Exam Prep Flashcards
Offer
A proposal freely made by one party to another
contract requirements, mutual assent
Obsolescence
A loss in property value due to outmoded functional or economic changes
(depreciation, appraisal, curable, incurable)
Open End Loan
A loan in which draws are available up to a set limit
draws, obligatory advances
Open Listing
A listing between the principal and numerous agents simultaneously
(listing agreement, procuring cause, unilateral contract)
Option
A future right of a party to buy or lease property at a specific price
(bilateral contract, first right of refusal, unilateral contract)
Optionee
The party who receives an option
option
Optionor
The party who gives an option
option
Orientation
Placing a house on property so that it brings the best advantages to the occupant
(setback)
Origination Fee
A fee charged by the lender for processing a new loan
mortgage
Owner’s Policy
A title insurance purchased for the benefit of the buyer in a real estate transaction
(title insurance)
P.I.T.I.
Principal, Interest, Taxes, Insurance
budget payment
Paper
A lending term referring to a note and a security instrument
primary lender, secondary market
Partnership
Consists of two or more people conducting business as co-owners
(general / limited partnership, syndication)
Percolation Test
A soil test which determines drainage and absorption
construction
Perpetuity
which no end - to go on forever
corporation, legal person
Personal Property
Items that are tangible and movable, not real property
fixture, tangible, trade fixture
Personal Representative
An appointed individual authorized to settle and estate
administrator, executor, intestate
Phase 1 Audit
An evaluation of a site to determine environmental problems. Phase 1 inspects public records and adjacent properties
(commercial)
Phase 2 Audit
An environmental survey that requires soil sampling to determine the level of hazardous substances
(commercial)
Physical Depreciation
A loss of value due to the physical deterioration of the property
(depreciation, appraisal, curable, incurable)
Plat Map
A recorded map that shows the smaller parcels in a subdivision by book and page number
(legal description, lot block subdivision)
Point of Beginning
The starting point at one corner of the surveyed land in a metes and bounds description
(bench mark, meets and bounds, monument)
Police Power
The right of the government to enact laws for the protection, health, and welfare of the general public
(enabling legislation, zoning)
Power of Attorney
A written document that authorizes one party to act for another
(agent, attorney-in-fact, general or limited agent)
Preliminary Title Report
A document provided in escrow which shows all claims affecting title
(abstract of title, schedule “A” and “B”)
Payment Penalty
An additional charge for paying off a debt before its time
“or more” clause
Primary Lenders
Those lenders that originate loans, thereby creating “paper”
paper, secondary market
Principal
The party represented in an agency relationship
agency, agent, client, fiduciary
Principal Balance
The original loan amount. The current remaining unpaid debt on the loan
(interest)
Private Mortgage Insurance PMI
A form of insurance required on conventional loans that exceed a loan value - ration of 80%
(MIP, LTV ratio)
Probate
A court action to prove the validity of a will, or settle an estate
(administrator, executor, intestate, testate, will)
Procuring Cause
The actions of a broker that bring about the desired result
commission
Progression
Lesser value properties will be increased by locating near more expensive properties
(regression)
Promissory Note
A written promise by a person to pay a debt under terms specified in the note
(deed of trust, mortgage, note)
Property Tax
Tax levied by the local governments to meet the needs of the community - Real estate taxes are primary liens and are usually based on Ad Valorem
(ad valorem)
Proration
To divide or assess proportionality between buyer and seller the obligations that have been paid or due. The close of escrow is the buyer’s day
(title, escrow)
Public Report
A report required before a subdivision can be offered for sale or lease - Discloses all facts about the property for the buyer’s protection
(subdivision)
Objective Value
The value in the object itself
subjective value, value
Puffing the Goods
Over exaggeration of one’s opinion
misrepresentation, embellishment
Punitive Damages
Damages extending far beyond the actual loss
liquidated damages
Purchase Money Mortgage
A mortgage given by a buyer as part of the consideration for the price - one usually carried by the seller in a credit transaction
(mortgage, soft money mortgage)
Pur Autre Vie
A life estate that is based on a life of an other
life estate
(per o -tra vee - French meaning “for another’s life”)
Pro Rata Share
Per front foot or a specific portion allocated to a property owner - usually used in an assessment calculation
(assessment)
Prior Appropriation
Water rights that are based on a government permit system. The rights to use the water in a river or stream adjacent to the land
(riparian rights)
Positive Leasehold
Economic rent exceeds the contract rent
contract rent, economic rent, leasehold, negative leasehold
Plottage
The process of combining two or more parcels of land so that together they have a greater total value
(assemblage, contribution, subdivision)
Plessy V Ferguson
A court case that established the doctrine of “Separate but Equal”
(brown vs board of education)
Plate
A horizontal piece that supports the trusses or rafters of a roof
(construction)
Percentage Lease
A rental payment which is based on a percentage of the gross sales
(gross lease, net lease, commercial)
Patent Deed
The instrument used by a Sovereign Power to transfer real property to an individual
(cession deed, deed)
Partiton
The dividing of co-ownership in property so that each holds his or her interest sole and separate. A legal process terminating a co-tenancy
(tenancy in common)
Parol Evidence Rule
A rule stating that oral evidence may not be added to a written agreement
(contract requirements, equal dignities rule)
Ostensible Authority
Authority arising when a principal has intentionally caused a third party to rely upon the apparent authority even though it has not been given
*An association of two parties that would lead a reasonable person to conclude that one party is acting as an agent for the other party.
(agency by ratification, implied agency)
“One More” Clause
A clause in a note or security device that indicates no pre-payment penalty. The debt can be paid in full at any time by the debtor
(prepayment penalty)
Obligatory Advances
An open-ended loan has lien priority as per recondition regardless of future draws
(construction loan, draws, open ended loan)
Qualified Mortgage
a home loan that meets certain standards set forth by the federal government. The Loan is presumed to have met the “ability to repay” rule per the Dodd-Frank Act
(ability to repay rule, Dodd-Frank Act)
Quantity Survey Method
An appraisal method which takes into account all the component parts along with the installation costs.
(const approach, unit-in-place method)
Quarter Section
One fourth of a township that contains 160 acres
Quiet Title Suit
A court action to remove a cloud on title and create marketable title
(cloud on title)
Quit Claim Deed
A deed which releases any or all interest one may have in real property
(deed, quiet title suit)
R.E.I.T.
Real Estate Investment Trust - A corporation white a minimum of 100 investors and 95% of the profit passes to the shareholder
R.E.S.P.A.
Real Estate Settlement Procedures Act. Requires disclosures of closing costs to buyers and sellers. Required within 72 hours of a loan application - Required on residential loans up to a 4-plex
(regulation Z)
Radon Gas
A colorless, odorless gas from decaying minerals in high concentrations that is knowns to cause lung cancer
(construction)
Rafters
Sloping boards that extend from the top of the exterior wall to the ridge board
(construction, ridge board)
Range Lines
Survey lines that are six miles apart and run parallel to the principal meridian
(government rectangular survey system, tier line, township)
Rate of Return
ROR - The percentage earned on an investment
cash on cash return
Realtor
A term used to identify members of the national association of realtors
Recapture
The amount of depreciation taken for tax purposes is now taxable
Recording
Entering a document in the Recorder’s office at the prescribed county
(chain of title, constructive notice)
Recovery Fund
A state fund that monetarily reimburses the aggrieved public due to dishonest acts of the licensee
(aggrieved, subrogation)
Redemption Period
The statutory period of time the borrower has to redeem in a mortgage foreclosure, usually six months after the sheriff sale
(mortgage, reinstatement period)
Redlining
An illegal practice that restrict loans by geographic area
blockbusting, federal fair housing, steering
Reduction Certificate
A document issued by lender for buyer’s benefit stating the existing loan balance
(assumption of mortgage, estoppel certificate)
Regression
An appraisal principle which states that the worth of an expensive property is lessened by the presence of less expensive properties
(progression)
Regulation Z
Truth in lending laws apply to residential financing - full disclosure of all financing charges. Interest rates are expressed in A.P.R.
(apr, respa)
Reinstatement Period
The period of time the truster has to make all the delinquent payments prior to the trustee foreclosure sale in a Deed of Trust
(trustee’s deed, redemption)
Release Clause
A clause in a blanket security instrument that allows for individual release of secured lots for the lien
(blanket mortgage)
Reliction
The gaining of land due to the subsidence of water of a non-navigable stream
(accretion, non-navigable stream)
Relief Map
A map indicating by lines, shading, or color, different elevations of land
(contour map)
Remainder (Vested)
One who is entitled to an estate upon termination of a life estate
(contingent remainder, reversionary estate)
Remainder Estate
A future interest in real estate after a life estate
contingent remainder, vested remainder
Rent
Consideration given for the use of property
contract rent, economic rent
Replacement Cost
The cost of replacing a property using today’s materials
cost approach, reproduction cost
Reproduction Cost
The cost of rebuilding an exact replica
cost approach, replacement cost
Reservations
Rights retained by the grantor when property is conveyed. Frequently called Deed Restrictions
(deed restrictions)
Residual Value
The value that remains after a property’s economic life
economic life, salvage value
Reversionary Estate
An estate returned to the original grantor. Usually at the end of a life estate or lease
(remainder estate)
Ridge Board
A large horizontal beam placed at the peak of a roof to which rafters are attached
(rafters, construction)
Right of Way
The right one has to cross the land of another
easement, ingress and egress
Rights of Survivorship
An incident whereby the surviving joint tenant automatically receives the interest and rights of the deceased joint tenant
(joint tenancy, tenancy by entireties)
Riparian Rights
The property owner’s right to enjoy or use the water abutting his land
(reliction)
Rod
A unit of measurement that consist of 16.5 feet
Run With the Land
A right that remains with the land even upon transfer such as an easement appurtenant
(appurtenant)
S Corporation
A regular corporation that has the elected to be treated as a partnership for tax purposes - restriction do apply
(corporation, partnership)
Sale and Leaseback
The selling of property to an investor while at the same time leasing it back for a specified period
(net lease)
Salvage Value
The estimated economic value of an asset at the end if its economic life
(depreciation, appraisal, residual value)
Sandwich Lease
A lease in which a lease rents the property to another party, putting himself in the middle position
(assignment, sublease)
Satisfaction of Judgement
A document which, when recorded, releases the judgment lien
judgment lien
Satisfaction of Mortgage
A document stating that the mortgage debt has been paid in full
(deed of reconveyance, defeasance clause)
Schedule “A”
Description page of a preliminary title report and the type of insurance being issued
(schedule “B”)
Schedule “B”
The portion of a title insurance policy that lists the exceptions to coverage by the policy
(schedule “A”, title insurance)
Scheduled Gross Income
The maximum potential income a property can generate before any deductions or expenses
(adjusted gross income)
Seasoned Loan
A loan repayment record that is consistent
Secondary Market
Agencies which purchase mortgages from primary lenders thereby creating funds for additional mortgages
(FHLMC, FNMA, GNMA, primary lenders)
Section
In the government rectangular survey system, a parcel of land one mile square containing 640 acres
(quarter section, township)
Security Agreement
Under the U.C.C., a document used to secure personal property
(chattel mortgage, financing statement, uniform Commerical code)
Servient Estate
The land against which an easement has been granted for the benefit of the dominant estate
(dominant estate, easement appurtenant)
Setback
The distance a structure must be from a given point such as a street or an easement
(variance, zoning)
Settlement Sheet
A full disclosure of all charges and disbursements in a real estate transaction
proration, regulation Z)
Sheathing
The inner covering of boards on the roof or outside walls of a frame house
(construction)
Sheriff’s Deed
Deed given by the Sheriff at the completion of a mortgage foreclosure sale
(bargain and sale deed, foreclosure, involuntary alienation)
Sherman Antitrust Act
Prohibits certain business activities that are ani-competitive such as price fixing
Short Term Capital Gain
The gain on the sale of a capital asset usually held for 12 months or less
(Asset, capital gain)
Sill
The lowest horizontal board in a window or door frame
mud sill, construction
Simple Interest
Interest paid only on the unpaid principal balance
command interest, interest, principal
Sinking Fund
A fund made up of sums of money set aside to pay a debt or meet depreciation expenses
Situs
Land has an economic value due to its location
law of situs
Soft Money Mortgage
A mortgage given to finance a specified property. Usually a carry back between the seller and buyer that reflects an extension of credit
(hard money mortgage, mortgage, purchase money mortgage)
Sole and Separate
Owned by one person - Severalty
concurrent tenancy
Special Service Properties
Properties such as churches and theaters having a single purpose and little demand
(cost approach)
Special Warranty Deed
A conveying deed in which the grantor guarantees the title of real property for only as long as he has owned it
(general warranty deed)
Specific Lien
A lien which encumbers only a certain parcel of property
lien, general lien
Specific Performance Suit
A court action that forces a party to comply with the contract as promised
(breach of contract)
Square Foot Method
Estimating the value of a building using the exterior measurements
(cost approach, replacement cost, reproduction cost)
Statute of Frauds
A law that states all real estate contracts must be in writing to be enforceable (except a lease for one year or less)
(contract requirements, equal dignities rule, parol evidence rule)
Statute of Limitations
A time limit during which a legal action must take place
laches
Statutory Law
Laws passed by a legislative body
Statutory Lien
A lien placed against property by operation of law
assessment, involuntary lien, judgment lien, property tax
Statutory Period of Redemption
The mortgagor’s last chance to redeem the property after the foreclosure sale by paying the entire debt
(acceleration, certificate of sale, equitable period of redemption)
Steering
An illegal practice that guide home buyers to a particular are of town
(blockbusting, federal fair housing, redlining)
Stepped-Up Basis
The basis of the property acquired from a decedent will equal the value at the time of death
(basis)
Straight Line Depreciation
A method of depreciation in which the asset is written off evenly over its useful life
(depreciation, tax)
Straight Note
A note that calls for payments of interest only followed by a balloon payment of the principal
(interest only, term only)
Straw Man
One who acts for another for the purpose of concealing the other’s identity - or a third party used to create a Joint Tenancy
(unities fo joint tenancy)
Stud
The vertical supports in a wall of frame house
construction, joists
Sub-Surface Rights
The right to use the land below ground level to the center of the earth
(mineral rights)
Subagent
A licensee who represents a designated broker but does not have the direct contractual obligation to buyer or seller
(agent, cooperating broker)
Subdivision
A large tract that has been divided into smaller parcels for sale. Six or more parcels improved or unimproved any of which are less than 36 acres each
(plat map, public report)
Subject To
A buyer takes over real property but is not liable for the mortgage on the property
(assumption of mortgage, novation)
Subjective Value
Value that is created in the minds of people
objective value
Sublease
A re-renting of space held under a lease to a third party
assignment, sandwich lease
Subordination Clause
A clause in which the lien holder agrees to be secondary to a future encumbrance
(junior mortgage)
Subpoena
A written order directing a person to appear in court or produce documents
Subrogation
The substitution of a claim for monies paid
Substitution
An appraisal concept that states that the value of one property is set by the cost of buying an equally desirable property
(conformity, regression)
Summation Approach
Also called the cost approach in appraising
cost approach
Superfund
Known as S.E.R.C.L.A. - Comprehensive Environmental Response Compensation and Liability Act. Purpose is to focus on cleanup of hazardous substances in given areas as so determined by the E.P.A.
(E.P.A.)
Surety Bond
A private company that promises to perform if the bonded party fails
Surface Waters
The classification of water that includes all natural streams, lakes or ponds
(ground water, prior appropriation, riparian rights)
Survey
Determining the location of land by measuring the determined lines and angles
(mets and bounds, plat mat)
Sweat Equity
An increase in value to real property due to the owner’s labor
(equity)
Syndication
A combination of parties joined together to undertake an investment as an entity
(general partnership, limited partnership)
Tacking
Adding successive time periods of continuous usage
adverse possession, easement by prescription
Take Out Loan
A permanent financing arrangement that pays off a construction loan
(open end loan)
Tangible
Personal property that can be moved
intangible
Tax Deferment
A real estate investment that postpones the paying of taxes
exchanging, installment sale
Tax Rate
The rate applied to the assessed value of property to establish a tax
(special assessment, dollar rate, mill rate)
Tax Shelter
Using investments to postpone the payment of income tax
depreciation tax
Tenancy
A mode of holding tittle to real property
concurrent tenancy, sole and separate
Tenancy at Sufferance
The quality of the tenancy one that has if he remains on the property after the lease has expired. Least possible state in land
(actual eviction, holdover tenant)
Tenancy at Will
A lease that can be terminated by either party at their will
tenancy at sufferance, tenancy for years
Tenancy by Entireties
A method of joint ownership whereby the remaining portion of the property automatically passes to the surviving spouse
(going tenancy, rights of survivorship)
Tenancy for Period to Period
A lease that in automatically renewed for the same like time
tenancy
Tenancy for Years
Any lease for a specified period of time
leasehold, tenancy at sufferance, tenancy at will
Tenancy in Common
Co-ownership in property. Interests need not be equal and no right of survivorship exists
(concurrent tenancy, partition, undivided interest)
Tenancy in Severalty
Owned buy one person. Sole and Separate
concurrent tenancy
Tenant
One who occupies or uses property under a lease
lessee
Tenements
Real property and those rights that remain, and are attached to the land
(appurtenant)
Term Loan
A mortgage which must be paid off in a specified period of time. Interest only
(amortization, balloon payment)
Testate
Having died with a will
executor, intestate, will
Tier Line
Survey lines that are six miles apart and run parallel to the principal baseline
(base line, principal, range lines, township)
Time is of the Essence
All obligations set forth in the contract must be met on or before the date specified
(close of escrow)
Title
The legal proof of real property ownership
chain of title, constructive notice
Title Insurance
Insurance in a real estate transaction that protects the parties against title defects
(lender’s policy, owner’s policy, schedule “A” and “B”)
Title Theory State
A lender of cash may hold legal title to property
lien theory state
Torrens Sytem
A registration system that accurately determines ownership and claims to real property
(evidence of title)
Tort
A wrongful act against a party in which civil action can be brought
(lis pendens)
Townhouse
Individual ownership of a specific structure plus interest in the common area - ownership includes air and subsurface rights
(condominium)
Township
A parcel of land that is six miles square and contains 36 sections
(section)
Trade Fixture
Items used in business that appear to be real property but remain personal property
(fixture)
Treasurer’s Deed
The deed one receives as a result of tax foreclosure sale
bargain and sale deed, certificate of purchase, involuntary alienation
Trust Account
A broker’s bank account used specifically for earnest money or rental deposits
(commingling, conversion, earnest money)
Trustee
One who holds bare-naked title in a deed of trust for the beneficiary until the entire debt is paid
(beneficiary, deed of trust, trustor)
Trustee’s Deed
A deed given by the trustee to convey property out of trust
bargain and sale deed
Trustor
The party who signs the trust deed. The borrower in a deed of trust
(beneficiary, deed of trust, trustee)
Truth-In-Lending
Covered by reg Z - Borrowers are to be given truthful and complete information as it relates to the cost of credit
(reg Z)
Undivided Interest
Co-ownership whereby each party has the right to use the entire property
(community property, concurrent tenancy, joint tenancy, tenancy in common)
Undue Influence
Taking unfair advantage of one’s position in acquiring an agreement
(duress, penance, mutual assent)
Unearned Increment
An increase of property value due to external causes such as inflation
(appreciation, sweat equity)
Unenforceable Contract
A contact that appears to be valid but neither party can be legally forced to perform
(parol evidence rule, valid, void, voidable)
Uniform Commerical Code
A code of law that regulates the security used in personal property transactions
(bulk transfer, financing statements, security agreement)
Unilateral Contract
A contract that is binding only to one party
bilateral contract, first right of refusal, option
Unit-In-Place Method
An estimate of value that computes each unit times the number of units in a given building
(cost approach)
Unities of Joint Tenancy
Time, Title, Interest, Possession
Universal Agent
One authorized to act for another in every and all actions, such as a guardian
(general agent, limited agent)
Useful Life
The period of time a property will be useful for its intended purpose
(economic life)
Usury
Charging a higher rate of interest that the law allows
interest
V.A. Guarantee
V.A. will guarantee to the lender of funds a specific amount in the case of default
(certificate of eligibility, VA guarantee)
Valid
A contract that contains all essential legal requirements and is enforceable though a court of law
(contract requirements, void, voidable)
Valuable Consideration
Something of monetary value given in exchange of rate conveyance of real property
(consideration)
Value
The amount of consideration an item can command: also the present worth of future benefits
(worth)
Value (Elements Of)
Demand, utility, scarcity, transferability
objective value, subjective value
Variable Rate Mortgage
Demand, utility, scarcity, transferability
Lender may adjust the interest on a loan based upon an index
(flexible payments, index lease, margin)
Variance
Permission obtained to act in a way that is contrary to current zoning ordinances
(non-conforming use)
Vendee
The buyer of real estate property under an agreement for sale
(agreement for sale, equitable title, vendor)
Vendor
The seller of real property under an agreement for sale
agreement for sale, equitable title, forfeiture
Void
A contract that never was legal and has no binding effect
valid, voidable, unenforceable
Voidable
A contract that appears to be valid on its face until action is taken to void it
(void, valid, unenforceable contract)
Warranty Forever
The grantor guarantees forever the title conveyed. The warranty is found in a general warranty deed
(general warranty deed, warranty of further assurance)
Warranty of Further Assurance
The grantor promises to deliver all necessary documents in order to convey clear title. This warranty is found in a general warranty deed
(genreal warranty deed, warranty forever)
Wild Deed
An unrecorded document that creates a gap in the chain of title
(chain of title, constructive notice, recording)
Will
A legal testament by which a person disposes of his or her property at the time of death
(formal will, holographic will, nuncupative will, testate)
With Recourse
The seller of a negotiable instrument may be held responsible for its future payments
(without recourse)
Without Recourse
The seller of a negotiable instrument may not be held responsible for its future payments
(with recourse)
Worth
The amount something should sell for in an open and free market
(market value)
Wraparound
Creating a new obligation which consists of all underlying debts plus the sellers equity
(all-inclusive deed of trust)
Wit of Execution
A decree of the court instructing an officer of the court to carry out the judgement
(judgement lien)
Yield
The financial benefits received from an investment
A.P.R., rate of return
Zoning
Local laws that regulate the specific use and character of land
(master plan, police power)
Legal Description (Formal)
A formal description that defines the boundaries of real property. This description is sufficient to locate the property and may be enforced through a court of law
(government rectangular survey system, legal description, metes and bounds, plat map)
Legal Description (Informal)
Identifying a parcel of land by a street address or local terminology
(legal description, metes and bounds, monument)
Legal Life Estate
A non-inheritable right provided by law
community property, curtesy, dower, homestead
Legal Person
A person created by law such as a corporation
corporation, natural person
Legal Rate
The interest rate the court assigns to those documents that have no specified interest rate
(contract rate)
Legal Title
The lawful claim to ownership
Legatee
One who receives money or personal property through a will
bequest, devise, legacy
Lender’s Policy
An extended coverage Title Insurance policy purchased for the lender
(extended coverage policy, owner’s policy)
Less than Freehold
An estate of possession but not ownership - a lease
freehold, leasehold
Lessee
The tenant in a lease
Lessor
A landlord in a lease
Level Payment Mortgage
A repayment plan that includes principal and interest. The total of which is the same amount each payment
(amortization)
Leverage
Using borrowed funds to finance investments with little or no personal cash invested
(loan to value ratio)
License
A personal privilege one has to use the land of another. (Privilege revocable)
(easement)
Lien
A money claim against property
encumbrance, general lien, specific lien
Lien Theory State
States in which the Lender of cash does not hold legal title, but only a lien as security against title
(title theory state)
Life Estate
An interest in property that is limited to the life of the grantee - or the life of some specified person
(contingent remainder, legal life estate, remainder estate, reversionary estate)
Life Tenant
One who possesses a life estate
conventional life estate, remainder (vested)
Like-Kind Property
Property held for an investment when qualifying for a real estate tax deferred exchange
(exchanging)
Limited Agent
An agent having the power to perform only in those areas expressed in a legal document
(agent of necessity, general agent)
Limited Partnership
Parties who contribute capital to an investment and are responsible for the amount invested
(general partnership, partnership)
Liquid Asset
An assed that can easily be converted into cash
asset, frozen asset, leverage
Liquidated Damages
The dollar amount stated in the contract paid to the injured party if a breach occurs. The dollar amount is usually pre-agreed
(aggrieved, breach of contract, forfeiture)
Lis Pendens
Lawsuit pending
attachment, judgment lien
Listing Agreement
A written agreement between a principal and broker to sell or lease property for compensation
(agency, agent, exclusive agency listing, exclusive right to sell, law of agency)
Listing Broker
The agent who acts for the owner of property in either leasing or selling
(agent, fiduciary, principal)
Littoral Land
A property owners right to use the land abutting a lake or ocean
(riparian rights)
Loan to Value Ratio
The amount of loan in relationship to property value
leverage
Long Term Capital Gain
The taxable gain on the sale of a capital asset held for more than the statutory period of time
(asset, capital, capital gain)
Lot Release
Clause in a blanket mortgage to release individual lots
blanket mortgage
Lot, Block, Subdivision
A method of identifying land in a subdivision by referring to a certain lot, block and a recorded plat of that subdivision
(legal description, plat map)
Love and Affection
Consideration that is given to support a gift deed
consideration, valuable consideration
M.I.P.
Mortgage Insurance Premium - Insurance pertaining to an F.H.A. insured loan
(federal housing administration, private mortgage insurance)
Majority
A person who is legally competent according to the minimum age law of that state
(competent party, contract requirements, incompetent party)
Margin
In an adjustable rate loan, the amount added to the index to determine the rate
(variable rate mortgage)
Market Data Approach
An appraisal process that uses comparable to estimate the value of a specified property
(appraisal, comparable, correlation)
Market Price
The price a property actually sells for
floor value, market value
Market Value
The price a property should sell for if enough time is allowed and neither seller nor buyer is under pressure to act
(market price)
Hard Money Mortgage
A mortgage that is given for direct cash
soft money mortgage
Hereditament
The right to will to another personal and real property
incorporeal
High Water Mark
Highest place on shoreline reached by rising water
non-navigable stream
Highest and Best Use
Land usage at the time of an appraisal which would create the highest net return
(appraisal)
Hold Harmless Clause
A contract clause stating one party agrees to protect another form losses
(exculpatory clause, indemnify)
Holder in Due Course
The party who is holding an one for value and has the protection of law for its enforcement
(negotiable instrument, promissory note)
Master Plan
A long-range guide for the orderly growth of a given area
zoning
Mechanic’s Lien
The legal right to a contractor to place a lien on real property for work or materials rendered
(inchoate lien, notice of completion, satisfaction of mortgage)
Megalopolis
A continuous series of ongoing cities all heavily populated
Megan’s Law
A law requiring sex offender registration and notification
Menace
The threat of force in acquiring an agreement
duress, mutual agreement, undue influence, voidable
Meridian (Principal)
In the government rectangular survey system, a reference line that runs North and South and crosses the principal baseline
(base line, government rectangular survey system)
Metes and Bounds
A legal description of land that uses an identifiable starting point to define the boundaries of real property
(monument, point of beginning)
Mill Rate
A property tax rate that is equivalent to one tent of one unit. Expressed as .001 or 1/1000 of a dollar
(dollar rate)
Mineral Rights
Sub-surface rights to all underground assets
air rights, sub-surface rights
Misrepresentation
To represent falsely or to give untrue statements
fraud, puffing the goods
Monolithic Slab
A foundation formed by a single pouring of concrete
foundation, construction
Monument
A natural object that is given as part of a survey
bench mark, legal description, metes and bounds
Moral Turpitude
An act of conduct that is base, vile, or depraved
Moratorium
A temporary halting of payments due on a debt
Mortgage
A security document given to insure the payments of a note
mortgagee, mortgagor, satisfaction of mortgage
