Vocab Flashcards
an area of land or a building has a common boundary with another.
Abutting
a contract provision that allows a lender to require a borrower to repay all of an outstanding loan if payments are not being made or there is a breach of contract.
Acceleration clause
the slow process of growth or acquisition of land, typically when soil is deposited by the natural action of water. Long term accretion can actually increase the size of a property.
Accretion
If you or your client sees a home listing with just “active” as their status, this indicates that the property is available for sale.
Active property
an intentional misrepresentation of fact; or in plain terms lying.
Actual fraud
The Latin phrase that means “according to value.”
Ad valorem
These mortgages have a flexible interest rate. They have a fixed period during which the initial interest rate remains the same, after that the interest rate adjusts at a pre-arranged frequency. The fixed-rate period can vary significantly anywhere from one month to 10 years.
Adjustable-rate mortgage (ARM)
the legal principle in which a person who does not have legal right to a property acquires legal ownership based on continuous occupation of the land without the permission of its real owner.
Adverse possession
one who speaks for or represents someone.
Agent
A form that states the buyer consents to purchase a property and the seller agrees to sell that property with the terms and conditions illustrated in from both parties.
Agreement of sale
the rights to use the space above the earth.
Air rights
the act of transferring title, ownership, an estate, or an interest in real estate from one party to another.
Alienation
he provision in a mortgage or deed of trust signed with the lender that states that the borrower must pay the mortgage in full before the borrower can transfer the property.
Alienation clause
Add on’s, or fixes to contracts.
Amendments
a useful feature or add on to a house that typically adds value to the property.
Amenities
when payments divide into equal amounts for the duration of the loan.
Amortization
a collection of federal and state government laws that regulate the conduct and organization of business corporations, normally to promote fair competition for the benefit of consumers.
Antitrust laws
an estimate of approximate worth of something.
Appraisal
Most big lenders or banks require the buyer to have an appraisal done to the property before the loan is granted. This is to ensure the house is worth somewhat close to the price of the accepted offer.
Appraisal contingency
any gain in the value of a property over time from any cause.
Appreciation
a noun; describing an item that is attached to something. In real estate, after something is installed onto a property, it can be called an appurtenance. Meaning it is passed on to a new owner if the property is sold.
Appurtenance
an adjective meaning it is attached to something. If something is appurtenant, it belongs to something else, either attached to or by law.
Appurtenant
a type of easement that “runs with the land.”
Appurtenant easement
the immediate action of adding or tearing away land by violent acts from natural causes. An example of this is a dam breaking or a hurricane.
Avulsion
a mortgage which does not fully amortize over the term.
Balloon loan
an individual for whom a trust works for. They “benefit” from the trust.
Beneficiary
an agreement between at least two people or groups. Most business and personal contracts fall into this category.
Bilateral contract
an illegal practice where real estate agents sell houses at a low price to one race then sell those same houses at a much higher price to a minority.
Blockbusting
the failure to complete an agreement per agreed terms.
Breach of contract
a space of land between two use districts such as a park, playground or a highway. The point of a this is to ease the transition from zone to zone.
Buffer zone
the rules and standards of properties for the protection of public safety and welfare.
Building code
When a person purchases property, he or she is given the rights to the property; these rights can be split up and given to different parties.
Bundle of rights
This contingency allows the buyer to cancel the contract if they are unable to sell their current home in a specified amount of time.
Buyer’s home sale contingency
If someone is in the market for a new home, they enlist ______. A _______ represents the buyer in a transaction in return for their services they receive a fee.
buyer’s agent
the profit from the sale or auction of property or investment.
capital gain
the conversion of assets or income into capital.
Capitalization
_____ used to indicate the rate of return that is expected to be generated on a property.
capitalization rate
____ is Latin for “Let the buyer or buyers beware”. The concept is that the buyer is responsible for checking the quality of a product before a purchase is made.
Caveat emptor
A Latin phrase meaning “other things equal” or in plain terms all things remaining constant.
Cetris peribus
Another word for personal property.
Chattels
a nonprofit corporation, complete with a board of directors, and each resident is a shareholder. Perhaps the largest distinction between a condominium and a _______ is that most _____ associations require that a prospective purchaser be approved by a committee composed of current ______ owners.
co-op
______ is when a title to one parcel of real estate is held by two or more individuals, those parties are called co-owners or concurrent owners. Individuals may co-own property as tenants in common, joint tenants, or tenants by the entirety or lastly community property.
co-ownership
The legal concept of a claim to title appearing to be legally valid, but in actuality, the claim is defective.
Color of title
Something of worth promised to a lender as security (mortgage) for an obligation.
Collateral
property that generates an income or salary.
commercial property
______ Laws are based on the idea that husband and wife are equal, separate, partners rather than one whole one like tenants by the entirety.
community property
Another word for properties sold in the same area seen on a property report.
comparables
Also known as The Superfund. The Superfund is a United States federal government program designed to fund the cleanup of sites contaminated with hazardous substances and pollutants.
Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA)
The procedure used by a public or private entity with the powers granted from eminent domain to take privately owned real estate.
condemnation
a type of living space which is similar to an apartment but which is independently sellable and therefore regarded as real estate.
condominium
____ occurs when two or more persons or entities conspire to restrict the ability of someone from competing. This unethical and highly illegal.
Conspiracy to boycott
a term used in the law of real property to describe a circumstance in which a landlord either does something or fails to do something that he has a legal duty to provide.
Constructive eviction
best described as ignorance, or lying without knowing you are lying.
Constructive fraud
____ means an offer for the property has been accepted but there is a condition or “contingency” that is written into the contract and it must be met before the sale can go through.
Contingent property
An agreement between two or more parties by law.
contract
_____ may be formed for profit or nonprofit purposes. A ____ is managed and operated by a board of directors. A _____ has certain rights, privileges, and liabilities beyond those of partnerships. Doing business as a _____ has its advantages and disadvantages.
corporation
A real estate appraisal method that states the price a buyer pays for a property should equal the cost to build an equivalent building on the property.
cost approach
A _____ is similar to a purchase agreement. If a ______ is made the original offer ceases to exist because legally the seller has rejected it.
counter offer
The set of data that equals heights and depths measured on a horizontal plane.
datum
Something owed or promised.
debt
a written legal document by which ownership of real estate is conveyed from one party to another.
deed
limitations to the use of the property imposed by a past or current owner and are usually legally binded forever.
deed restrcitions
A required contract provision that ensures that the title for the property is transferred to the buyer, once the mortgage is fully paid off.
Defeasance clause
Overdue taxes.
Delinquent taxes
The legal act of transferring ownership.
delivery
any loss in the value of a property over time from any cause.
depreciation
mortgage points are prepaid interest.
discount points
when competing brokers agree to split territories, and divide interests accordingly. This is a clear antitrust violation.
dividing territories
a parcel of real property that has an easement over another piece of property.
dominant estate
“”Double”” means two additional costs will be added to your base rent. Usually taxes and insurance costs are added to the monthly lease payment.
double net lease
the act of forcing an individual or business to do something against their will.
duress
occurs when one real estate agent represents both the buyer and seller in a transaction.
dual agency
A loan for a certified veteran through the Department of Veterans Affairs.
DVA loan
a right held by one person to use the land of another for a specific purpose, such as driving through someone else’s property.
easement
An easement used for entering and exiting a property.
Easement for ingress and egress
The right to exit a property.
Egress
Refers to the loss of property value due to external factors, meaning things off the property affecting the properties value.
Economic obsolescence
annual crops produced by cultivation legally belonging to the tenant with the implied right for its harvest, and they are treated as the tenant’s property.
emblements
The right of the government to take over privately owned real estate for public use.
eminent domain
intrusion on a person’s territory or property.
encroachment
an involuntary lien is on the property.
encumbrance
the federal agency responsible for dealing with environmental issues. The ____ was established in December 1970 by an executive order of United States President Richard Nixon.
Environmental Protection Agency (EPA)
A regulation that aims to give all legal individuals an equal opportunity to apply for loans. The act prohibits creditors and lenders from considering a consumer’s race, color, national origin, sex, religion or marital status in deciding whether to approve their credit application.
Equal Credit Opportunity Act (ECOA)
The interest held by one party to purchase property before closing.
equitable title
the difference between the market value of your home and the amount you owe the lender who holds the mortgage.
equity
The opposite of accretion, _____ is the wearing away of land or soil by the action of wind, water, currents, or ice. Long term erosion can decrease the size of a property.
errosion
Some but not all states require this form of insurance. It is a type of liability insurance that protects professionals against claims of inadequate work or negligent actions.
Errors and omissions insurance
When a property owner dies and leaves no proper documented inheritance plan, the property ownership reverts to the government. ____ ensures that property always has ownership.
escheat
_____ arises when the tenant holds over after the expiration of their term.
Estate at sufferance
_____ means that it can be ended at any time. The term of this estate is indefinite. It’s also important to note that not all states recognize an ______ and ones that do vary in laws.
estate at will
One broker is appointed as the sole agent of the seller and has exclusive authorization to represent the property. The broker receives a commission no matter who sells the property while the listing agreement is in effect.
exclusive right to sell
A completed contract.
executed contract
____ occurs when both parties legally establish an agency relationship. In other-words they sat down and wrote a contract stating their relationship. This is the most common method of creation for agency relationships.
express contract
Also known as Fannie Mae. Fannie Mae buys mortgages on the secondary market, puts them together, and then sells them back as mortgage securities bonds to investors on the open market.
Federal National Mortgage Association
____ or fee simple for short, is an estate in land. It is the highest form of real estate ownership that is recognized by law, in which the owner can enjoy the property to its fullest extent and is only limited by government powers.
fee simple absolute
____ is created when a condition is added on a fee simple estate. If the condition is met, the estate may be lost.
fee simple defeasible
___ Loans are a mortgage issued by an FHA-approved lender and insured by the FHA which is the Federal Housing Administration. FHA loans are sought after because they require lower minimum down payments and credit scores than many conventional loans.
FHA
___ provides a way for buyers to back out of the sale of the property if their loan falls through.
Financial contingency
an estate that has a specific duration of time as defined in the lease agreement.
fixed term tenancy or estate for years
An item that was once personal property, but is considered real property either by attachment or legal addition.
fixture
an estate in which you have an exclusive right to enjoy the possession of a property indefinitely. Contrast to a leasehold estate, where possession is limited by time period.
freehold estate
Refers to the loss of property value due to an obsolete design feature.
Functional obsolescence
an agent hired who can perform all acts associated with a particular business that a principal has appointed the agent to; these relationships are typically continuous.
general agent
A deed where the grantor (seller) guarantees that he or she holds clear title to a piece of real estate and has a right to sell it to the grantee (buyer).
general warranty deed
the constitutional authority and inherent power of a state to adopt and enforce laws and regulations to promote and support the public health, safety, morals, and general welfare.
government power
This method of appraisal is a federal system defined by identifying reference lines. The system is based on sets of two intersecting lines: principal meridians and base lines. It is sometimes referred to as the rectangular survey system.
government survey system
The transferring of title to real property.
grant
The legal term for the buyer.
grantee
The legal term for the seller.
grantor
a rental agreement for the use of the property where the tenant pays a fixed amount which does not change as a result of changes in the various expenses of the property.
gross lease
The total price of all goods and services produced inside a country annually.
Gross national product (GNP)
The ratio of the price of a real estate investment to its annual rental income before accounting for expenses such as property taxes, insurance, and utilities. More specifically its a measure of the value of an investment property that is obtained by dividing the property’s sale price by its gross annual rental income.
Gross Rent Multiplier (GRM)
The statement in a contract that describes the rights and interests being given.
Habendum clause
The Department of Housing and Urban Development
HUD
___ refer to contracts that are not a written agreement but still legal and considered a contract (some states).
implied contracts
grants that are used to create an easement.
implied grant
An addition or add on to a property or real estate.
improvement
A lease that determines the rental prices by evaluating the annual consumer index and determining fair rental price.
index lease
If a home inspection reveals problems, the buyer can request repairs, compensation for the issue, or just cancel the offer completely.
inspection contingency
The right to enter a property.
ingress
money paid or owed regularly at a particular rate.
interest
A short-term loan.
interim financing
The event in which the government takes private property but fails to pay compensation or just compensation.
inverse condemnation
when property is transferred without the owner’s consent.
involuntary alienation
___ aren’t created by the homeowner. It is a claim imposed against a property without the consent of its owner.
involuntary liens
When a property is owned by ______, the interest of a deceased owner automatically gets transferred to the remaining surviving owners.
joint tenancy
a legal agreement in which a property owner transfers the title to a property to a trustee.
land trust
____ is not discoverable by normal inspection but maybe not to the regular eye. But is known of by the seller or homeowner.
latent defect
a contract by which one party conveys land, property, services, etc., to another for a specified time, usually in return for a periodic payment.
lease
a lease with an option to buy the property.
lease option
A less than freehold estate (also known as a _____) is an estate held by one who rents or leases property. The key difference between a _____ and a freehold estate is the limitation of time. As lease is a legal estate, ______ can be bought and sold on the open market.
leasehold estate
The legal term for a tenant who leases a property.
leasee
The legal term for one who leases property to a tenant
lessor
an investment strategy of using borrowed cash to finance the bulk of an investment.
leverage
a legal seizure of property to satisfy a tax debt or obligation.
levy
___ is a form of security interest granted over an item to secure the payment of a debt or performance of some other obligation. A ____ serves to guarantee an underlying obligation. Usually that obligation is the repayment of a loan.
lien
A _____ is an interest in real property which is held for the duration of the life of a designated person. It may be limited by the life of the person holding it or by the life of another person. This designated person is called a life tenant.
life estate
a hybrid legal entity that has certain characteristics of both a corporation and a partnership or sole proprietorship.
Limited liability company (LLC)
___ is composed of one or more general partners and one or more limited partners. The general partners manage the business and share fully in its profits and losses. Limited partners share in the profits of the business, but their losses are limited to the extent of their investment.
limited partnership
The net price and speed of how long it would take to sell an asset and convert it into cash.
liquidity
____ isn’t a lien but instead is a notice of a potential future lien.
Lis pendens
a document in which a property owner contracts with a real estate agent to find a buyer for the owner’s property.
listing agreement
pertain to landowners whose land border large, navigable lakes and oceans.
Littoral rights
An appraisal method particularly for areas densely populated like metropolitan areas and suburbs. It starts with a large tract of land that has already been described by another form of survey system. The overall area is then made into smaller lots and a map is created.
lot and block
The actual selling price of the property. So if your home sells for $200,000. Its market value is $200,000.
Market value or market price
A comprehensive plan to guide the long-term physical development of a particular area.
master plan
a problem with property or any portion of it that would have significant impact on the value of the property or that involves a large risk to the people on land.
material defect
An appraisal method imported to the original colonies that formed the United States. The system uses physical features of the local geography, along with directions and distances, to define and describe the boundaries of a parcel of land.
metes and bounds
the amount of tax payable per dollar of the assessed value of a property. ____ is also known as the millage rate.
mill rate
a promise of property to the lender as security of payment for the debt.
mortgage
a voluntary, specific lien. In fact, it’s the most common type of voluntary real estate lien. When you borrow money to buy real estate, you give the lender a lien against the property. Some states call this a deed of trust lien.
mortgage lien
A service used by a group of real estate brokers. It connects listings together under one large umbrella.
multiple listing service (MLS)
a city or town that is considered local government.
municipality
the act of purposely leaving out information you legally must disclose; or in plain terms lying through omission.
negative fraud
the omission to perform a required action or in plain terms: laziness.
negligence
___ is when an agent agrees to sell an owner’s property for a set minimum price. Anything over the minimum price belongs to the agent as commission.
net listing
The total income of a property minus all operating expenses.
Net operating income (NOI)
The legal term for an individual that acquires and holds an option.
optionee
The legal term for a party that allows or gives an option.
optionor
____ means one person owns the property.
Ownership in severalty
a legal way to dissolve the relationship when the parties don’t voluntarily agree to its termination.
partition
a rental that is based on a percentage of the monthly or annual gross sales made on the premises.
percentage lease
a leasehold agreement that specifies an initial period of tenancy and the length of the agreement but does not end after the specified period. This type of leasehold agreement renews automatically.
lease from period to period
all things removable like clothes, lawn mowers, couches, TV’s, and furniture.
personal property
A legal document that authorizes someone to act on behalf of another person, typically in business or for some sort of business transaction.
power of attorney
___ states that a lender can penalize a borrower if the borrower pays off the mortgage much sooner than usual.
prepayment penalty clause
the practice of setting the price of a good or service to make a particular price a standard. Any agreement even if it just implied with other brokerages to set a standard commission rate is a violation of the antitrust laws.
price fixing
a party who has signed an agreement with an agent or more specifically a broker. In other words, it is any person directly involved in a contract, such as a buyer or a seller.
principal
Another word for an “I.O.U.” The note states the terms of the loan, like the interest and the number of years which the borrower has to pay back the loan.
promissory note
The overseeing of real estate and property.
property management
someone hired to maintain and manage property.
property manager
a real estate ad-valorem tax, calculated by local government, which is paid by the owner of the property. The tax is usually based on the value of the owned property.
property tax
a contract that legally binds two or more parties together, to specific obligations, that create a legally binding contract between the buyer and the seller.
purchase agreement
___ contains no title covenant and thus offers the grantee no warranty as to the status of the property title.
quitclaim deed
Radioactive gas dispersed from natural decay of mineral in earth. odorless, colorless, tasteless.
radon
a term used to describe property or buildings.
real estate
all things attached to the land and all the legal rights to it. ___ is usually things that are immovable such as the home itself or the buildings within the property line.
real property
A fund set up by commissions in a few states to protect the public from real estate agents committing harmful acts. Basically, an insurance policy for states, homeowners and their agents.
recovery fund
A contract provision (typically in a blanket mortgage) that allows for the freeing of all or part of a property from a claim through a proportional or full amount of the mortgage being paid off.
release clause
___ limit the use of a particular property, a condominium, or a subdivision. The main purpose of the _____ is to maintain the look and feel of the community.
Restrictive covenants (CCR)
The legal government-approved process of adjusting a zone.
rezoning
all landowners whose properties adjoin a river or stream, have the right to make reasonable use of it as it flows through or over their properties.
riparian rights
Established in 1974 Allowed greater control by EPA to control contaminant levels, take legal action against public water auth. for violations, and require periodic water testing and notification to state authority and homeowners if contaminated.
Safe Drinking Water Act (SDWA)
An agreement containing the entire terms of the sale between a customer and a seller.
Sales contract
the resale marketplace of loans.
secondary market
If someone wants to sell their home they enlist a _____. A _______ (also known as a listing agent) represents the seller in the transaction in return for their services they receive a fee.
seller’s agent
a parcel of land that is subject to an easement.
Servient estate
A ______ is one individual or married couple in business alone. _______ are the most common form of business structure.
Sole proprietorship
A deed in which the grantor warrants only against defects occurring during their ownership.
special warranty deed
an agent hired to perform a specific duty. The real estate agent’s power and authority is limited to that specific task.
special agent
The ________ (in real estate) establishes order of priorities of financial claims (liens).
subordination clause
_____ was passed when the original act, CERCLA, expired in 1985. It amended the comprehensive environmental response, compensation, and liability act.
Superfund Amendments and Reauthorization Act of 1986 (SARA)
____ is placed on real estate for unpaid real estate taxes.
tax lien
designated rate the government taxes a person, business or entity.
tax rate
The process of taking a portion of worth from a person or business and using that for the greater welfare of the public.
taxation
____ is when a parcel of real estate is owned by two or more tenants. Upon the death of one of the tenants, that share is transferred to the estate or heir of the deceased tenant.
tenancy in common
_____ Is a special form of co-ownership used in some states that allow a husband or wife to inherit the other spouse’s ownership interest upon death. Couples who are ______ automatically have the right of survivorship. The surviving spouse immediately becomes the sole owner of the property when the other spouse dies.
tenants by the entirety
Passed in 1972 and amended in 1977 and 1987, the ______ was originally known as the Federal Water Pollution Control Act. It Is intended to regulate pollutants discharged into waterways.
The Clean Water Act (CWA)
The law that prohibits discrimination in the buying, selling, renting or financing of housing. These laws prohibit discrimination based on race, religion, color, sex, disability, children, nationality and more.
fair housing act
a property with a divided form of ownership or use rights.
timeshare
The legal concept of saying you own a right to some form of asset or interest.
title
If the title for the property is under review the buyer can add a ______ to the offer. During this process, a title report will be done which may reveal a conflicting ownership status, in which the buyer then can opt out of the sale.
title contingency
____ means three additional costs will be added to your base rent. Usually taxes, insurance, and maintenance are all added to the monthly lease payment.
triple net lease
a three-party relationship in which the first party, the trustor or settlor, transfers a property upon the second party for the benefit of the third party, the beneficiary.
Trust
A _____ is required to manage a trust in accordance with the trustor’s wishes and in the beneficiary’s best interests. A _____ can be an individual or a financial institution such as a bank.
trustee
A ______ is one that is valid but one the court will not enforce. Any contract agreement created between two parties for illegal actions is considered an _____
unenforceable contract
a one-sided agreement. only one party makes a promise to perform. one party pays the other party to perform a certain duty. If the first party fulfills the duty, the second party is obligated to transfer the specified funds.
unilateral contract
an agent hired who can act on behalf of a principal with complete power. In other-words, a _____ can legally act in replacement of their principal.
universal agent
a mortgage loan available for military service members, veterans, and eligible surviving spouses. They often come with better terms than a traditional mortgage which is why they are commonly sought after.
VA Loan
A _____ meets all legal requirements of a court of law and is legally enforceable.
valid contract
a request to deviate from current zoning requirements. If granted, it permits the owner to use his land in a way that is ordinarily not permitted by the zoning ordinance.
variance
A _____ has no legal force or effect because it lacks one or more legal requirements.
void contract
A _____ appears on the surface as valid but is not. An example would be a contract with a forged signature.
voidable contract
a transfer of title made with the owner’s consent. Transfers like this are initiated by either a public grant, a property owner executing a will, gifting, selling the property or by a dedication.
voluntary alienation
_____ are created by a contract between the creditor and the debtor. The most common type is a mortgage.
voluntary liens
a type of deed where the grantor (seller) guarantees that he or she holds clear title to a piece of real estate and has a right to sell it to the grantee (buyer).
warranty deed
the removal or transfer of water from one place to another.
water diversion
the rights to use rivers, lakes, or oceans that fall adjacent to land.
water rights
the regulation of public land use and development by local government. _____ usually refers to local government laws that dictate how real property can and cannot be used in certain areas.
zoning
_____ are a written regulation and law that defines how property in specific zones can be used.
zoning ordinances
