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128 Cards in this Set

  • Front
  • Back
Maggie Mae
The Mortgage Guaranty Insurance Corporation's private secondary mortgage market program designed to provide an outlet where lenders can sell their conventional loans insured by MGIC.
Management contract
An agreement which authorizes a property manager to act on behalf of the owner.
Manual delivery
See absolute delivery.
Market price
The amount for which a property actually sells.
Market rent
The amount for which a property should rent based upon comparisons made with similar properties currently under lease. It is also known as economic rent; usually determined by an appraisal.
Market value
The price a property would be expected to bring in the open market under normal conditions.
Marketable title
Title to land which is free from reasonable objections leaving no doubt as to who the owner is. A title which a title insurance company will insure at its regular rates; subject only to standard exceptions.
Master plan
A comprehensive; long-range plan to guide the growth and development of a community.
Mechanic's lien
Also known as a material man's lien; a lien created by statute against real property. It exists for the purpose of securing payment to those persons who have performed work and/or furnished materials for the improvement; maintenance; or repair of real property against which the lien is recorded.
Meeting of the minds
Mutual agreement to the terms and conditions of a contract by all parties involved.
The threat of force to compel someone to enter into a contract against his/her will.
Certain reference lines which run north and south used in the rectangular survey system to locate land. The north-south line on a compass.
Metes and bounds
A method of legally describing land by measuring directions and distances of its boundary lines.
One tenth of one cent. One Mill = .001. Used in property taxation.
Mineral rights
A landowner's legal interest in minerals below the surface of his land. Such rights are considered to be appurtenant to the land and may be sold or leased separately.
Minimum property standards (MPS)
FHA construction standards to which a property must conform before the FHA will insure a loan.
"Ministerial Acts under ""BRRETA"" "
Ministerial Acts are acts that a broker or affiliated licensee performs for a person (customer) which do not require discretion or the exercise of judgment on the part of the licensee (e.g.; preparing and conveying offers; locating draftsmen; architects; attorneys; or lenders).
A person under legal age or the age of majority. Depending on the particular state; a minor is one under 18 to 21 years of age. A contract made by a minor is voidable.
Any person or persons who can be identified by race; color; sex; religion; national origin; familial status; handicap; or other locally or federally adopted characteristic.
Offenses lower than felonies and punishable by fine and/or imprisonment. License Law violations constitute a misdemeanor and are punishable by a fine of up to $1;000; up to one year in jail; or both. The penalties are always determined by a court of law.
A fixed point or object used to denote the end point of a boundary line in a metes and bounds description. Natural monuments include trees; streams; rocks; etc. Artificial monuments are man-made objects such as streets; fences; iron pins; concrete posts; etc.
An instrument which secures a promissory note by either giving the lender a lien against certain property or conveying title to; depending on state law.
Mortgage lien
A monetary claim against a specific property pledged by its owner as security for the repayment of a loan or other debt.
Mortgage loan correspondent
One who places mortgage loans by using funds belonging to an investor; such as a life insurance company who wants to invest in mortgage but does not want the administrative duties of placing and servicing the loan.
Mortgage note
See promissory note.
Mortgage pool
A package of many mortgage loans sold to several different investors. This approach allows a group of investors to participate in a pool of mortgages; thus spreading their risk.
Mortgagee in possession
A lender who petitions the court to appoint a receiver to manage income producing property during the period after default but before a foreclosure sale.
Mortgaging clause
In lien theory states; this provision gives the lender a lien in the property pledged as security.
Multiple listing
A form of exclusive right to sell listing used by brokers who are members of a multiple listing service.
Multiple listing service
An organization of brokers created for the purpose of exchanging listing information; thereby giving each property the widest market exposure possible.
Mutual assent
An expression of mutual agreement manifested by an unconditional acceptance of all terms and conditions of an offer.
Mutual mistake
A mistaken assumption made by both parties concerning a material fact of the contract. Results in a void contract.
Mutual rescission
Cancellation of a contract made voluntarily by all parties involved.
Naked title
Rights granted to a trustee by a trust deed.
Narrative report
An appraisal report summarizing all data; techniques; and appraisal methods used to arrive at a final conclusion of value; the most complete appraisal report supported with such documents as maps; photographs; charts; plats; floor plans; or contracts.
National banks
Commercial banks which are chartered by the Federal Reserve System.
Navigable water
A waterway open to the public for commercial boat traffic.
Negative amortization
An increase in the principal loan balance due to an insufficient amount of monthly payment to cover the accrued interest. The deficiency is added to the loan balance each month and is compounded at the prevailing interest rate; normally occurs in a graduated payment mortgage.
Negative fraud
Deliberate misrepresentation by failing to disclose vital information; such as defects that are not readily apparent from a reasonable inspection. A form of actual fraud.
Breach of duty resulting from failure to exercise reasonable care required by the circumstances involved in each individual case.
Negligent misrepresentation
A false statement believed to be true; but is made without sufficient grounds for such belief due to carelessness or negligence. When relied upon by another party; it has the same effect as willful misrepresentation and results in constructive fraud.
Negotiable instrument
A written promise to pay a certain sum of money which may be transferred by endorsement or by delivery.
Neighborhood Analysis
Analysis of a homegeneous grouping of individuals or businesses; as part of an appraisal; to determine the effect on the subject property of such factors as: 1. Growth; stability; and decline of the neighborhood. 2. Forces at work on the subject neighborhood. a. Physical; b. Economic; c. Governmental/political; d. Social.
Net lease
One which requires the tenant to pay the landlord a fixed rental amount plus all or part of certain operating expenses; such as taxes; insurance; and maintenance and repairs.
Net listing
A listing agreement which authorizes the broker to sell the property for any price possible; while the seller agrees to accept a set amount. It is prohibited by the License Law in most states.
Net operating income
A property's income after all operating expenses have been paid; the income used in the income approach to estimate value.
Nonconforming use
Land use in existence prior to the enactment of a zoning ordinance. Because zoning cannot be retroactive; the use is allowed to continue even though it does not conform to the new ordinance. Any building which is a nonconforming use may be used so long as it is in existence. If it is destroyed in any way or abandoned; the use will be terminated; and the building cannot be rebuilt under the existing zoning law.
Nondisturbance agreement
A provision in a mortgage for larger income properties in which the lender agrees to honor the leases (not disturb the tenants) in the event of foreclosure; thereby enabling the owner to obtain large; important tenants known as anchor tenants.
A characteristic of land which holds that no two parcels are exactly alike because each parcel has its own unique location.
Nonjudicial foreclosure
See foreclosure by power of sale.
Nonpossessory estate
An estate in real property; the possession of which is postponed until a d preceding possessors estate is terminated.
Notice of completion
A legal notice required in some states in order to perfect a mechanic's lien. The notice lets the property owner know that certain contracted work has been completed and/or materials ordered have been supplied.
Notice of lis pendens
Recorded notice which indicates that a lawsuit is pending.
A process of discharging obligations under a contract by substituting a new contract for an existing one or by substituting a new party for an old one.
Nuncupative will
An oral will declared by a person in expectation of death and made for the purpose of disposing of personal property. To be valid a nuncupative will must be properly witnessed and reduced to writing.
Observed condition
See cost-to-cure.
Occupancy agreement
An agreement which allows a purchaser to take possession for a short term; pending the closing of a sales contract. The purpose of the agreement is to allow the purchaser to occupy the home without creating a landlord-tenant relationship. This procedure reduces the legal difficulty of having the purchaser removed from the premises in the event final settlement of the contract does not occur; and the purchaser refuses to move voluntarily. Also known as a move-in agreement.
A proposal to make a contract. It does not become a legal offer until it comes to the knowledge of the person to whom it is made; known as the offeree.
Offer and acceptance
An essential element for the creation of a contract. Also called mutual assent and a meeting of the minds.
The party to whom an offer is made.
The party who makes an offer.
Open listing
An authorization made by an owner; either verbal or in writing which gives a broker the non-exclusive right to secure a purchaser. Such listings may be given to any number of agents without liability to compensate anyone; except the one who first secures a buyer ready; willing; and able to meet the terms of the listing; or who first secures the seller's acceptance of an acceptable offer. The owner can also sell and pay no commission.
Open mortgage
A mortgage loan which allows the borrower to pay off part or all of principal without penalty at any time before it becomes due.
Open-end mortgage
Entitles the borrower to receive future advances of funds up to but not exceeding a specified limit.
Operating budget
A property manager's projection of operating expenses and reserve for replacements and repairs. The budget serves as a guideline during the year of operation and must be revised as actual results point out items in the budget which need correction.
Operating expenses
Those expenses which are necessary to maintain a property's production of income.
A contract which binds one party to hold an offer open to another party for a specified period of time.
The party (buyer or tenant) to whom an option is granted.
The party (usually the owner) who grants an option to another.
Ordinary life estate
A life estate whose duration is measured by the life of the life tenant.
Placement of improvements in relation to the positive and negative features of a lot.
Ostensible agency
An agency that is created when a third party relies on the principal's expressed or implied actions that a particular person is his/her agent. The principal cannot later deny the agency exists because of estoppel.
An improvement which is not the highest and best use for the site on which it is placed due to excessive cost or size.
Owner's rent clause
A mortgage provision which obligates a defaulting borrower to pay rent while remaining in possession.
Package mortgage
A financing arrangement where the borrower pledges both real and personal property as security for a loan.
Panic selling
See blockbusting.
Parol evidence rule
Rule of law disallowing oral evidence which disputes a written agreement.
Partial release clause
A provision in a blanket mortgage which obligates the lender to release each parcel held as security upon payment of a specified sum.
Participation loan
Financing arrangement in which the lender is made a partner as a condition of obtaining a loan.
Partition sale
A method of involuntarily transferring title to real property. When joint tenants or tenants in common cannot mutually agree to a plan for dividing their co-ownership; the court will issue an order to sell the property with proceeds paid to the owners based on their percentage share of ownership.
A working relationship of two or more persons where they unite skill; property; or labor to carry on a business and share in the profits or losses.
Party wall
A fence or wall of a building that straddles the boundary line of two adjoining lots and exists for the use of both owners.
Pass through securities
An investment in a pool of mortgages which allows different investors to participate in the same mortgage rather than in individual ones. Investors receive principal and interest payments each month. These securities are sold by Ginnie Mae to raise funds for programs which offer special assistance in the secondary mortgage market.
A government document which conveys title to public land to a private individual.
Patent defect
One that is readily apparent by an ordinary inspection.
Percentage lease
A lease which bases the rental amount on a percentage of either gross sales; gross profit; or net income. Generally; the tenant is required to pay a flat rental fee plus a percentage of the gross sales which exceed a certain minimum. Percentage leases are normally used in retail store operations.
Percolating water
Underground water not confined to a specific waterway; channel; or stream.
The ability for soil to absorb water. Percolation tests are made to determine the rate of absorption when a septic system is to be used on a lot.
Personal easement in gross
A personal right granted to an individual to use the land of another. The right is neither transferable nor inheritable and may be terminated by the easement holder or; by death of the easement holder.
Personal property
Anything of a movable nature capable of being owned that is not considered real property. Also known as personality or chattel.
A map showing how a property is subdivided into lots.
Plat of survey
A map or drawing that shows the location and boundaries of a land parcel; and in some cases how the land is subdivided into lots. Also called a plot map.
The transfer of property to be held by the lender as security for a loan.
Pledged account mortgage (PAM)
A mortgage loan which requires the borrower to make graduated payments and at the same time provides the lender with full monthly payments. This unique feature is accomplished by the borrower pledging a savings account to the lender from which supplemental payments are made on behalf of the borrower during the first few years of the loan. The regular payments are lower than usual.
An increase in value brought about by the process of assemblage; the result of combining several lots under one ownership; so that the large tract has more utility and value than the sum of the lots owned individually. Also called plottage increment.
Pocket card
An evidence of licensure kept by the licensee. It identifies the licensee by name; the licensing designation; the license number; and the date the original license was made.
Point of beginning
The starting point at one corner of a parcel of land described in a metes and bound legal description.
Police power
The government's right to enact and enforce legislation which regulates the use of real estate to provide for the public safety; health; morals; and general welfare of the community.
Possessors estate
An estate whose owner has the right of present possession or control. Possessors estates are either freehold or leasehold.
Possibility of reverser
A possibility that title to land will revert back to the grantor if the grantee breaches a condition placed on the title by the grantor.
Potable water
Water which is pure enough to drink.
Potential gross income
The expected rental income from a property based upon full occupancy for an entire year.
Power of attorney
A written instrument which authorizes a person; called an attorney-in-fact; to act on behalf of the one granting the authority.
Power of sale clause
Mortgage provision which enables the lender to foreclose without filing a lawsuit against the defaulting borrower.
A written document authorizing another person to act as one's agent; who is called an attorney-in-fact.
Prepayment clause
Mortgage provision which allows the borrower to pay off part or all of the loan without penalty at any time before it becomes due.
Prepayment penalty
A charge for paying off part or all of a loan before it becomes due.
Prepayment privilege
See prepayment clause.
A method of acquiring an easement through continuous; open; visible; and notorious use of another person's property. The use must be without the owner's permission and for a period # of time as prescribed by law.
Present right
The right to immediate possession or control of a property.
Price fixing
An illegal arrangement among brokers to set commission rates.
Primary mortgage market
Where individual homebuyers go to obtain mortgage loan financing.
Also called client. One who employs an agent to represent him/her.
Principal meridian
One of the north-south reference lines used in the rectangular survey to locate land.
Prior appropriation
A doctrine of law relating to riparian water rights followed by states that typically experience periods of drought. The right to use riparian water is secured by permit. During periods of drought the earlier permits establish priority in using adjacent water.
Private mortgage insurance (PMI)
Protects lenders who make conventional loans of more than eighty percent of value. In the event of default the insurance covers the lender's losses up to the amount of the insurance.
Pro forma statement
A projected annual operating statement which forecasts gross income; operating expenses; and net operating income.
Probate court
A court which determines the validity of a will. If a person dies intestate; the court will determine the rightful heirs and appoint an administrator to distribute property according to the court's decree.
Procuring cause
The person whose action is the primary reason for a sale taking place.
Promissory note
The borrower's written promise to repay a loan. The note specifies the exact terms and conditions under which the debt is to be paid.
A specific object owned plus the rights of ownership.
Property manager
One who is given the responsibility of maintaining; preserving; and enhancing an owner's property and at the same time generating the highest possible net return from it.
Protective covenant
A lease provision which prohibits certain use of the leased premises in order to eliminate competitive businesses within the same facility owned by the landlord.
Public trustee
A government official who acts as trustee for borrower and lender when a trust deed is used as a security instrument in lieu of a mortgage.
A statement of exaggeration which a reasonable person would recognize as untrue; also called puffery.
Purchase money mortgage
A financing arrangement where the purchaser gives the seller a note secured by a mortgage as part payment of the purchase price.