions reform, recovery, and enforcement act (FIRREA)

this act restructured the savings and loan association regulatory system; enacted in response to the savings and loan crisis of the 1980s

86

financing

the business of providing the funds that make real estate transactions possible

87

first mortgage

a mortgage that has priority over all other mortgages

88

fiscal policy

the government's policy in regard to taxation and spending programs. the balance between these two areas determined the amount of money the government will withdraw from or feed into the economy, which can counter economic peaks and slumps

89

fixture

an item of personal property that has been converted to real property by being permanently affixed to the realty

90

forcible detainer

removal of a tenant from a rental property by the landlord if the tenant has breached one of the terms of the lease agreement, in compliance with statuary law.

91

foreclosure

a legal procedure whereby property used as security for a debit is sold to satisfy the debt in the event of default in payment of the mortgage note or default of other terms in the mortgage document. the foreclosure procedure brings the rights of the parties to a conclusion and passes the title in the mortgaged property to either the holder of the mortgage or a third party who may purchase the realty at the foreclosure sale. depending on the priority of the foreclosed mortgage, the property may be sold free of all other encumbrances incurred prior to the sale.

92

formal will/ witnessed will

a document having written instructions of property disbursements upon the death of the owner. the document must be signed and witnessed

93

formaldehyde

an air pollutant that is a colorless chemical used to manufacture building materials and many household products, such as particleboard, hardwood plywood paneling, and urea-formaldehyde foam insulation

94

fraud

deception intended to cause a person to give up property or a lawful right

95

freddie mac

a government-supervised enterprise established to purchase primarily conventional mortgage loans in the secondary mortgage market

96

freehold estate

an estate in land in which ownership is for an indeterminate length of time, in contract to a lease-hold estate

97

front footage

the measurement of a parcel of land by the number of feet of street or road frontage

98

frontage

the length of property along the street or waterfront

99

fully amortized loan

a loan consisting of equal, regular payments satisfying the total payment of principal and interest by the due date

100

functional obsolescence

a loss of value to an improvement to real estate arising from problems of design or utility

101

future interest

a person's present right to an interest in real property that will not result in possession or enjoyment until sometime in the future, such as a reversion or right of reentry

102

gap

a defect in the chain of title of a particular parcel of real estate; a missing document or conveyance that raises doubt as to the present ownership of the land

103

general agent

one who is authorized by a principal to represent the principal in a specific range of matters

104

general lien

the right of a creditor to have all of a debtor's property - both real and personal - sold to satisfy a debt

105

general partnership

partnership

106

general real estate tax

a tax that is made up of the taxes levied on the real estate by government agencies and municipalities

107

general warranty deed

a deed in which the grantor fully warrants good, clear title to the premises. used in most real estate deed transfers, a general warranty deed offers the greatest protection of any deed.

108

ginnie mae

a government agency that plays an important role in the secondary mortgage market. it guarantees mortgage-backed securities using FHA-insured and VA-guaranteed loans as collateral

109

good and indefeasible title

a title that cannot be annulled or rendered void

110

good faith estimate (GFE)

an estimate of all closing fees that was formerly provided to a borrower within three days of the loan application as was required by the real estate settlement procedures act (respa)

111

government national mortgage association

ginnie mae

112

government-sponsored enterprises (GSEs)

organizations created by the federal government (Fannie Mae, Freddie Mac, Farmer Mac, Ginnie Mae) to help increase loan opportunities for homebuyers

113

government survey system

retangular (government) survey system

114

graduated-payment mortgage (GPM)

a loan in which the monthly principal and interest payments increase by a certain percentage each year for a certain number of years and then level off for the remaining loan term

115

grantee

a person who receives a transfer of real property from a grantor

116

granting clause

words in a deed of reconveyance that state the grantor's intention to convey the property at the present time. this clause is generally worded as "convey and warrant"; "grant"; "grant, bargain, and sell"; or the like

117

grantor

the owner transferring title to or an interest in real property to a grantee

118

gross income multiplier (GIM)

a figure used as a multiplier of the gross annual income of a property to produce an estimate of the property's value; usually used for commercial property

119

gross lease

a lease of property according to which a landlord pays all property charges regularly incurred through ownership, such as repairs, taxes, insurance, and operating expenses. most residential leases are gross leases

120

gross rent multiplier (GRM)

the figure used as a multiplier of the gross monthly income of a property to produce an estimate of the property's value; usually used for single-family residential property

121

ground lease

a lease of land only, on which the tenant usually owns a building or is required to build as specified in the lease. such leases are usually long-term net leases; the tenantn's rights and obligations continue until the lease expires or is terminated through default

122

groundwater

water that exists exists under the earth's surface within the tiny spaces or crevices in geological formations

123

growing-equity mortgage

loan in which the monthly payments increase annually, with the increased amount being used to directly reduce the principal balance outstanding and thus shorten the overall term of the loan

124

habendum clause

that part of a deed beginning with the words "to have and to hold," following the granting clause and defining the extent of ownership the grantor is conveying

125

habitability

a property that is suitable for living in or on

126

heir

one who might inherit or succeed to an interest in land under the state law of descent when the owner dies without leaving a valid will

127

highest and best use

the legally permitted and physically possible use of a property that would produce the greatest net income and, thereby, develop the highest value

128

holdover tenancy

a tenancy in which a lessee retains possession of leased property after the lease has expired nad the landlord, by continuing to accept rent, agrees to the tenant's continued occupancy as definied by state law

129

holographic will

a will that is written, dated, and signed in the testator's handwriting

130

home equity loan

a loan under which a property owner uses the property as collateral and can then draw funds up to a prearranged amount against the property. also called a home equity line of credit, or HELOC

131

home inspection

a thorough visual survey of a property's structure, systems, and site conditions conducted by a professional

132

Home Mortgage Disclosure Act

a federal law, implemented at its creation by Regulation C of the Federal Reserve, that requires lenders to annually disclose the number of loan applications and loans made in certain areas to avoid the practce of redlining. On July 21, 2011, the rule-making authority of the law was transferred to the Consumer Financial Protection Bureau.

133

homeowners insurance

insurance that covers a residential real estate owner against financial loss from fire, theft, public liability, and other common risks

134

homestead

land that is owned and occupied as the family home. in many states, a portion of the area or value of this land is protected or exempt from judgments for debts other than those secured by the property

135

Housing for Older Persons Act of 1995 (HOPA)

amended the Fair Housing Act to provide that housing intended for persons aged 55 or older no longer needs to have significant facilities and services designed for the elderly

136

HUD-1

A form that was formerly used to itemize fees and services charged to a borrower and seller during a real estate transaction

137

hydraulic fracturing (fracking)

the process used to extract natural gas from the deep layers of rock in which it is embedded

138

hypothecation

to pledge property as security for an obligation or loan without giving up possession of it

139

immobility

the fact that property cannot be relocated to satisfy demand where supply is low, nor can buyers always relocate to areas with greater supply

140

implied agency

if the actions of the parties imply that they have mutually consented to an agency relationship, an implied agency relationship is formed

141

implied agreement

a contract under which the agreement of the parties is demonstrated by their acts and conduct

142

implied contract

implied agreement

143

implied warranty of habitability

a theory in landlord/tenant law in which the landlord renting residential property implies that the property is habitable and fit for its intended use

144

impound accounts

an account that the mortgage lender may require a borrower to have to accumulate funds to pay future real estate taxes and insurance premiums

145

improvement

1) any structure, usually privately owned, erected on a site to enhance the value of the property (e.g., a building fence, or driveway) 2) a publicly owned structure added to or benefiting (e.g., a curb, sidewalk, street, or sewer)

146

income approach

the process of estimating the value of an income-producing property through capitalization of the annual net income expected to be produced by the property during its remaining useful life

147

income property

property held for current income as well as a potential profit upon its sale

148

incorporeal right

a nonpossessory right in real estate (e.g., an easement or a right-of-way)

149

independent contractor

someone who is retained to perform a certain act but who is subject to the control and direction of another only as to the end result and not as to the way in which the act is performed. unlike an employee, an independent contractor pays for all expenses and social security and income taxes and received no employee benefits. most real estate sales associates are independent contractors, meeting the internal revenue service definition for a qualified real estate agent

150

index

an objective economic indicator to which the interest rate for an adjustable-rate mortgage is tied

151

inflation

the gradual reduction of the purchasing power of the dollar, usually related directly to increases in the money supply by the federal government

152

inheritance taxes

state-imposed taxes on a decedent's real and personal property

153

installment sale

a transaction in which the sales price is paid in two or more installments over two or more years. if the sale meets certain requirements, a taxpayer can postpone reporting such income until future years by paying tax each year only on the proceeds received that year

154

interest

a charge made by a lender for the use of money

155

interest-only loan

a loan that only requires the payment of interest for a stated period of time with the principal due at the end of the term

156

interim financing

a short-term loan usually made during the construction phase of a building project (often referred to as a construction loan)

157

intermediary

nonagent

158

internal revenue service tax lien

a lien charged by the internal revenue service for nonpayment of income taxes

159

internet data exchange (IDX) policy

policy that allows all multiple listing service (MLS) members to restrict internet access to MLS property listings

160

interstate land sales full disclosure act (ILSA)

a federal law that regulates the sale of certain real estate in interstate commerce

161

intestate

the condition of a property owner who dies without leaving a valid will. title to the property will pass to the decedent's heirs, as provided in the state law of descent

162

intrinsic value

an appraisal term referring to the value of a property unaffected by a person's personal preferences

163

inverse condemnation

an action brought by a property owner seeking just compensation for diminished use and value of land because of an adjacent property's public use

164

investment

money directed toward the purchase, improvement, and development of asset in expectation of income or profits

165

involuntary alienation

alienation

166

involuntary lien

a lien placed on property without the consent of the property owner

167

joint tenancy

ownership of real estate between two or more parties who have been named in one conveyance as joint tenants. upon the death of a joint tenant, the decedent's interest usually passes to the surviving joint tenant or tenants by the right or survivorship