RE Finance Unit 1: Nature & Cycle of RE Finance Flashcards
Allodial System
Land ownership free and clear of any rent or service due the government
Bill of Sale
The document by which personal property ownership is transferred
Bundle of Rights
All of the ownership rights in real estate
Chattel
Personal Property
Collateral
Property, real or personal, pledged as security to back up a promise
Community Property
All property acquired by either spouse during marriage and owned equally, except that received by gift, devise, or descent.
Concurrent Ownership
Real estate ownership by more than one party, such as partnership, tenants in common, community property, and joint tenancy.
Condemnation
Eminent Domain
Condominium
Fee simple ownership of an apartment or a unit, generally in a multiunit building, plus an undivided interest in the common elements
Consumer Financial Protection Bureau (CFPB)
Its mission is to make markets for consumer financial products and services (i.e., mortgages, credit cards, and other consumer financial products) work for Americans.
Cycle
A period of time within which the economic ups and downs of business or real estate takes place.
Deed
A document used to transfer ownership of real property.
Deed of Trust
A financing instrument in which the borrower/trustor conveys title of the collateral to a trustee to be held in trust for the beneficiary/lender. When the loan is repaid, title is reconveyed to the trustor. If a default occurs, the trustee exercises the power of sale on behalf of the beneficiary.
Deregulation
The removal of regulations or restrictions, especially in a particular industry.
Disintermediation
Rapid withdrawal of money from bank accounts.
Dodd-Frank Wall Street Reform and Consumer Protection Act
Its purpose is to promote the financial stability of the United States by improving accountability and transparency in the financial system.
English Common Law
Established allodial system of real property ownership
Eminent Domain
The government’s sovereign power of condemnation over private property for the benefit of the community; an example of police power.
Equitable Title
Pertains to the rights of a less-than-fee-simple owner to occupy, lease, or sell the subject property.
Fannie Mae
Provides secondary mortgage market.
Fee Simple Absolute
The best title one can obtain. Complete ownership of real estate.
Freddie Mac
Provides secondary mortgage market
Freehold Estate
The best title one can obtain. Complete ownership of real estate.
Ginnie Mae
Government National Mortgage Association (GNMA); created in 1968 to take over the special assistance and liquidation functions of Fannie Mae; Participates in the secondary market through its mortgage-backed securities pools.
Hereditaments
Things capable of being inherited
Hypothecation
The pledge of real estate as security without surrendering possession of the property
Joint Tenancy
Realty ownership entity with automatic survivorship
Land Contract
Real property sales contract
Leasehold Estate
An estate for a fixed length of time, established when a landlord gives up possession of real estate to a tenant; the tenant has an equitable interest in the property, defined by the terms of a lease.
Legal Title
Title that can be documented and is available through public records. Such title grants rights to the owner to exercise various types of rights on the property such as easement rights, development rights, possession rights, selling rights, exclusive use, etc.
Leverage
Using someone els’s money for the purchase of property
Lien
A legal claim against property as security for a debt
Mortgage
A conditional transfer or pledge of real property as security for the payment of a debt; the document used to create a mortgage lien
Partnerships
Two or more persons or entities joined together to own real property
Personal Property
Movable property that does not fit the definition of realty
Police Power
The government’s authority to regulate the use of real estate
Primary Market
Where loans are originated by local lenders to be sold to the secondary market
Property
Anything that can be controlled and owned
Ranchos
Land grants for grazing or farming issued by the King of Spain to political or military agencies in California
Real Property
A portion of the earth’s surface extending downward to the center of the earth and upward into space, including all things permanently attached thereto by nature or man and all legal rights therein.
Roman Civil Law
Early private property ownership codes enforced on California owners by the Spanish rulers
SAFE Act
The SAFE Act requires any person who accepts a consumer mortgage application or arranges a consumer mortgage secured by a one-to-four unit residential property to:
- Register with the public database of mortgage loan originators, the Nationwide Mortgage Licensing System (NMLS)
and/or
- obtain a state-issued mortgage loan originator (MLO) license or endorsement
Savings Association
Established primarily as savings institutions, not commercial banks. Participate heavily in residential real estate lending
Secondary Mortgage Market
Source to which originators of loans may sell them, freeing funds for continued lending; aids in distributing mortgage funds on a national level from money-rich to money-poor areas
Security Agreement
Financing contract for personal property
Tax Reform Act of 1986 (TRA ‘86)
Sweeping revisions of income tax laws, lowering tax rates but eliminating many tax shelters
Tax Relief Act of 1987
Provides broad exemptions from capital gains taxes on the profits from the sale of personal residences.
Tenants in Common
Undivided ownership interests in real estate that are inheritable
Thrifts
Name for savings institutions
Time-Shares
Interval ownership of real estate, such as the right to use a resort condominium for two weeks per year
Trade-Fixture
A commercial tenant’s improvement to leased property that remains the tenant’s personal property no matter how permanently it is attached
Zoning
The right of a community, under its police power, to dictate the use of property within it boundaries.
