Real Estate Glossary Flashcards by Despina Chryssopoulos

Section 1031 of the Internal Revenue Code allows the owner of real property to sell that property and then reinvest the proceeds in a “like-kind” property and defer paying any capital gains taxes

1031 tax-deferred exchange

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Land parcels that share a common border

Abutting

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Allows a lender to demand immediate and full payment of all debt owed if a buyer defaults

Acceleration Clause

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The addition of value to property through labor or the addition of new materials, including an increase in land through natural processes

Accession

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An incidental or subordinate use to the primary use of the property

Accessory use

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One of the fiduciary duties, accounting means an agent is accountable for any funds or properties entrusted to the agent. This is a duty that survives termination of an agency agreement

Accounting

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The gradual growth in the size of land parcel due to water-deposited sand, silt, or gravel

Accretion

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Expenses that are accruing but are not yet payable (e.g. property taxes)

Accrued items

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A requirement for deed transfer; a public official must acknowledge the grantor’s signature

Acknowledgement

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A unit of land that is equal to 43,540 square feet

Acre

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Intentional misstatement of a material fact

Active fraud

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Abuse of a property by a person who holds possession through a life estate

Act of waste

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Landlord evicts the tenant (who has breached the lease agreement_ by filing a suit for possession (known as a forcible detainer suit) with the justice of the peace in the applicable precinct

Actual eviction

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Express notice given directly to a person

Actual notice

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An addition to a real estate contract that’s added before contract acceptance

Addendum

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A mortgage with a rate that adjusts based on changes in a market index

Adjustable rate mortgage (ARM)

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The final basis for taxing purposes computed by taking acquisition costs plus capital improvements and subtracting depreciation taken

Adjusted basis

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The dollar value or percentage added to or subtracted from the sales price of a comparable to arrive at an indicated value for the subject

Adjustment

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The date on which the interest rate changes on an adjustable rate mortgage

Adjustment date

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A debit or credit at closing to coincide with appropriate closing costs

Adjustment (loan)

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Helps to ensure that no governmental entity acts without an opportunity for public input by requiring public disclosure and discourse before rulemaking

Administrative Procedure Act

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The process of obtaining a client’s go-ahead to dual agency should it arise. A client should always be given the option

Advance consent to dual agency

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A fact that might cause the buyer to change his mind about purchasing the property

Adverse material fact

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A person actually and visibly possesses another’s real property for a statutory length of time and then claims as his or her own; openly hostile to another’s ownership claim

Adverse possession

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Specifies style or architecture of buildings in an area in order to preserve charm, feel, etc.

Aesthetic zoning

A sworn statement assuring that no title defects have occurred since the date of the last title search

Affidavit of title

The relationship between the real estate professional and the person or persons being represented

Agency

A disclosure form that describes the possible agency relationships to a consumer

Agency disclosure form

Law related to the agency relationship

Agency law

One who acts on behalf of another in a business transaction

Agent

A specific section of the open space above a property

Air lot

Right to use the airspace above the land may be sold or leased independently of the land itself

Air rights

Newly formed land created by deposits from water action

Alluvion

An agreement between a shareholder and a cooperative which states the extent of allowable remodeling/alterations to the shareholder's unit

Alteration agreement

A change to an existing contract

Amendment

A federal anti-discrimination law to protect persons with disabilities from discrimination in public accommodations and commercial facilities; also mandates easy access in new multi-family housing with four or more units

Americans with Disabilities Act of 1990

The paying off of a debt with regular installments over a fixed repayment schedule

Amortization

A table that shows how much of each payment will apply toward principal and how much toward interest for the loan term; also shows decrease in loan balance until paid off

Amortization schedule/chart

Amount of current or electricity flowing through electrical wires

Amperage

A large commercial tenant that draws in traffic to a mall or shopping center

Anchor store/anchor tenant

The conversion of personal property into real property

Annexation

A rate derived according to a government formula that's intended to reflect the true cost of financing that allows consumers to compare loan products; includes financing fees, so it will always be higher than the actual interest rate on a loan

Annual percentage rate (APR)

An estimate of value as of a specific date and for a specific use

Appraisal

Contract clause that, if the property doesn't appraise at or above the sales price, the buyer is allowed to terminate

Appraisal contingency

An estimate of value as of a specific date, and for a specific use

Appraised value

One who performs an appraisal

Appraiser

Increase in property value

Appreciation

Automatic rights inherent in property ownership

Appurtenances

A fibrous material found in rocks and soil, previously used in construction materials for its insulating and fire-retardant strength

Asbestos

A chronic lung disease caused by breathing asbestos fibers

Asbestosis

The process of combining separate adjacent parcels of land into one piece

Assemblage

The dollar amount to which the local tax rate is multiplied to determine property tax owed

Assessed value

Charge against a property; for instance, condominiums will have periodic assessments for maintenance and repairs of common areas

Assessment

Items of value owned by an individual; often used when qualifying for financing

Asset

The substitution of tenants, putting the responsibility for the lease contract in the new tenant's hands. Requires written permission of landlord

Assignment (rentals)

When a new party to a contract agrees to satisfy the form party's obligations. Unless there is a novation (a new contract) the original parties remain liable for the contract terms

Assignment (contracts)

The transfer of a mortgage from the original lender to another

Assignment (mortgages)

The assignor is the person assigning the lease to someone (the assignee)

Assignor/assignee

A mortgage that can be assumed when property transfers ownership (requires borrower to qualify for the loan)

Assumable mortgage

A buyer agrees, in writing, to take over the seller's loan payments

Assumption

A representative given the authority to transfer a property through the use of a power of attorney document

Attorney-in-fact

Sale in which highest bidder buys the property

Auction

A loss of existing land by the sudden change in a watercourse washing it away

Avulsion

A mortgage that has lower initial payments that do not amortize and provide for a "catch up" lump sum to be paid at a specific time

Balloon mortgage

Lump sum payment, usually at the end of a loan period

Balloon payment

The legal process of discharging or restructuring a borrower's debts

Bankruptcy

A deed where there is at most one warranty: that the current owner has not encumbered it

Bargain and sale deed

An imaginary line that runs east and west and crosses the principal meridian at a specified point; it is used by surveyors as a reference point to locate and describe land under the rectangular survey system

Base line

Square footage below ground

Basement

A permanent affixed brass plaque that is numbered and is used as a point of reference by surveyors when measuring elevation

Benchmark

A person entitled to the benefit of a trust arrangment

Beneficiary

Personal property that is willed

Bequest/legacy

A document transferring title to personal property

Bill of sale

A mortgage in which the borrower makes payment every two weeks, resulting in 13 payments a year instead of 12. Some borrowers use this strategy to pay off their loan earlier

Biweekly mortgage

An illegal practice in which licensees or others encourage homeowners to sell because of an influx or expected influx of minorities into the area

Blockbusting

A building plan with an architect's or engineer's stamp that includes the layout of the rooms and their measurements, and indicates location of windows, doors, fixtures, and major appliances

Blueprint

A package of financial and personal information presented to a cooperative board when applying to become a shareholder in the co-op

Board package

Market for buying and selling of (frequently) 30-year treasury bonds. Yield on bonds often rises and falls as fixed rate mortgages do

Bond market

Determines a probable range of property values by comparing a group of comparable sales to the subject

Bracketing

One or more parties fail to meet the terms of their agreement

Breach of contract

A temporary loan used to cover the interval between two transactions

Bridge loan

A measure of heat energy (the amount of hear required to raise the temperature of one pound of water by one degree Fahrenheit)

British Thermal Unit (BTU)

Written contract between client and broker stating broker's responsibility to represent client. Must be in writing to be valid

Brokerage engagement

The person responsible for the real estate activities of licensees in a corporation or other business entity

Broker of record

An opinion of value prepared by a real estate licensee; similar to a comparative market analysis, but not as detailed; a lender or relocation company generally orders the BPO

Broker's price opinion (BPO)

An abandoned commercial or industrial site that is believed to contain toxic waste

Brownfield

A mortgage in which taxes and insurance are added to the payment for principal and interest

Budget mortgage

A strip of land used to separate land dedicated to one use from land of another use (for instance, residential from commercial). Often the buffer zone is a green space or other dedicated land such as a park

Buffer zone

Rules to ensure a safe, properly functioning environment for occupants of a building

Building code

Authority to construct a building or residential property by the local government

Building permit

Written narrative of the building plan; describes major systems, construction details, landscaping, and design features not captured in the building plan

Building specifications

The rights of ownership that come with owning real property; includes both tangible and intangible rights; may be sold separately from the land itself

Bundle of Rights

A financing technique in which the buyer obtains a lower interest rate by buying down the interest rate at the time the loan is made

Buydown

Opportunity to build trust with a potential client, showcase your expertise, and learn more about the buyer's needs

Buyer presentation

An agency agreement between a buyer and an agent to provide representation; it explains the duties of the agent to the buyer and the duties of the buyer to the agent

Buyer's agency agreement

The agent representing the buyer, and only the buyer in a real estate transcation

Buyer's agent

The rules of an association, such as homeowner's association or cooperative

Bylaws

Controlling the assault of non-solicited pornography and marketing act; protects consumers against unwanted email solicitations

CAN-SPAM Act

Expenses required to improve or maintain a building

Capital expenses

Permanent structural changes, remodels, or restorations that increase a property's value or use

Capital improvements

A projected budget over the economic life of the property, which includes variable expenses, such as repairs and updates

Capital reserve bugdet

A colorless, odorless gas that results as a byproduct of combustion of wood, gas, and other heated materials; poses a health hazard when released into the atmosphere and breathed in

Carbon monoxide (CO)

A refinance in which the borrower assumes a loan balance higher than the current one to pull out money for other use

Cash-out refinance

Requires you to stop running a deceptive ad or engaging in a deceptive practice; effective immediately upon issuance

Cease-and-desist order (advertising)

A deposit held in a bank for a specified term which earns interest (e.g., one-year CD, three-year CD)

Certificate of deposit

A document issued by the U.S. Department of Veterans Affairs that certifies a veteran's eligibility for a VA loan

Certificate of eligibility (COE)

A document issued after satisfactory final inspection allowing a building to inhabited

Certificate of occupancy (C/O)

A document used with a VA loan that indicates its appraised valye

Certificate of reasonable value (CRV)

A statement of opinion on the status of a title to real property

Certificate of title

An appraiser certified to perform appraisals for any time and value of property federally related real estate transactions

Certified general real estate appraiser

An appraiser certified to perform appraisals for one-to four-unit dwellings for federally related real estate transactions

Certified residential real estate appraiser

Quitclaim deed conveying street interests to a county or municipality

Cession deed

Established the title history or the path and proof of property ownership through a public records search for successive conveyance of title and encumbrances; each owner is considered to be a "link" in the chain

Chain of title

Personal property, as opposed to real property

Chattel

Synthetic chemical substances used in cooling products whose release into the atmosphere is blamed for ozone layer depletion

Chlorofluorocarbons (CFCs)

The first statute affecting equal housing opportunity largely interpreted to prohibit racial discrimination

Civil Right Act of 1966

Established quality standards for surface waters and added a structure to regulate pollutants (e.g. oil) discharged into U.S. waters

Clean Water Act

A marketable title (free and clear of liens or question of ownership)

Clear title

The principal in a transaction whom the agent represents

Client

The settlement of a real estate transaction in which a property transfer occurs

Closing

Manages the closing process, presents and explains all of the closing documents to the parties, and obtains signatures; may be an attorney broker, or a title company representative

Closing agent

A statement of final loan terms and closing costs, provided to the borrower three days prior to closing; part of TRID lender disclosure requirments

Closing dsiclosure

Aka title defect; any encumbrance, such as a lien or inheritance claim, that impedes the conveyance of a property; may be removed with a quitclaim deed

Cloud on title

Administered by the National Oceanic and Atmospheric Administration; designed to "preserve, protect, develop, and where possible, to restore or enhance the resources of the nation's coastal zone"

Coastal Zone Management Act

A person who's both responsible for the loan and on the title for the property

Co-borrower

An asset used to secure a loan. With a home mortgage, the home itself acts as collateral. If the borrower defaults, the lender can foreclosure and take the property

Collateral

A security that uses mortgage-backed securities as collateral

Collateralized mortgage obligation (CMO)

A process of attempting to recover loaned funds when the borrower is in default

Collection

A plausible, but not technically clear, indication of ownership

Color of title

Also known as mixed use, this type of zoning allows two different zoning types to co-exist, such as commercial and residential in the same building

Combination zone

Mixing trust funds with business or personal funds

Commingling

The amount of brokerage fee received for a real estate transaction

Commission

The portions of a property shared by common interest owners (e.g., in a condo property, this would include the pool)

Common areas

The shared area of an association such as a homeowners association, condominium, or cooperative

Common elements

Law established by court outcome or tradition rather than statute

Common law

The equal ownership of property in a marriage; nine states recognize community property: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin

Community property

Created in response to the practice of redlining (lenders' refusal to finance housing in specific minority-based neighborhoods)

Community Reinvestment Act (CRA)

An excessive decrease in soil volume

Compaction

Properties used for comparison purposes when valuing property

Comparables (comps)

An estimate of market value based on recent comparable sales for similar properties

Comparative market analysis (CMA)

Subdivision bonds; a developer's guarantee that off-site improvements will be made upon completion of the project. The municipality is named as beneficiary for the bond.

Completion bond

An online system consumers can use to compare mortgage options

Computerized loan origination

The taking of a property under eminent domain

Condemnation

City or county authorization for a use inconsistent with current zoning, but necessary for public benefit, such as locating an emergency medical facility in a residential neighborhodd

Conditional use permit

The rules of an association, such as a homeowners association or cooperative

Conditions, covenants, and restrictions (CC&Rs)

The fee simple ownership of a unit in a multi-unitbuilding

Condominium

The transformation of a building into condominiums (usually with an apartment building)

Condominium conversion

A condominium project that includes a rental desk; allows short-term occupancy, and is operated similar to a commercial hotel, even though the units are individually owned. Often found in resort areas, such as Hawaii

Condominium hotel, condotel, condo hotel

One of the fiduciary duties, confidentiality means an agent must keep the client's information confidential, provided the agent is not legally required to disclose it. Confidentiality is one of the duties that survives agency termination

Confidentiality

A landowner chooses to create a legal agreement with a land trust or government entity that includes permanent use and development restrictions

Conservation easement

The giving of something of value, which can include the agreement to not do something. Consideration is a required element of a binding contract

Consideration

Interim financing for developing land. The contract allows for disbursements of funds at specific stages of construction

Construction loan/mortgage

With this type of eviction, the tenant isn't permitted quiet enjoyment of the premises and vacates

Constructive eviction

A public recordation of an event; constructive notice means "you could have known if you'd bothered to look it up."

Constructive notice

One who purchases services or products, such as real estate services

Consumer

Measures changes in the price level of consumer goods and services, drawing samples from various marketplaces

Consumer Price Index (CPI)

An exchange of promises between two parties

Contract

The legal right to enter into an enforceable agreement

Contractual ability

The idea that the parties to a contract intend to be bound by the agreement terms

Contractual intent

Life estate granted by an individual for someone's lifetime, created by will or deed

Conventional life estate

Using escrow funds for personal or business purposes

Conversion

An adjustable rate mortgage that allows the borrower to convert the loan into a fixed-rate loan within a specified period of time

Convertible ARM

The legal transfer of property ownership to another

Conveyance

Form of real property ownership in which the owner is a member of an association that owns the building and shares stock in that association

Cooperative

Typically issued when a business needs ready cash for capital improvements, development, or expansion

Corporate bonds

A business organization owned by stockholders that exists as a legal entity

Corporation

Deed executed in order to correct a mistake in a previously recorded deed, such as a spelling error

Correction deed

The weighing of the value factors in an appraisal, with the appropriateness of the various comparable sales in relation to the subject considered

Correlation process

An appraisal valuation method based on the cost to replace or reproduce a property

Cost approach

An index used to determine interest rate changes for some adjustable rate mortgages

Cost of funds index (COFI)

An agreement or promise made between the parties

Covenant

Deed warranty that, unless otherwise stated in the deed, the property being conveyed is not subject to any encumbrances, liens, easement, etc.

Covenant against encumbrances

Deed warranty that the grantor (seller) will give the grantee (buyer) any further documentation required to further prove the grantee's title

Covenant against further assurance

Deed warranty that the seller is the actual owner of the property being conveyed and has the right to convey it

Covenant of seisin

An individual's record of repayment of debt; reviewed when lenders determine whether a borrower is a good risk for financing

Credit history

A person or entity to who money is owed

Creditor

A report of an individual's credit history. Used by lenders to determine creditworthiness of the individual

Credit report

A number that signifies a borrower's credit risk to lenders

Credit score

Funding a project by raising money from a large number of people, usually on the Internet

Crowdfunding

A street that does not connect to any main roads

Cul-de-sac

A husband's interest in the real estate owned by his deceased wife; a form of legal life estate

Curtesy

Ordinary cleaning and maintenance, such as vacuuming, trash removal, and landscaping

Custodial maintenance

A person related to the transaction whom the agent does not represent

Customer

A horizontal point of reference from which surveyors can measure depth and height

Datum

Qualifying ratio used by mortgage lenders, calculated by dividing the borrower's recurring monthly debt by the borrower's total monthly income

Debt-to-income ratio

A legal document filed in the county or state in which a condominium will be located, declaring the intent of the condominium complex

Declaration

Stage in neighborhood life cycle in which the area declines in desirability and value

Decline

The granting of private property for public use

Dedication

Formally conveying a parcel of land to a municipality

Dedication by deed

A legal document conveying title to or interest in real estate; established legal ownership

Deed

A defaulting borrower voluntarily conveys the deed to the lender to avoid foreclosure

Deed in lieu of foreclosure

Similar to a mortgage, in this document, the borrower conveys title for the property to a trust, which holds it as security for the lender

Deed of trust

A private control which limits the use or appearance of a given property

Deed restriction

Failure to pay on a loan

Default

Instructs the lender to cancel a security instrument upon full payment of aloan

Defeasance clause

An estate which transfers fee simple title, but subject to certain conditions (so inherently less than fee simple). Also called a qualified fee estate

Defeasible fee estate

A legal condition in which a court issues a personal judgment against a foreclosed homeowner or short sale seller when the sales proceeds aren't enough to cover the debts owed

Deficiency judgment

Failure to make a payment (e.g., a mortgage payment) when due. Even before a late fee applies, if it's past the due date to pay the loan, the payment is late and the loan is delinquent. A delinquency beyond 30 days prompts a report to the credit bureaus

Delinquency

Delivery is the act of giving the deed to the grantee; acceptance is the grantee's receipt of the deed

Delivery and acceptance

Bank deposits, such as those made to a checking account, which must be made available upon demand

Demand deposits

A federal agency that guarantees residential mortgages made to eligible veterans and active military personnel

Department of Veterans Affairs

Basis used to calculate the tax deduction allowed for a property's depreciation each each

Depreciable basis

Loss in property value from any cause

Depreciation

An agent who represents one party in a transaction while another agent who works for the same broker represents the other part

Designated agent

Cost of developing a property

Development cost

To leave something to someone in a will

Devise

A person who inherits property form a will

Devisee

One who devises (give something, such as real property) in a will

Devisor

The general trend toward which a neighborhood appears to be headed

Directional growth

A physical or mental impairment that limits a major life activity

Disability or handicap

A licensed person who's under severe disability of such nature to prevent that person from being able to attend any instruction lasting at least three hours in duration

Disabled licensee

Providing information to the principal, or any party to a transaction, that is required to be provided by law. Disclosure is one of the duties required of an agent

Disclosure

Points a lender charges at closing; buyers sometimes opt to pay points to get a lower rate or to buy down the interest rate

Discount points

A lack of mortgage funds available from lenders due to the pull out of depositor funds (to make other investments that provided greater yields)

Disintermediation

A legal condition in which unused or unclaimed rights may be lost

Doctrine of Laches

A wife's interest in the real estate owned by her deceased husband; a form of legal life estate

Dower

The amount of cash a buyer contributes to the purchase price (as opposed to borrowed funds)

Down payment

Helps reduce the amount of money homebuyers need to have saved to put down on a home; program requirements apply; include grants and/or funds for closing costs, second mortgage grants and deferred loans, and mortgage credit certificates (MCCs)

Down payment assistance programs

The rezoning of higher-density use to lower-density use; often used to control population growth in an area

Downzoning

Either a number of trenches or a space lined with gravel or sand that naturally filters septic system water and releases it back into the soil

Drainfield

Representing both sides in a real estate transaction

Dual agency

A mortgage clause that requires the borrower to pay off the loan balance when selling the property

Due-on-sale clause

Pressure, under threat of harm of some sort

Duress

An acronym used in valuation that stands for demand, utility, scarcity and transferability

DUST

Increase in property value as a result of an owner's actions (improvement, etc.)

Earned increment

An amount of money the buyer places in escrow or trust to show good faith in the buyer's intention to purchase the seller's property

Earnest money deposit

The authorized use of another's property for a specific purpose; runs with the land

Easement

This type of easement involves two landowners with adjoining property; one holds the dominant tenement or estate; the other the servient

Easement appurtenant

An easement created to benefit a landlocked property owner

Easement by necessity

An easement created through prolonged adverse use

Easement by prescription

The easement owner does not own land adjacent to the property on which the easement applies. This is typically a governmental easement or a public utility easement

Easement in gross

An appraiser's estimate of the physical condition of a building (actual age may be shorter or longer)

Effective age

Growing crops, such as Christmas trees or corn, which are produced annually. These are usually not considered fixtures, but are the personal property of the person who planted them

Emblements

The power of the government to take private property for pubic use

Eminent domain

A worker whose employer controls the details of the worker's performance

Employee

The illegal intrusion of some structure or object across a property boundary line

Encroachment

A security measure that turns electronic information into an undecipherable code

Encryption

A limitation on a property title, such as a lien or easement

Encumbrance

A contract that would hold up in court

Enforceable contract

Federal agency that aims to protect human health and the enviroment

Environmental Protection Agency (EPA)

Provides financial and technical assistance to landowners who put conservation practices into place on their agricultural and non-industrial private forestland

Environmental Quality Incentives Program (EQIP)

A 1974 federal law that prohibits discrimination based on protected class status when providing credit

Equal Credit Opportunity Act (ECOA)

Stage in neighborhood life cycle characterized by stability and steady property values

Equilibrium

The rights of ownership without the possession of title

Equitable title

The amount of value in a property after debts associated with financing have been paif

Equity

The increase in equity due to increase in value in a property

Equity buildup

The wearing away of land by wind, water, and other natural disturbances

Erosion

Protects licensees in the event of an inadvertent omission or error in real estate practice that causes financial harm to a consumer

Errors and omissions (E&O) insurance

A clause in a purchase offer that allows byers to state they'd pay more for the property if a higher competing offer comes in

Escalation clause

Allows the landlord to share increases in things like property taxes, utilities, etc. with the tenant. Usually founds in commercial leases for longer than five years

Escalator/participation clause

The state's power to claim the estate of a deceased person who left no wills, heirs, or creditros

Escheat

A neutral repository for client trust funds

Escrow

A special account that's separate from any other business or personal accounts; typically used to hold earnest money

Escrow account

A lender's look a how escrow funds on deposit by a borrower are holding out. The lender may make adjustments based an anticipated expenses (taxes and insurance)

Escrow analysis

The spending of escrow funds to pays property taxes, hazard insurance, mortgage insurance, etc., when due

Escrow disbursement

Interest in land; alternatively, assets owned by a deceased person

Estate

Leasehold estate in which the duration of the lease is unknown at the time it's created; may be terminated by either the lessor or lessee at any time

Estate at will

A fixed-termination type of lease that may be for a day, week, month, year, several years, or any definite period of time; when the specified date occurs, the lease terminates automatically

Estate for years

A legal concept that says that a person may not disavow something that the person had previously affirmed either by action or wrods

Estoppel

A document verifying the amount still owned on a debt; once the certificate has been issued, the lender may not claim that more money owed on that debt

Estoppel certificate

Beliefs and behaviors that are dependent on a person's conscience and values

Ethics

A legal action to remove the tenant and the tenant's belonging from the premises

Eviction

The title report derives from public records or an abstract of title

Examination of title

A listing agreement in which the broker doesn't earn a commission if the seller procures the buyer

Exclusive agency

A written contract between a seller or building owner and a real estate licensee giving the licensee the exclusive right to sell or lease the property during the term of the listing agreement

Exclusive listing

A listing agreement in which the broker has earned a commission no matter who finds to buyer for the property during the term of the listing

Exclusive right to sell

One named in a will to carry out the deceased wishes in regard to distribution of property. The Female term is "executrix" but "executory" is becoming more commonly used for both geners

Executor

Conveys real property from a decedent's estate to a buyer

Executor's deed

An agency agreement entered into when both parties agree to and understand the arrangement via written or oral communication between the parties

Express agency

Aka economic obsolescence; decrease in property value due to external issues such as pollution, traffic, and other nuisances

External depreciation

A consumer protection law regulating disclosure of consumer credit reports by credit reporting agencies and established procedures whereby consumer can correct mistakes in their records

Fair Credit Reporting Act

Added familial status and disability to the protected classes list

Fair Housing Amendments Act of 1988

The price that a willing buyer and seller would agree to, given market conditions and absence of duress

Fair market value

A protected class status under the Fair Housing Act which prohibits discrimination against families with children under 18, including pregnant women

Familial status

Among other definitions, this includes one or more persons living as a single housekeeping unit

Family

FNMA, the Federal National Mortgage Association; a private, for profit corporation that operates under a congressional charter that buys loans in the secondary mortgage market from lenders in the primary mortgage market

Fannie Mae

The Federal Agricultural Mortgage Corporation, created by Congress, provides a secondary market for agricultural mortgage and rural utilities loans

Farmer Mac

The area of material facing the outer edge of the soffit

Fascia

Prohibits discrimination based on race, religion, color, and national origin in the sale or rental of residential real estate

Federal Fair Housing Act of 1968

The Federal Housing Administration (FHA) is an agency of the U.S. Department of Housing and Urban Development. It sets underwriting standards for loans it insures, but its doesn't make loans

Federal Housing Administration (FHA)

Oversees Fannie Mae and Freddie Mac and regulates the 12 Federal Home Loan Banks

Federal Housing Finance Agency (FHFA)

Aka "The Fed"; a national banking system that helps to control inflation and deflation by regulating interest rates and reserve fund requirements of its member banks

Federal Reserve System

A federal law passed to prevent unfair methods of competition and deceptive advertising; created the Federal Trade Commission

Federal Trade Commission Act

A federal body formed through an act of Congress in 1914 with the power to declare trade practices that conflict with basic policies of antitrust legislation to be unfair

Federal Trade Commission (FTC)

An inheritable estate with ownership

Fee simple

An inheritable estate with absolute ownership; provides the most complete form of ownership and bundle of rights in real property

Fee simple absolute

A defeasible fee estate where the property holder owns the property subject to a condition; if the condition is breached, the property automatically reverts back to the original owner

Fee simple determimable

A defeasible fee estate that doesn't end automatically when the stated even or condition occurs, but the grantor can reclaim ownership by taking action

Fee simple subject to condition subsequent

An estate that does not go into effect until a specified condition is met

Fee simple upon condition precedent

Fair Isaac Corporation score; the most widely used credit score, based off information in the credit reports produced by the three credit bureaus (TransUnion, Equifax, and Experian)

FICO score

A person in whom another's trust and confidence is placed

Fiduciary

The duties of obedience, loyalty, disclosure, confidentiality, accounting and reasonable skill and care comprise the list of fiduciary duties an agent owes the principal

Fiduciary duties

A mortgage in first place among other recorded loans. Receives payment first in the event of a foreclosure

First mortgage

A loan where the principal and interest payment remains the same over the life of the loan

Fixed-rate loan

An item that is permanently attached to real property

Fixture

Metal or rubber strips installed at corners and edges of roofing, chimneys, etc., to prevent moisture penetration

Flashing

A tax imposed upon the selling of a cooperative. Usually paid by seller, but may be paid by the buyer or split between them

Flip tax

Required when properties are in designated flood areas; covers the costs of damage resulting from flooding

Flood insurance

Total net floor area divided by the total lot area

Floor area ratio (FAR)

A concrete base below the frost line that support the foundation

Footing

A lender forces the sale of a property because they buyer has defaulted on the loan

Foreclosure

The disposition of a U.S. real property interest by a foreign person (the transferor) is subject to the Foreign Investment in Real Property Tax Act of 1980 (FIRPTA) income tax withholding

Foreign Investment in Real Property Tax Act of 1980 (FIRPTA)

A product used in the manufacture of urea-formaldehyde foam insulation, paneling and other other products that is a chemical air pollutant

Formaldehyde

Masonry or concrete walls below ground level that serve as support for the strucutre

Foundation walls

The "wooden skeleton" of a home to which interior and exterior walls are attached

Framing

Trickery or deceit to induce someone to do something, especially in a real estate contract; may involve concealment of material facts, providing false information, or using trickery

Fraud

The Federal Home Loan Mortgage Corporation (FHLMC) which increases the availability of financing for conventional mortgages insured by the federal government by purchasing them from lenders in the primary market

Freddie Mac

An inheritable estate with absolute ownership

Freehold estate

Hydrochlorofluorocarbons: Non-toxic, extremely stable chemical substance used in most home AC units

Freon

Flaky, crumbly

Friable

The linear measurement of a property that abuts a street, highway, waterway, etc.

Frontage/Front Foot

Aka general warranty deed; a deed that grants the most protection to the buyer because it carries all the possible covenants of the grantor

Full covenant and warranty deed

The base rent, the nets, utilities, and janitorial services are included in one lease rate, based on price per square foot

Full-service lease

A decrease in property value resulting form poor or outdated design or material

Functional obsolescence

A device that melts and opens the circuit, interrupting electrical power when overheating occurs

Fuse

A legal right to future ownership of property

Future interest

A person who is authorized to act for another (the principal or client) in a range of matters

General agent

A lien against a person and all the property owned by that person, whether real or personal (e.g., judgments, estate and inheritance tax liens, income tax liens)

General lien

A partnership in which each partner shares in the administration, profits, and losses of the venture

General partnership

A deed that grants the most protection to the buyer because it carries all the possible covenants of the grantor. Also known as a full covenant and warranty deed

General warranty deed

Oversees fair housing and enforces laws; complaints are filed with the Fair Housing Division

Georgia Commission on Equal Opportunity

Deed created when, instead of monetary consideration, the consideration clause is changes to ""his [her, their] natural love and affection""

Gift deed

Government National Mortgage Association (GNMA); a federal agency located within the Department of Housing and Urban Development (HUD) that established requirements for loans that can be accepted into its mortgage pool

Ginnie Mae

Another term for "beam" which spans the distance from one side of the foundation to the other on which the joists rest for support

Girder

Consideration given without reciprocal consideration but which still qualifies as valuable consideration between the parties due to their relationship or the circumstances surrounding the gift

Good consideration

Funds that are immediately available to the closing company for deposit and disbursement

Good funds

A loan guaranteed, insured, or (in limited cases) made by an agency of the federal government

Government loan

Private companies such as Fannie Mae, Freddie Mac, and the Federal Home Loan Bank, created by the U.S. Congress to make borrowing easier and more cost effective

Government-sponsored enterprises (GSEs)

Enacted to legislate reforms in the financial services industry and to address concerns relating to consumer financial privacy

Gramm-Leach-Bliley Act

Words of conveyance in a deed

Granting clause

The grantee is the recipient of the deed (usually the new buyer); the grantor is the giver of the deed (usually the seller)

Grantor/grantee

Collective name of two lists that the county recorder updates when a property is transferred

Grantor/grantee index

The quantity of goods and services our country produces, which influences demand for commercial properties

Gross domestic product (GDP)

Income before expenses are deducted

Gross income

A figure used as a multiplier of gross annual income of a property; used to estimate property value for properties of five=plus units

Gross income multiplier

The tenant pays a fixed rent and the landlord pays all operating expenses; most common type of lease used in residential rentals

Gross lease

A figure used as a multiplier of gross monthly rent of a property; used to estimate property value for properties of one to four units GRM = Price/gross rent

Gross rent multiplier

Water found beneath the earth's surface that collects in aquifers

Groundwater

An illegal agreement between parties to not do business with a particular person or company

Group boycotting

As defined in fair housing law, a dwelling occupied by two or more unrelated people with disabilities

Group home

A fixed-rate mortgage in which the monthly payments increase over time according to a set schedule

Growing equity mortgage

State in neighborhood life cycle during which the neighborhood is under development and property values will steadily increase

Growth

Deed used to convey a minor's interest in a property; the only covenant it contains is that the guardian and minor have not encumbered the property

Guardian's deed

A deed clause containing the words "to have and to hold," and which described the interest and rights of the grantee

Habendum clause

Amount of the final, successful auction bid, signaled by a bang of the auctioneer's gavel

Hammer price

Gives state attorneys the general the authority to sue on behalf of consumers in their states

Hart-Scott-Rodino Act

Insurance that covers property damage due to fire, wind, vandalism, and other hazards (usually flood insurance is separate)

Hazard insurance

Intestate successor

Heir

The legal and feasible use of a property that would return its highest value

Highest and best use

A tenant who refuses to leave after the expiration of a lease

Holdover tenant

FHA program aimed at educating buyers in order to reduce defaults on FHA-insured loans; Buyers that complete the program receive reduction on their CIP and other benefits

Homebuyers Armed With Knowledge (HAWK)

An open line of credit based on the available equity in the borrower's home

Home equity line of credit (HELOC)

A thorough examination of a property conducted by a professional home home inspector

Home inspection

An individual who inspects homes on behalf of prospective buyers

Home inspector

The Home Mortgage Disclosure Act (HMDA), enacted by Congress in 1975; requires financial institutions to make mortgage data available to the public

Home Mortgage Disclosure Act

A 1975 law that requires financial institutions to make mortgage data available to the public

Home Mortgage Disclosure Act (HMDA)

Addresses abusive practices in refinancing and home equity loans by requiring special disclosures and restrictions on loan terms; an amendment to the Truth in Lending Act

Homeowner and Equity Protection Act (HOEPA)

A governing body made up of homeowners or their appointees to manage aspects of living in a community (e.g. fence heights, paint colors, amenities, etc.)

Homeowners association

Dues paid to the homeowners association in a common interest community (e.g., condominium property) to pay for the costs to use and maintain common area elements, such as landscaping, pools, etc.

Homeowners association (HOA) fee

An insurance policy that combines hazard insurance and liability insurance for a home and its contents

Homeowner's insurance

A legal life estate involving long-term ownership within a family

Homestead estate

Typically covers items from workmanship and materials to systems and structural issues

Home warranty

Rules of a cooperation or condominium property that shareholders or owners must follow

House rules

Added sex to the list of protected classes

Housing and Community Development Act of 1974

States that communities and facilities that meet certain criteria for providing housing to older persons are legally exempt from the familial status discrimination

Housing for Older Persons Act of 1995

Qualifying ratio mortgage lenders use to determine the percentage of a borrower's gross monthly income that will be used for housing expenses

Housing ratio

The unofficial name for a now outdated settlement statement that was provided to borrowers prior to closing

HUD-1

A department of the U.S. whose mission is to create affordable home for all

HUD/Department of Housing and Urban Development

The median family income for statistical area as determined by the Department of Housing and Urban Development (HUD)

HUD median income

Pledging a property as collateral for a loan

Hypothecation

Fees charged to a developer by a local government to reimburse for costs of providing public services to the new development

Impact fees

Agency that is created from the actions of the parties rather than express agreement; illegal in some states

Implied agency

The idea that real estate professionals are competent and knowledgeable about their field, and can't claim ignorance if something goes wrong

Implied obligations

Anything added to the land which benefits the land, such as a building, driveway, etc.

Improvement

Developed from a spot survey; often requested by lenders and title companies when a property changes hands; offers reasonable assurance regarding property boundaries and possible encroachments

Improvement location certificate (ILC)

Notice that a party to an agency transaction is deemed to have had due to the agency relationship

Imputed notice

Where a municipality will allow an otherwise prohibited type of construction if the developer will give the municipality something back

Incentive zoning

An approach to determining value used for investment properties based on the income it will produce

Income approach

Property that is managed for cash flow and income

Income-producing property

A form of physical depreciation indicated by a loss in value that is not economically feasible to remedy because the increase in value from the "fix" would not equal the costs to fix it

Incurable depreciation

A person whose work is not directly controlled by a supervisor or manager

Independent contractor

An economic indicator to which interest rates are applied

Index

Rent either increases or decreases depending on some economic indicator, such as an inflation index

Index lease

A cost for an expenditure other than materials and labor

Indirect cost

Aid low- and very low-income households in setting up savings accounts used to purchase a home

Individual Development Accounting (IDA) programs

A type of real property used for industry

Industrial property

Agreement as to the agency relationship a consumer accepts after considering all option available

Informed consent

Community services such as water, sewer, utilities, schools, roadways, medical, fire and police support

Infrastructure

The amount the interest rate may adjust up upon the first rate adjustment in an adjustable rate loan

Initial cap

The unknowing misstatement of a material fact

Innocent misrepresentation

Contract clause that allows the buyer to terminate if an issue arises during the inspection that can't be successfully negotiated

Inspection contingency

Aka land contract; allows the seller to provide financing by providing credit to the buyer; buyer makes payments directly to seller

Installment sale

A title against which there may be known defects (such as easement), but the title company has notified the parties of the defect and has agreed to insure against it (not list it as a policy exception)

Insurable title

The combined value of a homeowner's belongings and the home replacement costs, should the dwelling be destroyed

Insurance estimation

A numerical rating that summarizes the likelihood of a person filing an insurance claim during the coverage period

Insurance score

Essentially the same as fraud; misrepresentation that occurs when the person knows better and intentionally remains silent or misstates the facts

Intentional misrepresentation

The percentage fee charged on the amount loaned

Interest (financing)

The right or claim a person has to property

Interest (property)

Generally short-term and open-ended, this kind of financing is usually obtained to finance a construction project

Interim financing

Created by the Internal Code Council to provide standards for residential construction across the country; aka I-Codes

International Codes (I-Codes)

Aka broker reciprocity, created by the National Association of REALTORS to enable brokers to share listing information across MLSs

Internet Data Exchange (IDX)

When broker deposit disputed escrow funds with the court and then obtain a discharge and release from any liability regarding the escrow account and the disputing parties

Interpleader action

A deed used to convey property between spouses

Interspousal deed

A federal law regulating interstate land sales

Interstate Land Sales Full Disclosure Act

Dying without a will

Intestate

Determines how the deceased's property is to be distributed when the person died without a will

Intestate succession

When the government takes private property but fails to compensate the owner; property owners are forced to file suit to obtain compensation. The taking may be physical through occupation, or regulatory, where government regulations deprive the owner of the property's beneficial use and cause the property to lose its economic value

Inverse condemnation

The value to an investor of an investment property

Investment value

A lien imposed on a property or person by someone else, such as for nonpayment of taxes

Involuntary lien

Property is owned by a group of two or more persons; the death of one person simply raises the stake the others have in the property; called right of survivorship

Joint tenancy

A temporary organization of two or more people to carry out a single project

Joint venture

A horizontal length of timber or steel supporting part of the structure of a building, usually arranged in parallel between foundation, walls or beams to support a ceiling or floor

Joists

Placed when monetary damages are awarded; can be placed on property until the debt is paid

Judgment lien

Foreclosure process requiring court proceeding

Judicial foreclosure

A loan that exceeds conforming loan limits established by Fannie Mae and Freddie Mac

Jumbo loan

Any loan on a property that is below first payment priority

Junior mortgage

Makes it unlawful to send an unsolicited commercial message via fax unless the sender has permission from the recipient or an established business relationship with the recipient

Junk Fax Prevention Act

An improper payment of real estate compensation to an unlicensed individual who is not exempt from licensing laws

Kickback

A concrete-filled column for structural support

Lally columns

Property which include the surface of the earth, down to the center of the earth and upward infinitely into space; it also includes any items permanently attached to the land, such as trees and water

Land

Aka a contract for deed; allows the seller to provide financing by providing credit to the buyer; buyer makes payments directly to sell

Land contract

An instrument conveying public land (it can also be used to describe the actual land conveyed)

Lan patent

An issue with a property not immediately recognizable by a layperson; concealed, hidden, or requiring professional evaluation

Latent defect

A metallic element found in rocks and soils worldwide

Lead

A contract that transfers possession for consideration

Lease

A legally binding, written contract between an owner/landlord (lessor) and a tenant (lessee) for the tenant to possess the owner's real property for a specified period of time in exchange for a fee (rent or rental payment)

Lease agreement

This defines the legal relationship between the parties who sign the lease. It grants possession, but not title, to the tenant, and is for a limited period of time

Lease fee

This defines the legal relationship between the parties who sign the lease. It grants possession, but not title, to the tenant, and is for a limited period of time

Leasehold estate

Allows the lessee (renter) the option to purchase the property at the end of the lease

Lease with option to buy

The ability to enter into legal contracts

Legal capacity

A method of identifying a property in written words that allows for an unambiguous interpretation of a property's boundaries and location

Legal description

A life estate caused by a rule of law

Legal life estate

A party has the capacity (legal and mental) to enter into a contract

Legally competent party

The idea that a contract must not propose to do anything illegal; such a contract would be unenforceable

Legal purpose

Testate successor who benefits from the deceased's will

Legatee

A title insurance policy that protects the lender's interest in the property for the amount of the loan

Lender's policy

One who leases and is placed in possession (tenant)

Lessee

One who leases out, granting temporary possession to another (landlord)

Lessor

A document stating that a buyer wishes to purchases a specific unit or units, and setting forth the terms of the transaction

Letter of intent

The use of borrowed funds to increase the potential return on an investment

Leverage

The placement of tax that create a lien

Levy

Standard package homeowner's insurance policy coverage for personal injuries to others resulting from the insured's acts or negligence; may include medical payments for accidents sustained by guests visiting the property and physical damage to others' property

Liability insurance

The temporary right to use another person's property

License

A creditor's legal right to have their debt paid out of the property of a defaulting debtor, usually by a court sale

Lien

The lienor is the part holding the lien, such as a lender. The lienee is the person who needs to pay up!

Lienor/lienee

A state that adopts a lien theory goes under the presumption that a lender's mortgage is a lien on the property. A title theory state says that the lender owns the property until the loan is paid off

Lien theory

A limit on the amount that an adjustable rate mortgage can increase over the term of the loan

Life cap

A freehold estate granted for someone's lifetime

Life estate

The owner of a life estate

Life tenant

A provision that allows the lien(s) ahead of the junior mortgage to be refinanced without changing their priority in lien positions

Lifting clause

One who acts on a principal's behalf, but within a very limited scope

Limited agent

A hybrid business formation that combines the limited liability features of a corporation with the tax efficiencies and operational flexibility of a partnership

Limited Liability Company (LLC)

A partnership in which there is one or more general partners who administer the enterprise, and one or more limited partners who are liable only to the extent of their investment

Limited partnership

An asset that's either cash, or that may easily be converted into cash

Liquid asset

A public note that is a legal issue is pending

Lis pendens

An agreement in which a licensee reserves the right to list a property the licensee has helped the buyer secure or develop

List back

A legally binding contact between the seller and real estate licensee in which the dates of service, terms of compensation, and authority to market and list the property are provided

Listing agreement

Rights of the owners of a bordering property to the use of a stationary body of water, such as a lake or sea

Littoral rights

Disclosure lenders gives to the borrower within three days of the borrower applying for a loan; discloses loan terms, interest rate, and estimated payment

Loan estimate

Borrowers work with lender to restructure or modify the terms of their mortgage so they can continue to make payment

Loan modification

The making of a loan

Loan origination

The term for the lender processing payments, sending statements, and managing the escrow/impound account for a loan

Loan servicing

The ratio of a loan amount to the value of the property being purchased

Loan-to-value ratio (LTV)

Secure a given interest rate for a specified period of time (between a borrower and a lender). The term is called the lock-in period, and it's often for 30 or 45 days

Lock in

Rental of floor space for wide open loft type spaces; structural changes are generally not permitted

Loft lease

Gain realized from an investment held for more than one year (receives favorable tax treatment, as compared to short-term capital gains)

Long-term capital gain

A legal description that refers to lot and block number within a subdivision as indicated on a recorded subdivision plat (e.g., Lawndale, Block 4, Lot 6)

Lot and block

A lender requirement that a portion of a construction or development loan be paid off as each lot is sold

Lot lease provision

One of the fiduciary duties, loyalty means putting the client's interest ahead of all others, including your own

Loyalty

The upkeep of property

Maintenance

Housing that is built to HUD specifications; manufactured housing must be at least 320 square feet and built on a permanent chassis

Manufactured housing

Criteria a developer must meet in order to obtain approval for a development project. Can include setting aside land for school and parks

Mapping requirements

The amount a lender charges (expressed in points or percentages) above a variable index, as in an adjustable rate mortgage

Margin

The status of being married or divorced

Marital status

A title that is reasonable free and clear of encumbrances so that the average buyer would not hesitate to consummate a sale

Marketable title

The illegal process of dividing up a market by geography, price point, etc., to limit competition

Market allocation

The price at which a property can be bought or sold

Market price

The rent a leased space would likely get in the current market

Market rent

A price at which a willing buyer and willing seller can strike a deal given ordinary market conditions

Market value

A defect in the property or title that could cause a reasonable person to not purchase a property, or cause the buyer to value the property lower

Material defect

A fact that would influence a reasonable person in making a decision; if not disclosed a person's decision would have been different

Material fact

The date on which the principal balance of a loan or bond, for example, because due and payable

Maturity

A lien places by a laborer on a property for nonpayment of work done

Mechanic's lien

A dispute resolution process whereby a neutral party hears each side and attempts to get the parties to resolve their differences

Mediation

A law which requires the local authorities to publish the location of registered sex offenders in the area

Megan's Law

Threat of violence

Menace

A survey system using point of reference and directional indicators to identity and locate a property for legal purposes (e.g., west of the widow Fiona Smith's stone wall)

Metes and bounds

The amount per $1,000 used to calculate property taxes; one mill represents $1 in tax per $1,000 of assessed value (e.g., Tax rate is 150 mills and assed value is $25,000. $25,000 x .150 = $3,750)

Millage rate

Services performed that are routine and do not involve judgment, advocacy, or negotiation

Ministerial acts

A false statement of a material fact in a real estate transaction, either intentionally or through lack of property care

Misrepresentation

An error involving the parties to a contract that would affect their decision to enter into the contract had they known of the error

Mistake

A development with mixed zoning uses, generally commercial and residential

Mixed-use development

Part of the fungi kingdom that includes mildew; mold growth is encouraged by the presence of moisture and a lack of air circulation

Mold

A cash award granted to a party as an outcome of a legal action

Monetary damages

A natural or man-made permanent landmark that serves as a point of reference in a metes and bounds description. (e.g., an oak tree as a point of reference, been there for 150 years)

Monument

Temporary halt on development

Moratorium

A voluntary lien placed on a property as collateral against a loan

Mortgage

Mortgages that are pooled together and sold to investors on the secondary mortgage market

Mortgage-back security (MBS)

An entity that makes and services mortgage loans

Mortgage banker

A service professional who acts as a liaison between borrowers and lenders for a fee

Mortgage broker

A lender's promise to the borrower that a specified loan will be provided to the borrower

Mortgage Commitment

Allow qualified buyers to claim some of the mortgage interest they paid as a credit on their tax returns

Mortgage credit certificates

Amends TILA to require specific timing related to disclosures that give consumers time to think about the loan they're about to obtain

Mortgage Disclosure Improvement Act (MDIA)

The lender in a mortgage

Mortgagee

A database that racks mortgages as they're transferred between lenders

Mortgage Electronic Registration System (MERS)

Using deceptive means to obtain financing or make a loan that would otherwise not be possible were the facts known

Mortgage fraud

FHA-insured loan version of PMI; All FHA borrowers must pay an MIP because the down payment is only 3.5%

Mortgage Insurance Premium (MIP)

Created when a mortgage is signed; places the property as security for repayment of a loan

Mortgage lien

Invests in real estate debt, including mortgage-backed securities

Mortgage REIT

The borrower in a mortgage, usually the homeowner

Mortgagor

A property with more than one dwelling, e.g., a duplex

Multi-family

A system that pools the listings of all member companies

Multiple listing service (MLS)

Bonds issued by a city, county, or state to fund government projects

Municipal bonds

Fees a developer pays to a municipality as part of the costs of development

Municipal fees

When both parties to a contract have an incorrect belief about an important fact

Mutual mistake

An agreement between the parties to cancel the contract

Mutual rescission

A federal program created to help mitigate future flood losses through the use of building and zoning ordinances, and by providing homeowners with access to affordable flood insurance protection

National Flood Insurance Program (NFIP)

A term differentiating an actual human being from a 'legal person' (which could be a private entity, such as a company or corporation)

Natural person

A river or other body of water that will accommodate commercial shipping

Navigable water

A type of loan in which the payments do not cover the interest due, which increases the amount owed over time

Negative amortization

A document that conveys an unconditional promise to pay a fixed amount (with or without interest)

Negotiable instrument

Income after expenses have been deducted

Net income

The tenant pays on top of the rent one or more of the following expenses: property taxes, property insurance premiums, or maintenance costs

Net lease

A listing agreement in which the broker contract with the seller to receive all net proceeds from a sale above a specified sales price; illegal in some states

Net listing

Income projected after deducting losses for vacancy, collection loss, and operating expenses

Net operating income (NOI)

Some lenders offer no-cost loans; it's important to determine what this means, exactly - are these lender costs only or other costs, such as escrow fees, title insurance, appraisal, etc.?

No-cost loan

A licensee acting as a facilitator but not in a representative capacity in a transaction

Non-agent

A loan that doesn't meet the Fed's qualification standards (cannot be sold to Fannie Mae or Freddie Mac)

Non-conforming loan

A use that no longer conforms with a new or changed zoning; its use is allowed through the concept of grandfathering

Nonconforming use

Protects a valid lease from termination in the event of mortgage foreclosure

Non-disturbance clause

Uniqueness, the inability to exactly replicate something

Non-homogeneity

A lender is able to sell a property in the event of buyer default, without going through the court system; usually granted via a power-of-sale clause in the security instrument

Non-judicial foreclosre

No right to occupy the property; easements are non-possessory rights

Non-possessory

A debtor's contractual promise to repay

Note

A written notice that a borrower has defaulted; lets borrower know that legal action, including possible foreclosure, is imminent

Notice of default

The substitution of a new contact for a prior contract, or a new part for an old party

Novation

One of the duties an agent owes to the client, obedience means carrying out all lawful instructions of the client

Obedience

In a promissory note, the obligor is the borrower and the obligee is the lender

Obligor/obligee

Also called an offering plan, this document describes a project-either a new development or conversion of an existing building-so that prospective purchasers will have sufficient information to determine their purchasing decision

Offering statement

The offeror is the person making the offer; the offeree is the person to whom the offer is being amde

Offeror/offeree

Where a con artist use real estate listing information to fraudulently rent out a property

Online rental scam

A listing agreement that allows the owner to work with multiple brokers, only paying a commission to the broker who procures the buyer

Open listing

A property manager's detailed plan for expenses and income

Operating budget

Expenses realized for the operation of an enterprise

Operating expenses

Dictates the manner in which parties automatically acquire rights or liabilities due to established rules of law, and not through an agreement or act of their own

Operation of law

Allow a tenant to purchase the lease (at a predetermined price) or extend the term of the lease if desired

Option clause

The length of time in an option contract in which the optionee may act

Option period

The right of a tenant to renew a lease upon the expiration of a lease period. Seen frequently in commercial leases

Option to renew

Gives the life tenant possession and use of a property for the life tenant's lifetime

Ordinary life estate

How a house is built in relation to the direction of the sun

Orientation

The original lenders holds and services the loan for the length of the loan term

Originate, hold, and service

The original lender sells the loan on the secondary mortgage market and someone else services it

Originate, sell, and service release

The cost of making the loan; on a conventional loan, this refers to the amount of points the borrower pays

Origination fee

Extra lots beyond those developed in a subdivision

Outlot

Amount of cash a developer puts down that is not financed

Owner participation

A specific tract of land with specific boundaries

Parcel

Meeting some, but not all terms of a contract

Partial performance

A division of a piece of property

Partition

A legal form of business relationship between two or more people; may take the form of a limited partnership or a general partnership

Partnership

A shared wall on the border or two properties; each property owner owns their half of the wall and has an easement on the other half

Party wall

Intentional nondisclosure; when the law imposes a duty to disclose a known fact and someone intentionally remains silent

Passive fraud

Income earned without active participation, such as rental income

Passive income

A visible problem with a property, such as a crack in the basement foundation or bulging ceiling tile

Patent defect

The person to whom a negotiable instrument is intended to pay

Payee

The tenant pays a base rent, plus an additional charge based on a percentage of the tenant's gross sales or income (usually in retail property rentals, like shopping centers and malls)

Percentage lease

The absorption rate of soil for a septic drain field; determined through a percolation test (ask perc test)

Percolation rate

The discharging (ending) of a contract through the full completion of all terms

Performance of contract

Aka subsequent cap or period cap; limits the amount an adjustable rate loan's interest rate can go up in subsequent adjustments (after the initial adjustment)

Periodic cap

Possessory interest that is automatically renewed at the end of each period specified in the lease

Periodic estate

Anything that's not real property

Personal property

Law pertaining to personal property

Personal property law

A legal way for borrowers to avoid having to purchase private mortgage insurance (PMI) when they put less than 20% down; involves two separate loans

Piggyback (split) loan

The slope of a roof

Pitch

The four expenses in a budget mortgage payment

PITI (Principal, interest, taxes, and insurance)

The person who files a lawsuit in a civil matter

Plaintiff

A mix land uses such as residential and commercial in one contained development

Planned Unit Development (PUD)

A planning board prepares and amends the master plan for the community, and implements that plan through sit plan and subdivision ordinances and recommendations to other agencies. It also investigates, maps, reports and makes recommendations relating to planning and development of the municipality, and recommends amendments to the zoning ordinance or map

Planning board/commission

Building material used to make walls that consists of large pieces of plaster covered with paper

Plasterboard (aka wallboard)

The most common form of framing used in residential construction, platform framing consists of a framing structure resting on as subfloor platform

Platform construction

A map which shows the location of a piece of property in context to its adjoining lots, roads and landmarks. It includes lot, street and block identifiers

Plat map

The increase or decrease in land value that occurs when several parcels are combined into one large plot, as that value compares to their combined total value if sold individually

Plottage

A fee equal to 1% of a loan amount. It's typically paid upfront to lower the interest rate on a loan

Point

A reference point marking the beginning point of a metes and bounds description

Point of beginning

The authority of all levels of government to act on behalf of the health, safety, and welfare of its citizens

Police power

Contains a brokerage firm's best practices, core business processes and procedures, and guidelines and standards by which the members of the firm perform their respective function

Policies and procedures manual

Synthetic liquid compounds used as a cooling and insulting medium in electrical transformers until they were banned

Poly-chlorinated byphenols (PCBs)

The right to live or work on a property

Possession

A right to occupy the property

Possessory

This type of framing uses wood members that are much larger than ordinary studs, and are spaced father apart

Post and beam construction

The right to act for someone else in a legal transaction

Power of attorney

Allows a lender to sell a property if the buyer defaults on payments without going through a formal court proceeding

Power of sale

An assurance from the lender that the borrower appears to have the funds and creditworthiness to close; includes verifying the borrower's credit standing, available funds and employment history

Pre-approval

Items a seller paid in advance and that the buyer must reimburse at closing, e.g., utilities

Prepaid items

A penalty charged by a lender to a borrower for paying off a loan early

Pre-payment penalty

A letter from a lender stating that, on the face of information provided by the borrower, the borrower will likely qualify for the loan

Prequalification

Maintenance that is done to prevent future damage or deterioartion

Preventive maintenance

The dollar amount agreed upon for the sale of property

Price

The illegal agreement between competitors to fix services or products at a specific price (e.g., "standard" brokerage fee)

Price fixing

The primary market is where loans are originated; the secondary market is where they are sold

Primary market

Where loans are originated; they are sold on the secondary mortgage market

Primary mortgage market

The interest rates that lenders offer to preferred customers

Prime rate

The amount being borrowed, or the amount left to be repaid

Principal

The person represented by an agency in a real estate transaction

Principal (agency)

What's left to be repaid on the principal of a loan (doesn't include interest and other charges)

Principal balance

Loan balance

Principal (loans)

An imaginary line that runs north and south and crosses a base line at a specific point, and used by surveyors of reference to locate and describe land using the rectangular survey system

Principal meridian

A term used in valuing income property when using capitalization rate

Principle of anticipation

A term used in valuation that says that property holds value when surrounding properties are similar

Principle of conformity

A term used in valuation that means that the value of a portion of the property is dependent on the value it bring to the entire property

Principle of contribution

The order in which liens are paid

Priority

An insurance requirement that protects the lender when it approves a loan with more than 75% to 80% of the purchase being financed

Private Mortgage Insurance (PMI)

The law states only the parties within a contract can be held to the contract's requirements

Privity of Contract

When two or more parties hold an interest in the same real property

Privity of Estate

The process by which the court determines how a deceased person's estate should be distributed

Probate

The initiator in a chain of events that leads to a real estate sale

Procuring cause

The right to take products out of the soil

Profit (land)

A financial statement based on assumptions and projections

Pro forms

The bump in value that a lower-valued property receives when an adjacent property's value increases

Progession

The understanding that a life tenant or other possessor of a property will maintain it, pay taxes, and do other things to keep up the property

Prohibition of waste

A promise by the borrower to repay the loan; it includes the terms for repayment

Promissory note

Also called hazard insurance, property insurance is a way of protecting a home or property against physical damage or loss of assets in the case of damage or theft. The policy holder pays a premium, and insurance pays the policy holder to recover losses when they occur

Property insurance

Managing a property or properties for another

Property management

Creates an agency relationship between property managers and owners

Property management agreement

Someone who manage real estate for another for compensation; duties include generating income, budgeting, market analysis, advertising, and negotiating leases

Property manager

A lease held by the shareholder of a cooperative which allows the shareholder the right to occupy the shareholder's unit

Proprietary lease

A division of expenses and income between buyer and seller according to who owes what to whom

Proration

Prevents buyers from reaching an agreement with a seller on a property and then discarding their broker so that neither parts has to pay a broker commission

Protection clause

History of ownership and conveyance that drives up the price of an auctioned item

Provenance

A transfer of land from public ownership to private ownership

Public grant

A statement of opinion or exaggeration that is generally understood not to be a statement of fact

Puffery

"For the life of another"; a life estate that lasts for the life of someone other than the life tenant

Pur Autre Vie

A written contract between a buyer and seller specifying the terms for the transfer of interest in real property

Purchase agreement

A form of seller financing in which a mortgage is given by the buyer to the seller toward the purchase price; buyers use this as down payment financing

Purchase money mortgage

A 24-mile by 24-mile parcel (16 townships) as defined by the government's rectangular survey system

Quadrangle

A loan that meets stringent CFPB guidelines that are designed to curb lending practices that led to the late-2000s financial crisis

Qualified mortgage

Calculations to determine whether a buyer qualifies for financing. The front-end ratio uses the borrower's monthly housing debt and compares it to the borrower's gross monthly income. The back-end ratio uses total monthly debt compared to gross monthly income

Qualifying ratio

This is a right of tenant to enjoy the property without being dispossessed or trespassed upon, even by the landlord

Quiet enjoyment

A court action to remove a cloud on a title

Quiet title

A deed that does not offer any warranties but simply releases the current owner's claims to the property

Quitclaim deed

A radioactive gas found worldwide caused by the natural decay of uranium

Radon

An internal beam extending from the eaves to the peak of the roof

Rafter

The securing of a given interest rate for a specified period of time between a borrower and a lender

Rate lock

Gain or loss on an investment over a period of time, expressed as a percentage of the investment's cost

Rate of return (ROR)

Acceptance after the fact, sometimes in contrast to a prior agreement

Ratification

Land, plus all things permanently attached to it, naturally or artificially

Real estate

Someone who, for a fee, estimates the value of real property. If the property is in any way related to a federal transaction of $250,000 or more, the appraiser must be licensed or certified to perform the appraisal

Real estate appraiser

An person, partnership, association, or corporation who, for another and for compensation of any kind, negotiates any form of real estate transaction. Real estate brokers supervise and are responsible for the activities of associate brokers and salespersons who work for them

Real estate broker

A business owned by shareholders who invest in properties or mortgages

Real estate investment trust (REIT)

An investment vehicle similar to a collateralized mortgage obligation in which an entity is used to pool mortgage loans and issue mortgage-backed securities

Real estate mortgage investment conduit (REMIC)

Anyone who performs as a real estate broker for compensation of any kind, but does so only while associated with ands supervised by a licensed broker who is that person's sponsor. A salesperson may not work independently

Real estate salesperson

Protects borrowers from overcharges by requiring disclosure and prohibiting kickbacks

Real Estate Settlement Procedures Act (RESPA)

Real estate, plus the interest, benefits and rights included with ownership

Real property

Law pertaining to real property (e.g., real estate)

Real property law

The amount charged against assessed value of a property

Real property tax rate

A member of the National Association of REALTORS(R)

REALTOR (R)

A duty owed to a client by an agent, reasonable care requires the agent to act at the utmost professional level in serving the client

Reasonable skill and care

Period in which the parties must complete contract terms, if the date isn't specified

Reasonable time

What buyers can sur sellers for when sellers breach the contract; covers buyer expenses such as inspection, surveys, and other buyer costs

Reasonable foreseeable

A moderate, short-term dup in the economy's health

Recession

The agreement between states to allow licensed individuals to do business in both states

Reciprocity

An agreement signed by the borrower, lender and cooperative board, which acknowledges the lender's lien interest in the shares covered by the unit

Recognition agreement

The last step in the appraisal process, when the appraiser weighs the estimates of value from the three approaches to value (market, cost, income) and arrives at a final number

Reconciliation (appraisals)

A balancing of both sides of the Closing Disclosure

Reconciliation (closing)

The returning of a deed to the borrower once their debt is paid in full

Reconveyance

Often a county clerk, this is the public official who records transaction affecting real properyt

Recorder

Public filing of a document

Recording/recordation

A governmental survey system that describes land in reference to principal meridians and baselines (e.g., SW 1/4 NW14 S13, T1SR20E)

Rectangular survey system

The illegal practice of a lender to refusing to lend in a specific area, often based on the minority makeup of the area

Redlining

A deed which contains no covenants or warranties but does imply ownership (seisin); often used in bankruptcy proceedings and foreclosures

Referee's/sheriff's deed

This is used in legal descriptions on documents such as deeds. The reference is to a subdivision plat map. The page number and subdivision name are provided, the lot and block as well, and the recording authority

Reference to a plat

A fee paid to someone who receives a client or customer for service to the person referring the client or customer

Referral fee

Paying off a loan with the proceeds of a new loan, using the same property as collateral

Refinancing, refinance

The loss of value of a property when an adjacent property depreciates

Regression

The gradual creation of land when adjacent water levels recede

Reliction

Ownership rights upon the death of the life tenant

Remainder interests

The person receiving title upon the death of the life tenant

Remainderman

A list of all the tenants and the particulars about the type of unit, what the tenant is paying for it, and when the lease ends

Rent roll

Real estate owned property; when foreclosed home don't sell at auction, they become a real estate owned (bank-owned) property

REO

The construction costs at current prices to replace a property. It won't be an exact duplicate, but serves the same purpose of function as the original

Replacement cost/replacement cost new

A fund set aside for replacement of common property (e.g., parking lot) in a common interest community, such as a condominium development

Replacement reserve fund

The construction costs at the current price to exactly reproduce the property

Reproduction cost

An owner reserves a life estate for themselves when conveying a property

Reservation

Law that requires sellers, landlords, and their agents to disclose the presence of any known lead hazards in the home

Residential Lead-Based Paint Reduction Act

A type of combination property that includes residential and office zoning in the same place

Residential office

Similar to a planned unit development (PUD), this special zoning project allows a mixture of land uses and zoning within a single parcel. Planned communities use this type of planning

Residential planned development (RPD)

Promises between two parties that appear on a deed and prohibit or require specific use of the property

Restrictive covenant

When a landlord evicts or threatens to evict a tenant because of a complaint the tenant made; illegal in many states

Retaliatory eviction

The amount of income an investor's financial investment is producing; expressed as a ratio: (investment gain - investment cost) / investment cost

Return on investment (ROI)

A tax applied upon the recordation of a transfer of ownership in real property. May also be referred to as transfer tax

Revenue stamps

With a reverse mortgage, the lender makes payments to the homeowner for a specified period of time, and gains corresponding ownership

Reverse annuity mortgage

When an investor finds and closes on an investment property and then decides to sell another property, he or she can do a tax deferral "backward"

Reverse exchange

The lessor's right to reclaim possession of the property at the end of the lease term

Reversion

Right of repossession of the property by the owner after the end of the life estate

Reversionary interest

The rehabilitation or renewal stage of the neighborhood life cycle

Revitalization

The permanent removal of a license. If a real estate licensee has a license revoked, it may not be re-enacted before a specific amount of time has passed

Revocation

Debt that allows a consumer to borrow against a line of credit (e.g., a credit card, home equity line of credit)

Revolving debt

R-factor or R-value is a term used in insulation and means the degree of resistance to the heat transfer of the walls (how much heat is kept in or out)

R-factor

A structural member used to support the ends of the rafters at the ridge of the roof; transfers loads to end walls

Ridge beam

Provides a prospective buyer with the right to purchase a property if the seller decides to sell, or if another buyer comes along

Right of first refusal

The right to enter (ingress) or leave (egress) a property

Right of ingress or egress

A co-ownership position in which a co-owner's interest may be willed to another person

Right of inheritance

The right of a delinquent homeowner facing foreclosure to pay all amount owed and cancel the foreclosure

Right of redemption

A co-ownership position in which the death of one of the owners simply increases the interest of the others; ownership cannot be devised (passed down to heirs)

Right of survivorship

A type of easement

Right of way

Rights of the owners of a bordering property to use a flowing body of water, such as a river or creek

Riparian rights

Minimizing risk through, for instance appropriate insurance

Risk management

Prohibits discharging refuse into, altering the course of, or excavating, filling, or changing the condition or capacity of any port, harbor, or channel without a license or permit, or building any wharf, pier or other structure in any water outside established harbor lines without a permit

Rivers and Harbors Act

A federal law enacted in 1974 that governs state drinking water regulation

Safe Drinking Water Act

Most often used in commercial transaction, a sale and lease back is where the building's owner will sell the building and rent or lease it back from the new owner

Sale-and-leaseback/sale-leaseback

An approach to determining value using similar recent sales data

Sale comparison approach

A buyer's ability to continue with a transaction is dependent on the buyer's current home selling first

Sale contingency

A document that buyers and they agents use to prepare the purchase offer for the sellers

Sales contract

The price at which a property actually sells; also known as "market price"

Sales price

Popular from the 1930s to 1980s, these organization would pool their savings, loan it to others, then create more loans off of the money that was paid back

Savings and loan association (S&L)

Includes house plans and specifications for new construction

Scope of work

The market for loans sold by the primary market; a secondary lender will service the loan for the consumer

Secondary mortgage market

A mortgage in secondary position to the first mortgage (e.g., a home equity loan)

Second mortgage

1/36 of a township. In a government survey system, a township is divided into 36 sections

Section

Series of HUD-funded housing assistance programs that are administered on the state level

Section 8

Requires every mortgage loan originator to be fully licensed and carry a mortgage surely bond

Secure and Fair Enforcement Act (SAFE)

A loan backed by collateral (e.g., a mortgage loan in which the property is used as collateral)

Secured loan

An intangible investment, such as stocks, bonds, or mutual funds

Security

A security instrument unique to Georgia; used in place of a deed of trust or mortgage. Two parties (borrower and lender), includes a power of sale clause

Security deed

A sum provided by a tenant to a landlord to ensure the landlord, is not left with extraordinary expenses or unpaid rent when a tenant vacates

Security deposit

Evidence of a pledge of an asset, to be used as a security for a loan

Security instrument

The undisclosed interest of a licensee in a transaction

Self-dealing

A relationship where the licensee represents the seller in a real estate transaction

Seller agency

A seller financing transaction in which the seller carries a portion of the buyer's loan

Seller carryback

An estimate prepared by the seller's agent of what the seller's net proceeds will look like if the seller accepts the buyer's offer

Seller net sheet

An agent who represents only the seller in the transaction

Seller's agent

Property owned outside of community property ownership

Separate property

A private sewer system in which a pipeline connecting to the structure also connects to a drain and septic tank

Septic system

The estate that gives the easement

Servient estate

The estate that gives the easement

Servient tenement

The required distance between the property line and the building line

Setback

A service provider who assists in a real estate transaction (e.g., title company representative, mortgage broker, real estate broker)

Settlement service provider

A form of ownership that severs that interest of all others; complete, exclusive ownership

Serveralty

Altering the characteristic of an item from real property to personal property by removing it from the land

Severance

A loan in which the borrower purchasing shares in a cooperative

Share loan

A plywood covering over the exterior framing members. A final covering is placed over this, usually siding, brick, stucco or stone

Sheathing

An 1890 act to protect the public from antitrust practices, such as monopolies or combinations that restrain trade

Sherman Act

A distressed homeowner sells a property for less than is owed; requires lender approval

Short sale

Gains realized from an investment held for less than one year (taxes as ordinary income)

Short-term capital gain

A condition where people start getting headaches and respiratory problems due to being in an environment with poor ventilation or other air quality issues

Sick building syndrome

The exterior covering of walls of a house that goes over sheathing. It may be metal, wood, vinyl, or a combination of fieldstone, brick, or other materials

Siding

The bottom (or first) horizontal members of a wall or building

Sill plates

When a licensee/brokerage firm acts in a fiduciary capacity for either the buyer/tenant or the seller/landlord in a real estate transaction, but not for both

Single agency

Usually a detached residence designed for one family

Single-family home

When the licensee represents both the buyer and seller in a real estate transaction

Single-licensed dual agency

A depression in the ground caused by gradual erosion or a sudden cave-in

Sinkhole

A location of a property

Situs

Allows owners to lease the rights to the air above their property

Sky lease

A foundation that is a concrete slab, instead of a foundation wall. Possible only on level terrains

Slab-on-grade construction

Aka Brownfields Law; protects future landowners of contaminated properties from liability under certain conditions

Small Business Liability Relief and Brownfields Revitalization Act

The area under the roof extension

Soffit

A business of one person

Sole proprietorship

An agent whose scope of authority is limited to a specific area

Special agent

A levy to fund community improvements

Special assessment

Levied against real property to help fund the cost of a specific improvement (e.g., putting in sidewalks)

Special assessment lien

Area designated as prone to flooding; used to determine cost of flood insurance

Special flood hazard areas (SFHAs)

A lien on a specific property. A property tax lien is an example of a special lien.

Special lien

Allows a property to be used in a way that isn't really in accordance with zoning regulations

Special use permit

Aka limited warranty deed or bargain and sale deed; a deed in which the grantor only guarantees the title against defects arising during the time the grantor owned the property but not against defects that may have been in existence before taking ownership of the property

Special warranty deed

Written narratives explaining a building plan

Specifications

The people who know, like and trust you

Sphere of influence

A developer/owner who creates offers for sale a condominium or cooperative

Sponsor

The act of allowing a specific property to be zoned differently from adjacent properties

Spot zoning

Budgeted funds to cover operating expenses to remain constant for a period of time

Stabilized budget

Preparing a property for show or sale by removing clutter, moving furniture, adding accessories, etc.

Staging

ADA regulations that apply to new construction or remodeling of public accommodations and commercial buildings

Standards for acceptable designs (SAD)

A legal concept stating that contracts involving the creation or conveyance of an interest in real property must be in writing to be enforceable

Statute of frauds

Laws created by statute, as opposed to case law

Statutory laws

Land whose slope is 30-45% or steeper, or a % as determined by the local building department to be a "steep slope"

Steep slope

The illegal practice of nudging buyers away or toward a specific area based on the presence or absence of protected class members in the area relative to the buyers

Steering

A gradual increase in rent, agreed upon at lease signing

Step-up/graduated rent

A property that buyers may shy away from for reasons other than physical defects, such as a property being the site of a murder

Stigmatized property

Income tax depreciation taken through regular deductions over time

Straight-line depreciation

The portion of the payment applied to the principal remains the same with each payment, and the interest amount varies according to the outstanding loan balance

Straight-line loan

A loan in which the periodic payments go to interest only and the entire loan amount is due at the end of the term

Straight loan

Framing members used vertically for wall contruction

Studs

A licensee from a competing firm who brings the buyer to the deal, but instead of representing the buyer, works under the listing agent as a representative of the seller

Sub-agent (or subagent)

Land that's been or is being developed and is divided into lots

Subdivision

Rules for a subdivision that ensure compliance with zoning and public safety and preserve real property value

Subdivision regulations

A buyer can purchase a property "subject to" the seller's loan; the buyer is supposed to continue payment of that loan, but the seller is still ultimately liable for it

Subject to clause

An agreement for a new occupant to live in the premises and pay rent to the tenant, who pays the landlord. Requires written permission of the landlord

Sublease

A mortgage or loan secondary to another

Subordinate financing

A lease in which the lender retains the right to evict the tenant if the borrower defaults

Subordinate lease

An agreement to subordinate a senior to a junior lien

Subordination agreement

Allows the security instrument's lien position to be placed in a lower priority to a new loan using the same property as collateral

Subordination clause

When a covered party grants permission to the title company to pursue a party that caused a claim or loss

Subrogation (insurance)

Rights related to use of minerals and other products below the surface of the property

Subsurface rights

An amendment to CERCLA (the Comprehensive Environmental Response, Compensation, and Liability Act

Superfund Amendments and Reauthorization Act (SARA)

Economic variables that are inversely proportionate to price

Supply and demand

The right to use, or an ownership interest in, the surface of a property, including both land and water

Surface rights

Water that's above the ground in the form in rivers, streams, lakes, ponds, seas, and oceans. Includes storm runoffs.

Surface water

A blueprint or map showing measurements, boundaries and area of a property, sometimes required by lenders to ensure that no encroachments exist

Survey

A contribution to the value of a property made in labor, rather than funds

Sweat equity

The process of adding one adverse possessor's possessory time to the subsequent owner's adverse possession time to meet the statutory requirements

Tacking

Used to convert a short-term construction loan to more traditional, long-term financing; aka end loan

Take-out loan

Governmental appropriation of property; a taking may or may not use the power of eminent domain

Taking

A local government official who estimates the value of real property within a city, town, or village. The assessor may be elected or appointed, and services for six years. In addition to placing value on all taxable property, and listing it on the assessment roll, the assessor maintains tax maps, assists taxpayers with certain exemption, and maintains property tax records for the minucipality

Tax assossor

Deed that conveys property that has been sold due to nonpayment of taxes

Tax deed

Trading a business properties or investment properties in order to defer paying taxes on gains from a sale of the property

Tax-deferred exchange

Deductions in taxes taken against property depreciation over time

Tax depreciation

A lien imposed for nonpayment of taxes

Tax lient

Legislation that allows first-time home buyers to use up to $10,000 of their IRA funds towards the down payment and closing costs of their new home without paying an early withdrawal penalty

Taxpayer Relief Act of 1997

Property with unpaid taxes is sold at auction

Tax scale

A way to protect income from taxes, such as depreciation

Tax shelter

A tenant continues to occupy a property after lawful authority has expired. The tenant is known as a holdover tenant

Tenancy at sufferance

A type of concurrent estate in real property in which the owners of property are married; each spouse has an equal and undivided interest in the property

Tenancy by the entirety

A form of ownership that includes an undivided interest in the property; owners may sell, convey, mortgage or transfer their interest without the consent of co-owners

Tenancy in common

Dying with a will in place

Testate

One who drafts a valid will

Testator

People hired to impersonate prospective buyers or prospective tenants to determine whether a landlord or seller is practicing discriminatory behavior

Testers

The act that brought about the creation of one set of mortgage loan disclosures (the loan estimate and closing disclosure) that TILA and RESPA require

The Dodd-Frank Wall Street Reform and Consumer Protection Act

Smaller lenders, such as savings and loan associations, credit unions, and mutual savings banks

Thrift

An antitrust violation in which the provider of a service requires the customer or client to purchase another service as a condition of the transaction

Tie-in arrangement

A condominium-type of property that is occupied for short periods by multiple unrelated individuals. These individuals may own real interest in the property or simply the right to use the property for specific times and duration

Timeshare

A type of timeshare ownership that is a fee simple ownership

Timeshare estate

Another term for owning a timeshare; also known as "interval ownership," "interval ownership interest," and "vacation ownership interest"

Timeshare interest

A licensee who sells time shares under the supervision of a broker

Timeshare salesperson

This type of timeshare ownership does not convey ownership, just the right to occupy the property for the period of time set forth in the timeshare contract

Timeshare use

The legal concept of property ownership and the rights that go with it

Title

A document outlining that a title insurance policy will be issued to the buyer provided certain conditions are met (usually a required payoff of liens or other title defects)

Title commitment

The business used to determine clear ownership and possibly to facilitate the closing

Title company

An examination by a title company to determine marketable title or uncover any deficiencies in title

Title examination

An insurance contract insuring the policy owner against financial loss if the title to real estate is defective

Title insurance

A title company's search to determine marketable title or to uncover any deficiencies in title

Title search

The theory that a lender owns the property until the underlying loan is paid off

Title theory

The physical features and contours of the land

Topography

Legal wrongs

Torts

A single-family home attached to another on one side; often built in a two-story design

Townhome (townhouse)

A square that is six miles (36 square miles) and makes up the principal unit of the rectangular government survey system

Township

A piece of equipment or other item that is one or attached to the real estate which is used in a trade or business. The term "trade fixture" is actually a misnomer, because the item, while attached, may be removed by the business owner as a personal item

Trade fixture

A tax applied upon the recordation of a transfer of ownership in real property. Sometimes referred to as a revenue stamps or tax stamps

Transfer tax

An index based on the yield from sales of Treasury bills and securitires

Treasury index

Replaced the HUD-1, Good Faith Estimate, and Truth in Lending disclosures with the Loan Estimate and Closing Disclosure

TRID/TILA-RESPA Integrated Disclosures

Term that, when used in advertising, requires disclosure of other terms so as not to mislead consumers

Triggering term

A term that, if used in advertising a loan product, requires the disclosure of all other tersm

Trigger term

A lease in which the tenant is required to pay rent plus taxes, insurance, and maintenance costs

Triple net lease

A framework of rafters, posts, and struts, supporting a roof; usually manufactured offsit

Truss

An estate planning vehicle in which property is owned by an entity controlled by the trust maker

Trust

The person in charge of carrying out the terms of the trust

Trustee

A deed executed by a trustee that conveys land held within a trust

Trustee's deed

The individual creating the trust

Trustor

TILA requires disclosure of all financing terms when specific trigger terms are used in advertising

Truth in Lending Act

Requires disclosure of all financing terms when specific trigger terms are used in advertising

Truth in Lending Act (TILA)

An insurance policy that covers additional risks beyond the underlying policies; doesn't apply until the primary insurance coverage is exhausted

Umbrella policy

A tank for storing liquids, such as chemicals or oil, below ground

Underground storage tanks

The detailed analysis of a loan application, evaluating the borrower's ability to repay the loan and conformance to the lender's qualification standards

Underwriting

Representing more than one party in a transaction without fully disclosing the agency relationships to all parties

Undisclosed dual agency

An ownership situation in which each person shares in the ownership of the entire property

Undivided interest

One of the duties an agent to the client, undivided loyalty means the agent puts the client's interests ahead of all others, including the agent's own

Undivided loyalty

Using a position of trust or power to bend them to your will

Undue influence

Increase in property value as a result of inflation, change in neighborhood directional growth or other external factor

Unearned increment

Gives electronic signatures and documents the same legal weight as paper writings and signatures

Uniform Electronic Transaction Act (UETA)

Law that governs partnership businesses

Uniform Partnership Act

Provides a standard method or reporting results when appraising single-family homes

Uniform Residential Appraisal Report (URAR)

A series of laws intended to lay out standardized responsibilities and rights of both tenants and landlords

Uniform Residential Landlord Tenant Act of 1972 (URLTA)

The federal standards that appraisers must abide by when appraising federally related transactions

Uniform Standards of Professional Appraisal Practice (USPAP)

Entitles purchaser to their money back if material damage occurs to a property before possession or the passing of title

Uniform Vendor and Purchaser Risk Act

When one party cancels the contract

Unilateral rescission

Land that has no structures built upon it, and no services

Unimproved land

The fifth unity required to take property as tenants by the entirety, based on the legal principle that marries couples constitute a single legal entity

Unity of person

Each co-owner acquires an undivided interest in a property at the same time

Unity of possession

A person with unlimited power to act for another, such as a conservator or one who holds a broad scope power of attorney

Universal agent

A foam insulation containing large amount of formaldehyde

Urea-formaldehyde foam insulation (UFFI)

Provides both direct farm ownership loans and guaranteed loans to lenders

USDA Farm Service Agency (FSA)

Helps low- and moderate-income individuals attain housing in rural areas through grants, loans, and loan guarantees

USDA Rural Housing Service (RHS)

Permission to use the land for a purpose prohibited by current zoning restrictions

Use variance

The rights unique to tenants-that is, those who do not have actual ownership interest in their leasehold estate

Usufruct

A percentage of all available units in a given market that are unoccupied at a given time (Vacancy rate = number of vacant units/total units)

Vacancy rate

An agreement to provide something of worth to another that is either a loss incurred by the person making the promise or a benefit received by the other person; it is an essential element of a binding contract

Valuable consideration

An estimate of value; an appraisal

Valuation

The worth of a property as the owner is currently using it

Value in use

Expenses that change, depending on occupancy level

Variable expenses

A permitted deviation from zoning

Variance

The liability of person for the actions of another when the other person is acting on his or her behalf

Vicarious liability

A failure to abide by a rule or law

Violation

Volatile organic compounds; emitted as gases from certain solids or liquids

VOCs

VOCs; When they break down, they release toxins into the air/atmosphere, endangering health and the environment

Volatile organic compounds

The electrical pressure that pushes through electrical wires

Voltage

The loss of real property ownership with the owner's consent (e.g., traditional sale)

Voluntary alienation

A lien that is agreed to, such as a mortgage

Voluntary lien

A buyer's final inspection of a property to determine if all the conditions to the purchase agreement have been satisfied and that the home is in the same condition it was in when it went under contract

Walk-through

Building material used to make walls that consists of large pieces of plaster covered with paper

Wallboard (aka plasterboard)

In a deed, a guarantee that what is stated or promised is true

Warranty

In a deed, gives the grantee the right to sue the grantor for damages up to the value of property if someone in the future can prove to be the rightful owner

Warranty forever

The rights to use the water either on or adjacent to ones land

Water rights

Land formations that direct the water "shed" from higher elevations to lakes, streams, and other bodies of water

Watershed

The ground saturation point

Water table

Areas of standing water, wet all or most of the year, that support aquatic plants, including bogs, marshes, swamps, and sloughs, with very high diversity of species

Wetlands

Buying real property at deep discounts and immediately selling for a small profit

Wholesaling

A written document detailing the disposition of asset after death, and other wishes, signed by the testator

Will

Termites, wood-boring beetles, carpenter ants, and other insects that damage a property's wooden structural components

Wood-destroying insects

This is a form of seller financing in which the seller's mortgage remains in place, but the seller is receiving payments from the new buyer and therefore financing the purchase. The mortgage payments the buyer makes are expected to be higher than the payments on the seller's original loan, so the seller isn't paying out of pocket. It's generally a relatively short-term arrangement (perhaps five years), made until the buyer is able to qualify for a conventional mortgage, and will then pay off the remaining principal to the seller

Wrap-Around Mortgage

Establishing specific classifications to land that impacts how the land may be used

Zoning

Local laws or regulations that implement the comprehensive plan by regulating zoning and land use

Zoning ordinances

Real Estate Glossary Flashcards

(898 cards)