THE DICTIONARY OF REAL ESTATE TERMS

A B C D E F G H I J L M N O P Q R S T V Y Z

A   
A.B.A.
ABSTRACT
ABSTRACT OF TITLE
ABSTRACT WITH LAWYER'S OPINION
ACCELERATION CLAUSE
ACCOUNTS RECEIVABLE
ACRE
ADDENDUM
ADJUSTABLE RATE MORTGAGE - (ARM)
ADVERSE POSSESSION
AGENCY
AGREEMENT
AIR RIGHTS
AMENDMENT
AMORTIZATION
ANNUM
APPRAISAL
APPRECIATION
"AS IS" CONDITION
ASSESSMENT
ASSIGN
ASSIGNEE
ASSIGNMENT
ASSIGNOR
ASSUMPTION OT MORTGAGE

B   
BALLOON PAYMENT
BENCHMARK
BENEFICIAL INTEREST
BENEFICIARY
BID
BILL OF SALE
BLANKET MORTGAGE
BREACH OF CONTRACT
BUYER'S MARKET
BY-LAWS

C   
CAPITAL GAINS
CAPITALIZATION
CASH FLOW
CCIM
CERTIFICATE OF OCCUPANCY
CHATTEL
CLOSING
CLOUD ON TITLE
CONDEMNATION
CONTRACT
COST APPROACH

D   
DEED
DEFAULT
DEPRECIATION
DUAL AGENCY

E   
EARNEST MONEY
EASEMENT
EQUITY
ESTIMATED CLOSING COSTS

F   
FACE VALUE
FAIR MARKET VALUE
FEE SIMPLE (ABSOLUTE)
FHA
FHA LOAN
FIDUCIARY RELATIONSHIP
FORECLOSURE
FRAUD

G   
GAIN
GENERAL LIEN
GOOD FAITH ESTIMATE
GRANTEE
GRANTOR
GROSS INCOME

H   
HIGHEST AND BEST USE
HOMESTEAD

I   
IMPROVEMENTS
INCOME APPROACH
INSOLVENT
INSTALLMENT SALE
INSTRUMENT
INTEREST ONLY MORTGAGE

J   
JOINT VENTURE
JOINT TENANCY
JUDGMENT
JUDICIAL SALE
JUNIOR MORTGAGE

L   
LAND CONTRACT
LEASE HOLD ESTATE
LETTER OF INTENT
LIEN
LIS PENDENS

M   
MARKETABLE TITLE
MARKET VALUE APPROACH
MECHANIC LIEN
MORTGAGE
MORTGAGEE
MORTGAGOR

N   
NET INCOME
NET WORTH
NON-PERFORMING LOAN
NOTE

O   
OFFER
OPTION

P   
PARTITION
PAY-OFF AMOUNT
P.M.I.
PRE-PAID EXPENSES
PRIME RATE
PROBATE
PROMISSORY NOTE
PUBLIC SALE
PURCHASE MONEY MORTGAGE (PMM)

Q   
QUITCLAIM DEED

R   
REAL ESTATE
REAL PROPERTY
REALTOR
REDEMPTION PERIOD
REGULATION "Z"
REHABILITATION (REHAB)
REFINANCING
REINSTATEMENT
REPLACEMENT COST
R.T.C.

S   
SBA
SECONDARY MARKET
SECOND MORTGAGE
SHERIFF'S DEED
SPECIAL ASSESSMENT
SPECIFIC PERFORMANCE
"SUBJECT TO" CLAUSE
SURFACE RIGHTS
SYNDICATE

T   
TAX DEED
TAX DEFERRED EXCHANGE
TAX SHELTER -
"TIME IS OF THE ESSENCE"
TITLE
TRUST

V   
VA
VA LOAN
VENDEE
VENDOR

W   
WAIVER
WARRANTY DEED

Y   
YIELD

Z   
ZONING

A

A.B.A.   
American Bar Association.

ABSTRACT   
A summary, condensed history.

ABSTRACT OF TITLE   
A condensed summary of all recorded documents (conveyances and encumbrances) relating to a parcel of real estate, from which an opinion as to the condition of title may be given.

ABSTRACT WITH LAWYER'S OPINION   
Abstract of title with lawyer's opinion as to the condition of title.

ACCELERATION CLAUSE   
A clause in a mortgage or trust deed, which gives the lender at it's option the right to demand the entire unpaid balance of the loan due and payable. (Also known as clause 17th).

ACCOUNTS RECEIVABLE   
Money owned for services performed or goods sold. Accounts receivable are assets and may be sold by the business to rise founds.

ACRE   
43,560 square feet of land.

ADDENDUM   
A form/document added to a contract or agreement also known as a Rider.

ADJUSTABLE RATE MORTGAGE - (ARM)   
Mortgage loan under which the interest rate may periodically change.

ADVERSE POSSESSION   
Method of acquiring title to real estate by actual, continuous, open, notorious and hostile possession of another man's real property.

AGENCY   
A relationship in which the agent is given the authority to act on behalf of another person (Principal).

AGREEMENT   
A meeting of minds.

AIR RIGHTS   
The right to the air space above the real property.

AMENDMENT   
A change to the correct or alteration to the original document/agreement without changing its principal essence.

AMORTIZATION   
The period of time over which a debt is to be repaid in equal installments.

ANNUM   
A year.

APPRAISAL   
A formal opinion of value.

APPRECIATION   
The increase of value due to the economic and social factors over a period of time.

"AS IS" CONDITION   
"What you see is what you get". Seller does not make any guarantees or warrantees as to the physical condition of the property.

ASSESSMENT   
An estimate of value for Tax purposes, or an additional charge to the general taxes for special improvements such as new streets, sidewalks, sewers, etc.

ASSIGN   
To transfer interest.

ASSIGNEE   
A person who receives the assignment.

ASSIGNMENT   
A document transferring ones interest to another person.

ASSIGNOR   
A person giving up the interest, giving the assignment.

ASSUMPTION OT MORTGAGE   
An agreement by which a person assumes an existing mortgage or trust deed.


B

BALLOON PAYMENT   
A final payment of the entire loan balance, usually after partial amortization, due and payable in a lump sum at the maturity of the loan.

BENCHMARK   
A permanent reference mark for surveyors.

BENEFICIAL INTEREST   
Equitable ownership of a Land Trust.

BENEFICIARY   
A person for who's benefit a trust is created.

BID   
An offer.

BILL OF SALE   
Instrument conveying the ownership to the personal property.

BLANKET MORTGAGE   
A mortgage covering more than one property.

BREACH OF CONTRACT   
Failure to perform provisions of a contract.

BUYER'S MARKET   
Market where there is more properties available for sale than interested buyers.

BY-LAWS   
Rules and regulations governing an association or corporation.

C

CAPITAL GAINS   
Profit earned from a sale of real estate.

CAPITALIZATION   
A method used to estimate value of a property based on the rate of return on investment.
Income Rate = Value

CASH FLOW   
Income generated from the operation and ownership of real estate.

CCIM   
A Certified Commercial Investment Member (CCIM) is a recognized expert in the disciplines of commercial and investment real estate. A CCIM is an invaluable resource to the commercial real estate owner, investor, and user, and is among an elite corps of 7,000 professionals across North America who hold the CCIM designation -- the "Ph.D. of commercial real estate."

CERTIFICATE OF OCCUPANCY   
A certificate issued by a local governmental body stating that the building is in a condition to be occupied.

CHATTEL   
Personal property.

CLOSING   
A final procedure (settlement) involving a transfer of legal title.

CLOUD ON TITLE   
An evidence of encumbrances.

CONDEMNATION   
A judicial proceedings through which a governmental body takes a private property for a public use.

CONTRACT   
A legally enforceable agreement between two parties.

COST APPROACH   
A method used by an appraiser to estimate replacement cost of improvements less depreciation.

D

DEED   
Document transferring Legal Title to real estate.

DEFAULT   
A nonperformance of duty under an agreement (contract).

DEPRECIATION   
Imaginary decrease in value of improvements for tax purposes.

DUAL AGENCY   
Representation of opposing parties (buyer and seller) at the same time in the same transaction.

E

EARNEST MONEY   
A good faith deposit.

EASEMENT   
A right to use land of another person for a specific purpose.

EQUITY   
The difference between the market value and what's owned on the property.

ESTIMATED CLOSING COSTS   
Seen on a "GOOD FAITH ESTIMATE" as an estimate of expenses incidental to the sale of real estate, including loan, title, and appraisal fees. These costs are in addition to the price of the property, and are pre-paid at closing. Some are one-time expenses and some are recurring.

F

FACE VALUE   
The value of a mortgage without any discounts.

FAIR MARKET VALUE   
The price for which a property would sale in normal market where the seller nor the buyer are under any pressure.

FEE SIMPLE (ABSOLUTE)   
The maximum/absolute right of ownership.

FHA   
Federal Housing Administration.

FHA LOAN   
A loan insured by Federal Housing Administration and made by an approved local lender.

FIDUCIARY RELATIONSHIP   
A relationship of trust and confidence between principal and agent; lawyer and client; doctor and patient; etc..

FORECLOSURE   
A court process undertaken to sell the property to satisfy unpaid mortgage or lien.

FRAUD   
Intended deception to obtain property, or money from another person.


G

GAIN   
Profit.

GENERAL LIEN   
The right of a creditor to a lien which attaches to all property (personal and real) of the debtor.

GOOD FAITH ESTIMATE   
A Good Faith Estimate is a lender's estimate as to what your closing costs will be associated with your real estate financing request. This Estimate is due 3 days after a loan application is submitted to a lender.

GRANTEE   
A person who receives.

GRANTOR   
A person who gives.

GROSS INCOME   
Income before expenses.

H

HIGHEST AND BEST USE   
The possible use of land that would produce the highest income or value.

HOMESTEAD   
The land property that is occupied as the primary family home/residence.

I

IMPROVEMENTS   
A structure, generally a building.

INCOME APPROACH   
A method used by an appraiser to estimate the value of a property by calculating it's generated income.

INSOLVENT   
Not capable of repaying debts (bankrupted).

INSTALLMENT SALE   
A transaction in which the sale's price is paid in installment payments over a period of time.

INSTRUMENT   
A written legal document.

INTEREST ONLY MORTGAGE   
A loan under which the principal amount borrowed is usually paid back in one balloon payment at the time of maturity of the loan, and during the time of the loan the borrower is obligated to pay interest payments only on the amount borrowed.

J

JOINT VENTURE   
An agreement between parities to conduct specific business, share the losses and profits.

JOINT TENANCY   
Undivided interest in property which passes to the surviving joint tenant, and not to his heirs.

JUDGMENT   
The decision of the court which when effective becomes a general lien on the defendant.

JUDICIAL SALE   
A Sale conducted by the court order.

JUNIOR MORTGAGE   
Mortgage of lesser priority than the prior recorded mortgage.

L

LAND CONTRACT   
The installment contract for purchase of Real Estate where the title to the property does not pass until paid in full.

LEASE HOLD ESTATE   
Tenants right of possession for a specific period of time under a lease agreement.

LETTER OF INTENT   
Not legally binding formal expression of interest in property. It does not create obligation, and it's not an offer, or a contract.

LIEN   
Encumbrance against a property placed by a creditor to enforce the payment of debt.

LIS PENDENS   
Recorded document showing a pending litigation filed in the court.

M

MARKETABLE TITLE   
Good clear title free of clouds.

MARKET VALUE APPROACH   
A method used by an appraiser to establish value of a property based on comparable sales in the area.

MECHANIC LIEN   
A lien created by and in favor of a contractor who performed work and/or furnished materials for a repair of the property.

MORTGAGE   
A pledge of Real Estate as security for the repayment of a loan.

MORTGAGEE   
Lender.

MORTGAGOR   
Borrower.

N

NET INCOME   
Income after operating expenses.

NET WORTH   
The difference between total assets and total liabilities.

NON-PERFORMING LOAN   
A loan in default, usually referred by lenders to pending foreclosures.

NOTE   
Promise to repay debt/loan.

O

OFFER   
A proposal; after acceptance it becomes a contract.

OPTION   
A right given for a consideration to keep an offer to purchase or lease open for specific time.

P

PARTITION   
Court procedure to divide interest of parties who do not voluntarily come to agreement.

PAY-OFF AMOUNT   
A total balance, mount of a full payment on existing loan or lien.

P.M.I.   
Private Mortgage Insurance.

PRE_PAID EXPENSES.   
Pre-paid expenses are items such as Property Tax and Insurance that must be paid for before the closing of a real estate loan.

PRIME RATE   
The most favorable interest rate charged by lenders on a short term loans to qualified customers.

PROBATE   
Court process to prove a valid will.

PROMISSORY NOTE   
A written unsecured note promising to pay a specified amount of money on demand, transferable to a third party.

PUBLIC SALE   
Sale, auction open to the public.

PURCHASE MONEY MORTGAGE (PMM)   
Seller financing as a part of the purchase price.

Q

QUITCLAIM DEED   
A deed conveying the title by which the grantor transfers whatever interest he/she had without any warranties, guaranties, or obligations.

R

REAL ESTATE   
The bundle of legal rights and interest inherent in real estate ownership.

REAL PROPERTY   
A portion of the earth extending down to the center of the earth, and upward into space including the surface and anything permanently affixed to the land.

REALTOR   
A member of National Association of Realtors.

REDEMPTION PERIOD   
A time provided by the state law during which the property owner can redeem the property from foreclosure or tax sale by paying off the amount owed plus any interest, court cost, or attorney's fee.

REGULATION "Z"   
Issued under the Truth-in-Landing Act, requires the creditor, or a landing institutions to disclose in writing the true cost of obtaining credit.

REHABILITATION (REHAB)   
Reconditioning, renewal of the property and improvements there on.

REFINANCING   
Obtaining a new loan to pay off the existing one.

REINSTATEMENT   
Making a loan current, bringing it up from a default into a good standing.

REPLACEMENT COST   
Construction cost of building a substitute property, the same as the original, accept in the current market, at current costs.

R.T.C.   
Resolution Trust Corporation.

S

SBA   
Small Business Administration.

SECONDARY MARKET   
A market for the purpose of purchase and sale of existing mortgages usually at discounted prices to provide greater liquidity to the mortgagee/lender.

SECOND MORTGAGE   
A mortgage recorded after a First mortgage, ranks second in priority.

SHERIFF'S DEED   
A deed given for property purchased at a sheriff's sale, as a result of a mortgage foreclosure.

SPECIAL ASSESSMENT   
Additional tax imposed by the local government for public improvements such as new streets, etc..

SPECIFIC PERFORMANCE   
A legal action to complete the performance of a contract.

"SUBJECT TO" CLAUSE   
Condition clause, it makes the agreement contingent up on the performance of that clause.

SURFACE RIGHTS   
The right to use the surface of land.

SYNDICATE   
Association of individuals for the purpose of business venture.

T

TAX DEED   
A deed to the property from Governmental body given at a public sale for delinquent taxes.

TAX DEFERRED EXCHANGE   
Also know as a 1031 Exchange. For more information Click here.

TAX SHELTER   

"TIME IS OF THE ESSENCE"   
Clause used to bind party to performance at/or within a specific time.

TITLE   
The right of ownership.

TRUST   
A fiduciary relationship under one holds the title for the benefit of another.

V

VA   
Veterans Administration.

VA LOAN   
Loan to a qualified veteran guaranteed by the Veterans Administration and made by the local approved lender.

VENDEE   
Buyer.

VENDOR   
Seller.

W

WAIVER   
Relinquishment of a right.

WARRANTY DEED   
A deed conveying the title to a property with a warranty of clean, clear marketable title.

Y

YIELD   
Ratio of income from an investment including all the cost and additional profit over a given period of time.

Z

ZONING   
A regulation and control of uses allowable for real property in the specific area.