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30 Cards in this Set
- Front
- Back
Fixture |
An article that was once personal property but has become so affixed to the land that the law construes it to be part of the real estate is a |
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Metes and bounds |
Uses physical descriptions for legal descriptions of real estate. |
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Government survey |
Specifies locations by using a rectangular coordinate system. |
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External obedience |
Neighbor, loud airport. |
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Reproduction cost |
Cost of identically reproducing an asset or property with the same materials and specifications. |
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Replacement cost |
Actual cost of replacing based on current value including depreciation. |
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Objective real estate value |
Value that buyer is willing to pay for the property. |
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Comparable real estate |
Similar properties in the same area that were recently sold. |
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Highest and Best Use |
Used in appraisal. It states that the value of a property is directly correlated to the use of the property. |
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Leverage |
Using borrowed money to increase profits on an investment |
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Equity |
Difference between what the property is worth and what it owes. |
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Basis |
Original cost of the property, plus capital improvements, minus depreciation |
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Capital gain |
Increase in value of a capital asset that gives it a huger worth than the purchase price |
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Rescission |
Cancels contract and restores buyer and seller to original agreement position. |
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Breach |
If one party does not fulfill their part of the agreement. |
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Escrow agent |
Neutral third party whom the purchaser and seller will sign closing documents with. |
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Alienation Clause |
Clause in which full payment of the mortgage balance is due at the lenders discretion if sold or the title is transferred. |
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Straight note |
Payments are made on the interest only and not in the principal balance borrowed. At the end of the term is when the entire principal is due. |
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Bi-monthly oayments |
Paid twice per month. Substantially reduces the amount of interest compared to monthly payments |
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Acceleration clause |
Clause in which the balance of the loan becomes due immediately. |
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Due on sale clause |
Allows the lender to call the loan immediately due and payable in the event that the owner sells or transfers title of interest. |
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Lock in Clause |
Clause in which paying it off early in prohibited. No early payments |
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Late payment penalty |
Charged by the lender when payments from the borrower are not paid on time. |
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Subordination Clause |
Ales another loan to have a higher priority. |
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Defeasance Clause |
clause in which it provides the cancellation of the lenders interest when the debt has been paid in full. |
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Financing instrument |
Documents that have monetary value or are evidence of a monetary transaction such as checks, drafts, bills, bonds and promissory notes. |
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Usery |
When a lender charges more interest than what is legally allowed. |
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Interest |
Cost of borrowing money. |
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Simple intersst |
Interest that is calculated with the original loan amount, and does not change. |
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Compounding interest |
interest that takes into consideration that the balance is getting lower over a period of time. |