Real Estate Vocab Flashcards
Accelerated Bi-weekly Payments
Constant payments that are equal to 1/2 of the regular monthly payments and are paid every 2 weeks.
-Not twice a month but every 2 weeks
-26 total payments a year (making an additional payment a year*
-This can help you pay off your mortgage faster and save on interest.
Acceleration Clause
A term in a loan agreement contract that allows the lender to demand the full repayment of the loan if certain conditions are met, such as missed payments or a default on the loan. This means that instead of continuing with regular payments, the borrower must pay off the remaining balance in a lump sum.
- Acceleration clauses are most common in mortgage loans and help to mitigate the risk of default for the lender.
Accessibility
The level of ease with which customers can reach the property.
- The value of a property is heavily influenced by its accessibility.
- “As mentioned above, accessibility design in buildings and public spaces can include the installation of ramps and lifts for people with mobility problems” (Use of the word in a sentence)
Accounting
The systematic recording, reporting, and analysis of financial transactions.
- understanding real estate accounting is essential for running a successful business. Without proper accounting, real estate professionals may struggle to manage their finances effectively, leading to financial difficulties and potential loss of business.
Accrual Basis
Accounting procedure which recognizes revenue at the time it is earned, as opposed to when it is actually received. This method ties in with the Revenue Principle. Contrast with Cash Basis.
- Example: “you would record the Rs10,000 revenue in December when the project was completed and earned, even though the money wasn’t received until the following year. This means that your December financial statements would show $10,000 in revenue for the project instead of the following year.”
Actual Value
Actual value is determined by the assessor. This value, in thousands of dollars, when multiply by the tax rate equals the amount of real property taxes payable.
- To find out how much property tax you need to pay, you take the actual value of your property and multiply it by the local tax rate. For example, if your property has an actual value of $300,000 and the tax rate is 1% then you would have 3,000$ in property taxes
Adjacent
In law, implies that two or more properties are not widely separated, though they may not physically touch.
- Example: If you have two pieces of land that are next to each other, separated by a road or another property, they are considered adjacent. This idea is important in various legal contexts, such as zoning, property rights, or easements, where the proximity of properties affects their use or value.
Adjoining
In law, implies that two properties are contiguous or touching each other as opposed to adjacent to one another.
- A townhouse would be considered adjoining.
Adjustment Date
Date agreed to by both parties to a real property transaction for the adjustment of the property taxes, rent, interest, and other items.
- Example: If a buyer purchases a property on June 15, the adjustment date might be set for June 1. On this date, the seller would be responsible for the expenses incurred up until June 1, and the buyer would be responsible for expenses from June 1 onward. If property taxes are due annually and total $1,200, the buyer would owe for the days after June 1, while the seller would cover the portion before that date.
Advisory Planning Commission
A committee made up of volunteer members of the public who advice the local government on planning and land use related matters.
- That input is given as advice, and does not form policy or set direction for the local government.
Affidavit
A written statement of facts, the contents of which are sworn under oath to be true by the person making a statement. An affidavit is sometimes used in court proceedings as evidence in place of oral testimony.
- Affidavits may be used to declare property ownership, confirm the accuracy of a property description, or disclose potential issues with the property. They provide a legal way to present facts and claims, often used to facilitate transactions or resolve disputes in real estate.
Agency
A relationship in which one person (the agent) is granted the authority to represent and act for another person (the principal) in dealings with others,
- Example: A real estate agent acts as the agent of a seller or a buyer in a real estate transaction, and owes fiduciary duties to their client.
Agency Contract
An agreement under which the agent is given authority to perform actions on behalf of the principal, in return for remuneration
- Example: A homeowner (the principal) hires a real estate agent (the agent) to sell their property. The agency contract outlines the agent’s responsibilities, including marketing the home, conducting open houses, and negotiating offers on behalf of the homeowner.
Agency by Implication (Implied Agency)
An agency relationship that is established by the actions and conduct of the parties, rather than by express contract between the principal and agent.
- Example: Greg has a real estate license. He asks his friend Mark to help him find a home. If Mark continues to work with Greg they may enter an implied agency because he is representing Greg to find the desired home successfully. Since there is no written agreement, the situation becomes implied.
Agent
At common law, an agent is any person who contracts to act for or on behalf of another, who in turn, is known as the principal. The common law principles of agency apply to all levels of licensee, including brokerages, managing brokers, associate brokers, and representatives, as defined by the Real Estate Service Act, when they are acting on behalf of a vendor or purchaser.
- A real estate agent usually works for commission, a set percentage of the final sale price.
Agreement for Sale
A contract by which the owner of land (vendor) agrees to sell land or another (purchaser) who agrees to purchase it. The purchaser’s interest is registered in the Land Title Office as a charge against the vendor certificate of title. While not all agreements for sale require installments, many do, making it a common feature of such agreements.
- A preliminary agreement between the buyer and the seller of a property. It outlines the terms and conditions under which the property will be sold, and it serves as a legally binding contract that safeguards the interests of both parties during the transaction’s intermediate stages.
Airspace
Airspace refers to the legal concept that a person who owns land also owns as much of the airspace above the land as he or she can effectively use
- Historically, one owned the airspace above a parcel of land “to the heavens” but that has since changed.
Amendment
Change to an existing regulation, such as zoning bylaw, authorized by a majority vote of an elected council or board
- Example: Contract amendments are documents used to make a mutually agreed-upon change to a preexisting contract.
