Real Estate Glossary Terms Beginning With – T

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Updated: November 22, 2021

Terms Beginning With - T

Property Development & Investment Glossary, Terms & Definitions

Table of residuals

A list of disparities between actual and anticipated values for a variable from a regression equation.

Tacking

1. Adding or combining different periods of continuous occupancy of real property by adverse possessors, so that someone who hasn't been in possession for the full time required by law can still claim adverse possession. For one person's possession to be added to that of another, both possessions must have been continuous and uninterrupted, and the two people must have been successors in interest, such as ancestor and heir, landlord and tenant, or seller and buyer.

2. For tax purposes, the ability to carry over holding periods. For example, in a tax-deferred exchange or a replacement of principal residences, the holding period of the new property or principal residence includes the holding period of the old property.

Take down

To borrow or use money that a lender has already put up, as in a construction loan.

Take off

Estimating how much of each material is needed to build a building.

Take-out commitment

A long-term lender's agreement to disburse permanent loan funds after a project's construction is completed according to specifications.

Take-out financing

Permanent long-term finance. In the normal large construction project, the developer acquires two sources of finance. The first is the interim loan, a short-term loan to pay building costs. Before granting any money, however, the interim lender generally requires a promise by a permanent lender to agree to "take out" the interim lender, in which the lender pays off the construction loan and leaves the developer with a permanent long-term loan when the project has been completed. Such a pledge, called a takeout commitment or a takeout letter, normally represents the second phase of funding a development.

Take-out mortgage loan

A construction loan that is taken out over a set period of time.

Taking

Refers to the "takings clause" of the Fifth Amendment, which says, "Private property shall not be taken without just compensation for public use."

Tandem plan

A mortgage subsidy programme occasionally offered by Congress through Ginnie Mae. Ginnie Mae is authorized to purchase certain mortgages at below-market interest rates when assistance is required so that borrowers (builders and developers of non-profit public housing) can receive low-interest loans. Ginnie Mae then sells these loans on the secondary market at steep discounts, with the amount of the discount loss representing the subsidy. When these programmes are available, they are typically administered under a contract with Fannie Mae and Freddie Mac in conjunction with local mortgage lenders.

Tangible assets

Automobiles, clothing, land, and buildings are examples of physical things.

Task

A phrase used to characterize a project's activity, effort, or needs.

Task relationship

The relationships that exist between two or more project activities. Logical connections may be divided into four types:

  • Finish-to-start means that the 'from' action must be completed before the 'to' activity may begin.
  • Finish-to-finish means that the 'from' action must be completed before the 'to' activity may be completed.
  • The 'from' action must begin before the 'to' activity may begin.
  • Start-to-finish-the 'from' action must begin before the 'to' activity can be completed.

Tax

A charge collected by the government on a regular basis and depending on the relative worth of the thing levied.

Tax abatement

A reduction in a property owner's taxes for a specified time period. As an economic stimulant, a municipality may grant abatements as an incentive for developers to build and buyers to purchase. When the tax abatement expires, property taxes will increase.

Tax and lien search

A search for a property's title that is registered in the Torrens system. The tax and lien search is used to find out about things like real property taxes, city and county assessments, federal tax liens, and bankruptcies that are not shown on the Torrens certificate of title. A lien letter is another name for the report that a title insurance company sends out.

Tax assessor

The local governmental authority in charge of determining the taxable value of property in the jurisdiction as the foundation for property taxation. In certain states, this officer is known as the county property appraiser.

Tax auction

A method of selling tax-delinquent land or real estate in which verbal or written bids are accepted and the property is sold to the highest bidder.

Tax base

All of a jurisdiction's taxable properties.

1. The total assessed value of all real property in a taxed area for property tax purposes. This would not apply to exempt property owned by the church or the government.

2. The amount of money that is subject to income tax.

Tax bracket

The amount of tax a person has to pay on income over a certain amount. Individual tax rates are set up so that they go up as income goes up.

Tax certificate

The document that is given to a person as a receipt for paying the back taxes on real property that belongs to someone else. It gives the person the right to get a deed to the property if the property is not redeemed within a certain amount of time.

Unpaid tax obligations are auctioned by taxing jurisdictions in an attempt to collect the sum owed. To receive title to the property, the property owner or any future buyer must pay off the tax certificates.

Tax clearance

A form that a state requires the estate of a person who has died to fill out if that person owned real estate in that state. The form is used to make sure that the property does not have any outstanding inheritance tax liens.

Tax conduit

Tax-deductible losses "flow through" the partnership "conduit" and are reported by each partner in line with his or her individual ownership position in the partnership.

Tax credit

A dollar-for-dollar offset against taxes due. The IRS sometimes uses tax credits to encourage the building of low-income housing, housing for the elderly, or housing in historic buildings. Tax credits are also used to encourage businesses to make changes that comply with ADA rules.

Direct offsets against a taxpayer's income tax burden, granted as a financial incentive to inspire behavior deemed to be in the best interests of the country.

Tax deductible

A cost that may result in a reduction in taxable income.

Tax deductions

Taxable income is reduced.

Tax deed

A deed to property that has been confiscated by the government for non payment of taxes and auctioned at auction in accordance with the law.

The legal document used to transfer ownership of property auctioned by a government agency for nonpayment of taxes. An auction sale can be held if the tax lien remains unpaid for a specified period of time and sufficient notice is given. As soon as a property is sold at tax auction, the delinquent taxpayer has a window of opportunity to reclaim it. Generally, a tax deed serves as presumptive evidence of the sale's legality and must be registered.

Tax deferred income

The cash flow received in a particular year for which no taxes are now owed due to tax sheltering.

Tax depreciation

According to IRS rules, the reduction in annual taxable income is designed to represent the wear and tear that income properties endure over time.

Tax lien

A government lien placed on a taxpayer's property for non-payment of taxes.

A lien imposed by statute against real property for nonpayment of taxes that remains on the property until the taxes are paid, even if the property is transferred to another party. Local tax liens for unpaid real estate taxes have priority over all other liens on the property, regardless of whether they were recorded prior to the state tax lien. If owners of out-of-state properties fail to pay their real estate taxes on time, they may find that their property has been sold at a tax sale and they have lost ownership.

Failure to pay an Internal Revenue Service tax, including income tax, estate tax, and payroll tax, results in a federal tax lien. A federal tax lien is a general lien on all property and property rights of the person liable, but its priority depends on the number of previously recorded liens at the time notice is recorded.

Tax map

A scaled map that shows the location of real property, tax keys, size, shape, and dimensions, among other things, to make it easier to find, value, and assess the property. Most of the time, these maps are kept in tax map books, which are made by local tax departments and held by them.

A map depicting the location and size of property lots liable to property taxes.

Tax option corporation

A qualified corporation whose shareholders have chosen to be taxed directly for their portions of corporate income rather than the corporation incurring income tax obligation. Subchapter S of the Internal Revenue Code contains the relevant provisions. An S corporation is another name for a limited liability company.

Tax participation clause

A clause in a commercial lease that says the tenant has to pay a pro rata share of any increases in taxes or assessments over an established base year.

Tax preference

A possible part of the taxpayer's alternative minimum income tax calculation.

Tax preference item

Tax deductions or exemptions that are added back to adjusted gross income in order to compute the alternative minimum tax burden.

The alternative minimum tax is calculated by adding certain forms of income or deductions to the adjusted gross income.

Tax rate

The rate that is used to a property's assessed value to determine its annual property tax. The tax rate is determined by the assessed value, which varies according to property use.

The proportion of tax levied to the amount levied.

The amount of property tax paid divided by the taxable value of the properties. The proportion that, when multiplied by the taxable value of a property, yields the tax burden.

Tax reform act of 1986

In 1986, the federal government passed a landmark tax law that made a lot of changes. The law changed the rules for becoming a real estate investment trust and how REITs are taxed. It also got rid of tax breaks for capital gains and made it harder for people to use tax shelters. It made it take longer for most depreciable assets to get their money back. For residential rental property put into use after December 31, 1986, the recovery period is 27.5 years, and for nonresidential real property, it is 39 years. In real estate, the accelerated method is no longer an option. The only method that can be used is the straight-line method.

The Tax Reform Act also made an alternative depreciation system (ADS), which must be used for property that is mostly used outside the United States, for property that is leased to a tax-exempt entity or paid for with tax-exempt bonds, and to figure out the amount of depreciation that is treated as a tax preference for the purposes of the corporate and alternative minimum taxes. ADS real estate is written down over a period of 40 years. Even if a taxpayer doesn't fit into any of the above groups, they can still choose to use ADS.

Tax relief act of 1997

Tax regulations that offered tax relief to individuals selling their primary residence, investment property, farms, and small businesses. The act altered the capital gains tax rules for the sale of a primary residence. If the owners have lived in and occupied the home for two of the previous five years, gains up to $250,000 for individuals and $500,000 for married couples filing jointly are exempt from tax.

Tax roll

All taxable properties' tax amounts, assessed values, and millage rates are documented in public records.

Tax sale

The process by which a government unit sells real property to pay off unpaid real property tax liens. This is often followed by a set amount of time for the owner to pay the taxes.

The sale of a property that has been seized due to non-payment of taxes.

Tax schedule income

When using the Internal Revenue Service's tax rate schedules, the amount of taxable income utilized as a reference for calculating income tax due.

Tax search

A part of a title search that checks to see if there are any unpaid taxes or special assessments that could be a lien on the property being looked at.

Tax shelter

This phrase is often used to describe some of the tax benefits of real estate or other investments, such as noncash deductions for cost recovery (depreciation), interest, taxes, and the postponement or even elimination of certain taxes. The tax shelter may not only lower the investor's tax bill related to the real estate investment, but it may also lower the investor's other regular income, which lowers the investor's overall tax bill.

The Tax Reform Act also made an alternative depreciation system (ADS), which must be used for property that is mostly used outside the United States, for property that is leased to a tax-exempt entity or paid for with tax-exempt bonds, and to figure out the amount of depreciation that is treated as a tax preference for the purposes of the corporate and alternative minimum taxes. ADS real estate is written down over a period of 40 years. Even if a taxpayer doesn't fit into any of the above groups, they can still choose to use ADS.

Income that does not have to be taxed.

Tax stop clause

A clause in a lease that says the lessee is responsible for any increase in taxes over the base or first year's taxes. This is also called a "tax-escalation clause." It should say in the lease that this extra amount will be considered extra rent.

Tax stops

Lease restrictions that oblige renters to pay all property taxes over a certain threshold.

Tax-deferred exchange

A transaction in which some or all of the realized gains from the exchange of one property for another may not have to be immediately recognised for tax purposes. Section 1031 of the Internal Revenue Code says that the exchange is not tax-free; the taxes are just put off until a later transfer.

Both the property you get in exchange and the property you give up must be held for productive use in a business or trade or as an investment (not as your main home), and they must be "of the same kind."

Tax-exempt properties

Churches, synagogues, public schools, and government property are examples of properties that local governments cannot charge taxes against.

Tax-free exchange

An exchange of property for similar property that has no immediate tax consequences since the taxes are delayed.

Taxable income

The amount of income that is due to tax after all permissible deductions have been made.

Taxable value

To calculate the amount of property tax payable, subtract the assessed value from any applicable exemptions.

Teaser rate

If it is less than the index rate + the margin at the time of origination, the starting interest rate on an adjustable rate mortgage.

Teaser rate mortgage

A mortgage with an interest rate that changes over time and starts out with a lower rate than the market rate. Before the housing crisis of 2009, many people who didn't qualify for a loan at the market rate were tricked into taking out a mortgage that was bigger than they could afford. When the rates went up, they couldn't pay it, so they went into default.

Technical analysis

Attempting to forecast future market value changes by studying historical market activity.

Telephone consumer protection act

A law meant to stop telemarketers from calling people without their permission. Under rules from the Federal Trade Commission, people who have signed up for the National Do Not Call Registry can't get sales calls over the phone. Calls to sell things can only come in between 8 am and 9 pm. Real estate licensees can only contact a seller who is selling their home on their own if they already have a buyer for the property. A licensee can get in touch with the owner of a company whose listing has expired up to 18 months after the listing has ended. Also, it is against the law to send advertisements by fax unless the people who were contacted asked for them.

Tenancy

The length of time a property is rented.

Tenancy at sufferance

Wrongful occupation, which can be terminated at any moment by the property owner.

When a tenant who is meant to depart fails to do so but continues to pay rent and the landlord accepts it.

In the event of an unintentional tenant holdover, such as when the tenant fails to vacate the premises following the expiration of their lease agreement without the landlord's permission, a tenancy (or estate) arises. Landlords may evict tenants without notice in a tenancy at sufferance, which is the lowest form of real estate ownership. The purpose of this type of tenancy is to protect the tenant from being labeled a trespasser while also preventing the tenant from gaining ownership of the property through adverse possession. The landlord hasn't given his or her explicit agreement to the relationship, but it's there through implication. There is no estate that tenants can transfer; they just have naked possession.

The Tax Reform Act also created an alternative depreciation system (ADS), which must be used for property that is primarily used outside of the United States, for property that is leased to a tax-exempt entity or financed with tax-exempt bonds, and to calculate the portion of depreciation treated as a tax preference for the corporate and alternative minimum tax. ADS. Real estate owned by ADS has a 40-year depreciation period. Even if a taxpayer does not fall into one of the aforementioned categories, they can still use ADS.

When a lease expires and the tenant stays on the premises, a tenancy is created.

Tenancy at will

A tenancy with no set duration and in which either the landlord or the tenant may terminate at any time or within the time specified by legislation, which is generally 30 days.

A tenancy extended by landlords to renters that allows them to continue in possession despite the lack of a written agreement.

Either the landlord or the tenant has the right to terminate the tenancy at any time.

A tenancy or estate in which a person holds or uses real estate with the owner's permission for an undetermined or uncertain amount of time (i.e., there is no fixed term to the tenancy).

The main things about the tenancy are that it isn't clear how long it will last and that it is still a permissive situation. The tenancy cannot be transferred, but the tenant can usually sublease the space. If the tenant tries to transfer the tenancy, the tenancy is usually ended. Unlike a tenancy at sufferance, a tenancy at will has all the duties and responsibilities of a landlord-tenant relationship, and either party can end it by giving notice.

In common law, either party could end the contract whenever they wanted. Most modern laws now require a certain amount of time to give notice, like 30 days. Tenancies at will are different from other leasehold estates in that they end when either the landlord or the tenant dies or when the property is sold (the sale results in conveyance of the reversion).

A permission granted by the owner to use or occupy his or her property at his or her discretion.

Tenancy by the entirety

For husband and wife, a type of joint tenancy ownership.

A sort of joint tenancy that may only exist between couples, in which the wife and husband transfer the tenancy interest in common, with that interest recognized as a single, indivisible unit and the survivor continuing to maintain the tenancy as a matter of right.

Special joint tenancy between a legally married husband and wife that places all title to property (real or personal) in the marital unit, with each spouse holding an equal, undivided interest in the entire property. Essentially, each spouse owns the entire estate; neither spouse owns a fractional share, but rather the property ownership is an undivided whole. Upon the death of one spouse, the surviving spouse inherits the entire estate, to the exclusion of the deceased spouse's heirs and creditors, and without the need for probate. Sometimes, tenancy by the entirety is referred to as a "poor man's will." In contrast to a joint tenancy, neither spouse can convey an interest or force a partition during the other's lifetime without their consent.

Less than one-third of property ownership in the United States is tenancy by the entirety. Under modern law, which recognizes women's separate property rights from those of their husbands, the original common-law theory that husband and wife are one person has been abandoned.

Both spouses can convert the tenancy to a tenancy in common or a joint tenancy voluntarily. The tenancy by the entirety may only be terminated by mutual agreement, divorce, or joint conveyance; a spouse's attempt to transfer his or her interest does not terminate the tenancy. Even if an attempted unilateral transfer fails, the transferor may still be liable to the transferee for breach of contract damages. When divorce terminates the joint tenancy, the parties become tenants in common (even where the entire purchase price was paid by one party). Upon the demise of a spouse, the survivor must file a "affidavit of surviving tenant by the entirety" confirming the demise.

An estate that exclusively exists between a husband and wife, with equal rights of possession and pleasure and the right of survivorship for their combined lifetimes.

Tenancy for life

A freehold estate with an unknown length of time that is not an inherited estate; a life estate.

Tenancy for years

A leasehold interest for a set amount of time that is longer than a year.

A leasehold estate (or tenancy) in which the property is leased for a set amount of time, such as 60 days, any fraction of a year, a year, or ten years. In most states, this kind of tenancy can only be made with an explicit agreement, which should be written if it lasts longer than a year. The year-long lease must have a clear start and end date, which are written in the lease. If there is no law or contract, the tenancy is treated as personal property and goes to the tenant's heirs when the tenant dies. The lease ends on the last day of the term, and neither party needs to give notice of the end of the lease. A holdover tenant or a tenant at sufferance is a renter who stays in the house even though they don't want to. Most ground leases and business leases are for a long time.

A lease that is for a specific amount of time.

Tenancy from period to period

A tenancy by one who has a leasehold interest for an unspecified term and pays rent on a regular basis, with each payment functioning as a renewal for another period. This is frequently the outcome of the continuation of a prior specified-term lease for which rent was paid on a monthly basis.

Tenancy in common

Tenancy by two or more people with an undivided interest in the same property, albeit not necessarily equal in each holder.

The "typical" type of direct co-ownership, which is as near to a fee simple absolute estate as possible, with the caveat that one owner cannot use the property in a way that infringes on co-owners' rights.

A way for two or more people to own the same piece of property at the same time, where each person owns an equal share of the whole property. Each cotenant has a separate and unique title to an estate in land, and each cotenant has the right to full and undivided possession of the property based on the amount of land they own and the rights of possession of the other tenants. Unless the conveyance document says otherwise, interest is assumed to be equal. No special words are needed to make the tenancy happen. It is the most common way for two or more people to own something together, unless something else is made clear.

In a tenancy in common, there is no right of survivorship, which is not the case in a joint tenancy. If one of the cotenants dies, the interest goes to the deceased person's heirs or beneficiaries, not to the other cotenants who are still alive. A tenant in common's property interest must go through probate. In property held in common, there may be dower rights.

Tenants in common can sell their share of the property without the other tenants' permission, but they can't give away the whole thing without the permission of all tenants in common. If one of the cotenants wants to sell the whole property but the other cotenants don't, the cotenant can bring an action for partition and ask that the property be split up in kind or sold at auction, with each cotenant paying their share of the proceeds.

Cotenants have the right to own all of the property and keep the money they make from how they use it, but they have to split the net rents they get from other people. No one can charge tenants in common rent for using the land, and no one can charge rent for the use of the land by other tenants in common. If one cotenant pays taxes or assessments that are more than her share, she usually has a lien on the pro rata share of each cotenant's interest.

A lender usually won't accept a tenant in common's interest as security because the mortgagee has to pay extra money to force a partition proceeding in a foreclosure case to get back its security interest.

As with joint tenancy, if one cotenant in good faith makes improvements to the property without the other's permission, that cotenant should be paid for the improvements in a partition action. The standard is either the percentage of the cost of improvements that the other tenant is responsible for or the proportionate share of the property's increased value.

One problem with tenancy in common is that the interest of a cotenant who has died is subject to probate. This adds a level of uncertainty to the situation. For example, let's say that A, B, and C all own a lakefront property together as an investment. A, a single person, dies intestate. Both of his parents and 12 brothers and sisters were still alive. Soon after, one sister dies, leaving behind a husband and six children. For the other tenants in common to sell the property to a developer, they may have to get all of A's brothers and sisters, parents, and guardian for the minors to sign away any possible interest. "Heirs' property" is the name for this kind of property.

Tenants in common take on the risk that their individual interest in the property could be hurt if other cotenants don't pay their share of taxes, debt service, and other carrying costs. Also, there is a chance that one cotenant's share of the property could be taken away because of a judgment lien or an income tax lien. This could happen if the cotenant goes bankrupt or if the property is sold or divided without the cotenant's consent. 

Without the right of survivorship, ownership by two or more persons who have undivided interests in a specific piece of property. It is not necessary for the undivided interests to be equal.

Tenancy in partnership

A partnership is an association between two or more individuals for the purpose of conducting business as co-owners and sharing profits and losses. Technically, under common law, a partnership cannot hold real estate because it is not a legal organization. The title must be conferred upon the individual partners, not the firm. Under the Uniform Partnership Act, partnership property may now be kept in the name of the partnership in the majority of states. In general, the characteristics of a tenancy in partnership as they pertain to each partner are as follows:

  • Each partner has an equal stake in the property and an equal right to possession, but only for partnership purposes.
  • A partner's right cannot be assigned except in conjunction with the transfer of all partners' rights; hence, a purchaser can acquire only the entire title.
  • Except for a claim against the partnership itself, a partner's interest is not subject to attachment or execution, and there can be no homestead exemption claim. However, the entire property may be auctioned at an execution sale to satisfy a partnership creditor. A partner's interest cannot be seized or sold individually by a personal creditor, but a personal creditor can seek a partner's share of the profits through an action known as a "charging order."
  • Upon the death of a partner, the decedent's rights in the partnership's real estate pass to the surviving partner(s), but his estate gets reimbursed for the value of his investment. The partner's interest in the partnership firm is the only personal property that goes to the administrator upon his death without a will.
  • The heirs have a right in the partnership but not in the partnership's unique assets. In the absence of surviving partners, the deceased's property rights pass to a legal representative. The vesting in the surviving partner or partners and the legal representative of the last surviving partner confers on them no higher right than the right to possess partnership property for partnership purposes.
  • Dower, courtesy, and family allowances do not apply to a partner's entitlement to specified partnership property.
  • Since this property is owned by the partnership, no tax exemption granted to individual partners will apply to the partnership or its property.
  • The property and income or losses of the partnership are subject to partnership income tax treatment.

Tenancy in severalty

Property that is owned by one person alone instead of by more than one person. Also called several tenancy or sole tenancy. Both the husband and wife could own property as tenants in severalty, but dower and courtesy could change their rights. No one else can claim to be the owner after this. When the only owner dies, the property is probated and given to the heirs or devisees. Often, a corporation, state, or county owns more than one piece of land or title.

The possession of property by a single individual or legal body.

Tenant

A person who leases or rents a property

Someone who rents from another person.

A person who holds or possesses property exclusively, such as a life tenant or a tenant for years; commonly used to refer to the lessee under a lease. The exclusive occupancy of a tenant is always subordinate to the owner's rights. Not necessarily a renter, a tenant is an occupant.

One who pays rent in exchange for the use of real land.

Tenant allowance

A monetary payment given by the developer to a tenant (typically on income property) to allow the tenant to do the interior work on the leased premises rather than the developer.

Tenant alternative costs

Costs associated with constructing and renovating a property to make it suitable for a specific tenant. These expenses may be borne by either the landlord or the tenant, or they may be split as a result of negotiations.

Tenant contributions

All costs incurred by the renter in excess of the contract rent provided in the lease. One example is area upkeep.

Tenant improvement allowance

The amount of money that the owner of a commercial property must contribute toward the cost of upgrading the space to fulfill the needs of the tenant.

Tenant improvements

Tenant-paid improvements to the property.

Tenant mix

The synergy formed by the proper tenant grouping, which results in the proper tenant mix, which "makes the whole larger than the sum of its parts."

A mix of different types of tenants in a rented building.

How to choose and place retail tenants to bring in the most money for the landlord and boost business in general. Stores in a shopping centre should be set up so that the foot traffic brought in by one store helps the other stores and competition doesn't hurt anyone.

Tenant reps

Brokers or agents who specialize in assisting tenants in locating suitable rental space.

Tenant union

A local group of people who rent their homes and work for their rights and interests.

Tenants in common

A situation where two or more people own the same or different amounts of a thing.

Tender

An offer by one party to a contract to do her part of the deal without any conditions. For example, when a seller wants to force a buyer to pay the purchase price under the terms of a sales contract, the seller must first make a tender of the deed. Some states do this by putting the money into escrow. This is necessary because the buyer's responsibility to pay goes along with the seller's responsibility to hand over the deed. Also, if the buyer makes a tender of performance, such as by putting the purchase money in escrow, the seller is in default if she doesn't accept it and give the deed.

When someone owes money, giving the amount owed gets rid of any lien that was put on the debt as security, releases any sureties, and stops the debt from getting any more interest.

When there is an anticipatory repudiation or the seller has already sold the property to a third party, it is clear that they do not intend to keep the contract. In these cases, a tender is not necessary because it would be a waste of time. The parties can look for the right solutions, such as getting money for not doing what they agreed to do. Sellers shouldn't try to resell the property until they can prove that a valid offer has been made or that the other party has broken the contract.

To submit a proposal.

Tenement

A common-law real estate term for permanent real property rights that belong to the land and are transferred with the land, such as buildings and improvements. It also refers to things that are attached to the land. Tenements include not only land but also rights in real property that can be seen and felt. Modernly, the word is used to talk about apartment buildings, especially old, run-down ones in cities.

Tenure

A common-law term referring to the ownership of land, such as fee simple or leasehold. The practice of holding lands or tenements in subordination to a superior right, which was the principal characteristic of real estate ownership in feudal times.

Term

1. The period of time. A mortgage term, for example, is the amount of time the loan must be paid off (as specified in the mortgage). A lease term is the period of time during which the tenant has the legal right to occupy the premises (as specified in the lease), such as 60 days, ten years, or life. An option term is the amount of time specified in the option agreement for the optionee to exercise the agreement's rights.

2. A contract's clause or condition.

The amount of time a debt must be repaid within.

Term for amortization

On a mortgage, the time period that defines the payment, as well as the schedule of interest and principal installments, is referred to as the amortization period.

Term mortgage

A short-term mortgage that secures a loan with interest-only payments until the maturity date, when the entire principal is due and payable.

Term to maturity

A balloon loan term that specifies when the entire outstanding balance on the loan must be paid in full.

Terminal capitalization rate

The rate at which annual net cash at the conclusion of an expected holding period is converted into an estimate of future sale price.

Terminal value

The estimated sale price at the end of the holding term.

The market value of an investment at the moment it is sold.

Termination of listing

The end of an employment contract between a broker and a principal. If a listing doesn't say when it will end, it will end after a reasonable amount of time. This kind of listing can be canceled by the seller at any time before the broker finds a buyer who is ready, willing, and able to buy on the terms of the listing. If, on the other hand, the listing has a specific end date, which is usually required for all exclusive listings, the seller can't pull the listing before that date without being responsible for the broker's marketing costs, like advertising the property. Most state laws and courts don't like provisions that automatically extend the listing period, such as "30 days and continuing indefinitely until written cancellation is given."

A listing is basically a contract with an agency, and it can be canceled in the following ways, based on general agency and contract rules:

  • The principal or agent dies or goes crazy
  • End of the time for listing
  • Mutual agreement
  • Enough notice in writing
  • When the agreement is fulfilled. For example, if an open listing is used, the sale by one broker would end the agency for all brokers.
  • The property in question being taken away or destroyed
  • If either party goes broke
  • The broker gives up on the agency (broker might be liable for damages)
  • Cancellation by the owner (broker may recover damages)
  • A change in the law that stops the property from being used as it is now

Termination statement

A document that is filed to get rid of a financing statement that was filed under the Uniform Commercial Code.

Termite shield

A metal sheet installed in the exterior walls of a house near ground level, usually under the sill, to keep termites out. Termite shields should be installed on all exterior wood in the house as well as around pipes entering the structure. Shields are commonly built with an overhanging lip to allow for water runoff.

Terms

The terms and conditions set forth in a contract.

Terraserver

Satellite images with a very high resolution (less than 2 metres) (panchromatic digital imagery is orthorectified and georeferenced).

Terre tenant

The person who actually owns the land.

Testament

A determination.

Testamentary trust

A trust founded on will.

Testate

Real estate is conveyed in line with a will when a property owner dies.

Making a legally binding will.

Testator

A person who leaves a will is said to have died testate. Devisees inherit real estate, taking title to it subject to any liens in favor of the estate's creditors.

Someone who writes a will.

Testimonium clause

A part of a legal document that starts with "In Witness Whereof..." and then lists the act and date of when the document was signed.

Theme/specialty center

A shopping mall with a variety of formats, sizes, and market orientations. The architectural architecture of these centres is typically consistent throughout. These areas are typically anchored by restaurants and entertainment venues that cater to both visitors and locals. The renters frequently have interesting items to sell.

Theorems

The fundamental mathematical laws from which all other mathematical operations are derived.

Thin capitalization

Too much debt compared to equity in a company's capital structure. This causes the Internal Revenue Service to treat at least some of the debt capitalization as equity, which means that the tax benefits of debt are lost.

Thin market

A real estate market with few buyers and sellers and slow property turnover. This makes it hard to find reliable information about comparable sales. Also called a restricted market.

Third party

A person who is not a party to a contract but may be affected by it, such as a broker or escrow agent; one who is not a principal in the transaction. For instance, the for-sale-by-owner seller is the unrepresented third party in a transaction where the real estate licensee represents the buyer.

Threatened Species

A species with a fast diminishing population that is likely to become endangered, according to the United States Endangered Species Act.

Thrifts

Depository institutions are financial institutions that primarily gather and invest household money. Credit unions are not included in the phrase, which usually refers to (previous) savings and loan associations and savings banks. Until roughly 1980, thrifts were the backbone of house mortgage finance in the United States, investing primarily in home mortgage loans.

Tidewater land

Land under the water from the low-tide mark to the edge of a state's territory.

Tie-in contract

A contract wherein one transaction is contingent upon another. A developer may agree to sell a prime property only if the buyer agrees to purchase a less desirable property from the developer or agrees to list the property with the developer's brokerage firm. Such arrangements may be in violation of state and federal antitrust laws.

Tier

A line of townships that extends east to west.

Tier line

A characteristic of a government rectangular survey used to number townships south and north of the base line.

Tight money market

As shown by high interest rates, an economic situation in which the supply of money is restricted and the demand for money is high.

Time is of the essence

A clause in a contract that says that being on time is an important part of the contract. So, if one of the parties to the agreement doesn't perform by the "drop-dead" date, that party is in default, as long as the other party has made a valid offer to perform. If no offer is made, the clause could be left out. The clause can also be waived if the parties do something else, like accept late payments or sign escrow instructions that give them more time to do what they agreed to do.

In equity, time is not important to a contract unless it seems clear that the parties want it to be. The idea works both ways. Buyers are expected to make payments on time, and sellers must also act quickly to protect their rights if a buyer doesn't pay. In option contracts, time is of the essence. If the option is not used by the option date, it is no longer valid.

A contract clause requiring that any references to certain dates and times of day stated in the contract be construed precisely.

Time On Market

The amount of time it takes for a property to sell when it is listed for the first time.

Time preference for money

Preference for faster rather than later receipt of cash, such that investment advantages are more valuable the sooner they are obtained.

Time sharing

A kind of ownership in which a property is held by a group of people for a set amount of time.

A contemporary approach to communal ownership and use of real estate that allows multiple purchasers to buy undivided interests in real property (typically in a resort condominium or hotel) with the right to use the facility for a fixed or variable time period. The owners split the costs of common expenses. Time-sharing programmes may have a reservation system or a rotation-of-units system in place, allowing tenants in common to occupy their unit at different times of the year and in different years. Other time-share programmes sell specific time periods throughout the year. Some time-sharing programmes require the purchase or lease of property (ownership programmes); others require only licenses to use the property (right-to-use or license contracts).

States frequently regulate the time-sharing industry by requiring special disclosure reports, escrow accounts, agent licensing, review of promotional material, and complete disclosure of the details of any exchange programme in which time-share units can be exchanged for other properties. The procedures for billing real property taxes, tax delinquencies, and the assessment valuation problem (i.e., whether the building is valued at the same figure as a similar building that is not time-share or at an amount determined by the cost and number of timeshare interests) have been among the difficult questions.

The Uniform Real Estate Time-Share Act, which has already been adopted in several states, covers all aspects of time-sharing. Residential time-share units are subject to the federal Fair Housing Act's antidiscrimination provisions. money's time value An economic principle stating that the value of a dollar received today exceeds the value of a dollar received in the future.

A property occupation arrangement in which many individuals enjoy use of property but, unlike typical forms of co-ownership, the interests are at various time intervals rather than concurrent. A time sharing arrangement may include actual co-ownership, leasehold interests, or simply the right to dwell (i.e., license).

Time value of money (TVM) techniques

The idea that the worth of money is determined by when it is received.

Standard methods for calculating the impacts of time and risk on value.

Time-price differential

The difference between the purchase price of a property and the higher total price it would cost if it were bought in installments (including finance charges). Under the Truth in Lending Act, a lender must tell you about the difference between the price you pay now and the price you pay over time, as well as any and all finance charges.

Time-share ownership plan (TSO)

Tenants in common is a type of ownership in which more than one person has legal title to a condo unit or other piece of real estate and has the right to use it for a certain amount of time each year. Most tenants in common have a "separate use agreement" that spells out each owner's rights and responsibilities, such as whether or not they have the right to trade units in other resort areas.

Ownership can be for a set number of years, which is also called "interval ownership." After that, all time-share owners become "tenants in common" and are free to sign a new agreement, rent out the property, or sell it.

TIN

An irregular triangulated network. A surface representation made up of randomly spaced points and break lines. Each sample point has an x, y, and z (surface) coordinate as well as a value.

Title

Evidence of real property ownership indicating a person's right to own, use, and dispose of property.

The evidence of the right to an estate; the title to the ownership of land. The bundle of rights that an owner holds; the sum of rights and property that a person possesses. Individually, jointly, in trust, or as a corporation or partnership, title can be held. The phrase "title" refers to the facts that, if proven, would allow someone to reclaim or keep possession of anything.

A person is considered to have title to real property if they own it outright. Original or derivative titles are available. Only the state can have the original title. This is a title obtained by the state through discovery, occupation, conquest, or cession. All other titles are derived and belong to certain people. Titles by descent (no will) and titles by purchase are two types of titles (deed, land contract, will).

A legal document that establishes a person's right to own real estate.

Title abstract

All documents detailing the chain of title are compiled into a chronological book and then presented to an attorney for final interpretation.

Title evidence in the traditional sense.

Title closing

The gathering of the parties to a sales contract at a predetermined location and time for the purpose of carrying out the contract.

Title company

A firm that investigates a property's title before issuing title insurance.

Title deeds

documentation demonstrating ownership or possession

Title defect

A potential legal issue that might limit the title's marketability.

Other people's legal right to claim property or make claims on the owner.

Title insurance

Insurance against losses resulting from the transmission of legally incorrect title, granted by a title insurance firm after a title search by that business has shown that legally valid title exists in the seller, who is then entitled to convey that title to the insured.

Insurance that pays monetary damages for property loss due to unforeseen superior legal claims or for title litigation. It is thought to be superior than the usual abstract with opinion as evidence of title because it also includes insurance.

A full indemnity contract in which a title insurance company promises to make up for any loss caused by flaws in the title to a piece of real estate or by liens or other claims. Title insurance is different from other types of insurance because it protects against losses that have already happened, like a forged deed somewhere in the chain of title. Other types of insurance protect against losses that might happen in the future, like a fire or car accident. Fannie Mae and Freddie Mac make sure that every loan they buy has title insurance.

The title company will give a policy if the investigation of public records and all other important facts is satisfactory. Most of the time, a title insurance policy protects the insured from losses caused by "hidden risks" like the following:

  • Deeds, releases of dower, and mortgages were made to look like they were real.
  • Unknown heirs; inability to act (minors)
  • Wrong way for lawyers to read wills
  • Misplaced papers and unofficial acknowledgments
  • Confusion caused by names that sound alike
  • Giving the wrong status of marriage; mental incompetence

Also, and this is the most important part, the title company will agree to defend the policyholder's title in court if it is sued because of a problem covered by the policy. Usually, there are three parts to a title insurance policy:

  • The contract to insure the title and cover losses
  • A description of the insured estate and property
  • A list of the conditions of coverage and the things it doesn't cover

Most of the time, title defects like the ones below are not covered by insurance.

  • The rights of people in possession that aren't listed in public records, such as unrecorded easements
  • Any information that a good survey would show (e.g., encroachments)
  • Taxes and assessments not yet due or payable
  • Zoning and rules from the government
  • Mines without patents
  • Some rights to water

Title insurance is done as of a certain date. Except for some policies, the premium is paid only once, and coverage stays in place until the property is sold to a new owner, even if that new owner is the insured's wholly owned corporation. It is not connected to the land. So, coverage is only for as long as the named insured is alive and for some of the named insured's legal heirs.

An owner's policy is made for the owner, the owner's heirs and devisees, or, in the case of a corporation, the corporation's successors in the event of dissolution, merger, or consolidation. The policy cannot be given to someone else. Title companies will give an extended coverage owner's policy for some properties for an extra fee to cover title problems that aren't covered by the standard policy. Some of these title problems are the rights of parties in possession, questions about the survey, and liens that have not been recorded.

A lender's policy protects both the mortgage lender and anyone who takes over the loan in the future. It protects the lender against the same defects that an owner's policy covers, plus some more. However, the insurer's liability is limited to the mortgage loan balance on the date of the claim, and liability under a lender's policy decreases with each mortgage payment and ends when the loan is paid off and released. A lender's policy usually costs less than an owner's policy because the lender doesn't have as much to lose. Under a mortgagee policy, the loss that has to be paid goes straight to the person who owns the mortgage.

When the property goes into foreclosure and the mortgagee buys it, the policy automatically becomes an owner's policy. This protects the mortgagee against loss or damage caused by things that happened before the policy went into effect. Title companies also sell policies that cover the leasehold interests of a lessee, a lender under a leasehold mortgage, or a buyer under a contract for deed.

In the event of a loss covered by a mortgagee's policy, the insurer pays the mortgagee the remaining balance on the loan. The owner no longer has to make payments on the loan. If the owner doesn't pay a slightly higher premium for an owner's policy, he or she will lose the property and the investment.

If a property's value goes up, like when a costly improvement is made, it's a good idea to increase the amount of title insurance to cover any possible losses. Newer policies have an add-on called "inflation guard" to cover price increases.

The American Land Title Association (ALTA) is made up of almost 2,000 title companies that all use the same ALTA title insurance policies.

Insurance against the loss or harm caused by faults in the title to a specific piece of property.

Title insurance commitment

A promise to write a title insurance coverage. One of the two basic types of title evidence.

Title insurance policy

A contract in which the title insurer undertakes to compensate the insured for damages caused by defective title.

Title report

A preliminary report of a property's current record title. A title report, unlike an abstract of title, only shows the current state of the title and any recorded problems, like unpaid mortgages and easements. The title report is used to make the policy for title insurance. A preliminary report doesn't make the insurer responsible for anything.

A document that shows the status of the title at the moment.

Title search

A thorough examination of all paperwork and records pertaining to a property in the recorder's office to establish if the seller has valid title to the property.

The task of investigating title evidence in public documents.

An examination of public records to see if there are any problems in the chain of title. This is usually done by a title company or abstracter with a lot of experience. Before an institutional lender will lend money backed by real estate, it will ask the borrower to pay for a title search to make sure that there are no other liens on the property that are higher than its mortgage.

The person doing the title search starts by looking at the original source of title, which is often a government patent grant or title award from 40 to 60 years ago, depending on local custom. After looking at the original source of title, the searcher "runs the title" in the recorder's office and checks the records in other government offices, such as tax offices and assessment offices (for sewer or street assessments that may be in effect). Title searchers often come across names that sound the same but have different spellings. In this case, the law has a "rule of idem sonans" that says names that sound the same must refer to the same person, even if they are spelled slightly differently.

A title company will give you a title abstract, a preliminary report, a certificate of title, a continuation certificate of title, or a title insurance policy after it does a title search. Some of these different documents give opinions about the title, while others just list the facts that the search turned up.

An investigation of public data, legislation, and court rulings to find current facts about property ownership.

Title theory

The lender obtains title to the mortgaged property, which matures upon failure.

The notion of a mortgage as a transfer of title from the borrower to the lender, according to this theory of mortgage law.

Title transfer

To transfer or cede ownership to another person.

Title XI

The part of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 that makes changes to real estate appraisal reform and gives states the power to license and certify appraisers.

Title-theory states

States where the mortgagee has legal title to the mortgaged property (typically in the form of a trust deed) and the mortgagor has equitable title. Title theory states, also known as conveyance or transfer theory states, follow the common-law approach that a mortgage is a defeasible conveyance subject to a subsequent condition. The payment of the mortgage debt when it becomes due is a condition of the defeasance. Thus, when a mortgage is obtained, the creditor obtains title to the property; when the debt is repaid, the debtor regains ownership. Upon default, a mortgagee has the right to possession and rents on the mortgaged property under title theory. In a lien-theory state, a mortgagee must foreclose in order to assert the same rights.

Tolling

The stopping or pausing of the clock on the statute of limitations. For example, if the owner of a record is mentally ill, the clock may stop ticking on the time limit for what is called "adverse possession."

Tongue and groove

A way to join two pieces of board together in which one piece has a tongue cut into one of its edges and the other piece has a groove cut to fit the tongue. The method is used to change any material, like tongue-and-groove lumber, that is ready to be joined in this way.

Top-down approach

A technique to market analysis that begins with aggregated data.

Topography

The contour is the nature of the land's surface.

Hills, valleys, and other aspects of the land's surface.

Topping-off

The most important part of a building's design. This is sometimes shown by putting a branch of a tree on the very top of the project.

Topsoil

The topmost layer of the soil, with a high organic content.

Torrens certificate

A rarely used method of proving ownership.

Torrens system

A method for registering real estate title that precisely detects the ownership of land as well as every lien and claim on it. Land title is registered in this system in much the same manner as title to a vehicle is.

A legal system for registering land that can be used to verify ownership and encumbrances (except for tax liens) without needing to search the public records again. The goal of the Torrens Act is to make sure that a property has a clear title that can't be taken away. This way, people who deal with the property know that the only rights or claims they need to be aware of are those that are registered. The title is part of the Torrens system of registration. This is different from a title insurance policy, which is only proof of title. In other words, a person can't own Torrens registered real property unless they register the title.

The most important thing about registered property is that the title does not change hands, and liens (like mortgages) do not affect the property until they are written on the registered certificate of title. If a government registrar makes a mistake that costs someone money, that person can get their money back from the state through an assurance fund. The registrar, on the other hand, won't defend the landowner in court or pay for court costs. This is one reason why most mortgagees need title insurance, even for Torrens-registered titles.

Under the Torrens system, the owner of a piece of land first asks a state court to register it, giving notice to everyone who might be interested. After a search of title is filed with the court, there is usually a hearing to determine the status of the title, and the court's decision is made in the form of a court decree. The steps are like those of a quiet title suit. You don't have to use the Torrens system right away. But once a property is registered, it can't be moved without following the same rules.

The Torrens system, which is popular in Canada, Australia, and Great Britain, has been used in about ten states. In some states, a general judgment lien can't be put on Torrens-registered property, and the title can't be lost through "adverse possession."

Torrens Title

The most prevalent form of freehold title in Australia, which includes a plan depicting the property's location and measurements.

The concept of registering property titles with governments was established by Sir Robert Torrens of South Australia, and it is currently utilized in many countries of the world. There used to be titles like General Law or Common Law.

A title that gives someone the right to land.

Tort

A civil wrong, such as negligence, libel, nuisance, trespass, slander of title, or false imprisonment, is a wrongdoing caused by negligence or on purpose that breaks a duty set by law and not by a contract. For example, if an escrow agent doesn't follow the escrow instructions because they were careless or on purpose, they could be held responsible in a tort action for the damage they caused. The escrow agent may also be in violation of its contract if it doesn't do what it's supposed to do.

Total debt ratio

PITI and other long-term debts are divided by the borrower's gross monthly income; one of two popular ratios used by house mortgage lenders to estimate a borrower's ability to pay a debt.

Total Return

The mix of capital growth and rental return achieved over time

Townhouse

A sort of dwelling unit that typically consists of two stories, with the living space and kitchen on the ground floor and the bedrooms on the second story; a sequence of independent dwellings that share architectural unity and a common wall. In cluster living, townhouses or row houses are particularly popular and frequently employ party walls and shared communal grounds. Frequently, townhouse complexes are planned unit developments (PUDs), with each owner holding fee title to the structure and land beneath the structure; the condominium form of ownership is prevalent. Typically, the surrounding land, including sidewalks, open areas, and recreational amenities, is held in common. The townhouse concept is a mix of the single-family home and the apartment, and is sometimes utilized in regions where height limitations prohibit the construction of high-rise buildings.

A structure that is classified as either a unit or a home depending on the title system in use, i.e. strata for units and Torrens for houses.

Single-family homes that are attached to each other by party walls. They are usually on a small lot with small front and back yards. Row Houses are also called that, but they are also called that.

A sort of attached or semi-detached row home that houses a single family.

Township

A six-mile-square region divided into 36 parts, each one mile square, utilized in the rectangular survey system of land description.

A six-mile-by-six-mile sector of the federal rectangular survey system that contains 36 completely detailed, one-square-mile parts.

A land area of six square miles.

A piece of land that is six miles square, has 36 sections that are each one mile square, and has a total area of 23,040 acres. It is part of the government's (rectangular) survey system for describing land.

Toxic waste

Asbestos, fibreglass, lead paint, radon, PCBs, leaking subsurface storage tanks, and other potentially hazardous elements

Track record

1. Prior operational results of a sponsor (or developer) or real estate project. When conducting a credit check, the creditor examines the debtor's payment history with other creditors.

2. The background of a real estate syndicator This history must be disclosed in an offering for public or private placement.

Tract

A parcel or lot of land; a specific development. Usually refers to a large land area.

A subdivision of land that is numbered and documented with the county recorder's office in various states.

Tract house

A house that is mass-produced according to the builder's blueprints, as one of many homes in a subdivision with similar styles, materials, and prices. It differs from a custom home, which is created to the homeowner's requirements.

Tract index

A list of title records based on the description of the property that was sold, mortgaged, or otherwise disposed of.

Trade area

The geographical area from which the majority of a store's or shopping center's patronage is drawn.

The geographical area from which the majority of a retail facility's clients are consistently drawn. Also known as a market area.

Trade fixture

A piece of personal property that is added to or attached to leased property by the tenant because it is needed for the tenant's business. Most fixtures must be left in place at the end of a lease. However, trade fixtures can be removed by the tenant before the end of the lease, and the tenant is responsible for any damage caused by their removal. But a tenant usually can't take out new fixtures that were put in to replace old ones that were worn out. For example, if a tenant of a tavern replaces an old bar with a new one, the tenant cannot take the new bar with them when the lease is up. If the tenant doesn't remove trade fixtures within a reasonable amount of time after the lease ends, the fixtures will be seen as abandoned and become the landlord's property.

Personal property that is normally paid for by the renter and may be removed at the end of the lease.

Articles that a tenant installs under the conditions of a lease and then removes before the lease expiration.

Trade or business property

Real estate kept in a trade or business activity for more than one year, including most income producing property, is taxable under Section 1231 of the Internal Revenue Code.

Trade usage

A consistent pattern of behavior in a specific trade, calling, occupation, or business. Any practice or method of dealing that is observed with such regularity in a place, vocation, or trade as to justify an expectation that it will be observed with regard to the transaction in question.

Trade-in

A deal where a builder or broker agrees to take a certain piece of real estate from a buyer as part of the price of another property. This is how it usually goes: A homeowner agrees to buy another home, and the builder of the other home or the selling broker agrees to buy the owner's current home at a certain price if it hasn't sold for that price or more within a certain time. This arrangement makes sure that the owner will have enough money to buy the new home.

Trades

Carpenters, plumbers, and other workers are classified as carpenters, plumbers, and so on.

Trading on the equity

The practice of committing to buy real estate and then assigning the purchase agreement to another buyer before closing to profit.

Trading up

Buying or trading for an item that costs more than what is already owned.

Traffic flow study

A traffic consultant conducted a study to examine vehicular traffic patterns. An interior space planner conducted research into the interconnections between various departments and activities in order to improve function and communication.

Traffic report

A list of people who have enquired about renting a home.

Transaction broker

A person who helps a real estate transaction but is not a buyer or seller's agent. A transaction broker is obligated to deal honestly and fairly with both parties and to carry out his or her duties with competence, care, and diligence.

A non-agency relationship is one that is allowed in states that have created a type of service where the agent doesn't represent either the buyer or the seller, but instead treats them both as customers. Also known as non agency relationship or facilitation.

Transaction costs

Brokerage costs, recording fees, transfer taxes, and legal expenses incurred in the course of a real estate transaction.

The fees connected with purchasing and selling real estate.

Transaction price

The real price of a transaction; the result of a negotiation process between buyer and seller. Also known as the market price.

Prices paid for properties that have been sold.

Transaction range

The price range within which a transaction between an owner and a prospective buyer can take place. The lower level of the transaction range is determined by the owner's subjective value, while the upper level is determined by the potential buyer's subjective value.

Transactional adjustments

Adjustments to comparable property transaction values based on the nature and terms of the transaction in an appraisal.

Transactions balances

The amount of money necessary to finance normal business operations and meet day-to-day home obligations.

Transfer

A land titles office-registered document indicating a change in ownership.

Transfer certificate of title (TCT)

A second copy of a Torrens system title certificate. Under the Torrens system for registering property titles, the court gives the owner an original title certificate in his or her name once the owner has proven that he or she has the right to own the property. The certificate is made in two copies and lists the name of the owner, the date the property was registered, the Torrens documentation number, and any liens on the title. The original certificate is then kept on file, and the owner is given a copy ( or it is sometimes held by the mortgagee). When the original owner sells the property, he or she hands over a standard deed and a transfer certificate of title. The original certificate and the owner's copy are then canceled, and the registrar gives the grantee a new transfer certificate of title.

Transfer costs

Transportation costs between linked locations.

Transfer of development rights (TDR)

A land-use planning concept that considers land development rights to be part of the bundle of individual rights to land ownership. According to this concept, any of these rights can be separated from the others and transferred to someone else, leaving the original owner with all other ownership rights. Communities have significant power to direct growth, preserve landmarks or unique environmental features, and maintain adequate amounts of open space by viewing development rights as a separate economic entity. All of this is accomplished without imposing an undue financial burden on the community or the owners of the lands that will remain undeveloped in the public's interest. TDR can be implemented in a variety of ways, but the end result is that the person acquiring the rights will reimburse the owner of the development rights for the rights that are given up.

TDR has been proposed or implemented in some form to promote various community values in various parts of the country. It has been used to preserve landmarks in New York and Chicago. It was proposed to protect Puerto Rico's ecologically vulnerable Phosphorescent Bay. Southampton, New York, has implemented TOR to encourage the development of moderate- and low-income housing. The state of New Jersey, as well as counties in Virginia and California, have proposed using TDR as a primary system of land-use regulation and open space preservation.

Transfer tax

A tax levied on the sale or transfer of an asset or a mortgage.

Transfer tax (conveyance fee)

A state tax on the transfer or conveyance of real estate or any interest in real estate by deed, lease, sublease, assignment, contract for deed, or a similar document. One reason for the tax is to get accurate information about the fair market value of the property so that real property tax assessments can be more accurate. Most of the time, the tax is paid by the seller, the grantor, or the lessor.

As of December 31, 1967, there was no longer a federal tax on the sale of real estate. Since the federal tax was taken away, most states now write the amount of tax on the first page of the document instead of putting a stamp on it.

Each state that has a real estate transfer tax has set the amount of the tax, how the taxable consideration is calculated, and which deeds or transactions don't have to pay the tax. Most of the time, but not always, the amount of the assumed mortgage can be subtracted from the full consideration to figure out the taxable consideration when a piece of real estate is sold with the unpaid balance of a mortgage made by the seller before the time of the sale and assumed by the buyer.

The tax is usually paid to the county recorder in the county where the deed is to be recorded at the time the deed is recorded. In many states, both the buyer and the seller or their agents must sign a transfer declaration form. Usually, this form needs information like the legal description of the property that was sold, the address, the date and type of deed, the type of improvement, and whether the sale was between strangers, between family members, or because of a court order.

When the transaction is exempt, the document must usually come with a form certificate that explains why it is exempt. Some transfers, like a deed of easement, are completely exempt, and the grantor does not even have to file an exemption certificate. Mortgages, correction deeds, real estate transfers where the tax was paid when the underlying contract for deed was recorded, transfers between husband and wife or parent and child, and transfers where the actual consideration is $100 or less are usually exempt from the tax. Gift deeds, correction deeds, conveyances to, from, or between governmental bodies, deeds of easement, deeds by charitable, religious, or educational institutions, deeds securing debts or releasing property as security for a debt, partition deeds, tax deeds, and deeds from subsidiary to parent corporations for cancellation of stock are also exempt from the tax.

Transit-oriented development (TOD)

A type of community planning that incorporates mixed-use residential and commercial areas within walkable areas, frequently centered on public transportation such as train stations, bus stops, or bicycle paths. These developments are intended to promote healthier lifestyles while also reducing air pollution and greenhouse gas emissions from household driving.

Transport breakpoints

Points on key transportation routes when the mode of transit must be changed.

Tread

The part of a step that is flat and rests on the riser. Steps are made on the tread.

Treble damages

Statutory damages in certain cases, such as an antitrust suit; actual damages may be tripled. When a landlord wrongfully and willfully retains all or part of a tenant's security deposit, for example, a court may have the authority to award treble damages.

Trespass

Any wrong, unauthorized entry onto someone else's land by someone who has no legal right or title to be there. Trespassing can happen on land, in the ground, or even in the air. Some trespasses are allowed, like trespasses to stop waste, to serve legal process, or to use a reasonable amount of airspace for aeroplane flights.

Unauthorized possession of real property is just trespassing, and it can't turn into ownership unless all the conditions of adverse possession are met. Because a tenant has the right to exclusive possession of the leased premises, not just against third parties but also against the landlord, any unauthorized entry by either the landlord or a third party would be considered trespass.

Most of the time, a landowner is not responsible for injuries caused by trespassers who are not known to be there. But if the landlord knows about the trespass, they can't do anything that could put the trespasser in danger.

Trim

Things like door and window casings, moldings, and hardware can be made of wood or metal.

Triple A tenant

A business tenant with a high credit score. An anchor tenant in a shopping centre is especially desirable.

A prime tenant is a renter who has a triple A credit rating.

Triple net lease

A lease in which the lessee pays all taxes, insurance, and maintenance costs while the lessor receives a net sum.

In a net-net-net lease, in addition to the stated rent, the lessee is responsible for all operating expenses related to the property. This covers both fixed expenditures, such as taxes and insurance, and running costs, such as maintenance and repair charges. In certain instances, the triple-net tenant pays the interest on the lessor's mortgage on the leased property.

The term triple-net lease (also known as a net-net-net lease) is redundant because the term "net lease" sufficiently defines the scenario. Instead of relying on labels, however, the parties must review the lease clauses to determine the tenant's responsibilities.

Triplex

A building with three apartment units.

Three interconnected residential units under one roof.

Truck well

A depression adjacent to a loading dock that is deep enough to allow direct loading from the floor of the building onto the bed of a truck that has been backed into the well.

Truss

A roof construction that uses a rigid framework of beams or members to support the roof load and typically achieves relatively wide spans between its supports.

Trust

A legal arrangement in which the grantor (or trustor) transfers legal title to property to a trustee, who then holds and manages it for the benefit of another named beneficiary. In a trust agreement, the grantor and trustee may be the same individual at first (i.e., a "declaration of trust"). Equitable title is held by the beneficiary. Trusts can be actual or constructive, and they can be created by verbal agreement or by operation of law. There are two types of trusts for estate planning: inter vivos (or alive) trusts and testamentary trusts.

A transaction in which a property is given to or retained by a third party or trustee.

Trust account

A bank account distinct from and aside from a broker's personal finances, into which a broker is obligated by state law to deposit any monies received for customers. The same as an escrow or special account.

Trust agreement

A document that specifies the parameters of security arrangements and directs the trustee in the case of a default.

Trust beneficiary

The person who a trust is set up for. The person who gets the benefits or money from the trust is called the beneficiary. The beneficiary can be the same person as the grantor.

Trust deed

A transfer of property to a third party for the purpose of holding it for the benefit of another.

Trust fund account

An account established at a bank or other recognized depository by a broker, attorney, or other agent into which the broker deposits all funds entrusted to the agent by the principal or others; also known as an earnest money or escrow account. The trust fund for a brokerage firm account must name the principal broker as trustee and must allow funds to be withdrawn on demand.

In general, a principal broker may authorize a broker-in-charge of a branch office to have custody and control of trust funds on behalf of the principal broker on transactions occurring at that branch office. The principal broker and the broker-in-charge are typically jointly liable for any trust funds that the principal broker authorizes the broker-in-charge to handle. Because a broker is liable for the actions of the salespeople, the broker is liable to the buyer if one of the salespeople embezzles earnest money deposited in a trust fund account. Also, if a broker deposits or spends earnest money in his or her own personal bank account, the broker may be guilty of commingling, which is a violation of most state license laws. However, most license laws permit a broker to keep a small amount of personal funds in a client trust account to keep the account open. Even if the client owes the broker a valid debt, the broker cannot use trust fund funds to offset it.

Trustee

The individual in a trust relationship who retains property for the benefit of another (the beneficiary).

Person who holds the deed in a deed of trust on behalf of both the borrower and the lender in mortgage financing.

1. One who holds property in trust for someone else as a fiduciary and is responsible for protecting, preserving, and increasing its value and making the best and highest use of it. Care should be taken to spell out in the trust agreement what the trustee can and can't do.

2. A person who holds someone else's property in trust to make sure they keep their promise. In states where trust deeds are used as security, the trustee holds the property's legal title until the borrower or trustor pays off the debt or promissory note. Most of the time, the trustee is a bank, trust company, or title insurance company. In some states, the title is held in trust for the lender by a public trustee. In a trust deed, a trustee's two main jobs are to sell the property at public auction if the debt is not paid and the trust deed gives the trustee the power to do so, and to execute a reconveyance (release) if the beneficiary asks them to do so when the debt has been paid off. In the case of a deed of trust, many financial institutions have set up a separate company to act as the trustee. In this case, the corporation is more of a common agent than a true trustee.

A trustee is a person who holds property in trust for another.

Trustee in bankruptcy

One who is chosen by the court to protect and take care of a bankrupt person's assets.

Trustee's deed

An executor and administrator of an estate, a guardian of a minor, a bankruptcy trustee, or possibly an attorney in divorce proceedings may issue a deed in a court-supervised property disposition.

A deed signed by a trustee that transfers trust property.

Trustor

A person who gives property to a trustee.

Truth-in-Lending Act (TILA)

The Truth in Lending Simplification and Reform Act, which went into force in July 1969 as part of the Consumer Credit Protection Act, was implemented by the Federal Reserve Board's Regulation Z and was updated in 1982 and later by the Truth in Lending Simplification and Reform Act. TIL's major goal is to ensure that borrowers and customers in need of consumer credit are provided with useful information about credit costs so that they can compare the various credit arrangements accessible to them. The TIL statute simply creates a disclosure device and does not impose any maximum or minimum interest rates or credit charges. Furthermore, some states have enacted their own truth-in-lending legislation.

Regulation Z applies to all real estate credit granted to a natural person (the consumer), but not to business, commercial, or agricultural operations. Personal property credit transactions worth more than $25,000, as well as credit extended to the owner of a home with more than four family housing units or a building loan to a function Object() { [native code] }, are exempt from Regulation Z. (this is considered a business purpose). The transaction is covered by Regulation Z if the credit is secured by real property or personal property that is used or expected to be utilized as the consumer's primary residence (manufactured home). The credit granted must either include a finance charge or be payable in more than four installments per written agreement.

The finance charge and annual percentage rate (APR) are the two most crucial disclosures. They serve as a quick reference for consumers, notifying them of the amount of credit they are paying and the percentage cost of that credit. Note that if the transaction is less than $1,000, a $5 cushion or tolerance is provided, and if the transaction is greater than $1,000, a $10 cushion is provided.

Interest, loan fee, loan-fee, finder's time-price difference, discount points, service fee, and premium for credit life insurance if it is a condition for providing credit are all fees the consumer must pay, directly or indirectly, for obtaining credit. Purchase costs that would be paid regardless of whether credit is issued are not included in the finance charge, as long as they are genuine, fair in quantity, and not removed to circumvent the rules.

The annual percentage rate (APR) is not interest under Regulation Z, albeit interest is factored in with the other financial charges when calculating the annual percentage rate. The annual percentage rate (APR) is the ratio of the entire finance charge to the total amount to be financed, calculated to the eighth percentile.

The total dollar amount of the "finance charge," the annual percentage rate, the number, amounts, and timing of payments, the total of payments, the amount charged for any late payments, the fact that the creditor may acquire a security interest in the property, prepayment privileges or penalties, and more must all be included in the disclosure statement for real estate transactions. The borrower's right to rescind continues for three years after the date of consummation of the transaction or upon sale of the property, whichever occurs first, if the required disclosures were not made or a notice of rescission was not delivered to the borrower.

Right to cancel: A borrower's right to terminate or repudiate a credit transaction is limited. This cancellation is meant to protect the homeowner from unscrupulous sellers of home upgrades, appliances, or furnishings who secure the credit advance by taking out a second mortgage on the buyer's home. The borrower has the right to cancel the transaction (in writing) by midnight of the third business day (including Saturdays) following the date of consummation, delivery of the notification of right to rescind, or delivery of all material disclosures, whichever comes first. The right to cancel does not apply to the initial loan used to buy or build the consumer's primary residence.

Creditors: All creditors who frequently extend credit must comply with this law. Only if a person extended credit more than 25 times (or five times for transactions secured by a residence) in the previous calendar year qualifies them as "frequently extending credit." Even when selling under a contract for deed payable in more than four payments, the owner/occupants of a single-family home are usually exempt from Regulation Z's disclosure requirements. Brokers who are operative builders, subdividers, brokers selling property on their own account (save for the sale of their own permanent abode), or brokers who take out a second mortgage as a commission may be considered creditors and must follow the law.

Regulation Z covers any advertising to facilitate or encourage any extension of consumer credit, including window displays, fliers, billboards, multiple-listing cards if exposed to the public, and direct mail literature, regardless of who the advertiser is.

When certain credit terms are stated in an advertisement, additional information is required to be disclosed. The goal of this criterion is to provide a complete and accurate image of the transaction to the prospective buyer.

Any advertisement that cites an interest rate but does not include the APR or the phrases annual percentage rate is breaking the law. Any advertisement that contains any trigger term (Column A) but does not include all of the mandatory disclosures (everything in Column B) is in violation.

"Small down payment OK," "FHA financing available," and "compare our reasonable rates" are not needed disclosures. When advertising a mortgage assumption, the rate of financing charge might be stated without any other information. The finance fee, on the other hand, must be disclosed as an annual percentage rate, together with whether or not an increase is feasible. For example, "assume 7% mortgage" is incorrect, but "assuming 712% annual percentage rate mortgage" is OK. Advertisements can include the interest rate alongside, but not more prominently than, the annual percentage rate. Also, while "annual percentage rate" is normally written out, it is acceptable to shorten it to APR. Bait advertising is illegal; for example, an ad promising new homes for "$1,000 down" is illegal if the seller generally does not accept this amount as a down payment, even if all other credit criteria are provided in the ad.

Creditors shall preserve records of all compliance with the federal Truth in Lending Act's disclosure obligations for at least two years after the date disclosures are required or action is required. Any variable rate clause in a credit contract that could result in a rise in the customer's credit cost must be disclosed in advance.

Each consumer whose ownership interest is subject to the security interest has the right to obtain disclosures, notification of the right to rescission, and the requirement to sign a waiver of such right when joint ownership is involved.

Penalties: The penalty for breaking Regulation Z is double the amount of the finance charge, plus court costs, attorney fees, and any actual damages, up to a maximum of $1,000. Willful violation is a misdemeanor punishable by up to $5,000 in fines, one year in prison, or both. Regulation Z is regulated by the Federal Trade Commission.

One of a number of current consumer protection statutes that require lenders to fully disclose the rates of interest, additional charges, and the terms and conditions of each loan in writing and plainly stated.

A federal legislation mandating lenders to offer estimates of total finance charges and annual percentage rate to home loan applicants (APR).

Tsunami damage

When a tide comes in, it can cause damage. Flood-prone property owners must get insurance to cover damage from floods and tsunamis, since the federal government no longer pays for all of this kind of damage. Lending institutions now need flood insurance in order to give a mortgage loan to a building or its apartments that are in an area that is known to flood or be vulnerable to a tsunami. So, if the condo association doesn't get enough insurance to meet the new federal requirements, an owner who wants to sell a beachfront resort condo might have trouble doing so.

Turnaround property

A property that can be made to return a positive cash flow with imaginative planning and hard effort.

Turnkey

A project in which the owner or builder prepares a property so that the occupier can move in and start doing business right away.

Turnkey project

A term in development that means the whole building process, from breaking ground to finishing the building. The only thing left to do is "hand over the keys" to the buyer. Some government housing projects are "turnkey," which means that a private developer builds a neighborhood and then the government buys the whole thing to use as low-income family housing. A "package deal," which usually includes financing, is not the same as a "turnkey job."

In a turnkey lease, the landlord agrees to give the rented space to the tenant in a state where it is ready to be used.

A type of development in which a developer completes a project and then sells it to a buyer.

Turnover

1. The number of times real estate is bought and sold in a certain area.

2. How often people move in and out of an apartment building. When there is a lot of turnover, the landlord has to pay more.

Glossary Index

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