There's enough to think about when looking for a new property without having to worry about what the weird and wonderful words and acronyms mean as well. Here's a quick and easy glossary of property terms, covering all the weird and wonderful things everything you might hear.
Consent by the person receiving the offer to be bound by the terms and conditions of the person making the offer. Acceptance of an offer constitutes an agreement.
Any act of nature such as rain, lightning, floods or earthquakes. Many insurance policies do not cover losses resulting from an ‘Act of God’.
A payment by a borrower of more than the scheduled principal amount due in order to reduce the remaining balance on the loan.
A person appointed by a probate court to administer the estate of a person who died intestate (without a will).
The written contract for the sale and purchase of property between the seller (vendor) and the buyer (purchaser).
A feature of real property that enhances its attractiveness and increases the occupant’s or user’s satisfaction although the feature is not essential to the property’s use, eg: scenic views, proximity to public transport or recreational facilities.
To repay a mortgage with regular payments that cover both Principal and Interest.
An amount paid yearly or at regular intervals, often on a guaranteed dollar basis.
A written analysis of the estimated value of a property prepared by a qualified appraiser.
A person qualified by education, training, and experience to estimate the value of real property and personal property. You can tell someone is accredited in NZ with the “B Prop” or “Dip Valuation” after their name.
An increase in the value of a property due to changes in market conditions or supply and demand, etc.
A decorative moulding around doors or windows.
The listed price of the property buy may not always be the selling price. The owner may be willing to negotiate.
The valuation placed on a property for the purposes of taxation by an authority.
Anything of monetary value that is owned by a person, eg: personal property, bank accounts.
The transfer of a mortgage or lease from one person to another.
A public sale of a property or real estate that is sold to the highest bidder when the owner’s reserve is reachedAdministration Fee
The fee charged by a Bank to cover the initial costs of processing a home loan application.
The Bank's assessment of a Buyer's ability to afford monthly instalments based on their income.
The amount payable by the Seller for the work done on marketing and selling a property. This is a percentage of the selling price.
Certain features of a property or features of the area which increase a property's value.
The form used to apply for a home loan, containing information about a borrower's income, savings, assets, debts, and more
The assessment made by an Estate Agent to determine the property's current value before it enters the property market to be sold.
The fee charged by an appraiser when producing an estimate of the market value for a property.
The increase in the value of a property due to changes in market conditions, inflation, or other causes.
The price at which the Seller is offering their property for sale.
The physical item that you invest in.
The voluntary and permanent cessation of use or enjoyment with no intention to resume or reclaim one’s possession or interest. May pertain to an easement of a property.
A condensed version of the history of a title to a particular parcel of real estate as recorded in the county clerk’s records; consists of a summary of the original grant and all subsequent conveyances and encumbrances affecting the property.
The joining, reaching, or touching of adjoining land. Abutting parcels of land have a common boundary.
A method of calculating for tax purposes the depreciation of income property at a faster rate than would be achieved using the straight-line method. Any depreciation taken in excess of what would be claimed using the straight-line rate is subject to recapture as ordinary income to the extent of the gain resulting from the sale.
A method of calculating for tax purposes the depreciation of income property at a faster rate than would be achieved using the straight-line method. Any depreciation taken in excess of what would be claimed using the straight-line rate is subject to recapture as ordinary income to the extent of the gain resulting from the sale.
A provision in a written mortgage, note, bond, or conditional sales contract that in the event of default, the whole amount of the principal and the interest may be declared due and payable at once.
Title to improvements or additions to real property is acquired as a result of the accretion of alluvial deposits along the banks of streams or as a result of the annexation of fixtures.
An increase or addition to land by the deposit of sand or soil washed up naturally from a river, lake, or sea.
The actual depreciation that has occurred to a property at any given date; the difference between the cost of replacement new (as of the date of the appraisal) and the present appraised value.
A declaration made by a person to a notary public or other public official authorized to take acknowledgments that an instrument was executed by him or her as a free and voluntary act.
The result of legal action originated by a lessor, by which a defaulted tenant is physically ousted from the rental property pursuant to a court order.
Express information or fact; that which is known; actual knowledge.
The party appointed by the county court to settle the estate of a deceased person who died without leaving a will.
A tax levied according to value; generally used to refer to real estate tax.
The actual, visible, hostile, notorious, exclusive, and continuous possession of another’s land under a claim to title. Possession for a statutory period may be a means of acquiring title.
A written statement signed and sworn to before a person authorized to administer an oath.
One who represents or has the power to act for another person (called the principal). The authorization may be express, implied, or apparent. A fiduciary relationship is created under the law of agency when a property owner, as the principal, executes a listing agreement or management contract authorizing a licensed real estate broker to be her or his agent.
A written agreement by which the purchaser agrees to buy certain real estate and the seller agrees to sell, on the terms and conditions set forth in the agreement.
A designated airspace over a piece of land. Air lots, like surface property, may be transferred.
The right to use the open space above one’s property. It can be sold to build a skywalk or for a utility company to erect power lines.
The act of transferring property to another. Alienation may be voluntary, such as by sale, or involuntary, such as through eminent domain.
Clause in a mortgage instrument that does not all the borrower to sell (without lender approval) on assumption or contract-for-deed. If an attempt is made to do so without prior approval, all of the mortgaged balance becomes due on the sale of the property.
The actual soil increase resulting from accretion.
Changes to previously approved and adopted written agreements are amendments.
Neighborhood facilities and services that enhance a property’s value. They are always outside of the property. Swimming pools, three-car garages, decks, etc., that are on the property are called features.
A federal law, effective in 1992, designed to eliminate discrimination against individuals with disabilities.
The liquidation of a financial burden by installment payments, which include principal and interest.
A loan in which the principal and interest are payable in monthly or other periodic installments over the term of the loan.
An appraising principle created by the expectation of certain future events causing values to either increase or decrease.
The laws designed to preserve the free enterprise of the open marketplace by making illegal certain private conspiracies and combinations formed to minimize competition. Violation of antitrust laws in the real estate business generally involves either price fixing (brokers conspiring to set fixed compensation rates) or allocation of customers or markets (brokers agreeing to limit their trades or dealings to certain areas or properties).
An estimate of the quantity, quality, or value of something. The process through which conclusions about property value are obtained; also refers to the report that sets forth the process of estimation and conclusion of value.
An estimate of a property’s present worth.
An increase in the worth or value of a property, due to economic or related causes, which may prove to be either temporary or permanent.
Belonging to; incident to; annexed to.
The simultaneous purchase and sale of a security with the purpose of obtaining a higher yield from the differential between its acquisition and selling price.
A means of settling a controversy between two parties through the medium of an impartial third party whose decision on the controversy (if agreed upon) will be final and binding.
The imposition of a tax, charge, or levy, usually according to established rates.
The transfer in writing of rights or interest in a bond, mortgage, lease, or other instrument.
The law, in effect in most states, that stipulates that no person shall conduct a business under any name other than his or her own individual name, unless such person files the desired name with the county clerk in each county where the business is conducted. In the case of brokers and salespeople, statement of such filing should be submitted to the state’s real estate commission.
The transfer of title to property to a grantee, by which the grantee assumes liability for payment of an existing note secured by a mortgage against the property. Should the mortgage be foreclosed and the property sold for a lesser amount than that due, the grantee/purchaser who has assumed and agreed to pay the debt secured by the mortgage is personally liable for the deficiency. Before a seller may be relieved of liability under the existing mortgage, the lender must accept the transfer of liability for payment of the note.
The holder of a power of attorney.
An instrument written and signed by the attorney who examines the title, stating her or his opinion as to whether a seller may convey good title.
A sudden tearing away of land by the action of natural forces.
A large loan payment to clear a debt.
The person designated to receive the income from a trust, estate, or a deed of trust.
A mortgage that requires payments to reduce the debt every two weeks, (instead of the standard monthly payment schedule). The 26 (or possibly 27) bi-weekly payments are each equal to one-half of the monthly payment that would be required if the loan were a standard 30 year fixed-rate mortgage and they are usually drafted from the borrower’s bank account. The result for the borrower is a substantial savings in interest.
An administrative body made up of all the owners within a group of units or apartments of a strata building. The owners elect a committee, which handles administration and upkeep of the site.
A sum of money paid by a tenant and held by the Tenancy Services to ensure against defaulting on payment and damage to the property.
The lines that define the perimeter of a property.
A type of construction in which a structural timber frame is tied to a non-load bearing, single-brick external wall.
A short term loan (usually at a higher rate) taken out to cover the financial gap between buying a new property and selling an existing property.
An ordinance specifying minimum standards of construction of buildings for the protection of public safety and health.
A standard day for conducting business. 9.00am - 5.00pm. Excludes weekends and public holidays.
When the demand for property is less than supply so the advantages shift to the buyer.Bank-owned Property
Repossessed property now owned by the bank, usually sold at a lower price.Beetle Certificate
A certificate issued confirming that a structure is free of wood borer or termite infestation. This is a legal requirement when selling.
To transfer personal property through a will.
A group of trustees which controls the day-to-day running of a sectional title scheme.
A lending agreement between a Buyer and the Bank. The legal bond document states that the Bank will lend an amount of money in the form of a bond.
Costs accrued during the cancellation of a bond. These include an Attorney's registration fee and a Deeds Office fee.
Someone who receives money from a Bank (lender) with the intention to repay the amount.
The buyer of a property enters into an Agreement of Sale with the Seller of the property and pays the purchase price in cash or via a home loan.
A period in the property market which favours the Buyer with an increased number of properties for sale and low purchase prices.
When you buy a residential property with the intention of renting it out for profit.
This is when the purchase of the property is bought for investment and then rented to a third party to generate passive income.
A deed that carries with it no warranties against liens or other encumbrances but that does imply the grantor has the right to convey title. The grantor may add warranties to the deed at his or her discretion.
A determinable fee estate that may be inherited.
One of a set of imaginary lines running east and west and crossing a principal meridian at a definite point. Base lines are used by surveyors for reference in locating and describing land under the rectangular survey system (or government survey method) of property description.
A permanent reference mark or point established for use by surveyors when measuring differences in elevation.
A provision in a will providing for the distribution of personal property.
A contract in which each party promises to perform an act in exchange for the other party’s promise to perform.
A written instrument given to pass title to personal property.
An agreement that may accompany an earnest money deposit for the purchase of real property as evidence of the purchaser’s good faith and intent to complete the transaction.
A mortgage that covers more than one parcel of real estate and provides for each parcel’s partial release from the mortgage lien on repayment of a definite portion of the debt.
The illegal practice of inducing homeowners to sell their properties by making representations regarding the entry, or prospective entry, of minority persons into the neighborhood.
The common name for state and federal laws that regulate the registration and sale of investment securities.
Two or more businesses conspire against other businesses to reduce competition.
A secondary place of business apart from the principal or main office from which real estate business is conducted. A branch office generally must be run by a licensed real estate broker, broker salesperson, or associate broker working on behalf of the broker operating the principal office.
The failure, without legal excuse, of one of the parties to a contract to perform according to the contract.
A loan that bridges the sale of property.
One who buys and sells for another for a commission.
The business of buying and selling for another for a commission.
A person who has passed the broker’s licensing examination but it is licensed to work only on behalf of a licensed broker and who may be allowed to manage an office. In many states, known as (and licensed as) associate broker or broker/associate.
Deserted, defunct, and derelict toxic industrial sites in need of renewal. Federal legislation has diminished the innocent landowner’s liability exposure and provided the landowner the opportunity to expense cleanup costs rather than capitalize them.
A loan in which the monthly payments made by the borrower cover not only interest and a payment on the principal, but also 1⁄12 of such expenses as taxes, insurance assessments, private mortgage insurance premiums, and similar charges.
A strip of land that separates one land use from another.
A line fixed at a certain distance from the front and/or sides of a lot beyond which no structure can project; a setback line used to ensure a degree of uniformity in the appearance of buildings and unobstructed light, air, and view.
The limitations on the size or type of property improvements established by zoning acts or by deed or lease restrictions. Building restrictions are considered encumbrances and violations render the title unmarketable.
The theory that land ownership involves ownership of all legal rights to the land, such as possession, control within the law, and enjoyment, rather than ownership of the land itself.
A three to five year blueprint for an organization or individual real estate practitioner.
A payment made, often by the seller, to help the buyer qualify for the loan.
Money used to create income, either as an investment in a business or an income property. The money or property comprising the wealth owned or used by a person or business. The accumulated wealth of a person or business. The net worth of a business represented by the amount its assets exceed its.
The cost of an improvement made to extend the useful life of a property or added to its value.
The gain on the sale of a capital asset.
Any structure or addition to a property erected as a permanent improvement that adds to its value and useful life.
A measure of cash inflow and outflow from the business. Positive cash flow means more money is coming into the business than is leaving it. Negative cash flow is the converse.
A refinance transaction in which the amount of money received from the new loan exceeds the total of the money needed to repay the existing first mortgage, closing costs, points and the amount required to satisfy any outstanding subordinate mortgage liens,. In other words a refinance transaction in which the borrower receives additional cash that can be used for any purpose.
A warning on a title to a purchaser that a third party might have some interest or right in the property.
A Latin phrase for “Let the buyer beware”, i.e.: the onus is on the buyer to be satisfied with any item before purchasing.
All Salespeople in real estate who have not qualified by exam to be an Associate (AREINZ), who are employed by a licensed Real Estate Agent.
A document issued by a local government to a developer permitting the structure to be occupied. This generally indicates that the building is in compliance with public health and building codes.
A description of a property with the name of the registered owner, encumbrances, i.e.: mortgages or easements on the property. It must be produced by the vendor before the sale of the property.
Moveable and removable items of personal property. In real estate transactions, chattels included in the sale usually include the stove, television aerial, carpets, blinds, curtains, drapes and light fittings. However, unless chattels are specified in the agreement, they are not sold as part of the property.
Special Conditions in a Sale & Purchase Agreement
Conditional upon a Specialist Report
Conditional upon the sale of the purchaser’s property
Conditional upon an existing agreement
Conditional upon a LIM report
Conditional upon Finance
A title that is free of or legal questions as to ownership of the property.
An asset (such as a car or a home) that guarantees the repayment of a loan. The borrower risks losing the asset if the loan is not repaid according to the terms of the loan contract.
A proportion (usually a percentage) of the sale price of a property paid to a real estate agent for negotiating a real estate transaction.
A body of law based on custom, usage, and court decisions.
See Old System Title
Area of building, land or amenities within a strata title property that are shared by all owners, eg: a driveway.
A company owner has a certificate of title and the owner automatically becomes a member of a company that administers, manages and maintains the property in which the owner’s flat is registered. The Directors of that company are elected each year at the Annual General Meeting from owners involved only with that company, i.e. owners in that block.
This is a legally binding contract, but it is subject to conditions being satisfied, usually by the purchaser. The conditions will be detailed in the agreement and may, for example, require that you are able to sell your existing home by a set date or to arrange finance by a certain date. Conditions can also be included by the purchaser that require the seller to do something by a specified date - for example, that settlement will take place only on the conditions that the house is painted, the windows repaired or that rubbish around the section is removed. Note: Purchasers' conditions usually do not prevent the sale-taking place, but may allow the purchaser to delay settlement without penalty or claim damages if the conditions are not met in time.
Also called Building Loan. A short-term, interim loan (only paid to registered builders) for financing the cost of construction. The lender makes payments to the builder at periodic intervals as work progresses.
Contingency. See Special Condition.
An agreement in writing setting out the terms and conditions relating to the sale or purchase of a property.
An agreement in wiring setting out the terms and conditions relating to the sale or purchase of a property. It is the purchase document signed at auction.
Terms, conditions and restrictions noted on the title. A covenant may affect future plans or resale of the property.
A document issued by an insurance company giving temporary insurance until a formal policy is issued.
A record of an individual’s current and repaid debts which is usually used by a lender to assess the risk of a potential borrower.
A report of an individual’s credit history prepared by a credit bureau and used by a lender in determining a loan applicant’s creditworthiness.
This type of ownership is common where there is more than one home on a block of land. You are all owners of the land and you each lease your home. The lease will usually provide for an exclusive use area for each cross-lessee. It's like owning a freehold property but there are some restrictions. Another form of ownership for more than one home on a block of land is a unit title.
Also called a ‘Court’ or ‘Dead End Street’. A street with only one entrance, the other end being closed. Often valued for the privacy provide to homes in the street.Cancellation Attorney
The Attorney who attends to the cancellation of the Seller’s bond and is appointed by the Bank with whom the current mortgage bond is held.
A certificate issued by an insurance company verifying which parts of your property or property contents have coverage and the amount.
A freehold property in a development of similar houses.
Property which is used for business purposes or for generating income from the premises. Not used for residential purposes.
A tax charged for the transfer of property from the Seller to the Buyer.
A Conveyancing Attorney will attend to Deed Office transactions such as the transfer of a property from a Seller to a Buyer.
The 5-day period after the Offer to Purchase has been signed during which the Buyer of a property has the right to cancel this agreement.
A detailed score card of an individual's credit history prepared by an official credit bureau. This report will determine your risk as a borrower.
An institution or person to whom money is owed such as a Bank or mortgage originator.
The practice of making telephone calls or visiting from door to door to seek prospective buyers or sellers; in the real estate business, generally associated with acquired listings in a given area.
The legal ability of persons to enter into a valid contract. Most persons have fully capacity to contract and are said to be competent parties.
Profit earned from the sale of an asset.
The initial capital and the long-term expenditures made to establish and maintain a business or investment property.
The process of converting into present value (or obtaining the present worth of) a series of anticipated future periodic installments of net income. In real estate appraisal, it usually takes the form of discounting. The formula is Income/Rate = Value
The rate of return a property will produce on the owner’s investment.
The net spendable income from an investment, determined by deducting all operating and fixed expenses from the gross income. If expenses exceed income, a negative cash flow is the result.
A type of insurance policy that protects a property owner or other person from loss or injury sustained as a result of theft, vandalism, or similar occurrences.
A Latin phrase meaning, “let the buyer beware.”
The document generally given to a purchaser at a tax foreclosure sale. A certificate of sale does not convey title; generally, it is an instrument certifying that the holder may receive title to the property after the redemption period has passed and that the holder paid the property taxes for that interim period.
The statement of opinion on the status of the title to a parcel of real property, based on an examination of specified public records.
The succession of conveyances from some accepted starting point by which the present holder of real property dervies his or her title.
Community planning tool that welcomes and improves public participation in discussions about a community’s future growth and development.
Tracts of land located repetitively every 24 miles from a principal meridian and 24 miles from a defined base line. Guide meridians and correction lines define a check;s boundaries, consisting of 16 townships. A correction line “corrects” for the curvature of the earth, and guide meridians slant to compensate for North Pole directional movement.
A local government organization designed to direct and control the development of land within a municipality.
Used as a factor in determining adverse possession claims. Adversely occupying another’s real estate for a statutory period of time may create a claim of right.
A claim or encumbrance that may affect the title to land.
An insurance company repository for reported claim activity and previous property damage. CLUE is an acronym for Comprehensive Loss Underwriting Exchange. Insurers use the report to ascertain patterns of possible future claims and adjust their insurance premiums according to risk.
A testamentary disposition subsequent to a will that alters, explains, adds to, or confirms the will, but does not revoke it.
A clause in insurance policies covering real property that requires the policyholder to maintain fire insurance coverage that is generally equal to at least 80% of the property’s actual replacement cost.
Something of value given or pledged to a lender as a security for a debt or obligation.
Used as factor in an adverse possession claim when the occupying party actually received title but by a defective or incorrect deed (color of title).
A classification of real estate that includes income-producing property, such as office buildings, restaurants, shopping centers, hotels, and stores.
Property of a married couple that is so mixed or commingled that it is difficult to determine whether it is separate of community property. Commingled property becomes community property.
The illegal act of a real estate broker who mixes the money of other people with that of his or her own; brokers are required by law to maintain a separate trust account for other parties’ funds held temporarily by the broker.
The payment made to a broker for services rendered, such as in the sale or purchase of real property; this is usually a percentage of the selling price of the property.
The parts of a property that are necessary or convenient to the existence, maintenance, and safety of a condominium, or that are normally in common use by all of the condominium residents. All condominium owners have an undivided ownership interest in the common elements.
A system of property ownership based on the theory that each spouse has an equal interest in the property acquired by the efforts of either spouse during marriage.
The sold properties, listed in an appraisal report, which are substantially equivalent to the subect property.
Persons who are recognized by law as being able to contract with others; usually those of legal age and sound mind.
A method of determining the depreciation of a multi-building property using the average rate at which all the buildings are depreciating.
A judicial or administrative proceeding or process to exercise the power of eminent domain.
The absolute ownership of an apartment or a unit, generally in a multi-unit building, based on a legal description of the airspace the unit actually occupies, plus an undivided interest in the ownership of the common elements, which are owned together with the other condominium unit owners. The entire tract of real estate included in a condominium development is called a parcel or development parcel. One apartment or space in a condominium or part of a property intended for independent use and having lawful access to the public way is called a unit. Ownership of one unit also includes a definite undivided interest in the common elements.
Securitized mortgages sold on the secondary market that meet certain requirements established by Fannie Mae and Freddie Mac.
Something of value that induces one to enter into a contract. Consideration may be “valuable” (money or commodity) or “good” (love and affection”). Also, an act of forbearance, or the promise thereof, given by one party in exchange for something from the other. Forbearance is a promise not to do something.
1. Acts by the landlord that so materially disturb or impair the tenant’s enjoyment of the leased premises that the tenant is effectively forced to move out and terminate the lease without liability for any further rent.
2. A purchaser’s inability to obtain clear title.
Notice given to the world by recorded documents. All persons are charged with knowledge of such documents and their contents, whether or not they have actually examined them. Possession of property also is considered constructive notice that the person in possession has an interest in the property.
A provision or condition in the purchase of real estate requiring a certain act to be done or an event to happen before the contract becomes binding.
An agreement entered into by two or more legally competent by the terms of which one or more of the parties, for a consideration, undertakes to do or to refrain from doing some legal act or acts. A contract may be either unilateral (where only one party is bound to act) or bilateral (where all parties to the instrument are legally bound to act as prescribed).
A contract for the sale of real estate under which the sale price is paid in periodic installments by the purchaser, who is in possession and holds equitable title, although actual title is retained by the seller until final payment.
A contract for sale of real estate in which the consideration is paid wholly or partly in property.
An appraising principle where the value of a property’s component parts are measured by their effect on the selling price of the whole. Appraisers use sold properties as “paired sales” to isolate component parts and to identify their monetary contribution to the whole.
A loan that is not insured or guaranteed by a government agency.
A written instrument that evidences transfer of some interest to real property from one person to another.
A residential multi-unit building whose title is held by a trust or corporation that is owned by, and operated for, the benefit of persons living within the building. These persons are the beneficial owners of the trust or the shareholders of the corporation, each having a proprietary lease.
An entity or organization created by operation of law whose rights of doing business are essentially the same as those of an individual. The entity has continuous existence until dissolved according to legal procedures.
The horizontal provisions in the rectangular survey system made to compensate for the curvature of the earth’s surface. Every fourth township line is used as a correction line on which the intervals between the north and south range lines are remeasured and corrected to a full six miles.
The process of estimating the value of a property by adding the appraiser’s estimate of the reproduction or replacement cost of the building, less depreciation, to the estimated land value.
The business of providing people with expert advice on a subject, based on the counselor’s extensive, expert knowledge of the subject.
A new offer made as a reply to an offer received, having the effect of rejecting the original offer. The original offer cannot be accepted thereafter unless revived by the offeror repeating it.
Condominium documents that serve as the operational procedures describing the rights and prohibitions of the co-owners in a condominium association.
A three-digit score that assesses a borrower’s credit risk and the probability of default based on his or her past pay performances, outstanding credit balances, credit mix, time on file, and number of search inquiries.
A dead-end street that widens sufficiently at the end to permit an automobile to make a U-turn.
A life estate, usually a fractional interest, given by some states to the surviving husband in real estate owned by his deceased wife. Most states have abolished curtesy.
A recurring sequence of events that regularly follow one another, generally within a fixed interval of time.
A legal document conveying title to a property.
Failure to make mortgage payments regularly or to comply with other requirements of the mortgage.
A percentage of the purchase price given to bind the sale of real estate.
A decline in the value of property due to changes in market conditions or other clauses.
A cash expenditure for the purpose of settling a debt.
Money left over after all expenses have been met.
The vertical sides of a door frame.
The disbursement of mortgage funds provided by the Bank.Debit Order
A monthly instruction given to a Bank to deduct money off your account for payment of a loan.
A ratio which shows a Buyer's monthly payment obligation to debts and which is divided by gross monthly income to ensure affordability.
A document which states the particular information of a property transfer.
Failure to make the home loan payment within a specified period of time.
Money which you have saved and is paid towards the purchase price of a property. In renting, a deposit is also paid upfront as security.
A decline in the value of a property.
Any building (e.g. A house, flat, apartment, room, hostel room or shack) within which people reside.
A block of land which is zoned so that there two distinct dwellings are permitted by the Local Territorial Authority, to be constructed.
A horizontal plane from which heights and depths are measured.
A qualified estate in which the grantee could lose his or her interest upon the occurrence or non-occurrence of a specified event. There are two types of defeasible fee estates: (1) Those known as a condition subsequent where the possibility of re-entry takes place, and (2) A qualified limitation, where the grantee’s ownership automatically ends with the possibility of reverter (otherwise known as a fee simple determinable). The words as long as, while, or during are key to creating a qualified limitation defeasible fee estate.
Doing business as
A note or bond given as evidence of debt and issued without security
Something owed to another; an obligation to pay or return something.
An accounting method of calculating depreciation for tax purposes designed to provide large deductions in the early years of ownership.
A written instrument that when executed and delivered conveys title to, or an interest in, real estate.
A process by which the mortgagor can avoid foreclosure. Mortgagor gives a deed to mortgagee when mortgagor is in default according to terms of mortgage.
The instrument used to reconvey title to a trustor under a deed of trust once the debt has been satisfied.
An instrument used to create a lien by which the mortgagor conveys her or his title to a trustee, who holds it as security for the benefit of the noteholder.
The clauses in a deed limiting the future users of the property. Deed restrictions may impose a variety of limitations and conditions, such as limiting the density of buildings, dictating the types of structures that can be erected, and preventing buildings from being used for specific purposes or from used at all.
The nonperformance of a duty, whether arising under a contract or otherwise; failure to meet an obligation when due.
A clause used in leases or mortgages that cancels a specified right on the occurrence of a certain condition, such as cancellation of a mortgage on repayment of the mortgage loan.
A personal judgment levied against the mortgagor when a foreclosure sale does not produce sufficient funds to to pay the mortgage debt in full.
Unpaid taxes that are past due.
The legal act of transferring ownership. Documents such as deeds and purchase agreements must be delivered and accepted to be valid.
Delivery of a deed to a third person until the performance of some act or condition by one of the parties.
The willingness of persons to buy available goods at a given price; often coupled with supply.
The zoning ordinances that restrict the average maximum number of houses per acre that may be built within a particular area, generally a subdivision.
1. In appraisal, a loss of value in property due to all causes, including physical deterioration, functional obsolescence, and economic obsolescence.
2. In real estate investment, an expense deduction for tax purposes taken over the period of ownership of the income property.
The hereditary succession of an heir to the property of a relative who dies intestate.
An agency relationship where a client designates a broker to appoint an office agent to singularly represent his or her interest to the exclusion of all of the other agents in the broker’s office.
A fee-simple estate in which the property automatically reverts to the grantor on the occurrence of a specified event or condition.
A transfer of real estate by will or last testament. The donor is the devisor and the recipient is the devisee.
The principle that applies when a given parcel of land reaches its maximum percentage return on investment, and further expenditures for improving the property yield a decreasing return.
An added loan free charged by a lender to make the yield on a lower-than-market-value loan competitive with higher-interest loans.
The rate of interest a commercial bank must pay when it borrows from its federal reserve bank. Consequently, the discount rate is the rate of interest the banking system carries within its own framework. Member banks may take certain promissory notes that they have received from customers and sell them to their district federal reserve bank for less than face value. With the funds received, the banks can make further loans. Changes in the discount rate may cause banks and other lenders to reexamine credit policies and conditions.
To oust from land by legal process.
A property that includes in its ownership the appurtenant right to use an easement over another’s property for a specific purpose.
The legal right or interest recognized in some states that a wife acquires in the property her husband held or acquired during their marriage. During the lifetime of the husband, the right is only a possibility of an interest; on his death it can become an interest in land.
The use of unlawful constraint that forces action or inaction against a person’s will.
A mortgage loan on approved property made to a qualified veteran by an authorized lender and guaranteed by the Department of Veterans Affairs to limit possible loss by the lender.
A right that someone has to use the land belonging to another, eg: a water authority may have a sewerage easement across part of your property.
Part of a house or establishment illegally overhanging the street or a neighbour’s property.
An impediment to the use or transfer of the property in the form of an interest or right in the property.
The amount of an asset actually owned, Equity is the difference between the market value of the property and the amount still owed on its mortgage.
See Loan Application Fee
The total of all the real estate and personal property owned by an individual at the time of death.
The lawful expulsion of an occupant or tenant from real property.
A written contract that gives a licensed real estate agent the exclusive right to sell a property for a specified time.
A person named in a will to administer an. ‘Executrix’ is the feminine form.Economy
Economy refers to the wealth and resources of a country or region.
Electronic banking is a method of banking which allows an account holder to perform banking duties without having to physically enter a branch.
The Estate Agent is a person who is authorised to act as an agent for the sale of land or the valuation, management, or lease of property.
The lawful removal of an occupant from a property which they are renting.
An amount of money deposited by a buyer under the terms of a contract. In the event that the buyer, for no valid or legal reason, backs out of the transaction, earnest money is sometimes used as liquidated damages.Easement
A right to use the land of another for a specific purpose, such as for a right-of-way or utilities; an incorporeal interest in land. An easement appurtenant passes with the land when conveyed.
An easement allowed by law as necessary for the full enjoyment of a parcel of real estate.Easement by prescription
An easement acquired by continuous, open, uninterrupted, exclusive, and adverse of the property for the period of time prescribed by state law.
An easement that is not created for the benefit of any land owned by the owner of the easement but that attaches personally to the easement owner.Economic life
The period of time over which an improved property will earn an income adequate to justify its continued existence.
The impairment of desirability or useful life arising from factors external to the property, such as economic forces or environmental changes, that affect supply-demand relationships in the market. Loss in the use and value of a property arising from the factors of economic obsolescence is to be distinguished from loss in value from physical deterioration and functional obsolescence, both of which are inherent in the property.Emblements
Growing crops that are produced annually through the tenant’s own care and labor and that she or he is entitled to take away after the tenancy is ended. Emblements are regarded as personally property even prior to harvest, so if the landlord terminates the lease, the tenant may still reenter the land and remove such crops. If the tenant terminates the tenancy voluntarily, however, she or he generally is not entitled to the emblements.
The right of a government or municipal quasi-public body to acquire property for public use through a court action called condemnation, in which the court determines that the use is a public use and determines the price or compensation to be paid to the owner.
The status of one who works as a direct employee of an employer. An employer is obligated to withhold income taxes and Social Security taxes from the compensation of his or her employees.
A document evidencing formal employment between the employer and the employee or between the principal and the agent. In the real estate business, this generally takes the form of a listing or management agreement.
A fixture or structure, such as a wall or fence, that invades a portion of a property belonging to another.
Any lien that may diminish the value of the property, such as a mortgage, tax, or judgment lien; easement; restriction on the use of the land; or an outstanding dower right.
The act of writing one’s name, either with or without additional words, on a negotiable instrument or on a paper attached to such instrument.
Federal legislation requiring lenders to make credit equally available without discrimination based on race, sex, color, religion, marital status, age, national origin, or receipt of income from public assistance.
The raising or lowering of assessed values for tax purposes in a particular county or taxing district to make them equal to assessments in other counties or districts.
The interest held by a vehicle under a contract for deed or an installment contract; the equitable right to obtain absolute ownership to property when legal title is held in another’s name.
The interest or value that an owner has in a property over and above any mortgage indebtedness.
The gradual wearing away of land by water, wind, and general weather conditions; the diminishing of property caused by the elements.
Insurance coverage for real estate agents against claims for innocent and negligent misrepresentations.
The reversion of property to the state in the event that its owner dies without leaving a will and has no heirs to whom the property may pass by lawful descent.
The closing of a transaction through a third party called an escrow agent, or escrowee, who receives certain funds and documents to be delivered on the performance of certain conditions in the escrow agreement.
An interest for a certain, exact period of time in property leased for a specified consideration.
The degree, quantity, nature, and extent of interest that a persona has in real property.
An estate owned by one person.
A legal instrument executed by a mortgagor showing the amount of the unpaid balance due on a mortgage and stating that the mortgagor has no defenses or offsets against the mortgagee at the time of execution of the certificate.
Legally allowed necessities, such as the right of a tenant to use timber on leased property to support a minimum need for fuel or repairs.
Conduct conforming to professional standards.
Latin, meaning “and others”.
Latin, meaning “and wife”.
Latin, meaning “and husband”.
A legal process to oust a person from possession of real estate.
A proof of ownership of property, which is commonly a certificate of title, a title insurance policy, an abstract of title with lawyer’s opinion, or a Torrens registration certificate.
A transaction in which all of part of the consideration for the purchase of real property is the transfer of like-kind property. Ex. real estate for real estate.
A listing contract under which the owner appoints a real estate broker as his or her exclusive agent for a designated period of time to sell the property on the owner’s stated terms for a commission. The owner, however, reserves the right to sell without paying anyone a commission by selling to a prospect who has not been introduced or claimed by the broker.
A listing contract under which the owner appoints a real estate broker as his or her exclusive agent for a designated period of time to sell the property on the owner’s stated terms and agrees to pay the broker a commission when the property is sold, whether by the broker, the owner, or another broker.
A contract in which all parties have fulfilled their promises and thus performed the contract.
The signing and delivery of an instrument. Also, a legal order directing an official to enforce a judgment against the property of a debtor.
The person designated in a will to handle the state of the deceased. The probate court must approve any sale of property by the executor.
A contract under which something remains to be done by one of more of the parties.
The short-term costs that are deducted from an investment property’s income, such as minor repairs, regular maintenance, and renting costs.
An oral or written contract in which the parties state their terms and express their intentions in words.
A consumer protection law that regulates the disclosure of consumer credit reports by consumer/credit reporting agencies and establishes procedures for correcting mistakes on one’s credit record
The greatest possible interest a person can have in real estate.
Building material made of compressed fibres cemented into rigid sheets.
Financial Institutions Duty. State duty on the receipts of financial institutions.
A person who essentially holds the character of a trustee. Real Estate agents and salespersons are considered by law to be fiduciaries, thus they have a duty to act primarily for the benefit of the principal (the person who employed them) and not their own. A fiduciary must act with the highest degree of care and good faith in relations with the principal and on the principal’s business. Penalties for failing in fiduciary duties may be quite severe.
A mortgage that is the primary lien against a property.
Objects that can be removed from a property without causing damage to it.
The monthly payment due on a mortgage loan. The fixed instalment includes payment of both principal and interest
A mortgage in which the interest rate does not change during the term of the loan.
Fixed items that cannot be removed without damaging either the property or the fixture itself, eg: cupboards.
The footing supports the building on its foundation.
The legal process by which a borrower in default under a mortgage is deprived of his or her interest in the mortgaged property. This usually results in the selling the property by auction and the proceeds being used to service the mortgage debt.
An estate in real property which continues for an indefinite period of time. Freehold estates may be inheritable or non-inheritable. Inheritable estates include the fee simple absolute, the qualified fee, and the fee tail. Non-inheritable estates include various life estates which are created by acts of parties, such as an ordinary life estate, or by operation of law.Fees
A charge to cover the cost of a service (e.g. building inspection fee, zoning fee).
The Financial Intelligence Centre Act, 2001 was formed to regulate money laundering and requires valid information to be presented to the Bank.
An establishment such as a bank, trust company, insurance company and investment dealer. A financial institution deals with investing your money.
A floor plan shows the architectural layout of the building and the specifications of each room.
The sale of a property used as security for a loan to repay the creditor in the event of default on the loan.
When a Bank takes possession of property as a result of defaults in loan or mortgage payments. (See: Repossessed)
Shared ownership and shared usage of an asset such as property. Fractional ownership often refers to holiday property.
Property where the owner has full rights to the property and takes on all responsibilities.
The term for Title VIII of the Civil Rights Act of 1968 as amended, which prohibits discrimination based on race, color, sex, religion, national origin, handicaps, and familial status in the sale and rental of residential property.
A federally chartered corporation created to provide a secondary mortgage market for conventional loans (Freddie Mac).
A federal administrative body created by the National Housing Act in 1934 to encourage improvement in housing standards and conditions, to provide an adequate home-financing system through the insurance of housing mortgages and credit, and to exert a stabilizing influence on the mortgage market.
An annual tax based on income, including monies derived from the lease, use, or operation of real estate.
“Fannie Mae” is the popular name for this federally chartered corporation, which creates a secondary market for existing mortgages. FNMA does not loan money directly, but rather buys DVA, FHA, and conventional loans.
The maximum possible estate or right of ownership of real property continuing forever.
An FHA evaluation of a property as a security for a loan. Includes the study of the physical characteristics of the property and the surroundings, and the location of the property.
A loan insured by the FHA and made by an approved lender in accordance with FHA regulations.
A relationship of trust and confidence, as between trustee and beneficiary, attorney and client, principal and agent.
A mortgage that creates a superior voluntary lien on the property mortgaged relative to other charges or encumbrances against the property.
The government’s policy in regard to taxation and spending programs. The balance between these two areas determines the amount of money the government will withdraw or feed into the economy in an attempt to counter economic peaks and slumps.
An article that was once personal property but has been so affixed to real estate that it has become real property.
A summary proceeding for restoring to possession of land one who is wrongfully kept out or has been wrongfully deprived of the possession.
A legal procedure by which property used as security for a debt is sold to satisfy the debt in the event of default in payment of the mortgage note or default of other terms in the mortgage document. The foreclosure procedure brings the rights of all parties to a conclusion and passes the title in the mortgaged property either to the holder of the mortgage or to a third party who may purchase the realty at the foreclosure sale, free of all encumbrances affecting the property subsequent to the mortgage.
An acknowledgment taken outside of the state in which the land lies.
A private contractual agreement to run a business using a designated trade name and operating procedures.
A misstatement of a material fact made with intent to deceive or made with reckless disregard of the truth and that actually does deceive.
An estate in land in which ownership is for an indeterminate length of time, in contrast to a leasehold estate.
The impairment of functional capacity or efficiency; the inability of a structure to perform adequately the function for which it currently is employed. Functional obsolescence reflects the loss in value brought about by factors that affect the property, such as overcapacity, inadequacy, or changes in the art.
A fee required by the Department of Veterans Affairs for making a VA guaranteed loan. The funding fee is added in with the loan and then forwarded to the VA to guarantee a veteran’s loan.
A person’s present right to an interest in real property that will not result in possession or enjoyment until sometime in the future, such as a reversion or right of reentry.
The triangular part of a building’s end wall which extends up to meet the two slopes of a roof.
The legally divert part or whole of someone’s money or property to someone else, eg: for Child Support Payment.
The ratio of your own money and borrowed funds for investment.
Income before taxes are deducted.
A person who agrees to indemnify the holder of a loan all or a portion of the unpaid principal balance in case of default by the borrower.Gross Income
Your total monthly income before taxes and other expenses are deducted.Gross Profit
Remaining revenue after deducting total costs from total sales.
A defect in the chain of title of a particular parcel of real estate; a missing document or conveyance that raises doubt as to the present ownership of the land.
A construction specialist who enters into a formal construction contract with a landowner or master lessee to construct a real estate building or project. The general contractor often contracts with several subcontractors specializing in various aspects of the building process to perform individual jobs.
A lien on all real and personal property owned by a debtor.
A deed that states that the title conveyed therein is good from the sovereignty of the soil to the grantee therein and that no one else can successfully claim the property. This type of deed contains several specific warranties sometimes referred to as the English Covenants of Title.
Fractional sections in the rectangular survey system (government survey method) that are less than one full quarter-section in area.
“Ginnie Mae,” a federal agency and division of HUD that operates special assistance aspects of federally aided housing programs and participates in the secondary market through its mortgage-backed securities pools.
Lease that provides for rent increases at set future dates.
A mortgage loan for which the initial payments are low but increase over the life of the loan.
The act of conveying or transferring title to real property.
A type of deed that includes three basic warranties: (1) the owner warrants that she or he has the right to convey the property, (2) the owner warrants that the property is not encumbered other than with those encumbrances listed in the deed, and (3) the owner promises to convey any after-acquired title to the property. Grant deeds are popular in states that rely heavily on title insurance.
A person to whom real estate is conveyed; the buyer.
A person who conveys real estate by deed; the seller.
A lease or property under which a landlord pays all property charges regularly incurred through ownership, such as repairs, taxes, insurance, and operating expenses. Most residential leases are gross leases.
The total value of all goods and services produced in the United States (or other country) in a year.
A figure used as a multiplier of the gross monthly rental income of a property to produce an estimate of the property’s value.
A lease of land only, on which the tenant usually owns a building or is required to builder her or his own building as specified in the lease. Such leases are usually long-term net leases; a tenant’s rights and obligations continue until the lease expires or is terminated through default.
An agreement between the broker and the seller that if the seller’s real property is not sold before a certain date, the broker will purchase it for a specified price.
One who guards or cares for another person’s rights and properties. A guardian has legal custody of the affairs of a minor or a person incapable of taking care of his or her own interests, called a ward.
Suitable for occupancy. Local building codes ensure that structures are habitable through requirements for building permits and certificates of occupancy.
A mortgage loan which allows the borrower to obtain multiple advances of the loan proceeds up to a specified percentage of the borrower’s equity in a property.
A loan made to a homeowner in which the home is used as collateral for the loan.
A thorough inspection that evaluates the structural and mechanical condition of a property.
A term used to describe a dwelling or home which is suitable for a person to live in.
An inspection that evaluates the condition of a property for valuation purposes.
An agreement between the Buyer and a Bank, where the Bank lends the Buyer money in order to purchase property.
A form on which all relevant personal and financial information is given to begin the home loan application process.
An insurance policy that covers your house (structure and property) in the event of damage or loss.
A freehold dwelling.
The deed clause beginning “to have and to hold,” which defines or limits the extend of ownership in the state granted by the deed.
One who might inherit or succeed to an interest in land under the state law of descent when the owner dies without leaving a valid will.
Every kind of inheritable property, including person, real corporeal, and incorporeal.
The possible use of land that will produce the greatest net income and thus develop the highest land value.
A tenancy by which a lessee retains possession of a leased property after her or his lease has expired and the landlord, by continuing to accept rent from the tenant, agrees to the tenant’s continued occupancy as defined by state law.
A will that is written, dated, and signed in the handwriting of the maker.
A standardized package insurance policy that covers a residential real estate owner against financial loss from fire, theft, public liability, and other common risks.
An insurance program offered to buyers by some brokerages, warranting the property against certain defects for a specified period of time.
The land and the improvements thereon designated by the owner as his or her homestead and, therefore, protected by state law, either in whole or in part, from forced sale by certain creditors of the owner.
The Department of Housing and Urban Development; regulates FHA and GNMA.
The pledge of property as security of a loan in which the borrower maintains possession of the property while it is pledged as security.
A mortgage that is protected by private mortgage insurance. If the borrower defaults on the loan, the insurer must pay the lender the lesser of the loss incurred or the insured amount.
The fee charged for borrowing money.
A loan where only the interest is repaid throughout the course of the loan. The original amount is repaid at the end of the term of the loan, rolled over by the same bank or the owner re-mortgages.
The rate of interest in effect for the monthly payment due.
A loan offered at a reduced rate for an introductory period to new borrowers.
A property that is not occupied by the owner, but provides a return to the owner through letting or leasing to a tenant.Instalment Amount
The monthly amount paid to the lender as part of the total home loan amount. Instalments run for the entire duration of the agreed term.
Insurance protects an individual or their property in the event of unforeseen circumstances, such as theft, loss or death. This is a monthly fee.
A charge owed for borrowing money. Interest is calculated as a percentage of the remaining balance of the amount borrowed.
When Attorneys and Estate Agents hold money for clients, it is deposited into an interest bearing account. This is for the protection of the amount.
Interest is added onto the amount of money borrowed from a Bank. This amount is fixed for a period and is based on the amount of money.
A detailed list or a record of property Immovable property- An immovable object that is attached to the earth like land and buildings.
A flat fee charged for conducting a routine inspection on your property. Some managers can charge extra for initial inspections, chattels inspections and furnished property inspections.
When the owner leases out a property not occupied by him to an individual with an intent to earn an income e.g. -renting a house
A contract under which the agreement of the parties is demonstrated by their acts and conduct.
A method of creating an easement. One party may be using another’s property for the benefit of both parties.
1. Improvements on land: any structure, usually privately owned, erected on a site to enhance the value of the property;
2. Improvements to land: usually a publicly owned structure.
Incomplete right, such as a wife’s dower interest in her husband’s property during his life.
The process of estimating the value of an income-producing property by capitalization of the annual net income expected to be produced by the property during its remaining useful life.
A nonpossessory right in real estate.
The principle that applies when increased expenditures for improvements to a given parcel of land yield an increasing percentage return on investment.
One who is retained to perform a certain act but who is subject to the control and direction of another only as to the end result, and not as to how he or she performs the act. Unlike an employee, an independent contractor pays all of his or her expenses, pays his or her income and Social Security taxes, and receives no employee benefits. Many real estate salespeople are independent contractors.
Lease that allows the rent to be increased or decreased periodically, based on changes in the a selected economic index, such as the Consumer Price Index.
All land and buildings used or suited for use in the production, storage, or distribution of tangible goods.
A method of reporting gain received from the sale of real estate when the sale price is paid in two or more installments over two or more years. If the sale meets certain requirements, a taxpayer can spread recognition of the reportable gain over more than one year, which may result in tax savings.
A title to land that a title company will insure.
The indemnification against loss from a specific hazard or peril through a contract (called a policy) and for a consideration (called a premium).
A charge made by a lender for the use of money.
A short-term loan usually made during the construction phase of a building project, often referred to as a construction loan.
The condition of a property owner who dies without leaving a will. Title to such property passes to his or her heirs as provided in the state law of descent.
Having no force or effect.
To render null and void.
Money directed toward the purchase, improvement, and development of an asset in expectation of income or profits. A good financial investment has the following characteristics: safety, regularity of yield, marketability, acceptable denominations, valuable collateral, acceptable duration, required attention, and potential appreciation.
The ownership of real estate by two or more parties who have been named in one conveyance as joint tenants. On the death of a joint tenant, her or his interest passes to the surviving joint tenant or tenants by the right of survivorship.
The joining of two or more people to conduct a specific business enterprise. A joint venture is similar to a partnership in that it must be created by agreement between the parties to share in the losses and profits of the venture. It is unlike a partnership in that the venture is for one specific project only, rather than for a continuing business relationship.
The official and authentic decision of a court on the respective rights and claims of the parties to an action or suit. When a judgment is entered and recorded with the county recorder, it usually becomes a general lien on the property of the defendant for a ten-year period.
A provision that may be included in notes, leases, and contracts by which the debtor, lessee, or obligor authorizes any attorney to go into court to confess a judgment against him or her for a default in payment. Also called a cognovit.
A major or primary tenant in an office building or shopping centre, generally such a tenant leases a significant amount of the available space.
Tiny retail outlets which are located at public places where customers could purchase items like newspaper
Layers of timer glued and pressed together to increase rigidity or to use as bench tops or cupboard doors.
A person who rents property to another, a lessor. A property owner who surrenders the right to use property for a specific time in exchange for the receipt of rent.
You buy the right to own the home and lease the land for a certain time. You pay rent to the landlord for the land. You can sell the lease if you want to move on. There may be restrictions on your use of the property.
A person leasing a property.
The owner of a property that is leased to another person.
A list of debts owned.
A legal claim against a property that must be paid off when the property is sold.
Also called Tenancy for Life. A freehold interest (in real property) that expires upon the death of the owner or some other specified person.
A LIM is a report prepared by the local Council at your request. It provides a summary of property information held by the Council as at the day the LIM was produced.
A LIM provides some or all of the following:
The Memorandum may also include:
An asset, cash or otherwise, that can be converted into cash.
A written contract between an owner and a real estate, authorizing the agent to perform services for the principal involving the owner’s property. The property so listed.
A sum of borrowed money that is generally repaid with.
Also called Establishment Fee. A fee paid to a lender for processing a loan.
The amount of the loan financed as a proportion of the property value, expressed as a percentage.Land Surveyor
A qualified professional who is trained to measure the boundaries of a property.
The owner of property that is leased to others. A landlord is seen as a custodian of the property and is responsible for collecting rent.
Points of interest or amenities. Schools, libraries, sports fields and shopping centres are examples of landmarks
A contract signed between an owner of a property and the tenant. This contract specifies important terms and conditions regarding the rental period.
A Bank, person or other institution that lends money to a borrower.
The owner renting out the property.
A set of fees or a tariff collected by an authority.
An amount of money transferred from a Bank (lender) to a borrower in exchange for future repayments.
An equitable doctrine used by the courts to bar a legal claim or prevent the assertion of a right because of undue delay, negligence, or failure to assert the claim or right.
The earth’s surface extending downward to the center of the earth and upward infinitely into space.
A contract between a landlord (the lessor) and a tenant (the lessee) transferring the right to exclusive possession and use of the landlord’s real property to the lessee for a specified period of time and for a stated consideration (rent). By state law, leases for longer than a certain period of time (generally one year) must be in writing to be enforceable.
A tenant’s right to occupy real estate during the term of a lease, generally considered to be a personal property interest.
A disposition of money or personal property by will.
A description of a specific parcel of real estate sufficient for an independent surveyor to locate and identify it. The most common forms of legal description are rectangular survey, metes and bounds, and subdivision lot and block (plat).
An element that must be present in a valid contract. If a contract has for its object an act that violates the laws of the United States or the laws of a state to which the parties are subject, it is illegal, invalid, and not recognized by the courts.
The tenant who leases a property.
One who leases property to a tenant
The use of borrowed money to finance the bulk of an investment.
To assess, seize, or collect. To levy a tax is to assess a property and set the rate of taxation. To levy an execution is to seize officially the property of a person to satisfy an obligation.
1. A privilege or right granted to a person by a state to operate as a real estate broker or salesperson.
2. The revocable permission for a temporary use of land – a personal right that cannot be sold.
A right given by law to certain creditors to have their debt paid out of the property of a defaulting debtor, usually by means of a court sale.
An interest in real or personal property that is limited in duration to the lifetime of its owner or some other designated person.
A person in possession of a life estate.
Liquidated damages occur when, by contractual agreement, defaulted earnest money becomes the personal property of the seller.
The ability to sell an asset and convert it into cash at a price close to its true value.
A public notice that a lawsuit affecting title to or possession, use, and enjoyment of a parcel of real estate has been filed in either a state or federal court.
A contract between a landowner (as principal) and a licensed real estate broker (as agent) by which the broker is employed as agent to list and sell real estate on the owner’s terms within a given time, for which service the landowner agrees to pay a commission.
The broker in a multiple-listing situation from whose office a listing agreement is initiated, as opposed to the selling broker, from whose office negotiations leading to a sale are initiated. The listing broker and the selling broker may, of course, by the same person.
1. A landowner’s claim to use water in large lakes and oceans adjacent to her or his property.
2. The ownership rights to land bordering these bodies of water up to the high-water mark.
A description of real property that identifies a parcel of land by reference to lot and block numbers within a subdivision, as identified on a subdivided plat duly recorded in the county recorder’s office.
A qualified professional who is trained to measure the boundaries of a property.
The owner of property that is leased to others. A landlord is seen as a custodian of the property and is responsible for collecting rent.
Points of interest or amenities. Schools, libraries, sports fields and shopping centres are examples of landmarks.
A contract signed between an owner of a property and the tenant. This contract specifies important terms and conditions regarding the rental period.
A Bank, person or other institution that lends money to a borrower.
The owner renting out the property.
A person who leases the property.
The lender, bank, or Mortgage Company who holds the note on the loan agrees to modify the original terms of the loan. An example might be a reduction of the interest rate or changing the length of the loan from 30 years to 40 years. One of the main requirements to qualify for a loan modification is to prove to the lender you have a “hardship”. If the lender agrees to modify the loan, they seldom will reduce the principal balance of the original note.
A sum of money that is borrowed for temporary use. The loan sum is expected to be paid back with interest.
An individual who owns and rents out buildings and lands.
- Landmarks are buildings or heritage sites that are marked to be preserved by the government.
An opening which permits access to the space between the roof and the ceiling, or below the floor.
The price at which a seller is happy to sell and a buyer is willing to buy. This assumes that there is sufficient activity in the marketplace to generate enough buyers and sellers so that neither party controls the price. Establishing the market value is the objective of an appraisal.
A legal document that pledges a property to the lender as security for payment of a debit.
An individual or company that brings borrowers and lenders together for the purpose of loan origination. Mortgage brokers typically require a fee or a commission for their services. Usually paid by the Lender.
A fee charged by some lending institutions for finalising a loan repayment.
A policy that insures the lender against the borrower on a loan. Most lenders generally require insurance when borrowing more than 80% of the property value.
A type of term life insurance often bought by mortgagors. The amount of coverage decreases as the principal balance declines. In the event that the borrower dies while the policy is in force, the debt is automatically satisfied by insurance proceeds.
A non-interest earning account that is offset against a home loan to reduce the total interest payable.
The lender in a mortgage agreement.
The borrower in a mortgage agreement.Mortgage Broker
Someone who acts as an intermediary between the Buyer and a Bank, for the purposes of arranging a home loan.
The value of a piece of land, or property set out and decided by the Municipality.
A local government which presides over a city, town,or district which acts as the local authority.
A contract between the owner of income property and a management firm or individual property manager outlining the scope of the manager’s authority.
A lease agreement that barely covers the costs of operation for the property.
Land that barely covers the costs of operation.
A good or clear salable title reasonably free from risk of litigation over possible defects.
A method of appraising or evaluating real property based on the proposition that an informed purchaser would pay no more for a property than the cost to him or her of acquiring an existing property with the same utility. This approach is applicable when an active market provides sufficient quantities of reliable data that can be verified from authoritative sources. The approach is relatively unreliable in an inactive market or in estimating the value of properties for which no real comparable sales data are available. It also is questionable when sales data cannot be verified with principals to the transaction. Also referred to as the market comparison or direct sales comparison approach.
The actual selling price of a property.
The most profitable price a property will bring in a competitive and open market under all conditions requisite to a fair sale. The price at which a buyer would buy and a seller would sell, each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus.
A statutory lien created in favor of contractors, laborers, and materialmen or material suppliers who have performed work or furnished materials in improving real property.
A legal description of a parcel of land that begins at a well-marked point and follows the boundaries, using direction and distances around the tract, back to the point of beginning.
A tax rate used by municipalities to compute property tax.
A property tax rate obtained by dividing the total assessed value of all the property in the tax district into the total amount of revenue needed by the taxing district. This millage rate then is applied to the taxable value of each property in the district to determine individual taxes.
To represent falsely; to give an untrue idea of a property. May be accomplished by omission or concealment of a material fact.
The government regulation of the amount of money in circulation through such institutions as the Federal Reserve Board.
A court judgment ordering payment of money rather than specific performance of a certain action.
Those institutions, such as banks, savings-and-loan associations, and life insurance companies, who supply money and credit to borrowers.
A periodic tenancy – the tenant rents for one period at a time. In the absence of a rental agreement (oral or written), a tenancy generally is considered to be from month to month.
Fixed natural or artificial objects, used in metes-and-bounds description, to establish the boundaries; located at the corners.
A conditional transfer or pledge of real estate as security for a loan. Also, the document creating a mortgage lien.
A lien or charge on a mortgagor’s property that secures the underlying debt obligations.
One who, having all or part of title to property, pledges that property as security for a debt; the borrower
An exclusive listing (generally an exclusive right to sell) with the additional authority and obligation on the part of the listing broker to distribute the listing to other brokers in the multiple-listing organization.
The laws, regulations, and codes enacted by the governing body of a municipality.
The act of putting an end to a contract by mutual agreement of the parties.
Where the return on an investment is not sufficient to cover the costs on the investment, eg: property maintenance and interest on the loan against income from letting/leasing.
Make an offer and we will attempt to negotiate a concluded contract between the parties.
Income after taxes are deducted.
The value of a person’s assets minus liabilities.
A person who, in a limited sense, acts for or represents another.
A formal written notice to a borrower that has occurred and that legal action may be taken.
A notice to a tenant to vacate the property.
That which cannot be legally enforced, as with a contract provision that is not in conformance with the law.Net Income
This is your yearly income after taxes.
Carelessness and inattentiveness resulting in violation of trust. Failure to do what is required.
The gross income of the property minus vacancy, collection losses, and operating expenses (not including debt service).
A lease requiring the tenant to pay not only rent but also costs incurred in maintaining the property, including taxes, insurance, utilities, repairs. If the tenant pays for everything, it is referred to as a triple net lease.
A use of property that is permitted to continue after a zoning ordinance prohibiting it has been established for the area.
A lack of uniformity; dissimilarity. Because no two parcels of land are geographically alike, real estate is said to be nonhomogeneous, or heterogeneous.
To certify or attest to a document, as by a notary public.
A public official authorized to certify and attest to documents, take affidavits, take acknowledgments, administer oaths, and perform other such acts.
An instrument of credit given to attest a debt.
To purchase a property before it is completed after having only seen the plans.
Conveyed intent by one party to form a contract, which may have conditions and stipulations, with another party.
A process of calling for offers on the property, usually required by a certain date.
An account linked to a mortgage account so that the interest earned is applied to reduce the interest on the mortgage.
The Banking Industry Ombudsman is the avenue through which a customer can make a complain about their bank and have it dealt with independently.
A loan maintenance fee charged regularly over the life of the loan.
Land which has not had improvements such as buildings and other structures added to it. Such land is often left in a subdivision by a developer or stipulated by a local authority for recreational use or for personal use by the owner.Occupant
Someone who occupies a particular property or place.
A charge applied to the Seller for occupying the property after registration has taken place or to the Buyer for occupying the property before.
A legally binding document signed by the Buyer and Seller stating the agreement of the sale and its conditions.
A property designed specifically for business and corporate offices.
Someone who owns a property or an asset. This ownership is usually indicated on a title deed.
The two components of a valid contract; a “meeting of the minds.”
A deed by sheriffs, trustees, guardians, etc.
A salesperson compensation plan by which the salesperson pays his or her broker a monthly service charge to cover the costs of office expenses and receives 100% of the commissions from the sales that he or she negotiates.
A mortgage loan expandable by increments up to maximum dollar amount, all of which is secured by the same original mortgage.
A listing contract under which the broker’s commission is contingent on the broker producing a “ready, willing, and able” buyer before the property is sold by the seller or another broker; the principal (owner) reserves the right to list the property with other brokers.
The right to purchase property within a definite time at a specified price. No obligation to purchase exists, but the seller is obligated to sell if the option holder exercises the right to purchase.
The party that receives and holds an option.
The party that grants or gives an option.
The exclusive right to hold, possess or control, and dispose of a tangible or intangible thing. Ownerships may be held by a person, corporation, or governmental entity.
The highest bid fails to meet the reserve price of a property at an auction and consequently does not sell.
A report giving information on items such as potential erosion, subsidence, hazardous contaminants, stormwater. It may also include classifications under organisations such as the Dept. of Conservation or Historic Places Trust, as well as authorisations required by the Resource Management Act.
A pricing method used by some Real Estate companies, meaning Price On Application.
The person who has authority to execute documents on behalf of the grantor of the power. Also a legal document which authorises another person to act on one’s behalf. A power of attorney can grant complete authority or can be limited to certain acts and/or certain periods of time.
The process of determining how much money a prospective home buyer will be eligible to borrow before he or she applies for a loan.
The interest rate that banks charge their preferred customers. Changes in this rate can influence other rates including mortgage interest rates.
The amount borrowed or still to be repaid. The part of the monthly payment that reduces the balance of the mortgage.
The sale of property by the owner without the services of a real estate agent.
The sale of property, through a real estate agent, by negotiation.
A person who represents another, particularly, in some meeting. Also, the document giving to another, the authority to represent.Payslip
A document issued on a monthly basis by your employer as proof of your monthly income.
A building or part of a building, usually including the adjacent grounds.
When ownership of a property legally changes hands from Seller to Buyer, through registration of the property at the Deeds Office.
The classification of commercial Real Estate. The four primary property types are: retail, industrial, office and residential.
The amount paid for the purchase of a property as set out in the Offer to Purchase agreement.
The person who buys a property.
A method of financing in which the purchase of the land also finances the purchase of certain personal property items.
A law that states that no prior or contemporary oral or extraneously written agreement can change the terms of a contract.
A case in which the landlord’s negligence deprives the tenant of the use of all or part of the premises.
A mortgage in which the lender participates in the income of the mortgaged venture beyond a fixed return, or receives a yield on the loan in addition to the straight interest rate.
The division of cotenants’ interests in real property when the parties do not all voluntarily agree to terminate the co-ownership; takes place through court procedures.
An association of two or more individuals who carry on a continuing business for profit as co-owners. Under the law, a partnership is regarded as a group of individuals rather than as a single entity. A general partnership is a typical form of joint venture in which each general partner shares in the administration, profits, and losses of the operation. A limited partnership is a business arrangement by which the operation is administered by one or more general partners and funded by limited or silent partners, who are by law responsible for losses only to the extent of their investment.
A wall that is located on or at a boundary line between two adjoining parcels for the use of the owners of both properties.
The party that receives payment.
The party that makes payment to another.
A lease commonly used for retail property in which the rental is based on the tenant’s gross sales at the premises; often stipulates a base monthly rental plus a percentage of any gross sales above a certain amount.
A binding agreement, often accompanied by surety and usually posted by one who is to perform work for another, that assures that project or undertaking will be completed as per the agreement or contract.
An interest in leased property that continues from period to period – week to week, month to month, or year to year.
Referred to as a PRM, it is a fixed object that leads the surveyor to the point of beginning (POB). In most surveys, two different PRMs are used to locate the POB.
An individual working for a broker or salesperson who handles non-sales-related aspects of real estate transactions. However, if the personal assistant is licensed, then he or she can also handle the sales-related aspects of the transaction.
Items, called chattels, that do not fit into the definition of real property; movable objects.
A reduction in utility resulting from an impairment of physical condition. For purposes of appraisal analysis, it is most common and convenient to divide physical deterioration into curable and incurable components.
A map of a town, section, or subdivision indicating the location and boundaries of individual property.
A book containing recorded subdivisions of land.
A unit of measurement used for various loan charges; one point equals one percent of the amount of the loan.
The starting point of the survey situated in one corner of the parcel in a metes-and-bounds description. All metes-and-bounds descriptions must follow the boundaries of the parcel back to the point of beginning.
The government’s right to impose laws, statutes, and ordinances to protect the public health, safety, and welfare, including zoning ordinances and building codes.
A written instrument authorizing a person (the attorney-in-fact) to act on behalf of the maker to the extent indicated in the instrument.
The specific section of a deed that states the names of the parties, recital of consideration, operative words of conveyance, legal property description, and appurtenance provisions.
In a mortgage, the statement of the terms on which the mortgagor may pay the entire or stated amount of the mortgage principal at some time prior to the due date.
A charge imposed on a borrower by a lender for early payment of the loan principal to compensate the lender for interest and other charges that would otherwise be lost.
1. A sum lent or employed as a fund or investment, as distinguished from its income or profits.
2. The original amount (as in a loan) of the total due and payable at a certain date. 3. A main party to a transaction – the person for whom the agent works.
One of 35 north and south survey lines established and defined as part of the rectangular survey system (government survey method)
The appraisal theory stating that buildings that are similar in design, construction, and age to other buildings in the area have a higher value than they would have in a neighborhood of dissimilar buildings.
The order of position or time. The priority of liens generally is determined by the chronological order in which the lien documents are recorded; tax liens (like special assessments), however, have priority, even over previously recorded liens.
The formal judicial proceeding to prove or confirm the validity of a will or proof of heirship and to settle the affairs of the deceased.
The effort that brings about the desired result. Under an open listing, the broker who is the procuring cause of the sale receives the commission.
State mandated seller’s property disclosure reports. These reports place the burden of defect disclosure on the seller. Agents are not required to discover property defects but are required to disclose them if they are known.
The operation of the property of another for compensation. Includes marketing space; advertising and rental activities; collecting, recording, and remitting rents; maintaining the property; tenant relations; hiring employees; keeping proper accounts; and rendering periodic reports to the owner.
Taxes levied by the government against either real or personal property. The right to tax real property in the United States rests exclusively with the states, not with the federal government.
The proportional division or distribution of expenses of property ownership between two or more parties. Closing statement prorations generally include taxes, rents, insurance, interest charges, and assessments.
A printed advertisement usually in pamphlet form, presenting a new development, subdivision, business venture, or stock issue.
A right granted by a property owner to a public utility company to erect and maintain poles, wires, and conduits on, across, or under her or his land for telephone, electric power, gas, water, or sewer installation.
Latin, meaning “for the life of another.” A life estate pur autre vie is a life estate measured by the life of a person other than the grantee.
A note secured by a mortgage or deed of trust given by a buyer, as a mortgagor, to a seller, as a mortgagee, as part of the purchase price of the real estate.
A buyer who has satisfied a lender that he or she is financially able to qualify for a loan. Qualifying the buyer is one of the primary steps taken by the lender as part of the loan process.
The act of determining a prospect’s motivation, then matching his or her needs with the available inventory.
A conveyance by which the grantor transfers whatever interest he or she has in the real estate without warranties or obligations.
Part of the framework of the roof, the rafters slope down from the ridge to the eaves.
A person or Company licensed to negotiate and transact the sale or lease of real estate on behalf of the property owner.
The process of paying off one loan with the proceeds from a new loan using the same property as security.
Real Estate Institute of New Zealand. National representation body of real estate agents.
A process where the buyer requests additional information about the title of the property from the vendor.
The minimum price which a seller will accept at auction.
Resource consents are necessary when a group or individual wishes to carry out an activity or development that may have some effect on the environment. Resource consents relate directly to the rules set out in the District or Regional Plans and the Resource Management Act and are different to Building Consents.
A provision in an agreement that gives a party the first opportunity to purchase or lease the property before it is offered for sale or lease to others.
In, the right of the survivors to acquire the interest of a deceased joint estate.
A right of one property or the general public for access to or across another property.
This clause may be contained in a building contract. It provides for an upward or downward contract price which correlates to the movement of prices, wages or other factors specified in the clause.
The slope of the roof.Registering Attorney
The Attorney who attends to the registration of the new bond into the name of the Buyer.
Restoring a home or property by rebuilding or remodeling.
The number of months allocated to pay off a home loan. The maximum repayment term is 30 years.
A home that has been reclaimed by the Bank due to default payments by the owner. (see: Foreclosure)
A property used for residential purposes, not for business or office purposes.
A six-mile strip of land measured east and west from the meridian lines.
One who is prepared to buy property on the seller’s terms and is ready to take positive steps to consummate the transaction.
Land; a portion of the earth’s surface extending downward to the center of the earth and upward infinitely into space, including all things permanently attached thereto, whether by nature or by man.
Any person, partnership, association, or corporation that sells (or offers to sell), buys (or offers to buy), or negotiates the purchase, sale, or exchange of real estate, or that leases (or offers to lease) or rents (or offers to rent) any real estate or the improvements thereon for others and for a compensation or valuable consideration. A real estate broker may not conduct business without a real estate broker’s license.
Ownership of real estate by a group of individual investors who purchase certificates of ownership in a trust. The trust invests in real property and distributes the profits back to the investors free of corporate income tax.
The federal law ensuring that the buyer and seller in a real estate transaction have knowledge of all the settlement costs when the purchase of a one to four-family residential dwelling is financed by a federally related mortgage loan. Prohibits kickbacks.
An element of all valid contracts. Offer and acceptance in a contract usually are taken to mean that reality of consent also is present. This is not the case, however, if any of the following are present: mistake, misrepresentation, fraud, undue influence, or duress.
Real property consists of land, anything affixed to it so as to be regarded as a permanent part of the land, that which is appurtenant to the land, and that which is immovable by law, including all rights and interests.
A registered trademark term reserved for the sole use of active members of local REALTORS® boards affiliated with the National Association of REALTORS®.
In the year of sale, all depreciation or cost recovery taken on depreciable property in excess of the amount allowed by the straight-line method is subject to recapture provisions as established by the IRS, which has the effect of taxing the excess at ordinary income rates. Recapture is designed to prevent a taxpayer from taking advantage of both accelerated depreciation and capital gain treatment.
The court-appointed custodian of property involved in litigation, pending final disposition of the matter before the court.
1.The final step in the appraisal process in which the appraiser reconciles the estimates of value received from the market/data, cost, and income approaches to arrive at a final estimate of market value for the subject property.
2. An accounting procedure that balances a trust account by comparing the general ledger with the combined total of the account’s individual ledger balances.
The act of entering or recording documents affecting or conveying interests in real estate in the recorder’s office established in each county. Until recorded, a deed or mortgage generally is not effective against subsequent purchases or mortgage liens.
A fund established in some states from real estate license funds to cover claims of aggrieved parties who have suffered monetary damage through the actions of a real estate licensee. To protect the public, some states mandate errors and omissions insurance as a requirement for licensure.
A system established in 1785 by the federal government that provides for surveying and describing land by reference to principal meridians and base lines.
A period of time established by state law during which a property owner has the right to redeem her or his real estate from a foreclosure or tax sale by paying the sales price, interest, and costs. Many states do not have mortgage redemption laws.
The illegal practice of denying loans or restricting their number for certain areas of a community.
A regulation of the Federal Reserve Board designed to ensure that borrowers and customers in need of consumer credit are given meaningful information with respect to the cost of credit.
To relinquish an interest in or claim to a parcel of property.
An organization that aids a person in selling a property in one area and buying another property in another area.
The remnant of an estate that has been conveyed to take effect and be enjoyed after the termination of a prior estate, such as when an owner conveys a life estate to one party and the remainder to another.
A mortgage loan that is granted for a term of 3 to 5 years and secured by a long-term mortgage of up to 30 years with the interest rate being renegotiated or adjusted each period.
A fixed, periodic payment made by a tenant of a property to the owner for possession and use; usually by prior agreement of the parties.
A statement of proposed rental rates, determined by the owner or the property manager or both, based on a building’s estimated expenses, market supply and demand, and the owner’s long-range goals for the property.
The cost of construction at current prices of a building having utility equivalent to the building being appraised but built with modern materials and according to current standards, designs, and layout.
The cost of construction at current prices of an exact duplicate or replica using the same materials, construction standards, design, layout, and quality of workmanship and embodying all the deficiencies, superadequacies, and obsolescences of the subject building.
The termination of a contract by mutual agreement of the parties.
The creation by a deed to property of a new right in favor of the grantor. Usually involves an easement, a life estate, or a mineral interest.
A limitation on the use of real property, generally originated by the owner or subdivider in a deed.
A mortgage loan that allows the owner to receive periodic payments based on the equity in the home.
The remnant of an estate that the grantor holds after he or she has granted a life estate to another person; the estate will return or revert to the grantor. Also called a reverter.
An owner’s right to regain possession of leased property on termination of the lease agreement.
The process involved in changing the existing zoning of a property or area.
A person’s right to have the first opportunity to either lease or purchase real property.
An owner’s rights in land that borders flowing water, such as a stream or river. These rights include access to and use of the water.
A federal agency of the U.S. Department of Agriculture that channels credit to farmers and rural residents and communities; formerly known as the Farm Service Agency and Farmer’s Home Administration (FmHA).
The frame in which a pane of glass is set to form a window.
A mortgage that, on the sale of a property, is paid off only when the first mortgage is paid.
The property that is pledged as collateral.
When demand for property is greater than supply. The result is greater opportunities for owners who may find someone willing to offer the asking price or even a figure greater than the asking price.
Also called Duplex. A type of construction where two buildings are attached together by a common wall.
The period, normally monthly, collection of mortgage interest and principal repayment and other related expenses, such as property taxes and property insurance.
The sale of a property is finalized by the legal representatives of the vendor and the purchaser, mortgage documents come into effect, costs are paid and the new owner takes possession of the property and receives the keys.
Sinking of the soil or any part of the structure which it supports.
Thin pieces of wood or other material set in overlapping rows to form a roof or wall cladding.
The horizontal section of material at the base of a window opening.
A roof shape consisting of a single sloping surface without a ridge.
A sole or exclusive agency precludes all other agents from working on the disposal of the property, although another agent may approach the sole agent if the former has a suitable client. But even then the sole agent would finalise the deal.
A condition that must be met before the contract is legally binding. For example, if buying a home the purchaser may specify that the contract is not legally binding until the purchaser has obtained a building inspection and been satisfied by the report.
A title to a unit or lot on a plan of subdivision associated with townhouses, units and blocks of flats and based on the horizontal and vertical subdivision of air space. Owners have a certificate of title, are absolute owners of a freehold flat and have an undivided share of the common property.
The uprights in the wall of a building.
A tract of land divided into individual lots for a housing development.
A drawing or map showing the precise legal boundaries of a property, the location of improvements, easements, rights of way, encroachments, and other physical features.Sectional Title
An entire property of flats or townhouses. The property is divided into individual units and sold separately and runs under a Body Corporate.
During this time there are more Buyers than houses because the demand for property is greater than the supply.
When a sale of a house becomes binding and unconditional then certain conditions are met, such as bond approval.
A transaction in which an owner sells her or his improved property and, as part of the same transaction, signs a long-term lease to remain in possession of the premises.
A contract containing the complete terms of the agreement between buyer and seller for the sale of a particular parcel or parcels of real estate.
A person who performs real estate activities while employed by or associated with a licensed real estate broker.
A document acknowledging the payment of a debt. Once filed, the collateral pledged (mortgage) is returned to the mortgagor for a “mortgage burning party.”
A market for the purchase and sale of existing mortgages, designed to provide greater liquidity for mortgages; also called the secondary money market. Mortgages are originated in the primary mortgage market.
A portion of a township under the rectangular survey system (government survey method). A township is divided into 36 sections numbered 1 to 36. A section is a square with mile-long sides and an area of one square mile, or 640 acres.
A will in which the witnesses give their testimony at the time of signing. This testimony is preserved in a notarized affidavit to eliminate the problem of finding the witnesses at the maker’s death and to assist in the probating procedure.
The real property owned by a husband and wife prior to their marriage.
The land on which an easement exists in favor of an adjacent property; also called a servient estate.
The amount of space local zoning regulations require between a lot line and building line.
The ownership of real property by one person only; also called sole ownership.
A sale of secured property that produces less money than is owed to the lender, but in order to expedite the sale and avoid foreclosure expense, the lender releases its interest so the property can be sold.
The personal preference of people for one area of land over another, not necessarily based on objective facts and knowledge.
The beginning of the record of ownership of land by conveyance from the sovereign or the state. Historically, this is known also as a patent.
A tax or levy customarily imposed against only those specific parcels of real estate that will benefit from a proposed public improvement, such as a street or sewer.
A deed in which the grantor warrants or guarantees the title only against defects arising during the period of his or her tenure and ownership of the property and not against defects existing before that time, generally using the language “by, through, or under the grantor but not otherwise.”
A lien affecting or attaching only to a certain, specific parcel of land or piece of property.
A legal action brought in a court of equity in special cases to compel a party to carry out the terms of a contract. The basis for an equity court’s jurisdiction in breach of a real estate contract is that land is unique, and mere legal damages would not adequately compensate the buyer from the seller’s breach.
A duly licensed real estate broker who employs a salesperson. Under law, the broker is responsible for the acts of her or his salespeople.
Those rights acquired through adverse possession. By “squatting” on land for a certain statutory period under prescribed conditions, one may acquire title by limitations. If an easement only is acquired, instead of the title to the land itself, one has title by prescription, or easement by prescription.
The part of a state law that requires certain instruments, such as deeds, real estate sales contracts, and certain leases to be in writing to be legally enforceable.
That law pertaining to the period of time within which certain actions must be brought to court.
A lien imposed on property by statute, for example, a tax lien; in contrast to a voluntary lien, which an owner places on his or her own real estate, for example, a mortgage lien.
The illegal practice of channeling home seekers to particular areas or avoiding specific areas, either to maintain or to change the character of an area, or to create a speculative situation.
A property regarded by some as undesirable because of events that have occurred on the property, like murder or suicide, or present paranormal activities. Sometimes, proximity to undesirable property causes a property to become stigmatized, too.
A method of calculating depreciation for tax purposes computed by dividing the adjusted basis of a property less its estimated salvage value by the estimated number of years of remaining useful life.
An agent appoints a subagent to help the agent in a specified transaction and to act on the principal’s behalf.
A tract of land divided by the owner, known as the subdivider, into blocks, building lots, and streets according to recorded subdivision plat that must comply with local ordinances and regulations.
The leasing of premises by a lessee to a third party for part of the lessee’s remaining term.
A relegation to a lesser position usually in respect to a right or security.
An agreement that changes the order of priority of liens between two creditors.
The substitution of one creditor for another, with the substituted person succeeding to the legal rights and claims of the original claimant. Subrogation is used by title insurers to acquire the right the sue from the injured party to recover any claims they have paid.
An appraisal principle stating that the maximum value of a property tends to be set by the cost of purchasing an equally desirable and valuable substitute property, assuming that no costly delay is encountered in making the substitution.
A court suit initiated by a landlord to evict a tenant from leased premises after the tenant has breached one of the terms of the lease or has held possession of the property after the expiration of the lease.
A legal action brought by either a buyer or a seller to enforce performance of the terms of a contract.
A legal action intended to establish or settle the title to a particular property, especially when there is cloud on the title.
An approach under which value equals estimated land value plus reproduction costs of any improvements after depreciation has been subtracted.
The amount of goods available in the market to be sold at given price. The term often is coupled with demand.
An agreement by an insurance or bonding company to be responsible for certain possible defaults, debts, or obligations contracted for by an insured party; in essence, a policy insuring one’s personal and/or financial integrity. In the real estate business, a surety bond generally is used to ensure that a particular project will be completed at a certain date or that a contract will be performed as stated.
The process by which boundaries are measured and land areas are determined; the on-site measurement of lot lines, dimensions, and positions of buildings on a lot, including the determination of any existing encroachments or easements.
A combination of two or more persons or firms to accomplish a joint venture of mutual interest. Syndicates dissolve when the specific purpose for which they were created has been accomplished.
The right to occupy a property under agreed terms and conditions.
See Life Estate
A type of joint tenancy in a property where two or more purchasers own a property in unequal shares. If one dies, his or her shares pass to his or her beneficiaries under the terms of the will. The shares can be sold without consultation of the other owners.
A process of selling, calling for purchasers to make their best offers in writing for that property by a given date.
A legal document evidencing a person’s right to or ownership of a property.
A check of the title records to ensure that the seller is the legal owner of the property and that there are no other claims or outstanding.
A dwelling unit, generally having two or more floors and attached to other similar units via party walls. Can be Strata or Cross lease titled.
A document registered at the Land Titles Office and noted on the Certificate of Title which verifies the change of ownership of a property.
A person who holds or controls property for the benefit of another.Taxes
An involuntary fee levied that is enforced by government in order to finance government activities.
A person who occupies a property, but does not own it and pays rent in return.
The legal document which states ownership of a property. The Title Deed is filed at the Deeds Office and contains details of the property.
A cluster-type home, either a simplex or a duplex, usually sharing a boundary with other units.
The process by which a government or municipal quasi-public body raises monies to fund its operation.
A charge against property created by the operation of law. Tax liens and assessments take priority over all other liens.
The rate at which real property is taxed in a tax district or county.
A court-ordered sale of real property to raise money to cover delinquent taxes.
The tenancy of a lessee who lawfully comes into possession of a landlord’s real estate but who continues to occupy the premises improperly after her or his lease rights have expired.
An estate that gives the lessee the right to possession until the estate is terminated by either party; the term of this estate is indefinite.
The joint ownership, recognized in some states, of property acquired by husband and wife during marriage. On the death of one spouse, the survivor becomes the owner of the property.
A form of co-ownership by which each owner holds an undivided interest in real property as if he or she were the sole owner. Each individual has the right to partition. Unlike a joint tenancy, there is no right of survivorship between tenants in common, and owners may have unequal interests.
One who holds or possesses lands or tenements by any kind of right of title.
Everything that may be occupied under a lease by a tenant.
The cancellation of a lease by the action of either party. A lease may be terminated by expiration of the term, surrender and acceptance, constructive eviction by lessor, or option, when provided in the lease for breach of covenants.
The cancellation of a broker-principal employment contract. A listing may be terminated by death or insanity of either party, expiration of listing period, mutual agreement, sufficient written notice, or the completion of performance under the agreement.
Having made and left a valid will.
A will maker
A phrase in a contract that requires the performance of a certain act within a stated period of time.
Insurance designed to indemnify the holder for loss sustained by reason of defects in a title, up to and including the policy limits.
A method of evidencing title by registration with the proper public authority, generally called the registrar.
The principal unit of the rectangular survey system. A township is a square with six-mile sides and an area of 36 square miles.
The horizontal lines running at six-mile intervals parallel to the base lines in the rectangular survey system.
The articles installed by a tenant under the terms of a lease and removable by the tenant before the lease expires.
A fiduciary arrangement by which property is conveyed to a person or institution, called a trustee, and held and administered on behalf of another person, called a beneficiary.
An instrument used to create a lien by which the trustor conveys his or her title to a trustee, who holds it as security for the benefit of the note holder (the lender).
One who as agent for others handles money or holds title to their land
A deed executed by a trustee conveying land held in a trust to the beneficiary.
The legal contract that binds both the purchaser and the seller to settle on the agreed date at the agreed price. It is either not subject to any conditions or those conditions have already been satisfied. You should only consider entering an unconditional agreement if and when you are absolutely sure you want to buy a particular property and you already have the full purchase price or 'pre-approved' loan finance from a lender. You should also be confident that there are no other issues or requirements that must be satisfied before you are committed to purchase the property. An unconditional agreement commits you to purchasing the property.
Early possession of the property before settlement with the permission of the vendor. This usually involves the payment of rent.
Supports placed under an existing wall to provide added strength.
A loan that is not backed up by assets or guarantee.
The private or public service facilities such as gas, electricity, telephone, water and sewer that are provided as part of the development of the land.Utilities
Services provided by the government for your use at home. Utilities include: water, electricity, telephone service and other essentials.
An increase in the value of a property caused by increased population, development, or demand for which the owner is not responsible.
A codification of commercial law, adopted in most states, that attempts to make uniform laws relating to commercial transactions, including chattel mortgages and bulk transfers. Security interests in chattels are created by an instrument known as a security agreement. Article 6 of the code regulates bulk transfers, that is, the sale of a business as a whole, including all fixtures, chattels, and merchandise.
Standard Fannie Mae Form 1004 used by appraisers.
Standard Fannie Mae Form 1003 used by loan originators.
A one-sided contract by which one party makes a promise to induce a second party to do something. The second party is not legally bound to perform; if the second party does comply, however, the first party is obligated to keep the promise.
The four unities traditionally needed to create a joint tenancy – unity of title, time, interest, and possession.
The acquisition of run-down city areas for purposes of redevelopment.
In real estate investment, the number of years a property will be useful to the investors.
The practice of charging more than the rate of interest allowed by law.
A written analysis of the estimated value of a property prepared by a qualified valuer.
The person or entity legally authorised to sell a property.
Having no legal force or effect. Unenforceable.Vacant Land
An empty plot of land that has not yet been developed.
Refers to a property sold "as is". After a sale of property, a Seller is not liable for defects following a reasonable inspection of the property.
A contract that complies with all the essential elements on a contract and is binding and enforceable on all parties to it.
An enforceable lease that has the following essential parts: lessor and lessee with contractual capacity, offer and acceptance, legality of object, description of the premises, consideration, signatures, and delivery. Leases for more than one year also must be in writing.
The present worth of future benefits arising from the ownership of real property. To have value, a property must have utility, scarcity, effective demand, and transferability.
A mortgage loan that contains an interest rate provision related to a selected index. Under this provision, the interest rate may be adjusted annually either up or down.
An exception from the zoning ordinances; permission granted by zoning authorities to build a structure or conduct a use that is expressly prohibited by zoning ordinance.
The space between the inner and outer sections of a wall.
A natural stream of running water being fed by a natural source such as a stream or river.
Think of a wish list as the criteria for your perfect home. While it’s rare to find everything you’d like in the house you finally purchase, sitting down and making a wish list will help you find the house, which most closely matches your dream.Walk-Through
The final inspection of a home.
The method by which a debtor’s property is placed in the custody of the law and held as security, pending the outcome of a creditor’s suit.
A notation made by an individual who has not learned to write or physically unable to write, to show intent to sign an instrument such as a deed or will. In regard to the conveyance of real property, such a person would be required to make such a mark or at least a thumbprint as intent to sign and have it witnessed.
The interest earned or return by an investor on an investment, stated as a percentage of the amount invested.
Local authority guidelines for the permitted use of land.
There's enough to think about when looking for a new property without having to worry about what the bizarre and delightful jargon and acronyms mean as well. Here's a quick and easy glossary of property terms, covering all the weird and wonderful things everything you might hear.
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