Unit 18: Leases

Question 1

acutal eviction

Answer 1

the legal process that results in a tenant’s being physically removed from leased premises.

Question 2

assignment

Answer 2

the transfer in writing of interest in a bond, mortgage, lease, or other instruments.

Question 3

constructive eviction

Answer 3

Actions of a landlord that so materially disturb or impair a tenant’s enjoyment of the leased premises that the tenant is effectively forced to move out and terminate the lease without liability for any further rent

Question 4

estate (tenancy) at sufferance

Answer 4

The tenancy of a lessee who lawfully comes into possession of a landlord’s real estate but who continues to occupy the premises improperly after the lease rights have expired

Question 5

estate (tenancy) at will

Answer 5

an estate that gives the lessee the right to possession until the estate is terminated by either party; the term of this estate is indefinite

Question 6

estate (tenancy) for years

Answer 6

also known as estate for term. An estate for years is an interest for a certain exact period of time in property leased for a specified consideration.

Question 7

estate (tenancy) fro period to period

Answer 7

An interest in leased property that continues from period to perio d- week to week, month to month, or year to year

Question 8

gross lease

Answer 8

a lease of property according to which a landlord pays all property charges regularly incurred through ownership, such as repairs, taxes, insurance and operating expenses. Most residential leases are gross leases

Question 9

ground lease

Answer 9

a lease of land only, on which the tenant usually owns a building or is required to build as specified in the lease. Such leases ar usually long-term net leases; the tenant’s rights and obligations continue until the lease expires or is terminated through default

Question 10

holdover tenancy

Answer 10

a tenancy in which a lessee retains possession of leased property after the lease has expired and the landlord, by continuing to accept rent, agrees to the tenant’s continued occupancy as defined by state law.

Question 11

lease

Answer 11

a written or oral contract between a landlord (the lessor) and a tenant (the lessee) that transfers the right to exclusive possession and use of the landlord’s real property to the lessee for a specified period of time and for a stated consideration (rent). By state law, leases for longer than a certain period of time (generally one year) must be in writing to be enforcable.

Question 12

lease purchase

Answer 12

the purchase of real property, the consummation of which is preceded by a lease, usually long term, that is typically done for tax or financing puposes

Question 13

leasehold estate

Answer 13

a tenant’s right to occupy real estate during the term of a lease, generally considered a personal property interest, although a long-term lease may be eligible for treatment as real property for financing purposes.

Question 14

lessee

Answer 14

tenant

Question 15

lessor

Answer 15

landlord

Question 16

month-to-month tenancy

Answer 16

A period of tenancy under which the tenant rents for one month at a time. In the absence of a rental agreement (oral or written) a tenancy is generally considered to be month-to-month

Question 17

net lease

Answer 17

A lease requiring the tenant to pay not only rent but also costs incurred in maintaining the property including taxes, insurance, utilities, and repairs

Question 18

nondisturbance clause

Answer 18

a mortgage clause stating that the mortgagee agrees not to terminate the tenancies of the lessees in the event the mortgage forecloses on the mortgagor-lessor’s building

Question 19

percentage lease

Answer 19

a lease, commonly used for commercial property, who rental is based on the tenant’s gross sales at the premises; it usually stipulates a base monthly rental plus a percentage of any gross sales above a certain amount

Question 20

purchase option

Answer 20

the right given by a lease to the tenant to purchase the property at a predetermined price within a certain period, possibly the lease term.

Question 21

renewal option

Answer 21

a clause in a lease that grants the lessee the privilege of renewing the lease

Question 22

rent

Answer 22

a fixed, periodic payment made by a tenant of a property to the owner for possession and use, usually by prior agreement of the parties.

Question 23

reversionary right

Answer 23

the return of the rights of possession and quiet enjoyment to the lessor at the expiration of the lease

Question 24

right of first refusal

Answer 24

a clause allowing the tenant the opportunity to buy the property before the owner accepts an offer from another party

Question 25

sale-and-leaseback

Answer 25

a transaction in which the owner sells improved property and, as part of the same transaction, signs a long-term lease to remain in possession of the premesis.

Question 26

security deposit

Answer 26

a payment by a tenant, held by the landlord during the lease term and kept (wholly or partially) on default or on the destruction of the premises by a tenant.

Question 27

sublease

Answer 27

also known as subletting. Subletting is the leasing of premises by a lessee to a third party for part of the lessee’s remaining term. See also: Assignment