REAL ESTATE DICTIONARY

Surface horizon (layer) of soil, the composition of which is effected by water which percolates through it.

A type of construction usually found in resort areas. The exterior framing of the building is shaped like the letter A.

A national organization composed of member state and local bar associations, which control the licensing of attorneys.

A specialized association of real estate brokers and salesmen who deal primarily in industrial properties. The goal of the association is to further the knowledge and effectiveness of its members.

An organization, composed of title insurance companies, which has adopted certain insurance policy forms to standardize coverage on a national basis.

See: Prime Tenant

A flexible set of guide lines for depreciation which sets up an "asset depreciation period", rather than using the "useful life" of an asset.

See: Accredited Land Consultant.

See: Annual Percentage Rate.

See: Adjustable Mortgage Loans.

Legal slang meaning that there existed no special relationship between the parties involved in any manner which would taint the result.

A transaction without collusion or duress between the parties involved.

Originated by the American Bankers Association, it is the number (usually in the upper right hand portion of the check) which identifies the bank upon which the check is drawn.

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 recorded document, executed by those claiming a homestead exemption, giving up said homestead. Not applicable to all states and procedure must be according to local statutes.

A reduction or decrease. Commonly used to describe a decrease of assessed valuation of property for ad valorem taxes. When used regarding wills, it refers to a reduction of gifts to one or more beneficiaries when the assets left in the will are insufficient to pay all creditors and beneficiaries. There is usually a different formula used for debts than for priorities of gifts. See also: Contribution.

Soil having distinct A (upper), B (middle), and C (lower) horizons (layers of soil).

The horizontal axis of a curve; the vertical axis being the ordinate. The terms are used in connection with charts and graphs.

A lessor of real property (usually the owner) that does not occupy all or a portion of the property.

An owner of property who does not occupy said property.

The filling of space, such as the rental of units or sale of a tract. The time or rate must be estimated and considered as part of the owner's (usually the builder) costs.

A summary; an abridgement. Before the use of photostatic copying, public records were kept by abstracts of recorded documents.

See: Supplemental Abstract.

See: Supplemental Abstract.

A summary of the essential provisions of a court judgement, which when recorded in the county recorder's office, creates a lien upon the property of the defendant in that county, both presently owned or after acquired.

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.

A certificate contained in an abstract which shows the time period and scope of the search of public records done by the abstracter.

A method for appraising a site (land) by estimating the depreciated value of the improvements and deducting that amount from the total value (improved value) of the property. See: Allocation.

To touch, border on, or be contiguous to.

The vertical members (walls or heavy columns) which bear the load or pressure of the cross member, such as an arch, pier, or similar structure.

The joining, reaching, or touching of adjoining land. Abutting parcels of land have a common boundary.

One whose land is contiguous to (abuts) a public right of way.

Directly contiguous properties, sharing at least one common boundary.

A portion of the Economic Recovery Act of 1981 which allowed shorter depreciation of both real and personal property, did not distinguish between new and used property, and disregarded salvage value.

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.

The immediate right to possession of a remainder interest upon the failure of a life estate.

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.

Voluntary agreement to an offer. (1) Real property acceptance must be unequivocal See: Mirror Image Rule. (2) Acceptance for goods, according to the Uniform Commercial Code, need not be unequivocal. Offer, acceptance, and consideration form a contact.

A right to ingress and egress to and from one's property. May be express or implied.

The location of a site in terms of how easily it may be reached by customers, employees, carriers, and others necessary to the intended use of the property.

A residential building of more than one unit that can be entered and used by people who are physically handicapped.

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 apartment within a single-family dwelling.

Structures used for the benefit of a central or main building, such as a tool shed, garage, or similar structure.

The use or occupancy incidental or subordinate to the principal use or occupancy of a property.

The annual number of hotel (or motel) rooms occupied in a given market area.

Person who lends his name to help secure credit for another, by signing a note or other obligation without receiving consideration.

The recording of documents with the county recorder by a title insurance company, without liability (no insurance) on the part of the company, but merely as a convenience to a customer.

One who acts to facilitate an exchange under the rules of Section 1031 of the Internal Revenue Service Code. The proper terminology is a Qualified Intermediary, but accommodator, facilitator or intermediary are the common terms used.

An agreement by which one accepts something different (usually less) from what is owed as full satisfaction. The amount owed may be in dispute or simply accepted as full satisfaction by the creditor or claimant. The agreement and acceptance is called "Accord and Satisfaction".

The agreement (accord) and acceptance (satisfaction) by creditors of less than the full amount owing on a debt.

In an agency relationship, the agent’s fiduciary duty to account to the principal.

Money owing. The term is generally used in business rather than personal finances. Usually represents services or materials, such as wood, bricks, payment of subcontractors, etc., to a builder.

Money owed to a business for goods or services. Accounts receivable may be sold or borrowed against. Many times the sale of accounts receivable is for less than face value (discounted).

A designation conferred by the REALTORS Land Institute. See: REALTORS LAND INSTITUTE.

An increase or addition to land by the deposit of sand or soil washed up naturally from a river, lake, or sea.

An accounting method under which income and expenses are charged to the periods for which they are applicable, rather than when payment is received or made. The method calling for income and expenses to be based on payment being received or made is cash accounting.

To grow or mature.

Interest on a note, bond, etc. which has been earned but not yet paid. Since interest is usually paid in arrears, accrued interest does not necessarily indicate a delinquency in payment. See also: Accumulated Interest.

Expenses owing but not yet payable. An example is mortgage interest which is paid at the end of the month or property taxes which may be paid after the tax year begins. On a closing statement for a sale, the buyer would be credited with these amounts and would be responsible for their payment.

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.

See: Accrued Depreciation.

Unpaid interest which is past due. See also: Accrued Interest.

A soil with an acid rather than an alkaline base. This can determine its suitability for farming.

A formula used by lending institutions to determine if a business can meet its current obligations. The formula adds cash plus receivables plus marketable securities and then divides by liabilities. A ratio of one to one is considered acceptable.

A written declaration by a person executing an instrument, given before an officer authorized to give an oath (usually a notary public), stating that the execution is of his own volition.

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.

(See which)

Materials which absorb sound. Usually installed in walls and ceilings and composed of fiberglass, cork, special plaster, or similar materials.

Tile which absorbs sound.

A loan for the dual purpose of purchasing and improving or repairing property.

An appraisal to determine market value of a property to be taken by eminent domain, in order to justly compensate the owner.

Costs of acquiring property other than purchase price: escrow fees, title insurance, lenders fees, etc.

A measure, usually of land, equal to 160 sq. rods (43,560 sq. ft.) in any shape.

A volume of water, sand, coal, etc., equal to an area of one acre with a depth of one foot (43,560 cubic ft.). If a liquid, 325,850 gallons.

A cubic measure of one acre in area with a depth of one inch.

Most commonly refers to vacant land, but may refer to any parcel which may be measured in acres. The term is also used to describe land which has not been subdivided.

Federal control setting the number of acres which may be planted with crops which have federal price supports.

Damage caused by nature (floods, winds, etc.) rather than by people.

When a possessor who holds less than fee ownership (i.e., tenant, vendee, and mortgagor) misuses or abuses the property.

Modernly used to describe any court action to establish ownership or remove a cloud on title. See also: Cloud on Titlel.

Fraud meeting certain criteria, so a victim can successfully sue. Victim/plaintiff must prove the defendant concealed material facts or made false statements (intentionally or negligently) with intent to induce the victim to enter a transaction, and that the victim was harmed by relying on these misrepresentations.

Capital used on a regular basis for profit-making activities.

Earnings received from any of the following: wages, salaries, commissions, bonuses, and other payments for services rendered; profit from a trade or business where the taxpayer is an active participant; gain on sale or disposition of assets used in an active trade or business; income from intangible property if the taxpayer played a significant role in creating the property.

The chronological age of a structure as opposed to its effective or economic age.

Personal property physically attached to land. See: Fixture.

Authority intentionally given to an agent by the principal, either expressed or implied.

See: Market Value.

The cost to replace a property item at the time of loss, less an allowance for depreciation. Often used to determine the amount of reimbursement for a loss (replacement cost minus depreciation).

Intentional misrepresentation or concealment of a material fact; when a person actively conceals material information or makes statements known to be false or misleading. Also called: Deceit.

Direct receipt of funds from the sale of a relinquished property in a 1031 exchange. The taxpayer will lose the tax free benefit if the funds are received rather than directly reinvested in the replacement property.

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.

By, for, relating to, concerning.

Latin meaning "for this". For a single purpose only.

For the suit. Example: A guardian "Ad Litum" is one who is appointed to prosecute or defend a suit on behalf of a minor or one who is otherwise incapacitated.

"According to value". A method of taxation using the value of the thing taxed to determine the amount of tax. Taxes can be either "Ad Valorem" or "Specific". Example: A tax of $5.00 per $1000.00 of value per house is "Ad Valorem". A tax of $5.00 per house (irrespective of value) is "Specific".

A tax levied according to value; generally used to refer to real estate tax.

A method of computing interest by adding the total interest for the life of the loan to the amount borrowed (principal) and then deducting the full amount of each payment as made. This method creates a higher yield than computing interest on the declining balance of principal.

Something added. A list or other material added to a document, letter, contractual agreement, escrow instructions, etc. See also: Amendment.

(1) A portion of a building added to the original structure. (2) A synonym for subdivision in certain legal descriptions.

A buyer of real property will generally give a small deposit with an offer, and a more substantial deposit after the offer has been accepted. The second deposit is the "additional deposit".

A payment of principal above the required amount. Some loans limit the amount that a borrower may pay and impose a penalty for reducing the principal balance in too short a time.

Consideration comparable in value to that which the other party to the contract is giving.

Close to. May or may not be contiguous (touching).

Touching or contiguous to.

A judgement or decision by a court.

Mortgage loans under which the interest rate is periodically adjusted to more closely coincide with current rates. The amounts and times of adjustment are agreed to at the inception of the loan. Also called: Adjustable Rate Loans, Adjustable Rate Mortgages (ARM's), Flexible Rate Loans, Variable Rate Loans. See also: Indexing, Rate Index.

See: Adjustable Mortgage Loans.

See: Adjustable Mortgage Loan's (ARL'S).

See: Book Value.

Total income of property if fully rented, less an adjustment for estimated vacancies and uncollectible rent.

A mortgage released after a company has undergone reorganization.

An appraisal term used when a comparable property's sale price is adjusted to reflect the value of the subject property. The adjustment is made based on the differences between the subject property and comparable property in time of sale, terms of sale, location, and physical characteristics.

The date for changing the interest on an Adjust-able Rate Mortgage.

The time between adjustment dates for an adjustable rate mortgage. If the rate adjusted monthly, for example, one month would be the adjustment period.

See: Proration.

Government agency (federal, state, or local) that administers an area of law, adopting and enforcing detailed regulations that have the force of law.

Enforcement of license laws through reprimand and denial as well as the suspension and revocation of licenses.

Initiated when a taxpayer files a grievance with his municipal assessing unit; prerequisite to judicial review.

The party appointed by the county court to settle the estate of a deceased person who died without leaving a will.

Administrator when there is a will but no executor is named or the executor named is unable or unwilling to serve. The C.T.A. stands for Cum Testamento Annexo (with the will attached).

A conveyancing instrument used by an Administrator to transfer property from an estate. See: Administrator.

Female administrator.

A structure built of adobe blocks. Adobe blocks are made from adobe mud mixed with straw or a straw-like substance, and then baked. Considered a very good but expensive material.

A person old enough to vote and to make contracts. The age in most states is 18, except for contracts to purchase alcohol, for which all states classify an adult as a person over the age of 21.

A fee charged by a broker to a seller to cover all or a portion of the broker's costs of promoting the property. The fee is generally credited against commissions but is not refunded if no commissions are received. Most frequently used in connection with large offerings which require a substantial outlay of funds for promotion.

Payments made to a contractor before performance. Not the usual method and when made by HUD or GNMA, there must special approval. See also: Progress Payments; Provisional Payments.

Gifts made prior to death to one who would inherit the property. The value of the gifts is deducted from the donee's (recipient's) inheritance upon the death of the donor.

Money advanced by a lender (mortgagee or beneficiary under a deed of trust) to pay the borrower's (mortgagor's or trustor's) obligations of taxes, insurance, or other items necessary to protect the secured property. The amounts advanced are then added to the balance owing on the mortgage or trust deed.

A use which causes surrounding property to lose value, such as an industrial development in a residential area.

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.

Usually done by signs on the property and newspaper ads. Ads for the sale of real estate have modernly been required to conform to certain standards regarding disclosure of complete financing information if any financing information is contained in the ad.

Soil composed of materials deposited by the wind.

The surface soil to a depth from which plants draw moisture.

The value of a property attributable to the beauty of the improvements or surroundings.

One who makes an affidavit. Also called a deponent, although technically not the same.

A written statement signed and sworn to before a person authorized to administer an oath.

A sworn statement of a separated or divorced person showing the amount (if any) of alimony or child support.

An affidavit by a seller of real property that, as of a certain date, no defects of title exist except those which have been disclosed in the sales contract or deed.

(1) Relationship not of the blood. Related by marriage. (2) Any group for a specific purpose is called an affinity group, such as clubs, people in the same school, etc.

An appeals court ruling that the lower court’s decision was correct, rejecting the appellant’s arguments.

A substitution for an oath when a person objects to taking an oath (Quakers, atheists, etc.). A lie after an affirmation is still perjury.

Government policies that collectively sought to redress past discrimination.

An easement described from the benefited estate (dominant tenement). Also called a parcel 2 easement. The same easement described from the burdened estate (servient tenement) would be a negative easement.

A method to determine the right purchase price and mortgage for a potential home buyer. The price of the home and its future expense, cost to obtain the loan and its future expense, as well as buyers income, expenses and assets are used to determine the financial feasibility of the purchase.

The growing of a forest where none previously existed, as opposed to reforestation (the replanting of a harvested or destroyed forest).

As applied to a judgement lien, it means that the lien will attach to property of the debtor acquired after the judgement. See also: After Acquired Title.

Legal doctrine by which property automatically vests in a grantee when the grantor acquires title to the property after the deed has been executed and delivered.

Cash flow from incomeproducing property, less income taxes, if any, attributable to the property’s income. If a tax loss provides a tax savings from the shelter of income earned outside the property, that savings is added to the property’s earned cash flow.

Age at which a person gains legal capacity. Compare: Minor

Estimating depreciation by using the ratio of the effective age of improvements to the Economic Life (Economic Age-Life Method) or Physical Life (Physical Age-Life Method).

Any relationship in which one party (agent) acts for or represents another (principal) under the authority of the latter. Agency involving real property should be in writing, such as listings, trusts, powers of attorney, etc.

In some states, the term describing a listing under which the broker's commission is protected against a sale by other agents but not by a sale by the principal. Called a "non-exclusive" listing in some states.

An agency created by operation of law when one who is not an agent acts as an agent or an agent oversteps his/her authority, but action (or failure to act) by the principal leads one to believe that the authority exists. See also: Apparent Authority; Ostensible Agency.

A contractual relationship with consideration going from agent to principal; the agency is given as return consideration. Example: A broker agrees to work to obtain property for a builder in return for a listing after the builder has completed the project. The broker would be entitled to (have an interest in) the listing (agency), provided the broker did obtain the property for the builder.

Situation in which the agent has a personal interest in the subject of the agency, as when one co-owner has been authorized by the other to sell her property.

Form used to disclose the agency relationships permitted, the agency relationships a brokerage practices, payment to/ from brokers who do not represent the broker’s client, and required fair housing language.

Form that states whether an agent is representing the seller, buyer, or both in a transaction.

The representation of a party in a real estate transaction.

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.

Relating to land, or to a division or distribution of land.

A general term usually describing a common view of two or more people regarding the rights and obligations of each with regard to a given subject. Not necessarily a contract, although all contracts are agreements.

See: Land Contract.

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 lien against crops (only), to secure money or payment for materials used to grow the crop.

(1) Land which is zoned agricultural, (2) Land used for growing of agricultural products or raising of livestock.

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.

A recessed part or addition to a room.

Latin for "otherwise". Commonly meaning that a person is known by more than one name. In some states, indicated by the letters AKA (also known as).

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 chemical opposite of acid. Heavy concentrations of alkaline salts in soil may damage crops.

Soil which has an alkali, rather than an acid base.

See: Wrap-Around Mortgage.

The assertion or statement of a party to an action, setting forth that which the party expects to prove.

A narrow right of way, either public or private, used for access (usually to garages, loading platforms, etc.).

In appraising, the effect upon value of a property, because of an adjoining side or rear alley.

A method for appraising a site (land) by comparing other site values as a percentage of total value. Example: An area has a typical land value of 35% of the total value of a site (including improvements). Property X has a total (improved) value of $100,000. The land is worth $35,000. The term is often (and incorrectly) used synonymously with abstraction See: Abstraction.

See: Allodium.

See: Allodium.

Land owned by individuals, as opposed to the feudal system of ownership of all land by a king or ruler.

A small parcel of land, sold or given to a farm worker for cultivation as a supplementary source of income. Popular in the 1900's before World War II.

The actual soil increase resulting from accretion.

Deposits formed by accretion.

Written agreement, signed by co-op shareholder-tenants, before any renovations, modifications, repairs, or alterations can begin.

Changes in the interior or exterior of a building, but without changing the exterior dimensions.

When real estate is financed with terms and/or concessions other than those typical for conventional loans.

See: Waste.

A change, either to correct an error or to alter a part of an agreement without changing the principal idea or essence.

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.

Person who values a property based on its ability to fulfill his specific business needs, unlike investors who value a property based primarily on its investment return.

A national organization formed in 1875 as a professional association for banks and other financial institutions.

See: ABA Number.

A process in bricklaying by which every 5th, 6th, or 7th layer of bricks is laid with the wide length facing the wall; the other layers have the narrow length facing the wall.

The educational arm of the American Bankers Association.

Former name for ASTM. (See which).

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 schedule showing each payment of a loan to be amortized (see Amortization) and breaking down the payment into the amount applied to principal and the amount applied to interest.

The time required to pay off a mortgage if no additional principal payments are made and all payments are made on schedule. A ten year loan, for example, would have an amortization term of 120 months (ten years).

To reduce a debt by regular payments of principal and interest. Modernly, the word has been qualified as fully amortized, partially amortized, and negatively amortized. See: Balloon Note; Straight Note; Negative Amortization.

When monthly payments retire the debt over the life of the loan instead of leaving the borrower with a large balloon payment at the end of the loan term.

A loan in which the principal and interest are payable in monthly or other periodic installments over the term of the loan.

Amount of money at issue in a lawsuit; used as a limitation on the jurisdiction of some courts.

Amount of electricity going through electric wires, measured in amps.

A measure of electrical current equal to the current produced by the force of one volt through a resistance of one ohm. See also: Coulomb.

May denote lineal descent, such as a parent or grand parent, or collaterals, such as an older brother being the ancestor of a younger brother. May also mean one from whom a person inherits. Differs from predecessor in that an ancestor must be a person.

A bolt set (anchored) in concrete or other masonry foundation and then attached to the superstructure to prevent movement (anchor it).

The most reliable, and usually the largest, tenant in a shopping center. The strength of the anchor tenant greatly affects the availability of financing for the shopping center. The term may also be used to describe a tenant in an office building, industrial park, etc.

Subordinate, aiding.

A trustee appointed to conclude the business of a broker who has died.

To add or attach. Usually to join a smaller or subordinate thing to a larger or more dominant thing.

Permanently affixing to real property, such as a city adding additional land to increase its size.

By the year.

See: Loan Constant.

Yearly amount of principal and interest payments of debt service. See: Debt Service.

The yearly statement sent to a borrower showing the remaining loan balance and the interest paid over the year. Used primarily for income tax purposes.

The yearly interest percentage of a loan, as expressed by the actual rate of interest paid. For example: 6% add-on interest would be more than 6% simple interest, even though both would say 6%. The A.P.R. is disclosed as a requirement of federal truth in lending statutes.

Total cost of financing a loan in percentage terms, as a relationship of total finance charges to total amount financed.

(1) A payment of money yearly for life or a given period of years. (2) A fixed amount given or left by will, paid periodically, not necessarily yearly.

Appraisal method for determining present value by future anticipated net income before depreciation, which is then discounted.

Year.

Prefix meaning before.

An agreement made by a man and woman in contemplation of marriage, setting forth the property rights of each during the marriage, and in the event of divorce or death.

An appraising principle created by the expectation of certain future events causing values to either increase or decrease.

One party to a contract informing the other of his or her intent not to perform before performance is due. A legal action may be brought even though the original contract (not yet due for performance) has not been breached. Example: The buyer informs the seller before the closing date of his or her intent not to buy.

When one party to a contract informs the other before the time set for performance that he does not intend to perform as agreed. See: Tender.

A business activity that attempts to monopolize, contract, or conspire (or any of these things together) in a way that negatively affects another’s ability to do business.

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).

One or more rooms of a building used as a place to live, in a building containing at least one other unit used for the same purpose. Usually has, at least, cooking facilities, a bathroom, and a place to sleep. Those who live in these units pay rent for their use, usually on a monthly basis.

A building combining the features of an apartment building and a hotel. The units are furnished and may offer hotel facilities such as maid service, a restaurant, etc., but whose residents may stay for months or years, paying on a weekly or monthly basis.

A building containing two or more separate residential units, which is under one ownership. The residents of the units pay rent.

1. When someone acts as if she is a person’s agent even though she has not been authorized to do so. 2. When an agent acts beyond the scope of her authority, giving a third party the impression the acts are authorized. Also called: Ostensible Agency or Apparent Authority.

Action (or failure to act) by a principal which leads one to believe that an agent of said principal has authority which in fact the agent does not have.

Process by which a higher court reviews a lower court’s decision or an administrative tribunal.

A residential property loan which calls for a payment increase over the first 6 years. Level payments are made for the remaining years and the loan paid off during the 15th year. There is no prepayment penalty and P.M.I. is required.

Party who files an appeal because of dissatisfaction with the trial court’s decision. Also called: Petitioner.

Authority to hear an appeal as opposed to conducting a trial.

In an appeal, the party who did not file the appeal. Also called: Respondent.

The first step in the official loan approval process; the form records information about the potential borrower necessary to the underwriting process.

Using a formula to evaluate credit applications and credit bureau data. See also: Fico Score; Scoring Model.

Furnishings (mostly thought of as decorative) and equipment in a building.

A proper allocation of income and expenses of property, especially after a division of ownership.

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.

The amount of money charged by an appraiser. There is no set amount since the work necessary varies with each property.

A trade organization designed to establish standards of competency in the appraisal industry. The designations MAI (competent by the institute's standards to appraise all types of real property) and SRA (competent to appraise residential property) are prestigious and heavily relied upon by real estate agents, lenders, governments and others who utilize appraisers. The American Institute of Real Estate Appraisers and the Society of Real Estate Appraisers combined in 1991 to form the Appraisal Institute.

Generally, three major methods of appraisal: Cost Approach, Income Approach, Market Value (comparables) Approach.

A written report by an appraiser containing an opinion as to the value of a property and the reasoning leading to this opinion. The factual data supporting the opinion, such as comparables, appraisal formulas, and qualifications of the appraiser, will also be set forth.

An estimate of a property’s present worth.

One who is trained and educated in the methods of determining the value of property through analysis of various factors which determine said value.

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.

The private taking and use of public property, such as water from a river or lake. Not to be confused with condemnation or expropriation.

Water rights allocated by government permit according to an appropriation system. It is not necessary to own property beside the body of water in order to apply for an appropriation permit. Also called: Prior Appropriation. Compare: Littoral Rights, Riparian Rights.

An assessing unit certified by the New York State Board as having completed a revaluation program implementing a system of real property tax administration, which was or would be eligible for state assistance, based upon the latest completed assessment roll.

In states where attorneys examine the chain of title before title insurance is issued, the title company will approve certain attorneys as those whose opinion it will accept for the issuance of a title policy.

Something belonging to something else, either attached or not, such as a barn to a house, or an easement to land. The appurtenance is part of the property and passes with it upon sale or other transfer.

Belonging to; incident to; annexed to.

See: Easement.

Any structure resembling the shape of the apron worn as clothing, such as a protruding lower inside part of a window, the portion of a driveway which connects it to the street, the entrance to a loading dock, and similar structures.

Individual rights to the use of the sea and rivers, for the purpose of fishing or navigation, and to the soil in the sea and rivers.

A large pipe, conduit, or trench to bring water or carry it away.

Land capable of being cultivated for farming.

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 map drawn by a title company to be used in locating property in areas where legal descriptions are difficult and complex. Areas are arbitrarily subdivided usually by ownership at a given time, into lots which are numbered. Recorded documents are then posted to these arbitrary lots by the same "arb" number.

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.

A clause in a lease calling for the decision of a third party (arbiter) regarding disputes over future rents based on negotiation. Also used in construction contracts, disputes between brokers, etc.

A seldom used term describing a series of colonnaded arches, covering a walkway with retail stores on one or both sides. A forerunner of the present shopping center.

A concave curved span which may be over a doorway or an entire room or building, such as an arched ceiling or roof.

A roof used primarily in industrial buildings, and having the shape of an arch or crescent. It is supported by a bow-string truss which spreads the roof load evenly.

Concrete poured into a form to produce a design, giving the affect of stone masonry.

Determines the effects a proposed building or other structure, or alteration of an existing structure, will have on the desirability, property values, and development of surrounding areas.

The design and construction plans for a structure. Recently the design for landscaping has become known as landscape architecture.

The surrounding molding of a doorway or similar wall opening.

The surface (plane) space of land or a building. Also describes a neighborhood, or large land section (such as the Southern California area). The term may also indicate a use, such as a work area, living area, play area, etc.

Permission to use land in a way typically not allowed by current zoning laws.

Mainly residential zoning which regulates the ratio of improvements to land, setbacks, etc. Also called bulk zoning.

An old term referring to a cellar or room under the sidewalk.

A transaction that occurs under typical conditions in the marketplace, with each party acting in his or her own best interest.

French land measure of area used in parts of the South, approximately .84625 acre.

(1) Payment made after it is due is in arrears. (2) Interest is said to be paid in arrears since it is paid to the date of payment rather than in advance, as is rent. Example: A rental payment made July 1 pays the rent to August 1. An interest payment made July 1 pays the interest to July 1.

Any major highway or thoroughfare.

A well bored into a subterranean body of water, which, being under pressure, rises naturally to the surface without artificial pumping.

Article of New York Real Property Law, which contains most of the laws relevant to real estate brokers and salespeople.

Refers to an article of the Civil Practice Law and Rules that allows aggrieved persons to bring an action against a government body or officer.

Documentation filed with the state which sets forth general information about a corporation. More specific rules of the corporation would be contained in the by-laws.

A drawing of a proposed real estate project. Not necessarily to scale and generally used to promote the sale of vacant land or the leasing of proposed buildings.

Premises accepted by a buyer or tenant in the condition existing at the time of the sale or lease, including all physical defects.

Prohibits discrimination among landowners in a particular zone.

A fire and heat resistant material used in insulation, roofing, etc.

An environmental term referring to any material containing more than one percent asbestos.

A lung disease caused by extended exposure to asbestos.

A stone which is cut in squares and used both as a facing for masonry walls, and in foundations.

The price at which the seller is offering property for sale. The eventual selling price may be less after negotiation with a buyer.

A position or direction. Exposure.

The acquisition of contiguous properties into one ownership for a specific use.

The cost above the value of individual properties because of assemblage rather than periodic individual sales.

To fix a value; to appraise. Most commonly used in connection with taxes.

Value place upon property for property tax purposes by the tax assessor.

City, town, or county department of assessment with the power to assess real property.

The imposition of a tax, charge, or levy, usually according to established rates.

The total assessed value of all property in a given assessment (tax) district.

An area, the boundaries of which are set for tax assessment purposes only; these boundaries may cross city boundaries.

Taxable period. The period during which the tax assessment must be completed.

The assessed value of a property expressed as a fraction in comparison to market value.

Local board that hears complaints regarding property assessments and property exemption determinations.

The list of taxable persons and property in a given area as compiled by the assessor.

Listing of the assessed value for all real property in a municipality.

One who estimates value of property for tax purposes.

Everything owned by a person or corporation which can be used for the payment of debts.

To transfer property, or an interest in property.

One who receives an assignment (pl. assigns).

Assigning the purchase rights to property or a condominium unit to another buyer before that property or unit is closed.

The transfer in writing of rights or interest in a bond, mortgage, lease, or other instrument.

The transfer by a lessee to a third party of the exact interest of said lessee. Differs and should not be confused with sublease (see which). A lease may legally contain certain restrictions of assignments and/or subleasing.

One who makes an assignment.

A real estate broker who works for another broker.

A mortgage that allows the obligation of the borrower to be transferred to the buyer of the borrower's property secured by the mortgage. If the loan is truly assumable and the transfer is done properly, the originally borrower is relieved of further obligation. See also: "Subject To" Clause; Alienation Clause.

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.

One party taking over responsibility for the loan of another party; usually lender approval is needed.

The part (clause) of an assumable mortgage making it assumable. See: Assumable mortgage.

Lender's charge for paperwork involved in processing records for a new buyer assuming an existing loan.

See: Assumption of Mortgage.

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.

An organization which helps establish environmental standards in products and property.

A craftsman's workshop or artist's studio.

An interior court, centrally located in a structure, which is either uncovered or covered with a transparent or translucent material to admit light.

An act of seizing persons or property by judicial order to bring them within the custody of the court. Most commonly the seizure of property to furnish security for a debt in connection with a pending action.

A lien intended to prevent property transfer pending the outcome of litigation.

To witness, to affirm to be true or genuine; to certify.

Witnesses signing a legal document to affirm the parties’ signatures are real; the act of witnessing the execution of a legal document (such as a deed or will). Compare: Acknowledgment.

The clause in a document (deed, mortgage, etc.) in which the witnesses certify that the document has been properly executed.

The space under the roof of a structure but before the top story. May be simply an air space or improved and used.

To turn over; to transfer to another. To agree to recognize a new owner of a property and pay rent to him. See also: Letter of Attornment.

An advocate, counsel, or official agent employed in preparing, managing, and trying cases in court. Must be licensed by the state.

A statement placed in an abstract of title giving the opinion of the condition of title by an attorney who has examined the abstract. The attorney may be personally liable for mistakes he or she has made. Most abstract examination has modernly been replaced by title insurance.

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.

See: Letter of Attornment.

Anything on a property which may attract small children and is dangerous to them. Reasonable care must be used to prevent injury to children.

A public sale of land or goods to the highest bidder.

A clause in a document such as a lease or listing agreement stating that the terms are extended beyond the expiration date unless cancelled by one of the parties. The clause is usually required to be in large or bold type and, with regard to listings, is not enforceable in some states.

A lender that may process a loan or assumption without submitting the credit package to the insurer or guarantor for underwriting review. Limited to lenders that are regulated and examined by a government agency unless specifically approved by the insurer or guarantor.

A paved shoulder of a highway, usually designed for emergency stopping.

Originally, a broad passageway bordered by trees. Now synonymous with street or road, and of no special significance.

The sum of the daily balances in a bank account over a monthly period divided by the number of days in a month.

The average daily balance (see which) less the float (uncollected funds).

The number of vehicles passing a given point in one day. Usually obtained by finding the number for several days and averaging.

An easement over private property abutting an airport runway, which limits the height of crops, trees, structures, etc., in the aircraft's take off and landing path.

A sudden tearing away of land by the action of natural forces.

In condemnation, the amount paid for the property taken.

Canvas, metal or other material, which protrudes out over a window or doorway to provide protection from the sun, rain, etc.

A window which, being hinged at the top, forms an awning when open.

Distance in degrees from North to an object, or, in the Southern hemisphere, from South to an object. A surveying term.

Soil which does not contain distinct horizons (layers).