Real Estate Glossary Terms Beginning With – A

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Terms Beginning With - A

Property Development & Investment Glossary, Terms & Definitions

People who live in this kind of house have an outside design that looks like the letter A.

A-Frame Construction

People who live in this kind of house have an outside design that looks like the letter A.

A, B, C, D Paper

Borrowers and loans are classified according to their desirability; an A borrower is the most desirable and is eligible for the lowest interest rates; B is less desirable, while C and D are the least desirable.

AAA Tenant

A reputable business tenant with an extraordinary credit rating, or one whose national or local recognition provides dignity to a shopping complex or office facility.

Abacus

The horizontal slab atop a capital that supports the architrave.

Abandonment

The act of abandoning or the state of being abandoned.

Voluntary surrender of property, whether owned or leased, without naming a successor as owner or renter.

The act of giving up or letting go of real property without giving this right to anyone else. An overt act is usually needed to show that someone has given up on their home, like not paying their property taxes. Each case of possible abandonment must be looked at to see if the property has been legally left behind. The fact that someone doesn't use the property isn't enough to show that they won't take it back. For example, the owner of an easement footpath across a neighboring property might show that they don't want to keep it by building a fence between the two properties. When a condemning authority gives up an easement, the fee owner (condemnee) is the only person who owns the land.

This is different from "surrender," which must be agreed to by both the lessor and the lessee, and "forfeiture," which happens without the owner's permission. It happens when someone gives up a right to do something that isn't allowed under the current zoning rules. See forfeiture and surrender.

A tenant who moves out of leased property because they no longer want to follow the terms of the lease is "abandoning" the property. The landlord then takes full ownership and control. The lessee is still responsible for paying rent until the lease is over. It is called a surrender if the landlord agrees to end the tenancy. If the landlord doesn't, the tenant doesn't have to pay future rents.

 There is a law in many states that says that landlords must make "reasonable efforts" to rent out abandoned property at a fair price. See the Uniform Residential Landlord and Tenant Act (URLTA) for more.

People who want to give up their homestead in states that recognise homestead rights must file a declaration of abandonment in the public record. A person's homestead rights will not be officially lost if he or she just walks away from these places. 

There may be income tax consequences if you don't pay. People who own property and then leave it may be able to treat it as though they sold it for nothing, even though they didn't get any money for the sale at all (other than relief from any mortgages or liens). As a result, the taxpayer can claim a loss in this case, up to a certain amount.

Most states have laws that outline the rights and responsibilities of the government and other people when they can't find or don't want their own personal property. Landlords of mini warehouses, for example, should think very carefully about what could happen if they throw away unclaimed property at the end of a rental.

Abatement

Reduce or decrease in the number of things that are the same amount, intensity, or value There are many situations in which a lessee can get a break on the rent because of fire, flood, or other acts of God. Some landlords may also cut rent if they don't give a tenant possession when they say they will.

People who buy real estate can get their money back if they find a flaw in the title of a seller and they don't fix it before they close. This is called "specific performance." For example, a buyer signs a contract to buy a $100,000 house. Title checks before the closing show that sellers haven't paid $5,000 in property taxes, which means they won't be able to sell their home. In this case, the sellers don't want to pay the taxes, so they decide not to sell the house. An action for specific performance could be used by the buyer to deposit $95,000 in court and force the sale of the home. In order to get clear title to their home, the sellers would pay the state the $5,000 in unpaid taxes that had been left unpaid.

Tax abatement happens when there is a reduction in taxes or a halt to taxes on an initial assessed value, like when there was an error in the taxes.

When a court orders the destruction of unsafe or damaged buildings, this is called a "summary abatement."

If a property owner is keeping a nuisance, such as a chemical plant that emits harmful fumes, an abutting owner can file a lawsuit to get rid of the nuisance.

An asbestos abatement plan lays out how to deal with asbestos in a home. How to get rid of asbestos is done by people who have been trained to remove it. They can also encapsulate it so that the fibers can't be released, wrap it in a protective jacket, or seal off a place that has asbestos, like a crawlspace.

Able

Financial ability is used in the phrase "ready, willing, and able buyer," which is used to see if a broker can get paid. It doesn't mean that the buyer must have all the money needed to buy the house. It means that the buyer must be able to get and set up the financing in the time frame set out in the purchase agreement.

Abnormal Sale

This is a real estate sale that isn't typical for the market. To be used as a reliable comparison, the appraiser needs to think about things like whether the sellers sold their home to their kids for less than market value.

Abrasive Paper

Heavy paper coated on one side with sand or another abrasive substance and used to smooth surfaces.

Abrasive Surface Tile

Roughed-up floor tile prevents slipping and sliding.

Absentee Landlord

A landlord who doesn't live in the building.

Absentee Owner

A property owner who does not live on the premises or manage it.

A non-residential property owner who frequently defers management of the investment to a property manager.

Federal tax laws apply to ownership of depreciable real property when the owner is away for the majority of the year but occupies the property during vacations or other periods. These improvements are intended to mitigate the tax benefits associated with an absentee owner's use of the property as a second home. For detailed details, consult an experienced attorney.

Numerous states now require sellers to provide a property condition report to the buyer. This creates complications for absentee owners. Alternatively, the absentee owner may wish to provide a report from a professional property inspector to the buyer. The absentee owner is excused from providing the report in several states.

Absolute

Absolute and unrestricted, as in a fee simple absolute estate, an absolute transaction, or absolute obligation (strict liability).

Absolute Monopoly

A market in which there is just one supplier of an item or service for which no reasonably acceptable substitutes exist.

Absolute Title

The complete ownership of land or property, with no way for someone else to prove they have a right to it.

Absorber

A solar heat collector's covered panel that absorbs solar radiation and transmits it through absorber fluid passageways to be transformed to heat energy.

Absorption Bed

This is a shallow trench that has a distribution pipe in it. The septic tank effluent flows through the pipe and into the soil.

Absorption Rate

The absorption rate is the number of units of a certain type of commercial property that are rented out during a certain time period (usually a year) in a given market. 

The expected time it takes to lease properties in an area.

The rate at which a property is sold or leased. Absorption is typically represented in terms of units sold or leased per month for apartments or for-sale homes. The metric for office or retail space is square feet leased per quarter or year.

A forecast of the annual sales or occupancies of a certain type of space, such as new office space, new homes, or new condominium units. This rate is frequently predicted as part of a feasibility study or evaluation conducted in conjunction with a loan request.

The pace at which a product is "absorbed" by the market; the rate at which units are purchased.

Abstract And Opinion

A statement of the chain of previous title transfers for real estate, as well as an attorney's written judgment that the title is free of defects.

Abstract Of Judgment

This is the document that is utilized to enforce a judgment lien. Must be filed in any county in which the judgment debtor owns real property.

Abstract Of Title

A synopsis of each documented document related to title to a certain tract of land.

A comprehensive overview of all sequential grants, conveyances, wills, records, and judicial procedures affecting title to a particular tract of real estate, as well as a listing of all documented liens and encumbrances affecting the property and their current status. The abstracter searches the title as it is recorded or registered with the county recorder, county registrar, circuit court, and/or other official sources. The abstractor compiles a list of all documents impacting the property and arranges them chronologically, beginning with the grant of title.

The abstract offers a list of public records that were accessed and those that were not accessed during the report's development. When summarizing a deed in the chain of title, the abstractor may include the book and page number of the recorder's book, the date of the deed, the date of recording, the names of the grantor and grantee, a brief description of the property, the type of deed, and any conditions or restrictions contained in the deed.

The abstract of title in no way guarantees or ensures the validity of the property's title. Rather than that, it is a condensed history that discloses just those facts concerning the land that are public record; it does not disclose encroachments or forgeries. As a result, abstractors are typically only accountable for damages resulting from their own negligence in examining public information.

Abstracter

A person who draws a title abstract. Additionally spelled abstractor.

Abstracter's Certificate

An abstractor's warranty that an abstract contains all public records affecting title to a particular plot of property.

Abstraction

An assessment technique in which the appraiser determines the land value of any developed property by subtracting the value of any site improvements from the property's overall sales price. The remaining sum represents the land's projected sales price, or indicated value. Additionally referred to as the allocation or extraction procedure.

Abutment

A building built to hold an arch.

A section of a wall or pier that is pressed by an item, such as the supports at either end of a bridge.

Abutting Owner

A landowner whose property is adjacent to a public road or any other contiguous property. The primary source of contention between adjacent owners is encroachment, party walls, access, light and air easements, and lateral support. The rights of an adjoining neighbour include the right to see and be seen from the street. 

ABX Index

A made-up index that can be traded and is based on a group of 20 subprime mortgage-backed securities.

AC

The abbreviation for air conditioning or air conditioner.

AC Condenser

A central air conditioner's condenser unit usually has a heat exchanger section that cools down incoming refrigerant vapor and turns it into a liquid.

AC Disconnect

The main power source besides the air conditioner condenser.

Accelerated Cost Recovery System (ACRS)

The Economic Recovery Act of 1981 introduced a technique of depreciation that determines the useful life of various types of property.

The Economic Recovery Tax Act of 1981 came up with a simple way to depreciate things. It was meant to replace the old "ADS class life" system. People who live in certain classes or own certain types of things can write off some of the costs over a certain amount of time. People who bought or used a lot of things between 1980 and 1987 were subject to ACRS. 

The Tax Reform Act of 1986 made a lot of changes to the ACRS rules. After December 31, 1986, the changes were mostly effective. See "MACRS," the Tax Reform Act of 1986, for more information.

Accelerated Depreciation

A depreciation method in which the asset is written off faster than using the straight line method.

Depreciation is a way to write off the cost of certain things that people own and things that people make to real property faster for tax purposes than if they used the straight-line method. In order for the property to be taxed, it must be used in a trade or business or held for the purpose of making money. This method is based on the idea that an asset deteriorates more quickly in its first years of life.

For a description of the basic methods, see the SOYD method and the declining balance method.

In the case of property that has already been put to use, the original period and method of depreciation or cost recovery will stay in place as long as the same owner keeps the property in service for an eligible use. This means that some people will figure out depreciation for things that were put into use before 1981, ACRS things that were put into use between 1981 and 1986, and things that were put into use after 1986.

Accelerated Method

A technique of calculating depreciation or cost recovery allowances in which substantial yearly allowances are claimed in the first years of ownership, offset by lesser allowances in subsequent years.

Acceleration Clause

A clause in a contract that allows the lender to demand repayment of all or part of an outstanding loan if certain conditions are not met.

If the mortgagor defaults on any of the requirements, a clause in the mortgage agreement gives the mortgagee the authority to accelerate full repayment of the debt.

A provision that allows the mortgagee to declare the entire amount of a loan due and payable if the mortgagor fails to meet any of the agreed-upon requirements.

A clause that requires all future payments to be made in the event of a single loan failure. When a single payment is late, the lender is not required to litigate for each payment.

In the case of a mortgage, trust deed, promissory note, or contract for deed (agreement of sale), there is a clause that gives the lender the right to call all the money that is due and owed before the agreed-upon payment date. This could happen if someone doesn't pay an installment, the property is destroyed, an encumbrance is put on it, or the property is sold or given away. The payee usually has the option to speed up the note if he or she doesn't pay any installment of interest or principal when it's due, as long as he or she gives enough notice and gives the person who owes the money a chance to fix the problem. It can also happen if the payee doesn't pay taxes and assessments or keep the property insured and in good condition. Also, if the borrower (mortgagee) does not have good title to the property he or she is borrowing, the lender may be able to move forward with the loan. For example, if all or part of the property is taken away, the lender may be able to move forward with the loan.

If it isn't written in the mortgage or contract for the sale, there is no way to speed up the process. There should be a match between the acceleration clauses in the mortgage and the ones in the promissory note. A due-on-sale clause or alienation clause is also called an acceleration clause when it says that the payment will be made faster when the property is sold, so it is called that. There are times when an acceleration clause won't be valid because it's too much of a restraint on the sale of a home.

The seller of a contract for deed usually adds a clause that says that if the buyer doesn't fix a problem, the whole balance is due and must be paid. If this clause was not in place, the seller would have to sue the buyer when each installment payment was due and the buyer did not pay it.

Acceleration Principle

An occurrence that has a higher impact on demand or prices than may be directly attributed to that event. The driving force that draws trade, business, and/or industry to a specific location.

Accelerator

Something that speeds things up, like the hydration of concrete, mortar, grout, or plaster.

Acceptable Referee

Accountants, solicitors, magistrates, doctors, and the justice of the peace are all in this group.

Acceptance

To accept an offer or contract's terms and conditions.

The act of a party to whom a thing is provided, in which he or she accepts the object with the aim of keeping it.

The goal is to agree to the terms and conditions of a deal or offer

1. A person who accepts an offer (such as the seller in a real estate deal) says that they will follow the terms of the offer. It must be told to the person who made the offer that you have agreed to it (offeror, such as a buyer). The communication doesn't have to be written. It could be a simple nod of the head. If the offer is written and the acceptance is written, too, it must be written to be valid.

After making an offer, a buyer can cancel it at any time before the seller tells them that they've accepted it. Even if the buyer has said that they want to keep the offer open for a certain amount of time. Since the sales contract should say that it must be agreed to at a specific time and that acceptance should be communicated to both buyer and seller as soon as possible, this is what you should write in there. Getting the message across is very important because after a seller accepts your deal, but before you hear about it from them, you could effectively revoke your offer and not be able to buy the thing.

It must also be done within the time limit set out in the offer. If there is no time limit, the acceptance is valid if it is made in a reasonable amount of time, which varies from case to case and from community to community. Some offers say that if you accept the deal, you won't be able to close the deal until the offeror or broker gets a signed copy from you within a certain amount of time.

You can't accept an offer unless you use the method that the offer says you can use to accept it, like by facsimile or by e-mail. For example, if you accept a mailed offer, it becomes a legally binding contract when it is sent through the mails. The law assumes that the buyer choose the post office as the person who would get the acceptance notice. When the acceptance is sent in an unusual way, like by posting it in a newspaper ad, the contract isn't valid until the buyer gets the acceptance in a reasonable amount of time.

You don't have to accept an offer for the price you put on your home if you put it on the market through a broker. The listing is not an offer to sell, but a job offer. Because it doesn't give the buyer any power of acceptance, it doesn't work. Because the owner may owe the broker money, however, they may have to pay them money.

Silence is usually not enough to show that you want to accept, but sometimes it can be. Even though the community might be more used to 7 percent, some people think that the broker agreed to another 4 percent commission rate when he or she handled many sales for a developer at a 4 percent commission rate.

2. The grantee must willingly and unconditionally accept a deed in order for the deed to be valid. A grantee who doesn't want to own the property doesn't have to accept the deed. Constructive acceptance: When a beneficial transfer to a person who can't agree is made, the courts often assume that the grantee will accept it. This is called a deed to a minor or an incompetent person. Taking the deed, recording the deed, paying the sales price, encumbering the title, or any other act of ownership shows that the grantee has agreed to the deal.

As an example, a court probably wouldn't assume that the grantor had agreed to give his $ 100,000 farm, which was heavily in debt and had building code violations, to a grantee who died without ever hearing about it. As long as there was a valid delivery, the property would go to his estate if there was no debt or code violations on it.

Access

A technique of approaching a property or an entry into or upon a property. Additionally, access can refer to a broad or specific right of admission and egress to a certain property. Generally, a property owner has the right of access to and from his or her land to a public street or highway adjacent to the property, including the right to unrestricted light and air movement from the roadway to the property. Additionally, the term access refers to a riparian owner's right of passage to and from the waters that border his or her property.

Numerous state statutes provide that a residential tenant may not withhold consent from the landlord to enter the dwelling unit to inspect the premises, make necessary or agreed-upon repairs, provide agreed-upon services, show the dwelling unit to prospective purchasers, mortgagees, or tenants, or to demand rent. However, the landlord may not misuse this right of access or use it to harass the tenant and should enter only after providing adequate notice to the tenant, in an emergency, or when doing so is impractical.

Condominium rules establish easements and other rights that allow owners access to their units via shared features.

Access Right

The ability to enter and exit a property.

Accessibility

1. How easy it is to get to a site and where it is in relation to different transportation facilities is an important factor in deciding if a site is good for a certain use.

2. The ability of a person with a disability or handicap to get to and use things more easily and on their own. Making doors wider, increasing the radius of a wheelchair and installing grab bars, audible and visual signals as well as the like are all examples of things that can be done.

Accession

Acquiring title to extra land or improvements through annexation of fixtures or alluvial deposits along the banks of streams. For instance, if Ben Brown constructs a fence on his neighbor's land without first obtaining permission from the neighbour to remove it, ownership of the fence passes to the neighbour, until the neighbour wants its removal. 

Accessory Building

It is a building that is not the main building on the same lot. If, for example, a garage, pump house, or storage shed is built on the same piece of land as the main building on the property, it would be called an "accessory building," not the main building.

Accommodating Party

A person or corporation that agrees to take title to a property in return for tax benefits under Section 1031. Additionally referred to as the middleman.

Accommodation Party

Without receiving any remuneration, a party signs a negotiable document (such as a promissory note) as maker, acceptor, or endorser in order to accommodate another party and strengthen the paper's creditworthiness by giving his name as additional security. For instance, a brother who co-signs a bank note with his sister in order for her to borrow money to purchase a house is considered an accommodation party to the lending arrangement.

Account Payable

A debt (liability) is an amount of money that a person owes to another person, usually because they bought something, like goods, supplies, or services. It's not always due right away.

Account Receivable

A debtor has a claim against the debtor, which usually comes from sales or service that the debtor has paid for. Because an account receivable is the opposite of an account payable, it isn't always due or late at any given time.

Accounting

The agent's fiduciary obligation is to safeguard and protect the principal's property and funds. The agent is responsible for maintaining accurate records of funds and papers received.

Accredited Investor

A wealthy investor who is not one of the 35 investors allowed to invest in a private limited partnership under Securities and Exchange Commission Regulation D. To be eligible, an investor must have a net worth of at least $1,000,000, an annual income of at least $200,000, or a minimum investment of $150,000 in the deal, with the investment not exceeding 20% of the investor's net worth.

Accredited Land Consultant (ALC)

The REALTORS® Land Institute bestows this professional qualification (RLI).

Accredited Management Organization (AMO)

A professional title bestowed upon management groups that adhere to the Institute of Real Estate Management's requirements (IREM).

Accredited Purchasers

Investors who are either (1) sufficiently rich to ensure that a proposed stock acquisition (of $150,000 or more) does not exceed 20% of their net worth. (2) have a net worth of more than $1 million, or (3) have a two-year earnings record of more than $200,000 each year and expect current earnings to surpass $200,000.

Accredited Resident Manager (ARM)

A title given by the Institute of Real Estate Management (IREM).

Accredited Rural Appraiser (ARA)

The American Society of Farm and Rural Appraisers gives this title to people who work in the field of farm and rural value.

Accretion

Because of soil deposited by wave and current action, the land area close to a body of water gradually grows.

Land expands in size as a result of the addition or accumulation of soil to it through time through natural deposits.

Alluvial deposits of soil that move with the flow of water, such as when a stream or river moves the shoreline. Land that is added to a stream, whether it is navigable, is owned by the person who owns the land next to it. Any existing mortgages also apply to this new land. However, if land is slowly washed away by erosion, the owner can lose the right to the land.

Accrual Basis

Income and costs are recognised when they are earned or incurred, even if they have not yet been received or paid, according to this accounting technique.

Accrual Method

Income and expenses are reported in this way even if the expenses or income were not paid or the money was not received. This is an accounting method. The right to get, not the fact that you got it, is what makes the money count as gross income. Expenses are also deducted when the taxpayer's liability is set and clear, not when the taxpayer pays the expense. Most of the time, businesses can use the accrual method. Individuals can't use it, though. 

Accrued

Amounts that have been built up over time, like accrued depreciation, accrued interest, or accrued expenses. There are costs that have already been paid, like real estate taxes. It's called a "closing statement," and it shows how much money the buyer owes to the seller. The buyer will pay this money back at a later date.

Accrued Depreciation

A decrease in value as a result of physical degradation, functional obsolescence, and economic or geographical disadvantages.

The process of determining and quantifying decreases in a property's current market value from today's reproduction cost in cost appraisal.

1. In accounting, a bookkeeping account that shows how much depreciation has been taken off an asset since it was bought. This is also called accumulated depreciation.

2. It's important for an appraiser to figure out how much it would cost to make the property again and how much it's worth now, so that they can figure out how much it's worth. In this case, accrued depreciation is called "diminished value."

Accrued Interest

Interest that is due but has not yet been paid.

Accumulated cost recovery

Total cost recovery deductions made over the time a property is held.

Accumulated Depreciation

The entire amount of depreciation taken thus far.

Accuracy

The similarity of observations, calculations, or estimations to true values or values regarded as true.

Acknowledgment

An individual's assertion that he has signed a paper voluntarily.

A notary public or other relevant public official certifies that the grantor indicated before the official that he or she executed the recognised instrument.

Confirmation that a deed represents the grantor's purpose and behavior.

A statement made in front of a person who is legally allowed to do so, usually a notary public, by a person who has signed a document. Also, the document that the person signed. An acknowledgment is meant to stop fake and fraudulent documents from taking effect. The officer makes sure that the person who signed is someone who is known to the officer or who has the right identification. As usual, the person does not need to sign in front of the officer. The officer is liable for any damages caused by his or her negligence in not being able to identify the person correctly. For example, if someone forges someone's name because the officer accepted verification over the phone.

In most states, a document can't be recorded unless it's been signed by the person who wrote it. If a foreign acknowledgment (one that took place outside of the state where it is to be recorded) is valid where it was made, it is likely to be valid where it is to be recorded. When a foreign official signs an acknowledgement, it shows that it was done in accordance with the laws of the place where it was done and that the officer had the right to take the acknowledgement. This means that the document can be recorded and, if necessary, read into evidence in any judicial proceeding without having to show that it is real. However, for documents signed outside of the United States, many states require that the acknowledgment be made by an official at a U.S. Consulate Office, but this is not always the case.

It's important for the officer to sign the document if it has been changed or crossed out, even if it has been agreed to by everyone. Otherwise, the document might not be able to be recorded. Signs should be made in black ink because modern methods of making copies of documents make them easier to read.

Companies, partnerships, trustees, and attorneys-in-fact use different types of acknowledgment forms, and there are also different forms for each of these groups.

Acoustical Plaster

A material composed of fibers or aggregate that absorbs sound.

Acquired Immunodeficiency Syndrome (AIDS)

A very bad disease of the body's immune system. Federal and state laws don't allow people who have acquired immunodeficiency syndrome to be discriminated against because of their condition. The fact that someone has AIDS isn't considered a material fact in many states, so they can't say that a broker tried to hide a fact. People who have AIDS-related complex (ARC) or human immunodeficiency virus infection are also safe (HIV).

Acquisition

The procedure for acquiring real estate.

Acquisition Appraisal

The process of figuring out how much a piece of land is worth in the real world so that it can be used for a public good. The goal of the appraisal is to figure out what the market value is so the government can figure out how much the property owner should get. See appraisal, condemnation, and market value for more.

Acquisition Cost

The whole cost of purchasing a piece of real estate, including all fees, closing costs, and renovation expenditures.

In order to get the right to own something, money or other valuable things had to be spent. Closing costs, appraisal fees, and title insurance are some of the things that come with the purchase price.

Acquisition Fee

A fee paid to a syndicator in return for their assistance in the acquisition of a property.

Acre (AC)

43,560 square feet, 160 square rods, 10 square chains, or 4840 square yards are the dimensions of a piece of land.

An important land area measurement (containing 43,560 square feet).

43,560 square feet, or 208.71 feet by 208.71 feet, is a unit of land area. Equivalent to 4,840 square yards (4,047 square metres), 160 square rods (160 square rods), or 0.4047 hectare. A square mile is equivalent to 640 acres (25.6 hectares).

Acre Foot

One cubic yard is the same amount of water, sand, or minerals that would fill an area of one-acre with a depth of one foot. It is used to measure irrigation water. There are 325,850 gallons in each one of these things.

Acreage Zoning

By requiring big building lots, zoning was designed to limit residential density. Additionally referred to as large-lot zoning or snob zoning.

Act Of God

A natural disaster that is uncontrollable by humans, such as a tidal wave, flood, storm, volcanic eruption, or earthquake. Numerous contracts have a force majeure provision, which temporarily or permanently releases the parties from contract performance in the event that an act of God destroys or damages the subject matter of the contract or prevents performance. This clause, referred known as the destroyed or materially damaged clause, releases the parties to a real estate sales contract from obligation if an act of God damages the property's improvements prior to title transfer.

Active Income

Taxable income generated through salaries, wages, commissions, fees, and bonuses under US income tax law. Salary, wages, tips, commissions, and income from activities in which the taxpayer participates materially See also passive income.

Activity

Another name for a task or the work completed throughout the course of a project.

Actual Age

The building's chronological age, which is the opposite of its effective age, is based on how well and how well it works. A building that is only 15 years old might have an effective age of 20 years because it hasn't been kept up.

Actual Cash Value

An insurance term for how much money an improvement would be worth. In order to figure out how much a property is worth in cash, you subtract the value of the physical wear and tear from the cost of replacing the property.

Actual Damages

Damages that a court of law will acknowledge as a direct result of an act of wrongdoing. By contrast, courts award exceptional or punitive damages as a deterrence and as a sanction.

Actual Eviction

The process of physically evicting a tenant after the court rules in favor of the owner and the tenant doesn't want to leave. It is sometimes called eviction or taking back something. People who are evicted are shown in this picture

Actual Notice

An open, continuous, and obvious expression of real property claims to those who study the property.

Express knowledge or information; what is known; actual knowledge. Constructive notice, on the other hand, is the kind of knowledge that is required by law. It is the kind of knowledge that the law says you should know.

In most cases, a person who is aware of a third party's rights to a piece of land takes the land with that third party's rights in mind. A person can't get the benefits of the recording law if they buy a piece of land with knowledge of a previously signed but unrecorded document. There is also a type of notice called a "inquiry notice," which is used when there are circumstances, appearances, or rumors that make it clear that someone else owns the property. This type of notice can be used to find out if someone else owns the property.

Actual Rent

The amount of rent paid to the owner of a property.

Actuary

A person who works for an insurance company or savings and loan group, and who is good at figuring out how much life interests, pension plans, and annuities are worth.

Ad Valorem

A Latin phrase that refers to the taxation of property based on its monetary worth.

Latin: "according to value," which is usually used to talk about a tax or assessment. Real property tax is an ad valorem tax that is based on how much the property is worth. Each piece of property is taxed based on its value, not on how many units there are, like a tax on a gallon of gas or a package of cigarettes.

Ad Valorem Tax 

A property tax based on the property's current value.

Property taxes levied on the basis of the property's market value.

ADA

The Americans with Disabilities Act is a civil rights law that prohibits discrimination against people with disabilities in all areas of public life, including jobs, schools, transportation, and all public and private places that are open to the public.

Adaptability

The ability to easily change the physical design of residential or commercial units in the future to meet the needs of people who have limited mobility in the future. Putting reinforcements in the walls of a bathroom makes it easy to put in grab bars later on.

Adaptive Reuse

A conversion in which the emodeling results in a creative reuse of the building that is not related to its original use.

Adaptive Use

Putting an ancient but sound structure to new use.

ADC Loan

People who want to buy, build, and develop a project get loans to pay for all of that.

Add-Back

For a loan that lets you put off paying some of the interest, that money is added to the amount you'll have to pay at the end.

Add-on Factor

The number of rentable square feet divided by the number of usable square feet. This number is also called the load factor or the rentable-to-useable ratio.  Add-on factor = Rentable square feet divided by useable square feet/meterage.

Add-On Interest

Interest is calculated on the total principal balance for the chosen term, regardless of any principal repayments. The borrower is charged interest on the full principal amount for the duration of the loan (not on the declining balance), despite the fact that the principal is decreased monthly. Additionally referred to as block interest. 

For example, a $10,000 loan with 12% add-on interest payable over three years would need equal annual interest payments of $1,200 regardless of the amount of unpaid principal. As a general guideline, double the reported add-on interest rate to obtain the effective rate of interest (true annual interest). Thus, the true yearly interest rate on the $10,000 loan in the example would be about 24 percent.

Addendum

A proposal to alter contract terms or bid information.

Additions that are added to and become part of a document. If there isn't enough space on the sales contract form to write down all the details of a deal, the parties will add an addendum or supplement to the contract. The sales contract should include the addendum by referring to it as part of the deal, so it should be there. If there is an addendum to the sales contract, it should be dated and signed or initialed by all of the people who signed the contract.

Addition

When a building gets bigger or has a big change made to it, that's a renovation. If you add another floor to a one-story house, that's an addition.

Additional Charge Mortgage

A type of mortgage that is used to get more money from the person who owns the house after the person who owns the house gets a loan from the person who owns the house. There should be no question about whether the two debts are linked.

Additional Deposit

The extra money the buyer gives to the seller or to an escrow account as a part of a deal to buy something. The extra deposit is usually paid within a short time after the offer is accepted. With her offer to buy the seller's $150,000 condo unit, the buyer might deposit $1,000. She might also agree to pay an extra deposit of $4,000 in five working days after the seller accepts her offer. If the buyer doesn't keep their end of the deal, the seller can keep all of the money they've put down, including the extra deposit.

It might be possible for the seller to end the contract if a court rules that the buyer didn't pay on time was an important breach of the contract. There are many ways for the seller to make sure this happens. One way is to make the seller's acceptance contingent on timely payment of the extra deposit.

Additional Repayment

Additional money is deposited into the loan over and above the required minimum payments.

A lot more money was put into the loan than the minimum payment.

Additional Space Option

Tenants have the option to expand the space they rent during the term of their lease, as long as they do so in a way that is set out in their lease.

Adhesion Contract

A one-sided contract that benefits the party who authored the deal. Indeed, an adhesion contract might be so one-sided that doubts about its being a voluntary and uncoerced agreement arise due to the implication of a significant negotiating power imbalance. Courts will not enforce adhesion contract clauses that are unjust or oppressive toward the party who did not draught the contract. Additionally referred to as a take-it-or-leave-it contract.

Contracts containing extensive fine language, such as franchise agreements, mortgages, and leases, are occasionally challenged as adhesion contracts on the grounds that the non-drafting party was not given an opportunity to bargain over the agreement's many elements.

Additionally, an insurance contract (property, title, or life) is occasionally contested as an adhesion contract. Courts have concluded that any ambiguity should be construed in the insured's favor, and that any exclusion from coverage must be disclosed plainly and prominently. Additionally, courts will employ the notion of unconscionability.

Adjudicated

It is something that has been decided by a court or government body.

Adjunction

The act of annexing a piece of land to a larger piece of property.

Adjustable Rate Loan

There are many types of loans that can have different rates and terms. Fannie Mae and Freddie Mac, the Federal Housing Finance Agency, the Comptroller of the Currency, and the Office of Thrift Supervision have all issued guidelines that allow real estate loans with provisions to change the rate of interest at certain intervals (e.g., every six months) and within a certain range to be made (e.g., 1 percent).

People now use adjustable-rate loans, which can change their interest rates based on changes in the market. The ranges for time intervals, percentage increases or decreases, and total increases or decreases can change as the market changes. There is a cap on the biweekly payment loan that you can see.

The adjustable-rate loan has its own set of terms, like the following:

Current index: In this case, the current value of a well-known index as it is calculated and reported nationally or regionally. The value of the current index changes all the time. This value is used to figure out the new note rate on each rate adjustment date.

Fully indexed note rate: At the time of application, add up the index value at that time, as well as the gross margin in the note that says that.

Gross margin: When the rate changes, an amount of percentage points is added to the current index value to get the new note rate. In the loan document, the gross margin is written down.

Initial rate: The low rate for the first adjustment period was meant to entice people to borrow money (the "teaser rate").

Initial rate discount: When you apply for a loan, you need to know how much money you make and how much debt you have.

Life of loan cap: A limit that the note rate can't go over over the life of the loan is called a "cap."

Note rate: The rate that determines how much interest the borrower will pay each year, or how much they will pay each month. The accrual rate, the contract rate, or the coupon rate is also called the note rate, but these are different names.

Payment adjustment date: Borrowers may have to pay more or less each month.

Payment cap: At the payment adjustment date, there is a cap on how much the borrower's monthly principal and interest will go up at that time. If the interest rate rises by more than the payment cap percentage, this rule comes into play. In most cases, the borrower can choose whether or not to follow this rule. Negative amortisation could happen.

Payment rate: It is the rate at which the borrower pays back the loan. This rate is based on buydowns or payment caps.

Periodic interest rate cap: A cap on how much the note rate can change at each rate change, which limits how much the borrower's payment will change at each rate change.

Rate adjustment date: Loan rates may change on this date.

Subsidy buydown: The money, usually from the builder or the seller, is used to make the selling price of a home a little sweeter by lowering the monthly principal and interest payment for a short time.

Adjustable Rate Mortgage (ARM)

The interest rate on a mortgage loan fluctuates on a regular basis.

A mortgage whose interest rate is linked to a floating index. At predetermined intervals, the interest rate is modified.

Alternative mortgage form in which the interest rate is tied to an indexed rate during the life of the loan, allowing borrowers and lenders to share interest rate risk.

A loan where the interest rate on the note is changed periodically based on an index that shows how much it costs the lender to borrow money on the credit markets.

Adjusted Average Rate Of Return Method

A modified rule of thumb that uses an average income or cash flow figure while accounting for the predicted sales price or equity reversion.

Adjusted Basis

Equal to the initial cost basis plus any extra real estate or personal property capital expenditures, less the total amount of tax depreciation absorbed after the property was placed in operation.

The sum paid for the property plus any further capital expenditures made to improve it, less any tax deductions for depreciation or cost recovery allowances.

The property's initial cost basis is decreased by some deductions and enhanced by certain improvements. The taxpayer's initial basis, as established at the time of acquisition, is reduced by the amount of permissible depreciation or depletion allowances accepted and by the amount of any uncompensated property losses sustained. The cost of capital improvements is then added, as are some carrying expenses and assessments. The taxpayer recognises gain or loss on the sale of property by deducting the adjusted basis on the date of sale from the adjusted sales price.

The property's original cost plus any capital improvements, minus the total amount of cost recovery deductions and partial sales made during the holding period.

Adjusted Gross Income

The gross taxable income is a set of specified deductions outlined in the Internal Revenue Code.

Adjusted Rate Of Return

A customized version of the internal rate of return that is intended to remove issues related to negative cash flows.

Adjusted Tax Basis

The sales price less costs and commissions on which a capital gain or loss is calculated.

Adjustment Date

In an adjustable-rate mortgage, the date on which the interest rate is adjusted.

Adjustment Interval

The frequency at which an adjustable-rate mortgage loan's interest rate and monthly payment amount can be changed. 

Adjustment Period

The number of initial years that an ARM remains set before the interest rate can be modified.

Adjustments

Additions or subtractions from similar sale price or cost necessary to make the comparative properly more directly comparable to the subject properly.

1. In appraisal, the adjustments made to the sales price of a comparable property in order to arrive at an indicative value for the subject property. Adjustments may be necessary for a variety of reasons. The first adjustment is made for seller concessions or terms of sale; the second adjustment is made for financing terms. Another is for the date of sale, if market circumstances have changed since the similar transaction. Adjustments are subsequently made for location and dissimilarities in the subject's physical qualities and the comparable property's physical attributes. For each difference or dissimilarity, the stated value is increased or decreased. (For further information, see appraisal, comparables, and the direct sales comparison approach.)

2. In real estate closings, the settlement statement's credits and debits, such as real property taxes, insurance, and rent prorations.

Admeasurement Of Dower

Shares are determined and split up. A dower admeasurement is the legal remedy of an heir who thinks that the widow has been given more than she should have under her dower right. In valuing the widow's dower interest, standard annuity tables of mortality are used to figure out the value of her future life interest, which is then used to figure out how much of the widow's share of the estate she gets.

Administrative Law Judge

In the United States, the administrative law judge (ALJ) is the person who runs the administrative hearings where both sides present evidence. A lot of the time, the ALI can administer oaths and affirmations, rule on evidence, take depositions, regulate the hearing, and make or recommend decisions. The ALJ has a lot of power when it comes to making suggestions.

Administrative Regulations

Regulations that have the force and effect of law, made by an administrative body. The state's real estate commission often makes rules to go along with the licensing law.

Administrator

A person appointed by a court to manage the estate of someone who died intestate.

1. A person who is chosen by the court to settle the estate of someone who died without leaving a will (leaving no will). People sometimes call this person their "personal rep."

2. One who is in charge of securities.

Administrator's Deed

A deed that transfers the property of a person who died without leaving a will.

Advance

To think about something before it is due. In this case, money is given by one party (like a mortgagee or a seller) to cover costs that were not paid by the other party who was in default. These costs include taxes and insurance. These amounts are added to the account of the person who gave them. For example, a second mortgagee might pay the borrower's first-mortgage payments in order to keep the property from being foreclosed on.

Lenders need to know if a recorded mortgage that secures future loans takes precedence over a later mortgage that was recorded before the date of the loan but after the first mortgage was recorded. Other advances include money that is paid out under an open-end mortgage or money that is given to a developer-borrower by a construction lender. See also: Draw, extra charge mortgage. A fee that is paid before any work is done. People who want to sell their homes or businesses might agree to pay a broker a nonrefundable fee in advance to pay for advertising, but the broker doesn't guarantee that a buyer will be found. Brokers must keep good records of their expenses.

Advance Fee

A fee paid before any work is done. People who want to sell their homes or businesses might agree to pay a broker a non-refundable fee in advance to pay for advertising, but the broker doesn't guarantee that a buyer will be found. Brokers must keep good records of their expenses.

Adverse Financial Change Condition

Agreement: If the borrower loses their job, for example, the lender can cancel the loan. This is called a "cancellation clause."

Adverse Possession

Acquisition of title to property where an occupant has been in actual, open, infamous, and continuous usage for a period of time prescribed by state law.

Wrongful possession of real estate in a way and for a period of time specified under state legislation. The opposing possessor then obtains title by operation of law, independent of any previously documented title to the property.

Involuntary transfer of real property rights by an individual who demonstrates a usage that is (1) antagonistic to the owner's crests, (2) actual, (3) open and infamous, (4) continuous, and (5) exclusive.

Acquiring the right to a piece of land that someone else owns by having open, hostile, and continuous possession for a set amount of time. There is a main goal of adverse possession laws: to make sure that land is used to its fullest and most productive capacity. It's up to the people who own the land to show that four conditions were met: A claim of right has kept them there. (2) They were in real, open, and obvious possession of the property, which should have given the record owner enough notice. (3) Possession was both exclusive and hostile to the title of the owner. That is, it was done without the owner's permission and showed that the owner wanted to keep the claim of ownership against anyone who might challenge it. (4) At least for the prescriptive period set by state law, the person who had the land had it for at least that long. In this case, the occupancy of the premises by people who are successors in interest (that is, by contract or descent) can be added together to meet the requirement for continuous use of the premises. For example, a man's father occupies a piece of land for four years. When his father dies, his son takes over and "adds" to his father's four-year ownership. Two words can help you remember: POACH: Possession is open, real, continuous, and hostile. CANOE: Possession is not (possession is continuous, actual, notorious, open, and exclusive).

Under the law, anyone who is legally incapacitated (such as insanity) or who has a legal right to get rid of someone who owns something doesn't have to go through with the process. Because a life tenant has a life estate, someone who is a "adverse possessor" could get title to that person's property. But the remainderman has no right to the property until the life estate ends.

People who claim to own something by "adverse possession" don't have a marketable title until they get a judicial decree "quieting" the title or get a quitclaim deed from the person who took it away. When all of the rules are met, the owner's title is cancelled and a new title is given to the person who took it from them. A new title comes into effect when the first person who doesn't like it comes forward. Thus, the former owner can't sue for trespass, profits, or rents during the time that the new owner was in charge of the land.

In most states, the person who claims the property doesn't have to have paid taxes on it for a certain amount of time. In some states, if the person who claims the property pays taxes, that may shorten the prescriptive period. However, a court might think that failing to pay taxes is proof that the claimant didn't really claim to own the property.

Usually, courts don't let people make claims of adverse possession if they have a close relationship with the owner, like father and son or husband and wife. This is because it's hard to prove hostile claims in this case. Cotenants usually can't sue each other unless one cotenant is evicted by another cotenant in a very clear and real way.

Prescriptive rights in general aren't very popular with the law, because they make other people give up their rights. As a general rule, people think that if they take someone else's property, they did so with their permission.

In most cases, you can't own land in the state or the federal government if you take it illegally. As a result, the federal Color of Title Act says that someone can get a patent if he or she meets all four tests of adverse possession on public land. If the land doesn't exceed 160 acres and all taxes are paid, he or she can get a patent. The United States, on the other hand, owns all rights to the coal and minerals on the land. In addition, title to Torrens-registered property can't usually be taken by someone else taking it over.

Adverse Selection

When an adviser has an activity to filter the available investment options, it is similar to an agency problem. retaining the more viable ones and providing the less hopeful ones to 1hc investors

Adverse Use

It's when you get the right to use someone else's land for a limited amount of time, like by getting a path easement across someone else's land. People who want to get an easement through "adverse use" usually have to meet the same requirements as people who want to get an easement through "adverse possession," including the prescriptive period. Most easements can't be lost just by not using them, but an easement that was created by someone else using it in a bad way can be lost if they don't use it for the prescriptive period of their use.

Advertising

Getting the word out about one's products and services In real estate, advertising is regulated by rules and regulations set by federal, state, local, and private bodies. Many of the same rules apply when property is advertised on Websites over the Internet, like when it's put on a billboard or billboard.

To advertise a property, the broker needs written permission from the client. In any offer, the price must be the same as the one the owner agreed on with the broker. Many state license laws say that real estate brokers can't use blind ads, which are ads that are placed on behalf of the seller but don't say who the real estate broker is. In sales, people can't just use their own name to advertise. You can't see the ad, or it's not true.

When it comes to advertising real estate, three things are very important:

Condominiums and subdivisions: Condominium, time-share, and subdivision laws in many states control how advertising for condominium and subdivision sales can be done. These laws say that ads can't make false or misleading claims, and they say that no part of a public report or public offering statement can be used for advertising unless the report is used in its entirety. In addition, some state agencies require that all real estate ads be checked by them before they can be published; other states have strict rules for real estate advertising. In many states, a developer may not be able to advertise new projects until he or she has met certain state registration rules first.

Discrimination: Federal rules say that ads for housing can't discriminate on the basis of race, colour, religion, sex, disability, family status, or national origin. Some state and local rules also ask about marital status, age, sexual preference, or source of income.

Truth in lending: Federal truth-in-lending law says that if an ad has specific financing terms or credit terms, it must say what those terms are.

Aeolian Soil

It is a type of soil that has been made by wind-blown solids, like sand dunes and volcanic ash deposits. Also, soil that moves with the wind.

Aerator

The screened round screw on the tip of a sink spout. It combines water and air to create a smooth flow.

Aerial

Of, relating to, or happening in the air or atmosphere.

Aerial Photograph, Oblique

Aerial shot made with the camera axis oriented between horizontal and vertical:

(1) high oblique-an oblique image with the horizon visible;

(2) low oblique-an oblique photograph without the horizon visible.

Aerial Photograph, Vertical

An aerial image shot with the camera's optical axis almost perpendicular to the earth's surface and the film as nearly horizontal as possible.

Aesthetic Value

In the process of valuing residential property, an intangible benefit of a home that is very attractive or pleasing, rather than just functional. The government can use its police power to protect things like a hillside site that looks out over the ocean, for example, by putting in place a zoning ordinance.

Affiant

An affidavit is made by someone who says they are telling the truth.

Affidavit

It's when you get the right to use someone else's land for a limited amount of time, like by getting a path easement across someone else's land. People who want to get an easement through "adverse use" usually have to meet the same requirements as people who want to get an easement through "adverse possession," including the prescriptive period. Most easements can't be lost just by not using them, but an easement that was created by someone else using it in a bad way can be lost if they don't use it for the prescriptive period of their use.

Affidavit Of Title

Agent. A written document that says under oath that a seller is the real owner of a property. A person who has been given permission by a principal to act for that principal.

An oath is a written statement made by the seller or grantor and signed by a notary public. The grantor (I) identifies herself and states her marital status; (2) certifies that there are no judgments, bankruptcies, or divorces against him or her, no unrecorded deeds or contracts, no repairs or improvements that have not been paid for, and no known defects in the title; and (3) certifies that there are no known defects in the title. Often used in a number of states.

Affiliate Licensee

The licensee who works in real estate with the help of a broker. According to state law, affiliate licensees may be able to work as a sales person or a broker. Because the agency relationship is between the broker and the consumer, affiliate licensees may receive compensation for their real estate activities only from their employing broker, not directly from a consumer.

Affirmation

a statement that says that a certain thing is true. As an alternative to an oath, affirmations are used when the person who is being sworn or testifying doesn't want to take an oath because of their own or religious beliefs. A voluntary proactive programme designed by the U. S. Department of Housing and Urban Development (HUD) to inform all buyers, including those "least likely to apply," of homes for sale without discrimination and t9 provide real estate licensees with procedures and educational materials to assist in compliance with the law. Affirmative marketing doesn't have any specific goals or quotas.

Affirmative Covenant

A mutual agreement made by neighbors that a property will be utilized in a specific way.

Affirmative Marketing Program

Local associations of REALTORS® can meet with HUD to discuss the National Fair Housing Partnership Resolution to ensure equal opportunity in housing for all. This approach emphasizes the importance of local participation and community action programmes in this approach.

AFFO

Recurrent revenue given by REIT-owned buildings adjusted for non-real estate depreciation and amortisation, as well as a straight-line rent adjustment

Affordability Index

A standard set by the National Association of REALTORS® to see how well people can afford to buy a home. It says that a family making the national median income has enough money to get a mortgage on the median-priced house.

Some economists say that every one-point rise in the interest rate on a home mortgage reduces home sales by 300,000.

Affordable Housing

Housing units designed to serve households earning less than 60% (rent) or 80–120% (purchase) of a metropolitan area's median income.

Those who make less than a certain percentage or less than the median income for the area, as determined by HUD and adjusted for family size, can live in this type of home. Affordable housing projects are usually built with help from the government or as part of a development agreement with the right government agency.

The goal of affordable housing projects is to recognize that there is a real shortage of housing and to help people who can't afford to live somewhere else. There may be certain restrictions and conditions on how affordable housing units can be resold or how many people can live in them.

Affordable Housing Allocation

A provision that encourages or requires a "reasonable and equitable" component of new housing construction for low-income families.

Affordable Housing Loans

Loan purchase programmes were made available by Fannie Mae and Freddie Mac to 10 leading mortgage marketel lenders exclusively for low and moderate-income customers.

After Tax Cash Flow (ATCF)

Cash flow created by a property after deducting all current operational expenditures, debt servicing obligations, and income tax repercussions.

The remaining claim on the property's cash flow after the mortgage lender(s), as well as the state and federal governments, have been paid their fair share.

The amount of money left over after all expenditures, including taxes, have been paid.

After Tax Cash Flow Multiplier

The equity split by the after-tax cash flow is used to calculate the payback method.

After Tax Equity Reversion (ATER)

The equity reversion before taxes. defined as the net selling price minus the outstanding mortgage debt at the time of sale, less taxes owed at the time of sale

The net selling price minus any outstanding mortgages and any taxes owed at the time of sale.

After Tax Rate (ATR)

The after-tax cash flow divided by the equity yields a rate of return.

After Tax Real Rate Of Return

Adjusted for inflation, the amount of money an investor can keep after paying any taxes on a sale.

After-Acquired

At some point, this item is bought. An after-acquired title is a title that a grantor of property gets after the grantor has tried to give a good title to the property. When the grantor has a good title, it will automatically pass to the grantee because of the law. Smith gave Jones his farm on January 1, 2004, by way of a warranty deed. That's not the only reason Smith didn't have a valid title on January 1. He owned the land under a forged deed. Smith got good title on March 5, 2005, so Jones got good title on March 5.

Note that a quitclaim deed doesn't give the grantee the right to a title that the grantor hasn't yet owned. This is because the deed only transfers the grantor's current interest in the land, if any. You can see a "quitclaim deed" for more on this.

People who own property and have a mortgage must pay for and install any fixtures that they buy and pay for themselves. This means that they are subject to the lien of the mortgage. When you buy a home, you usually get a mortgage. Many mortgages also say that any fixtures that were there when the mortgage was made are subject to the mortgage. The Uniform Commercial Code (UCC) has set rules for resolving disputes between mortgagees and chattel security claimants who have rights to property that was bought before the mortgage was taken out. For example, if an appliance was bought on time and installed on the mortgaged property, the chattel security claimant has a right to it. As long as the UCC is used, a debtor can give a chattel mortgage a superior security interest in such property that he or she has bought after the debt has been paid off.

After-Tax Income

In accounting, the amount that is left after income tax is taken out of taxable income. After taxes, the cash flow from an investment is called "after-tax cash flow," or "after-tax cash flow" (ATCF).

Age To Life Method

Estimating improvement value by calculating the ratio of an improvement's effective age to its economic life and multiplying the resulting age-to-life ratio by the structure's reproduction cost.

Age-Life Depreciation

Depreciation is calculated based on the condition of a property and how long it has been in business. Effective age (based on condition) is added to the estimated remaining economic life of a home under this method. The effective age is then divided by that sum to figure out how much depreciation there is total. In this example, a house has been around for ten years and still has a lot of money left in it, so the depreciation is 20%. (ten divided by 50).

Agency

The legal connection that exists between a principle and an agent as a result of a contract in which the principal hires the agent to undertake specified tasks on his or her behalf.

A relationship is formed when one person, the principal, gives another person, the agent, the right to act on his behalf in business transactions and to have some control over how they do so. People who work with someone else have a fiduciary or legal relationship with them, which means they have certain responsibilities and obligations, as well as high standards of good faith and loyalty.

People who work for someone else have a lot of different rights and responsibilities that are regulated by a lot of common and statute law. It's not just the general law of agency that applies to all business transactions. State real estate licensing laws have a direct effect on the agency relationship between real estate licensees and their clients and the public. Even though contract law and agency law are two different things, they often come together when real estate agents and their principals are interpreted. This is because real estate agents and their principals often work together.

The payment of money does not have to be part of an agency relationship. One can agree to act as an agent for free and be held to the same standards as an agent when they start doing so.

General: When a principal gives a property manager the power to run a real estate project on his or her behalf, this is an agency. It can also be a special agency, like when the broker is hired to find a ready, willing, and able buyer. The broker is not allowed to sell the property or to bind the principal to a contract to sell the property.

An agency relationship can be implied by what the parties do, and it doesn't need to be written down to make it happen. The buyer and the agent with whom they are working can have an agency relationship even if they don't agree to it in writing. Once an agency relationship is set up, it has certain rights and responsibilities. This makes the broker responsible for any violations of duty.

There are two types of real estate brokers in a typical deal: one who works for both the seller and buyer is called a "listing agent," which includes the associate licensees who work for that broker. The other broker who works for the buyer is called a "selling agent," which means that he or she either works for the buyer or for the seller. In some cases, the listing agent is the only broker who works on the deal. There may be two types of agents: dual agents and limited agents. In some states, this relationship is set to transaction brokerage by default, but it can be changed.

In most cases, a real estate licensee can be held liable for breaking his or her fiduciary duties to the person who hires him or her. (1) The principal can sue the licensee-agent for money damages in court. (2) The state licencing authority can take action against people who break its rules. For example, if an agent does something or says something that isn't in line with his or her job description, the person who hired him or her is legally responsible for those actions and statements.

The agent must do what the principal wants, be loyal, obey, and tell the principal about important things that could make the property worth more than the agreed-upon price. The agent must also take care not to overstep the authority given to him or her or misrepresent important facts to the principal or to third parties, keep a proper accounting of all money, and put the property where the principal wants it. Keep in mind that in an emergency, a person's agent has more power, and he or she can disobey orders if it's in the best interest of their boss.

When an agent doesn't have permission from the person they work for, they can't tell a third party confidential information or information that hurts the person they work for. People can't say for example that the seller is forced to sell because of a job loss or because they are going through a divorce. They also can't say that the seller will accept less than the listing price without permission.

The private information learned during the agency can't be used later against the principal, even if the deal is done. This is true even if the deal is done. This includes financial information that was used in negotiations with properties that were later put on the market.

Agents are legally required to tell their principals everything that is important and relevant, but race, national origin, colour, disability, religion, family status, and sex are not important facts and should not be told even if the principal wants them to.

Sometimes, a real estate agent can get an offer from someone who will list their own home with that same agent. A smart broker will tell the seller this when he or she makes an offer. Otherwise, the broker could be accused of not telling the seller that he or she made money.

In some states, the agent in a principal/agent relationship must do more. For example, if one of the salespeople or a relative or a related company makes an offer to buy the property, the agent must say so in writing. For example, if the agent's wife used her birth name when making an offer, the agent must say so in writing. There must be written permission from both the seller and the buyer if an agent works for both of them at the same time. The agent cannot mix the principal's money or other things with his own. If the owner doesn't want the broker to advertise their property, they can't. If you work for a broker, you have to tell your boss or client about every deal.

Most states have laws that require the licensee to say who the licensee represents early on in the transaction and to make sure this information is correct in writing. A limited agent, "designated agent," "transaction coordinator," "facilitator," and other new terms and definitions have been used by states to describe how they work with customers.

Agents must be honest and careful when they deal with third parties for whom they are not the broker. They are liable for any material misrepresentations or negligent acts made by the broker, so they must be careful. A third person may also be held liable for any actions that an employee does while on the job. Statutorily, some states have given the responsibility back to the customer (abrogated vicarious liability).

At any time, a principal can end an agency with an agent. If the agency is linked to an interest, the principal can't do that at all. A money claim might be made if the agency is shut down before the stated end date. If one of the parties dies or becomes incapacitated, the agency ends. Notification of death isn't required. The property is destroyed or taken away, or the terms of the agency run out. The agent or principal can renounce or rescind the agreement. The principal can also go bankrupt and lose the property because the title is given to a receiver.

Agency By Ratification

"After the fact": When a principal says or implies that a person who claims to be her agent is acting in her best interest, that person is her agent. There must be proof that the principal knew about the act or acts and either agreed to the benefits or agreed to be bound by the actions of the agent.

Agency Coupled With An Interest

When the agent owns a piece of the subject of the agency (the property). The principal can't get rid of it, and it doesn't end when the principal dies. For example, a broker may be able to help with the financing of a condominium development if the developer agrees to give the broker an exclusive listing to sell the units that are already equipped. After the broker had given the developer the money, the developer couldn't take back the listing.

Agency Problem

Occurs when an investor (principal) uninformed relies on an advisor (agent) for counsel when there is a possibility that the adviser may not behave in the best interests of the investment/principal.

Agency Relationship

A relationship in which the properly managed/agent serves as the owner's fiduciary; consequently, the manager's words and actions bind the owner.

Agent

Individual who has been permitted to act on behalf of another person (principal) in a transaction with a third party.

The person or firm you authorize in writing to act on your behalf with third parties in exchange for a commission

A person who is allowed to act on behalf of another person (called the principal). An agent is different from an employee, who only works for a principal. An agent works in the place of a principal. The main difference between an agent and a worker is that an agent can make a contract on behalf of the person they work for. An employee, on the other hand, can only make a contract if they have been specifically told to do so.

A real estate broker is the person who works for the person who wants to sell or buy a house. She has a legal or fiduciary duty to that person. A salesperson, on the other hand, works for his broker and doesn't have a direct contract with either the seller or the buyer. Salespeople who want to leave their current company and become angry when their broker won't let them take their listings should keep this in mind, too.

Note that minors can't choose an agent to help them with their contracts, but an adult can choose a minor to be an agent.

A person who is licensed and well-trained helps with the process of selling a home.

Agents In Conjunction

You (as a vendor or landlord) may appoint more than one agency, or an appointed agent may collaborate with another agent who brings a buyer or renter to your property.

Agglomeration Economies

A nebulous word relating to cost savings attributed to proximity.

The formation of specialized resources in a community in response to demand from a variety of businesses. Large cities are commonly connected with this term.

Cost cuts or savings that come from efficiency gains caused by the concentration or clustering of firms, producers, or economic activities and the formation of a localized production network.

Aggregate

A material or structure composed of a loosely compacted mass of fragments or particles.

Aggrieved

Having been harmed or hurt because of someone else's infringement or denial of rights. The term also refers to someone who has been hurt or who has lost some of her personal or property rights or has been forced to do something that is unfair.

Agreed Boundaries

A law that affects the rights of people who own land to the borders. When there is a question about where the true boundary line is between adjoining parcels of land, the landowners can work together to set a boundary line. agreed boundaries are used when two people agree on a legal boundary. If they act in accordance with that boundary, the law says that line is the legal boundary between their properties.

Agreement Of Sale

A written contract between a buyer and a seller of real estate.

Ownership terms are words that move ownership from one owner to another. In real estate, the agreement of sale (purchase agreement) includes agreements about the price, when the sale will happen, and who will get what. There are some states where a "contract for sale" is also called a "land contract" or "contract for deed."

Agricultural Foreign Investment Disclosure Act (AFIDA)

1978: A federal law says that foreigners who own more than one acre of agricultural land in the U.S. must give the secretary of agriculture information about it.

Agricultural Lien

A legal lien is given to a farmer to get money or supplies for growing a crop. The lien is only on the crop, not the land.

Air Park

This is a piece of land that is near or part of an airport and has been made into commercial, industrial, and office space.

Air Rights

A type of real estate development right that refers to the empty space above a property.

The right to use, occupy, or govern the area above a specific piece of land. These rights can be transferred to another party by selling, leasing, or donating them.

Rights to construct on or occupy the vertical space above the specified location.

Having rights to use land that isn't owned by you. Ownership of land gives you the right to all the air above your land. Before the invention of the aeroplane, this right was unrestricted. Courts now allow reasonable interference with one's air rights, as long as the owner's right to use and occupy the land isn't harmed. Thus, low-flying planes might be trespassing, and their owners would be responsible for any damage they caused. Governments and airport authorities often buy air rights next to an airport, called an avigation easement, to make it easier for planes to glide over the ground.

If you talk about airspace in three dimensions with a specific piece of land in mind, such as in a condominium unit, it is real property. The air itself is not real property.

People who own land and people who own air rights in Maryland can be taxed separately. As with the Pan Am Building above Grand Central Station in New York City, air rights can be sold or leased and buildings built on them.

People can also give up air rights by giving up easements, like those used to build high-rise highways, get scenic rights, or get easements of light and air. Because there isn't a lot of land, many developers are looking into the possibility of building properties in the airspace above prime properties owned by schools, churches, rail lines, and cemeteries.

Air space

The space between insulation on the inside and wall coverings on the outside.

1. It's a good idea to put insulating glass in between two panes of glass.

2. When someone owns a unit in a condominium, they own a lot more than they think they do (in addition to tenancy in common for the common areas). Wall-to-wall and floor-to-floor are the most common ways to do this.

Airport Zoning

Regulations that try to keep planes safe from things like electronic interference by controlling land use, building height, and natural growth in the areas around an airport.

All-Inclusive Deed Of Trust

As the name implies: A purchase-money deed of trust that is in addition to, but not in lieu of, any existing debts or encumbrances. The only difference is that instead of a mortgage, a deed of trust is used instead.

Aleatory Contract

When a contract has to do with a contingency or unknown event, like when someone buys fire insurance or buys a lottery ticket.

Algorithm

An algorithm is a statement of the steps to be taken in the solution of a problem; it can take the form of a word description, an explanatory note, or a labeled diagram or flowchart.

Alien

A person born outside the United States who has not been naturalized by the Constitution and U.S. laws and is not a citizen of the United States is called a "immigrant." In most states, aliens can buy and own land, but some states limit the ability of businesses and non-resident aliens to buy and own land. Restrictions can come in the form of limits on how many holdings you can have, restrictions on how you can use the land for agricultural or industrial purposes, and identification rules.

FIRPTA says that the buyer of real estate from a non-resident alien must withhold up to 1% of the sale price and give that money to the U.S. Treasury so that the alien can pay less tax.

Alienation

When one person gives another a piece of land that they own, title to, or an interest or estate in. Property is usually sold or given away by choice, like with a deed or an assignment of a lease. An example of involuntary alienation would be when someone is foreclosed on their home or a tax lien is sold. People can get rid of rules that are too strict.

Alienation Clause

Promissory note: A provision in a promissory note or mortgage that says that when the debtor sells or gives away the property, he or she owes the mortgagee the rest of the debt. As a general rule, "alienation" means any transfer of ownership, title, or an interest in real property, including a sale through the use of a contract for deed. Also known as a due-on-sale clause.

Aliquot

Ownership of a fraction of a piece of land in U.S. public land states. The aliquot tells you which parcel is in the section, township, and range. There are a lot of aliquot descriptions in Alaska.

All Taxpayers are Liable

After calculating tax liabilities in the traditional manner, taxpayers must do the alternative calculation. They must pay the higher of the normal or alternative minimum tax.

All-A Loan

A house loan for borrowers who do not meet the requirements for a normal (prime) home loan. The phrase is used in a variety of contexts. Roughly. It refers to loans that are better than subprime but fall short of prime in terms of borrower eligibility and loan terms. The absence of detailed verification of the borrower's income assets distinguishes most Alt-A loans from prime loans.

All-Risks Policy

A term that used to be used to describe a homeowner's insurance policy has changed. The policy didn't cover all of the risks, so the industry now refers to it as a "Special Form." In the H0-3 homeowners' insurance policy, the dwelling and the contents are covered by a special type of insurance. This type of insurance is called "special form."

Allodial System

In the US, real estate law is based on the idea that people can have full and free ownership of land, and that this is how the law works. In contrast, under the feudal system, the king or sovereign owned the land and gave it to his noblemen, chiefs, and other people. These allotments could be changed and only gave the person who got them the right to use the land.

Allonge

Promissory note: A piece of paper attached to a promissory note for writing endorsements. It is sometimes used when a promissory note is given to an investor.

Allotment

A tiny building plot, often known as a block

Subdivided land is land that has been subdivided into smaller pieces.

The money that will be used to buy mortgages in a certain amount of time by a permanent investor with whom a mortgage loan originator has a relationship but not a specific contract in the form of a promise. The allotment may say what the investor wants when it comes to processing, loan terms, and/or underwriting rules.

Allowance

The money set aside for things that aren't in the original construction contract.

Alluvion

The material that adds to the soil on a shore or riverbank as it grows. Also called alluvial deposits, it is the fine material that water moves and deposits on land. Sand and mud are two examples of alluvial material. Alluvion and accretion are sometimes used to refer to the same thing.

Alluvium

Any material deposited by rushing water; floodplain and alluvial fan soil.

Alpha

When a manager uses skill to outperform the market competition at a given risk level, this is the return.

Alteration

A word that is used to talk about a part of a building project or remodeling work.

Alternate Bid

Amount that may be added to or deducted from the advertised price based on the selection of alternative methods and materials.

Alternative Minimum Tax

Individual taxpayers with specific income levels pay a flat rate tax.

A provision that defines the minimum amount of federal income tax that can be deducted.

Alternative Minimum Taxable Income

The income on which the alternative minimum tax liability is determined.

Alternative Mortgage Instrument

Interest, repayment terms, or the number of payments each month are all different from a standard fixed mortgage. This is a type of mortgage. The variable-rate mortgage, graduated-payment mortgage, renegotiable-rate mortgage, adjustable-rate loan, pledged account mortgage, reverse annuity mortgage, and shared appreciation mortgage are some of the examples.

Altitude

Elevation above or below a reference datum, which often means sea level.

Ambient Air

Any area of the atmosphere that isn't inside of a building or structure. Federal clean air laws set standards for the air around us.

Amenities

Tenant-provided improvements to a residential building.

Attractive aspects of a piece of property that can be improved.

There are many things that make real estate more valuable or desirable, both tangible and intangible. In a condominium community, for example, there is a swimming pool, a clubhouse, and a good view.

Amenity

Non-monetary tangible or intangible benefits that come from real estate, such as recreational facilities, concierge services, or planned events.

Americans With Disabilities Act (ADA)

The Americans with Disabilities Act was passed by the federal government in 1999. It was meant to stop people with disabilities from being discriminated against by making sure they had equal access to jobs, public places, government services, public transportation, and telecommunications.

The Americans with Disabilities Act doesn't allow people with disabilities to be discriminated against when they use goods and services at places like hotels, shopping centres, and professional offices. It also applies to private businesses that own, lease, or run almost all commercial facilities. Private clubs and religious groups aren't affected by this rule.

The Americans with Disabilities Act says that employers can't discriminate against qualified people who have disabilities (such as a physical or mental impairment that significantly limits one or more major life activities). This also includes people who are thought to have a disability, such as a disfigurement from an accident, in this group. Employers who have a certain number of employees must make changes to the job or work environment so that a qualified person with a disability can do the job. Examples include changes to the schedule, special equipment, reserved parking spaces for people with disabilities, and access to restrooms.

Specific rules say that existing privately owned places of public accommodation must be made as accessible as possible, if it is "easy" to do so.

Private civil action can be used to get people to do the right thing, like provide auxiliary aids or make changes to a facility. ADA wants people to use different ways to solve problems, like settlement, mediation, and arbitration. An entity that does not follow the act could be fined by the courts. Second time around, fines are not more than $11,000,000. For the first time, the fine can't be more than $55,000.

ADA might be able to help real estate brokers, salespeople, and appraisers do their jobs better. People who work with commercial real estate and investors should tell them about the ADA, the need to have leases reviewed by knowledgeable lawyers, and the importance of having offices checked out by a knowledgeable architect to see if they are ADA-compliant. Because real estate appraisers could be held liable under the ADA, they may need to put a limit on how much they can charge in their appraisal reports.

Amicus Curiae

"Friend of the court." Those who aren't involved in a lawsuit but want to know what happens may be able to file legal briefs (called amicus curiae briefs) with the court. These briefs are called amicus curiae briefs.

Amortization | Amortisation

The process of paying back a loan's principal by making equal payments of principal and interest over a set amount of time.

To recover your capital investment, recurring repayments are made over a set period of time.

A loan is usually paid back in installments over a period of time.

An amortization schedule shows how the payment is split up into multiple cash flow installments.

It is self-destructive (literally, "killing-off"). The process of paying off or paying off a debt over time by making regular payments of principal and interest over a set amount of time. At the end of the time, there is no debt left. Over the life of the loan, the principal is thus reduced or amortised, which means that the amount of the loan is reduced (hence the term direct reduction loan).

During the Great Depression, many people lost their homes because they couldn't pay their mortgages. Before then, most mortgages were straight loans that only paid interest for five years, with the whole amount due when the loan was over. Savings and loan groups were the first to offer amortised loans for homes. People also took into account standards set by the Federal Housing Administration when they switched to a long-term amortised loan.

In most pre-1980 mortgages, interest and principal are paid in equal monthly installments. Most of these mortgages are self-liquidating, which means they are paid off in full. set point in time.

The systematic payment of the principle over a set length of time to gradually repay debt. When the loan balance is zero, the debt is fully amortized. In other words, to repay a loan's principal and interest over a set length of time, usually in installments.

Amortization Schedule

The periodic principal and interest payments on a mortgage loan are shown in this table. As the loan is paid off, this timetable will also reflect the outstanding sum owed on the loan.

A table that shows how much money is owed in principal and interest each month, as well as how much money is left in the loan after each payment is made. An amortization table for a second mortgage with a 9% rate is shown here.

Amortization Table

A set of equal monthly payments required to repay a one-dollar loan with interest over a defined number of payment periods.

Amortize

To claim an expense spent at the start of the period as an annual expense or income tax deduction over a number of years.

Anaconda Mortgage

In a mortgage, there is a clause called a "Dragnet Clause" or "Mother Hubbard Clause." This clause says that the mortgage will protect the mortgagee from all of the debts of the borrower that are at any time due and owed to the mortgagee. Because the mortgagee could buy all of the debts of the person who owes them at a big discount and then use the threat of foreclosure to get them, courts don't like clauses like this one. The name anaconda comes from the fact that the debtor is "wrapped in the folds of indebtedness."

A lot of courts want to see that there is some connection between the two debts and that the second loan agreement specifically refers to the first anaconda clause. Also, if the second debt is backed by its own collateral, the anaconda clause usually won't apply to the second debt, either.

Analog

A type of data presentation in which values are represented graphically, such as curves.

Ancestor

An ancestor is a person from whom one is descended (like a father or grandmother) and from whom land can legally be legally taken. Under some state discrimination laws, it is against the law to discriminate against someone because of their ancestry. Under the federal fair housing law, it is against the law to discriminate against people because of their national origin.

Anchor Bolt

It is a bolt that holds the sill of a house to the foundation.

A fastener for affixing objects or structures to concrete

Anchor Tenant

A well-known tenant in a shopping centre, such as a major supermarket or department store, that draws in other tenants and customers.

The significant and well-known stores who attract the majority of customers to a shopping area.

The high-profile tenant of a shopping centre, typically a major supermarket or department store that attracts other tenants and consumers

The large chain(s) or department store(s) in a shopping complex, strategically placed to generate traffic for the facility's smaller retailers.

A major department store or chain store is placed in a shopping centre so that smaller, satellite stores get the most attention. An anchor tenant is a store that draws people in. In a typical strip shopping centre, two big stores, like a supermarket and a big drugstore, are at opposite ends of a mall. There are smaller stores in between them. This helps to make the whole shopping centre as profitable as possible. They need this strategy because most commercial lease rents are based on the amount of money the business makes each month in gross sales.

Recently, the Federal Trade Commission has tried to limit the power of the anchor tenant to choose the satellite tenants and the goods they sell.

Tenants who are supposed to bring clients to a shopping centre and thereby generate sales for the facility's other retailers.

Ancient Lights Doctrine

Early English common law said that an adjoining owner couldn't build anything that would keep light from coming into a neighbor's window. In modern U.S. courts, this ancient lights principle has not been accepted. However, the courts are starting to refer to it as they write new laws about solar easements.

Angle

It is a way to show how one line is connected to another. Many people measure angles clockwise and in degrees. This means that 360 degrees is a full circle or a full rotation back to the start. In each degree, each minute is broken down into 60 seconds, and each second is broken down into 60 seconds. North 42° 20' 15" easterly could be written as the direction of a line. Using north as the line of reference, this line would be located. It would then be measured from north to east at an angle of 40 degrees, 20 minutes, and 1 5 seconds.

Reference lines can be north or south, and they can be long or short. People can make angles that are either east or west of the line that serves as the centre.

Annexation

A way to add to your property by joining or putting two things together, like attaching personal property to real property and making a fixture. There are many things that make a room look good, like a sink that is attached to the plumbing.

Annual Compounding

Accumulated interest, which earns interest in all consecutive periods.

Annual Debt Service

The entire amount of monthly debt service payments that a lender requires.

It's the amount of money that must be paid each year to pay off all of the debts that are attached to a piece of real estate, such as mortgages, deeds of trust, and contracts for deeds.

Not all real estate lenders care as much about the loan-to-value ratio as they do about the ratio of net operating income and annual debt service. This is why it's important to keep in mind.

The total amount of principal and interest that a borrower has to pay back every year to meet the terms of a loan contract.

Annual Exclusion For Gift Tax

An amount of gift income that the donor can keep from being taxed.

In 2012, each person can get a $13,000 gift tax exemption for each donee they give each year. Thus, a mother could give six $13,000 gifts to six different children in one year (a total of $78,000), none of which would be taxed. She could do this every year. Her husband could give her an extra $13,000 per donee each year.

Annual Meeting

A meeting of shareholders of a company or members of an organisation every year to let them vote on the election of directors and other corporate or organisation business. Shareholders who aren't there can vote for them by proxy.

Condominium associations and cooperative societies usually have an annual meeting, as well as other meetings that happen more often.

Annual Mortgage Constant

The yearly percentage of the loan's original principle amount that must be paid in order to fully repay interest and principal during the loan's duration.

Annual Mortgagor Statement

A report from the lender or servicer to the person who owes money on their home. It shows how much taxes and interest were paid and how much of the home's value is still owed.

Annual Percentage Rate (APR)

In the absence of early payback, an approximation of the mortgage loan's yearly effective borrowing cost. This metric takes into account the impact of upfront finance fees on the 1rue cost of borrowing.

On an annual basis, the actual cost of borrowing.

To make sure everyone understands how much they're paying for, the federal Truth in Lending Act requires that this be written down. If you want to know the rate, you can use tables from any Federal Reserve bank to figure it out. The rate must be rounded up to the nearest one-eighth of a percent. Use of the APR makes it easier to compare different lenders. It allows for a standard way to say how much money you'll pay for credit. The act lets you use the abbreviation APR.

The interest rate that applies to a loan, mortgage loan, credit card, etc. for a whole year.

The real interest rate that a borrower will pay on a loan over the course of a year, taking into account all charges, such as compound interest, discount points, commitment fees, and mortgage insurance premiums. It also takes into account how long it takes to pay back the principal (especially if payments are made in instalments throughout the year but interest is charged at the beginning of the year), but not the actual costs the lender had to pay to make the loan and then charge the borrower for.

Annual Report

A report on how a company did financially and how it did in the last fiscal year. It usually includes a balance sheet, operating statement, and auditor's report. It is shown to the company's stockholders before the company's annual meeting. It must be filed with the Securities and Exchange Commission every year if a security has been registered with them.

Annuity

A sequence of regular payments received or made at regular periods.

An amount of money that the annuitant gets at set times as one of a series of payments. People sometimes trade real estate for a private annuity. There are some things that make an annuity deal unique. The annuitant only owns the payments, not the funds or sources from which they come. The buyer pays for the property by agreeing to pay the seller a set amount of money each month for the rest of the seller's life. The standard annuity tables are used to figure out how much each payment will be. The right way to set up a private annuity transaction that gives real estate to a member of the annuitant's family can save money on estate, income, and gift taxes.

Annuity tables, like the Inwood tables, can be used correctly to figure out how much money an investment is worth right now. They give a factor that can be multiplied by the amount of money you want each year to get an idea of how much money an investment is worth right now (what amount the investor should pay to acquire the property).

Payments or receipts that happen on a set schedule and are always the same amount.

Annuity Table

A table of factors used to determine the present value of a compound level annuity.

Antenuptial Agreement

A prenuptial agreement is a contract made by two people who are thinking about getting married in order to set out the property rights of both of them before they get married ("prenup"). It is best for each person to have his own lawyer when they are negotiating a contract like this. Antenuptial (or prenuptial) agreements may not be valid if they aren't completely disclosed and if each party has a lawyer of their own. 

Anticipatory Breach

A buyer or seller can say or do things before the deal closes that say they won't do what they say or do. At that point, the other party isn't in breach of the contract, so the other party can go to court and get the contract enforced without having to offer or give performance.

Antitrust Laws 

State and federal laws are in place to keep and protect business competition.

Among the things that are antitrust violations are price-fixing and certain types of boycotts. Also, there are restrictions on competition in leases for shopping centres, and certain restrictions on franchise owners. Several "tie-in" arrangements are also under fire, like when a developer makes the buyer promise to list the property with him if he wants to resell, or when a property manager makes the buyer promise to list with him when he sells.

There has been a lot of attention paid to some real estate brokerage activities by the Federal Trade Commission and the Department of Justice. People in local boards or groups of brokers set general commission rates and bar brokers from joining local boards or multiple-listing arrangements because they don't meet the rules for joining. A number of court cases have made it so that local real estate boards can no longer have an impact on fixed commission rates or commission splits between cooperating brokers. Furthermore, in some states, clients must be told that commission rates can be changed between the client and the broker.

Apartment

Within a multi-family construction, a residential unit.

A unit in a building that is normally owned under a strata (or company) title.

Originally an American term for a flat, but in Australia it might also refer to a suite or simply a room that is not always self-contained.

Apartment Building

A building with separate units for people who live there for a long time and rent or lease them. The owner of the building takes care of things like lights, heat, elevators, and garbage disposal. He or she also takes care of common entrances and hallways.

Apostille

A certificate from a foreign country that says that someone has been chosen to do this job. To get an apostille, you don't need to get a diplomatic or consular acknowledgment of a document. This is because of the Hague "Convention Abolishing the Requirement for Legislation for Foreign Public Documents."

Appeal 

1. Taking a case to a higher court to ask for a review, reversal, or new trial of the case. The appellant is the person who is taking the case to court. The other person is the appellee.

2. The legal process by which a property owner can fight a property tax assessment is called "the law." In most states, the chance to do so is very limited.

Application Fee

A fee charged by the lender when you submit a loan application.

What a lender charges when you apply for a loan, and this is what that fee is called.

Application for Payment

A written payment document.

Appointments

Things like furniture, fixtures, and equipment that are in a home, office, or other building. These things may add to or take away from the real value of the property.

Apportionment

1. The division or partition of a piece of property into equal but not equal parts. For example, tenants in common might try to split up a piece of land.

2. The pro rata split of real estate carrying costs at the end of the deal.

Appraisal

A licensed specialist looks at a property and gives it a professional grade.

A knowledgeable person's estimate of the value of a piece of property.

An unbiased written estimate of a property's fair market value.

A real estate agent provides a potential vendor with a property price estimate.

A value judgment or estimate supported by multiple analyses.

Making and sharing an opinion about the value of a piece of land Getting an appraisal is usually required when real estate is sold or financed or if it's being taxed, insured, or partitioned. Not all appraisals are the same. They are just estimates. This could be in the form of a long report, or it could be a simple letter, or even an oral report.

The direct sales comparison approach, the cost approach, and the income approach are all used to figure out how much a home is worth.

The direct sales comparison method is based on comparing the prices of recently sold properties that are similar to yours, after taking into account things like seller concessions, time, financing, and any differences in the properties. This method, which used to be called the market-data approach, is used most often by real estate brokers when valuing homes, and it is the method that is usually used in court.

In this case, the value is based on how much it would cost to make or replace the improvements, less depreciation, and how much land value there is (land value being usually determined by the direct sales comparison approach). The cost method is best for valuing new or planned construction, as well as service properties like churches and post offices, which are used by many people every day.

Income is a way to figure out how much a property is worth. It looks at how much money a property makes and how much that money would be worth if it were put into a bank account. Income capitalization is a way of looking at investment properties like apartment buildings, office buildings, and shopping centres. It is most useful for this kind of thing.

In most appraisals, the appraiser tries to figure out how each of the three approaches comes up with a value for the property. In order to figure out how much weight to give each approach in figuring out how much value a piece of property is worth, the appraiser takes into account the definition of value, the purpose of the appraisal, what kind of property it is, and how well the data was gathered. There are three ways to look at the market. Each method is based on data from the market, so the three methods are checked on each other.

When an independent appraisal is needed, most lenders want it done by a state-licensed or state-certified appraiser. They also want the appraisals to meet the Uniform Standards of Professional Appraisal Practice.

Appraisal Report

The document that the appraiser submits to the customer contains the appraiser's final estimate of market value, the facts on which the estimate is based, and the calculations used to arrive at all 1he estimate.

Appraisers write a report that includes a definition of value; a value estimate; a description of what is being valued; general data; enough evidence to back up the value estimate; a comparison of the three approaches; and an explanation of why they came up with the value estimate. Photos, maps, and floor plans are often included in the report as supporting documentation. This is what most people expect

Appraised Value

The property's current market value as determined by an appraisal.

The estimated price or value that an “average" investor would pay for a property.

Appraiser

A person who does appraisals and is qualified to do so.

One who thinks about value. Not only must appraisers have the right skills, abilities, education, and experience to do an appraisal of real or personal property, but they must also be state-certified or state-licensed to do an appraisal of property that is covered by a federally insured or regulated agency.

Appraisers can work for the government, lenders, or trust companies. They can also be on their own. In most cases, an appraiser's fees are based on their time and expenses; they are never based on how much the home is worth.

When making an appraisal, math can be a useful tool. The appraiser's experience and training are the most important factors in determining the value of a thing.

Appraiser Independence Requirements (AIR)

Established rules that protect mortgage investors, homebuyers, and the housing market by ensuring that appraisals are done without pressure from lenders and real estate agents to manipulate the value of properties. Code of Conduct: Title F of the Dodd-Frank Act says that standards must be put in place to replace it. They were made by Fannie Mae, the Federal Housing Finance Agency, Freddie Mac, and other key industry players (HV CC). It doesn't matter if you get a loan for a one- to four-unit home, but if you get a loan from a federal agency like the FHA or VA. Appraisers should at least be licensed or certified to work in the state where the home is. People who work for lenders can get appraisals from a single appraiser and not from a company that manages appraisals.

Appreciation

A property's value goes up after improvements and sales of parts of it have been taken into account.

When the property's value increases over its initial value.

A rise in property values brought on by inflation, improvements, or greater demand

A rise in the value of a home as a result of changes in market conditions or other factors.

Property values rise when they rise above the value they were when they were first bought.

It is the opposite of depreciation, which is when things get less valuable or worth less over time because of economic factors.

The value of an investment going up.

Appreciation potential

The chance or likelihood that the value of a real estate investment will go up during the holding period.

Approaches To Value

Market data, income, and the cost method are three assessment techniques used by appraisers to evaluate the worth of real estate.

Appropriation

1. It's the act of choosing or setting aside land for a public use or purpose, like a public park or school.

2. Admonition is the opposite of condemnation. In some states, taking water from a natural stream for private use is enough to show that you have a previous right against other people who own it.

3. Legislatively setting aside money for a public project.

Appurtenance

Something that is not within the boundaries of the property but is considered a part of it and contributes to its overall enjoyment.

Those rights, privileges, and improvements that come with property but aren't always part of the property itself: these things aren't always part of the property itself. Appurtenances to real property go with the real property to which they are attached unless there is a sign that the owner doesn't want them to go with the real property. A deed usually talks about the property and then says, "With all appurtenances." Appurtenances include rights-of-way, easements, water rights, condominium parking spaces, and other things that go with a home.

Appurtenant

Belonging to; added to; appended; or attached to. As an example, the garage comes with a house, and each apartment in a condominium has an interest in the common parts of the building that each one shares. Appurtenant items move with the land when the land is sold.

Apron

A board or panel that is put in place under the window sill.

Aquifer

Any subsurface substance that stores a reasonably significant amount of groundwater and can easily transfer that water.

Arbitrage

Buying and selling an asset at the same time in order to profit from a price difference, usually on different exchanges or marketplaces. A domestic stock that also trades on a foreign exchange in another nation and whose price has not altered in step with the exchange rate is an example of this. A trader profits from the differential by buying the stock when it is inexpensive and short-selling it when it is overpriced.

1. There is a lot of talk about spreads, or the difference in interest rates. This is a common thing in all-inclusive mortgage financing. An example: Joe Smith sells his land to Mary Jones for $10,000 with a loan of $10,000 at 12%. Mary Jones then sells the land to Susan Brown under a wraparound mortgage at a rate of 1 and a half percent. In this case, Mary Jones pays her debt to Mr. Smith with the monthly payments. The 0.5 percent arbitrage is income for Mary Jones.

2. Buying and selling mortgages or mortgage-backed securities in different markets at the same time to make money from the difference in prices.

Arbitration

The non-judicial transfer of a dispute to a group of chosen third parties for them to decide in a way that is agreed to or that is required by law. A lot of disagreements between listing REALTORS® and their cooperating REALTORS® are settled by arbitration, in which both sides agree to follow the arbitrator's final decision.

Many disputes are settled by following detailed rules set up by the American Arbitration Association. The most important thing about a binding arbitration is that it is quick and final, as well as the fact that the findings are kept "private," which is important.

Arcade

A covered walkway with businesses on both sides, usually with shops on both sides.

1. A group of open or closed arches on the same level. 

2. Second, a curved walkway or passageway with an arched roof, often with shops on one or both sides.

3. A passageway that is open on the side of the street, usually with a column or two.

4. A paved sidewalk with a lot of small columns on it.

Architect

A person who plans buildings and often oversees their construction as well.

A person who creates, coordinates, and writes the drawings and specifications utilized during the development design phase.

Architectural Drawings

A building's technical drawing (or building project).

Data that an architect has made or put together that is part of a proposal or part of contract documents. The data may include plot plans, floor plans, elevations, or sections. Most of the time, however, they don't include mechanical, electrical, or structural plans or other specialised data that the architect gets from consultants.

Architecture

1. Among these is the science and art of building structures.

2. How a building is made and how it looks.

Are

There are 100 square meters in this area.

Area

A bounded, continuous, two-dimensional object that may or may not include a border.

A piece of land that is thought to be level and at sea level. These assumptions are used to describe land in a consistent way. If you have 10 acres that slope down, you have more usable square feet than if you have 10 acres that are flat. The legal descriptions of both are the same.

through the outside walls to the main flat surface of exterior brick or wood siding, as well as the thinnest shakes and shingles. Some stairs, porches and utility rooms, as well as servants' quarters, common walls, servants' apartments, and garage apartments that are separate units make up the total living space.

Area Management Broker (AMB)

Property managers who work for the Federal Housing Administration in the field of housing that is subsidized by the government. They take over the property, write repair specifications, get repair bids from contractors, coordinate and inspect repair work, supervise maintenance and security, and submit financial reports.

Area Regulations

Zoning and building ordinances have rules about where things can be built on land, such as setbacks for the back and sidelines of a house.

Area Wells

A metal or concrete barrier wall around a basement or cellar window.

Arm's Length Transaction

A transaction involving two or more unconnected parties.

A transaction between two parties that have no prior relationship and are bargaining in their personal best interests. A sufficiently negotiated transaction that is reasonably indicative of market worth.

A deal in which both parties are in the same bargaining position. At arm's length, people do business with each other without trusting the other person's fairness or integrity, and they don't let the other person control them or make them do what they want (as is sometimes the case in transactions between family members). When someone doesn't buy or sell something at arm's length, it may have tax consequences if the value of the property is less than fair market value. There is also a factor in determining market value that has to do with whether a transaction was done at arm's length.

Arranger Of Credit

People who arrange for someone else to give someone else money for a long time, if there will be a finance charge, more than four installments, or if the person giving the money isn't a creditor are called Truth in Lending Act "lenders." At the moment, the term does not include a real estate broker who helps a buyer get a loan from the seller of a home or piece of land.

Arrears

A payment made at the end of a term. The majority of mortgage interest payments are made late.

Debts that have not been paid on time, mainly rent

1. The state of not paying a debt when it is due.

2. When expenses are due or levied at the end of a certain amount of time. This is not "in advance." Mortgage interest and real estate taxes are often paid in the future, but this is not always the case.

Artesian Well

A well is a hole that is very deep in the ground so that the pressure inside causes the water to rise to the surface.

Articles Of Incorporation

The document that lays out the goals, powers, and basic rules of how a corporation should work. Articles of Association: These are also called rules of the group.

Articles Of Partnership

A document that outlines the terms and conditions of a partnership, including the nature of the partnership's business and the partners' rights and responsibilities.

As Is

It's the same with a property that doesn't come with any promises, like when you buy it.

Words in a contract that say that the seller is selling the property as is, with no changes or improvements. This is usually a way to say that the seller isn't making any promises or promises. Courts are now trying to protect buyers by not allowing sellers to use as-is language in a contract to avoid fraud charges for not telling buyers about known material flaws in the property.

While an as-is clause may give a little protection to the seller from unknown problems, when the seller actively misrepresents how well a property is taken care of, that clause doesn't work. It doesn't work that way.

As-Built Drawings

Architectural drawings show how the building will be built and where the equipment and utility lines will be put in. Drawings called "as-built" are often made by an architect with help from the project's main contractor.

Asbestos

Rocks are made up of mineral fibers that are found inside of them. It is hard for natural processes to break down or destroy asbestos fibers, so they can't be easily burned or degraded. Among the things that use asbestos are appliances, ceilings, wall and pipe coverings and floor tiles. They also use roofing and siding materials. The Environmental Protection Agency says that, based on studies of people who have been exposed to asbestos, the fiber has been found to cause lung and stomach cancer. People who sell real estate, especially people who work in commercial sales, must tell the buyer if there is any asbestos on the property. Asbestos removal and containment usually requires the help of contractors who have been specially trained and licensed to do this work.

Asbestos Abatement

A way of getting rid of asbestos from a building.

Asbestos-Containing Materials (ACMS)

In this case, ACMs are made up of asbestos and other materials. They can be nonfriable (sheathed and/or crumbling) or friable, which can be crumbled by hand pressure. Friable ACM is thought to be more dangerous because the asbestos particles can be loosened and spread through the air.

Ash Dump

Under a fireplace, there is a container where ashes can be put for a short time. An "ash cleanout door" will come in handy when it's time to remove the ashes.

Asking Price

The selling price is determined by the amount of value a property owner assigns to it.

In real estate, the price at which a piece of land is offered for sale or rent to the public is called the "list price." An asking price is different from a set price because it implies that there is some room for negotiation. For this reason, some sellers don't want their listing agent to use the phrase "asking price" when advertising their home.

Asking Rent

The rent for a home that is listed.

Aspect

A slope's horizontal direction, often indicated as compass direction (for example, North, Northeast) or degrees clockwise from North.

Assemblage

The sale of two or more properties as if they were one.

To make one big lot out of two or more small lots that are next to each other This is usually done to raise the value of the individual lots because a bigger building that can make a bigger profit can be built on a bigger lot. The plottage value is the sum of the added value. The developer often uses option contracts to make sure that he or she has the right to buy the next-door land that they want. Care must be taken to avoid gaps or strips between the parcels that were bought through faulty legal descriptions. Exact surveys must be done to avoid this.

Assessed Valuation

It is the value of real property that is used to figure out how much you have to pay in real property taxes. In general, the value or assessment of property for tax purposes is done by county and township assessors. The land is usually valued separately from the building, and the value of the building is usually based on a manual or set of rules that cover unit costs and depreciation rates. Some states require that assessments be a certain percentage of the true or market value, but this isn't always the case (assessment ratio). State laws may say that property should be reassessed from time to time. Each taxing district has its own way of making sure that its assessments are always up to date, but most use a mix of building permit records, on-site inspections, and conveyance tax records. Property owners who say that mistakes were made when figuring out how much their property was worth can usually go to the local boards of appeal or boards of equalization to make their case for why they were wrong.

Assessed Value

The amount of money that a public tax assessor puts on a property so that it can be taxed.

The local taxing authority's assessment of a property's worth.

The value determined as the basis for calculating an owner's property tax burden, commonly expressed as a percentage of market value.

The tax assessor's determination of the value of real property for the purpose of levying real estate taxes.

Assessment

A tax imposed on the value of an asset or the asset itself.

A specific payment or tax imposed by a local taxing authority on a property.

The allocated rates or taxes for a certain property

1. A property's official value for tax purposes, based on an appraisal by a local government official. The term is the same as "assessed value." Land values are based on the sales prices of similar land, while building values are based on the difference between the improvement's replacement cost and how much it has depreciated.

2. The process of figuring out how much each person should pay for a common expense, such as when the owners of condominium or cooperative units are charged for their share of unusual building maintenance costs that benefit the whole project but aren't covered by regular maintenance fees.

3. A tax for a specific reason, like adding curbs or sewers to a neighbourhood.

4. An official decision about how much a property owner should be paid for taking his or her land for a public purpose (condemnation).

5. An extra amount of money that shareholders of a company or members of a partnership or association put in to cover a capital expense.

Assessment Lien

Local governments use liens to guarantee that individuals who gain the most from community improvements pay their "fair share.

Assessment Ratio

The proportion of a property's assessed value to its market value.

Assessment Rolls

Public records that show how much land and buildings in a certain area are worth are called tax records. When owners compare their property's assessed value to that of other properties in the same neighbourhood, they can ask for the value to be changed if they think their property was overvalued.

Assessor

A trained official who determines the property's fair market value.

A local government authority (official) who determines property taxes.

People who work for the government are called appraisers. Only the assessed value, not the tax rate, is set by the official.

Asset

Things like bank accounts, stocks, real estate, personal property, etc. that have a monetary value.

Everything monetary that an individual, group, or business owns

Someone owns something of value. The types of assets are either financial (cash or bonds), tangible or not tangible, or physical (real or personal property). Accountants look at financial balance sheets, which are made up of assets and liabilities, to figure out how much money a company has, or how much money it has left over.

Asset Depreciation Range System (ADR)

The part of IRS regulations that talks about how to figure out how long an asset should be depreciated over. This is because the ADR lets the taxpayer choose whether to depreciate the property over a shorter or longer time than the guideline period.

Asset Manager

The property owner's representative in charge of managing managers and advising owners on crucial strategic choices regarding properties.

A person who manages investment portfolios, including but not limited to real estate and upgrades, by balancing risk and reward. Asset managers either supervise or are directly responsible for property management.

Asset-Backed Securities (ABS)

Bonds or notes that are backed by a collection of financial assets. Banks and other credit providers will often originate such financial assets, which will have predictable revenue flows (for example, credit card receivables or automobile loans).

Assets

Everything a person or other entity owns that can be used to pay back a debt.

The total value of a person's real and personal property, including stocks and bonds.

Assignee

A person to whom a property interest is transferred.

Assignment

Transfer of mortgage title.

A property, a lease, rights or an interest, and occasionally a liability is transferred from one party to another.

Another tenant is affected by the transfer of the original lessee's lease rights. If rent is not paid on time, both the previous lessee and the new renter may be held accountable.

A property, a lease, rights or an interest, and occasionally a liability is transferred from one party to another.

The right, title, and interest of one person (the assignor) are given to another person (the assignee) (the assignee). Among the things that are given away in this way are mortgages and sales contracts, as well as contracts for the deed and leases.

Most contracts have rights and responsibilities that, unless they are personal, can usually be delegated or given to someone else. Contracts that form an agency relationship are, for example, personal and can't be given to another person without the person who is being represented giving their permission. Because rent isn't personal, it's often given to someone else. Contracts for real estate are usually transferable, unless they say otherwise. It is illegal for some sellers to give away their sales contract. They don't want buyers "trading on the equity," especially if there is a long closing time.

In any assignment, the assignee is now the main person who is liable, and the assignor is still liable as a surety, unless there is a novation agreement that removes the assignor from liability. When someone assigns a contract, they get the same rights, title, and interest in the contract as the person who gave the contract to them.

If someone tries to give someone a mortgage lien without the promissory note, they don't give them anything. But if someone gives someone the note but not the mortgage, they give them the right to get the security. There is a "constructive notice" when someone records an assignment of a mortgage or trust deed (a deed of trust). This notice is given to all people who might be interested in the assignment. There is no protection for the assignor if payments are mistakenly made to him by the mortgagor. The assignee must then be paid (the original mortgagee).

Many contracts for deeds say that buyers can't give away their share of the contract without the seller's written permission. Even if the seller doesn't agree, the assignment is still legal between the buyer and the buyer. 

Anti Assignment clause: When the seller wants this clause, the buyer should make sure it's in the sales contract. The contract for deed should say that the seller's consent to a proposed assignment will not be unreasonably withheld.

Mortgagees often use non assignment clauses in mortgages to keep the obligation from being transferred. This could help the seller decide whether to use a land contract or a purchase money mortgage. People can't give away their rights to money payments due under a contract, but that doesn't mean they can't give away claims for damages caused by a breach of that contract. The prohibition is for the benefit of the vendor (seller, lender), who can waive it either by saying so or by acting like they don't care (such as by accepting payments directly from the assignee).

People who want to buy property that already has leases should get a written assignment of the seller's rights in those leases in a form that can be legally recorded.

Most leases allow the tenant to sublet or assign the lease without the landlord's permission, unless it says otherwise in the written rental agreement. This is true unless it says otherwise. As a landlord, the most important difference between an assignment and a sublease from his point of view is that the landlord can't directly sue the sublessee, but it can be done with the assignee.

Contractual rights are transferred from one contracting party (the assignor) to another (the assignee) who is not a party to the contract.

Assignment Of Contract Or Lease

The transfer of a lease's entire title, right, and interest in a piece of real estate.

Assignment Of Lease

The transfer of all rights, title, and interest that a lessee has in a piece of land. It is called an assignment of lease rather than a deed to transfer a lease.

The assignee of a lease is liable because the assignee owns the land, which is called privity of estate. The assignor is liable because he or she is in the same business as the landlord.

Landlords can't be unreasonable or arbitrarily stop someone from taking over their lease. Assignment of a lease that breaks an agreement not to give it away is not void, but the lessor can choose to void it. In this case, the assignor and the assignee will be happy with it. The lessor can only raise the issue that it is invalid because the lessor didn't give it the go ahead.

A lender may ask for the assignment of the leases as collateral before giving you a loan for the leased space. The lessor may even be able to get the rent money from the renters.

Assignment Of Rents

This is an agreement between a person who owns real estate and a person who owns a mortgage. The mortgagee gets the right to collect rents from people who rent from the person who owns real estate. The person who owns real estate still has sole responsibility for their tenants under the terms of their lease.

Assignor

A person who assigns an interest in real estate.

Associate Broker

Persons who have qualified as real estate brokers but still work for and are supervised by another broker may be called broker-salespersons, broker associates, or affiliate brokers in some states. They work for and are supervised by another real estate broker.

Associate Licensee

An affiliate licensee is another name for a real estate salesperson who has been certified by the state to sell real estate.

Association

Tax law may treat a group of people who work together as if they were a corporation. In some cases, the Internal Revenue Service (IRS) may try to treat a partnership or limited partnership as if it were a corporation. The IRS runs this test: If the organisation has more corporate characteristics than non-corporate characteristics, it will be taxed as a corporation, which has bad tax consequences. These are four of the main characteristics of a company: continuity of life, centralization of management, limited liability, and transferability of interest.

Association Of Unit Owners

All the people who own units in a condominium work together to run the project, in line with the declaration and bylaws. The group of unit owners can be incorporated or not incorporated.

Assumable Loan

When a property is resold, the loan might be taken over by a new borrower. The new borrower will take over all of the original borrower's obligations.

A pre-existing debt that can be kept by the buyer rather than reimbursed by the seller when title to the mortgaged property changes hands.

Assumable Mortgage

When a house is sold, the buyer can take over the mortgage.

Assume Liability

To become legally accountable for a debt. Signing a contract, such as a bank note, does this.

Assumption (Loan)

Permits a buyer to assume and assume responsibility for an existing debt (mortgage) instead of obtaining a new debt.

Assumption Clause

A clause in which mortgagors agree not to sell mortgaged property subject to the mortgage or have a buyer take an existing mortgage without the mortgagee's prior agreement.

Assumption Fee

A cost charged by a lender to allow a mortgage to be transferred.

A cost levied by a lender as a condition for allowing a party other than the original mortgagor to assume mortgage obligation. When interest rates rise, mortgagees can adapt their rates of return to the current market.

Assumption Of Mortgage

When you buy property that already has a mortgage and agree to be personally responsible for all of the terms and conditions of the mortgage, you become the owner. In practice, the buyer (grantee) is now the main guarantor on the mortgage note and is primarily responsible for the amount of any deficiency judgment that comes from a default and foreclosure on the home. If the grantee doesn't pay, the original mortgagor (grantor) still has to pay. Usually, when a person buys a house, they agree to pay the mortgage debt. This is called an "assumption clause" ( or assignment of lease if a leasehold mortgage is involved). In most cases, only the person who gave the deed needs to sign it. When there's an assumption clause, both the buyer and the seller have to sign the deed so that the buyer is personally bound by the assumption. When a buyer agrees to take on a mortgage, the seller usually asks for a higher price for the home. The seller is, in effect, trading on the low interest rate of the existing mortgage. This means that the lender is a third-party beneficiary of the agreement to assume the debts.

Any changes in the assumed loan balance should be made to either the down payment or to the amount of the second mortgage.

A lender has very little reason to let the original seller off the hook for a note that he or she assumed.

For this reason, most lenders prefer to keep everyone who buys or sells something liable for the debt. In some cases, however, the lender will let the seller off the hook by making a novation. Keep in mind that if the mortgagee changes any of the mortgage terms with the new owner, the original mortgagor may not be liable for the note at all! The lender usually charges a fee for taking on debt. When interest rates rise, few lenders will let you take on the debt unless you can change the terms of the loan, raise the interest rate, and/or charge a fee. There have been some cases where courts have upheld the lender's right to ask for a "assumption fee" and to change the interest rate on a mortgage when it waives the right to start the loan early.

Assumptions

Things that are thought to be true but have not been tested or confirmed.

Astragal

A wood molding or strip with a half-circle shape in the middle.

At Risk

Those funds that are at risk of being misplaced. Limited partnership investors can only claim tax deductions if they can show the IRS that there is a probability they will never make a profit and will lose their investment.

At Risk Rules

The tax regulation that restricts the amount of money that an investment can lose as a result of a tax loss.

Special rules set up by the IRS to limit the amount of leverage an individual can use are meant to limit the taxpayer's deductible losses to the amount of money the individual has "at risk." Generally, a taxpayer is at risk to the extent that he or she gives money or borrows money for which the taxpayer is responsible for paying back with money from his or her own money (recourse debt).

To put it another way, the act extends the at-risk rules to real estate investment losses that happen after December 31, 1986, with a few caveats. It says that if the loan is made by someone who regularly and actively lends money to people who buy and sell real estate, then the amount of the loan that isn't repaid is at risk. Whether the loan comes from a friend or a business partner doesn't matter. As long as the terms of the loan are commercially reasonable and almost exactly the same as a loan from a non-business partner, it's fine. Seller financing of real estate of any kind, except in very rare cases, will not be a risk.

As soon as a taxpayer has taken all of the deductions that apply to a single piece of property, the taxpayer can no longer take any more deductions on the property. The amount for which the taxpayer is at risk increases. Because of the at-risk rule, losses that aren't allowed to be deducted in a taxable year don't go away. They are carried forward indefinitely and can be used as a deduction in a future tax year as long as there is more risk in the activity that caused them.

In order to limit how much money a person can use as leverage, the IRS has set up rules that limit the amount of money a person can write off as a loss to the amount the person has "at risk." Generally, a taxpayer is at risk to the extent that he or she gives money or borrows money for which the taxpayer is responsible for paying back with money from his or her own money (recourse debt).

To put it another way, the act extends the at-risk rules to real estate investment losses that happen after December 31, 1986, with a few caveats. It says that if the loan is made by someone who regularly and actively lends money to people who buy and sell real estate, then the amount of the loan that isn't repaid is at risk. Whether the loan comes from a friend or a business partner doesn't matter. As long as the terms of the loan are commercially reasonable and almost exactly the same as a loan from a non-business partner, it's fine. Seller financing of real estate of any kind, except in very rare cases, will not be a risk.

As soon as a taxpayer has taken all of the deductions that apply to a single piece of property, the taxpayer can no longer take any more deductions on the property. The amount for which the taxpayer is at risk increases. Because of the at-risk rule, losses that aren't allowed to be deducted in a taxable year don't go away. They are carried forward indefinitely and can be used as a deduction in a future tax year as long as there is more risk in the activity that caused them.

ATER

The equity reversion after taxes

Atomistic Markets

A market in which no single individual or organisation has a measurable influence on market pricing. Market participants are just price takers in the sense that they have the option of accepting current pricing or not engaging in the market at all.

Atrium

In most cases, the main parts of a building have a translucent roof that lets light into the inside.

Attach

To encumber real estate with debt.

Attached Housing

Party walls separate two or more homes (for example, townhouses or stacked flats).

Attachment

A legal seizure of property to compel debt repayment.

Attachment

The legal process of taking the real or personal property of a person who is being sued and keeping it as a form of payment for a judgment. The lien is then made by the law, not by a private agreement. The plaintiff can get this property in any case where there was a contract, whether it was written or implied.

A copy of the writ of attachment is put in the public record. Before a judge makes a decision, the attachment puts a lien on the property. This way, the plaintiff can be sure that there will be enough money to pay the judge's decision. After a judge rules in favor of the plaintiff, the lien can be enforced by putting out an execution.

It can happen when someone files a lawsuit for money to be paid on a contract that isn't secured by a bond. Sellers and lienholders can't get rid of the attachment until they pay the plaintiff's claim and costs, or they must put up a cash bond that's equal to the plaintiff's claim. When one party wants to get paid for a secured debt, an attachment isn't available (mortgage).

Attestation

People who are subscribing witnesses watch a person sign an instrument.

Attic

Room between the ceiling and the bottom of a roof where people can get in and out. A structural cavity is a space that can't be reached.

Attic access

A room or building's basement is the area directly below the building's pitched roof.

Attic Ventilators

A ventilation system that controls the amount of heat in an attic by letting hot air out.

Attorney Fees

An attorney charges a fee for his or her work. Unless a statute or a contract says otherwise, an aggrieved party can't usually get back their lawyer's fees. If there is a dispute over a contract, it's important to add a clause to all contracts (especially promissory notes) that says that the party who wins will get back all of their lawyer fees and costs if there is a lawsuit.

Attorney-In-Fact

A competent and uninterested person who has been given the authority to act in her place by someone else. If someone is going to buy or sell real estate, an attorney-in-fact who has a "fiduciary" relationship with the person who wants to buy or sell should be able to do so. This is called a power of attorney. As a rule, people give their lawyers power of attorney. The person who is the attorney-in-fact doesn't have to be an attorney at law.

An attorney-in-fact can have general or specific power, but even if he has general power, he can't do anything bad for the person he's representing (for example, sell the person's property for less than it's worth) or do something good for himself (for example, give the person's land to himself). To avoid conflicts of interest, the listing broker should think very carefully before agreeing to take on a client's power of attorney. He or she should also think about having separate written instructions outlining exactly what the broker can do and how.

a minor can't make someone else a "attorney in fact." That person can't legally give someone else the title to real estate that the minor owns, though.

A husband can't be his wife's attorney-in-fact when she wants to give up her dower rights.

Attornment

A renter's formal agreement to become a new landlord's tenant.

Landlords who have been foreclosed on can ask tenants to become their tenants again. This is called "attorning." New tenancy is set up with the mortgagee as the landlord, and attornment is used as a defense against a debtor's claim for rent.

An attornment agreement is usually signed by someone who is subletting land for a long time. This agreement is usually signed by someone who is subletting land for a long time and a person who owns the land and has a mortgage on it. Attempting to keep his property from being destroyed when the master lease is terminated early or when the mortgage is foreclosed on when the sublessor does not pay. A clause in the attornment agreement says that, if a sublease is terminated for any reason, the owner or the mortgagee will still be the lessor in a lease with the sublessee for a term equal to the unexpired term of the sublease and on the same terms.

Attraction Principle

One or more factors that make a commercial business centre draw people in, such as how well it sells things. A shopping centre, which is made up of many different businesses, has a lot of appeal to people.

Attractive Nuisance

Those who keep their property in a way that is both dangerous and could be dangerous to children have a legal duty to take reasonable steps to protect children from the danger. There are many situations where an owner could be held responsible for the injuries of trespassing children who are in their pool, in an unmarked pit, or when they throw away a fridge or freezer. Construction sites should be well-protected to keep curious kids from getting hurt.

Attribute

An entity's specified feature (for example, topographic slope).

Attribute Value

An characteristic that has a defined quality or amount given to it (for example, 15 percent slope).

Attributes

Bedrooms, bathrooms, garage spaces, sundeck, pools, gardens, aspect, vistas, accessibility to services and facilities, land area, and floor area are all elements of a property.

Auction

The public sale of property where the highest bidder is the successful buyer.

Selling an asset to the highest bidder is known as auctioning.

The sale of property in front of the public, where the highest bidder is usually the winner.

A way to sell land or personal property in which people make oral offers and the property is sold to the person who can pay the most. Some states make auctioneers who sell real estate get a special license. Usually, real estate auctions are used to sell homes that have been foreclosed on, tax sales, and properties that are hard to sell. In a "without reserve" auction, the auctioneer can't get rid of the goods or bid on them himself or through an agent.

In the secondary mortgage market, Fannie Mae buys mortgages from approved lenders in an auction-style process called a free market system auction, which is called that. In recent years, auctions have become a new way to sell real estate, especially when lenders or developers want to sell a lot of properties quickly.

Auctioneer

In this case, it is someone who is legally allowed to sell real or personal property at a public sale. Some states say that the auctioneer must be licensed both as an auctioneer and as a real estate broker in order to sell real estate at a sale.

Augmented Estate

A way to figure out which of the decedent's assets are subject to the surviving spouse's right of choice (forced share), even if the deceased spouse died testate or intestate. It also includes some lifetime gifts of property made by the decedent to people other than his or her spouse. The addition of these lifetime gifts is in line with the policy of not leaving the surviving spouse out of the will.

Authorization To Sell

A contract in which a seller hires an agent to find a buyer for their home. It usually doesn't give the agent the power to sign a legally binding contract for sale; this kind of power usually needs to be given by someone else, like in a limited power of attorney.

Automated Underwriting

A loan underwriting strategy that takes use of the convergence of cyber-technology with the extensive lending expertise embedded in the massive loan portfolios of Freddie Mac, Fannie Mae, and other big mortgage lenders.

Automated Valuation Model (AVM)

A property valuation generated by computer.

Long-distance, electronic appraisal alternatives are used to decrease the cost and time involved with loan underwriting, especially when refinancing an existing loan. Estimated values are based on statistical methodologies that make use of Fannie Mae, Freddie Mac, and huge banks' enormous data resources.

Automatic Renewal Clause

A lease condition that automatically revives the contract unless both the renter and the owner mutually agree to end it.

Avenue

A fully upgraded through road that is used by local or minor collector traffic and is landscaped and planted with trees.

Average

A group of numbers' computed central value

Insurers use the term 'subject to average' when responding to a claim on property that has been insured for less than its full worth.

Average Annual Effective Rate

The average effective annual rent divided by the number of square feet.

Average Annual Effective Rent

The total effective rent of the renter divided by the length of the lease.

Average Rate Of Return

Things to keep in mind that result in average earnings or cash flow numbers expressed as a percentage of net or ownership cost.

Average Rate On After Tax Cash Flow

The average rates are determined by dividing the after-tax income stream by the equity expenses.

Average Rate On Before Tax Cash Flow

The average profit can be made by dividing the average before-tax income stream by equity costs.

Average Rate On Net Operating Income

The average profit can be made by dividing operating profit by investment costs.

Averaging Method

A simple way to predict the vacancy rate for the next period or year is to take the average of the vacancy rates for the previous years. This method works best when vacancy rates have been fairly stable or haven't changed much over time.

Avigation Easement

An easement that can be bought or taken away so that planes coming into an airport can fly over private land at low altitudes. This effectively stops landowners near airports from building above a certain height or cutting down trees.

Avulsion

A quick and noticeable shift in land borders caused by floods or abrupt changes in the path of rivers or streams.

Avulsion

Lost land because it was washed away by a sudden or violent act from nature. Land that is lost by avulsion usually doesn't lose its owner. The boundary lines stay the same, no matter how much soil is lost, and the former owner can get back the land. A person who owns land next to a river or stream loses ownership of land that is washed away by erosion.

Axial Growth

Along major transportation routes, cities grow outside of the city centre. Usually, this pattern is shaped like a star.

Azimuth

The angle between a north-south line and a boundary line measured from the north point in the northern hemisphere and the south point in the southern hemisphere. There are two azimuths for every line, based on which way you look down the line. Because line A + B is 240° long, the angle of line A+B is 60° long.

 

 

Glossary Index

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