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156 Cards in this Set

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Abandonment

Giving up possession or ownership of property by not using it, generally indicated through some affirmative act, like removing one's belongings from an apartment.

Abstract of judgment

Document that summarizes is the result of a legal action, which can be filed in any country where the judgement debtor owns a property.

Abstract of title

Summation of all recorded transfers, conveyances, legal proceedings, and any other facts relied on as evidence of title to show ownership continuity and signify any possible loss to title.

Acceleration clause

Provision in a real estate financing instrument allowing the lender to declare the full debt due immediately if the borrower breaches any of the provisions of the loan agreement. AKA "call provision".

Accession

The process of manufactured or natural improvement or addition to property.

Acceptance

A) agree to the terms of an offer to enter into a binding contract.


B) Receive a delivery of a deed from the grantor.

Accretion

A steady addition to dry land through the forces of nature, as when waterborne sediments get deposited on waterfront property.

Acknowledgement

Formal declaration made before an authorized person (generally a notary public) by an individual who has executed a written and instrument that it has been done voluntarily.

Acquisition cost

Amount of money required to acquire title to a property. It includes the purchase price as well as; closing costs, legal fees, escrow, service charges, title insurance, recording fees and other such expenses.

Acre

Area of land measuring;


160 square rods,


4,840 square yards,


43,560 square feet,


a tract of about 208.71 feet square.

Actual age

Number of years since a building was completed. AKA - historical or chronological age.

Actual authority

Authority actually given to an agent by the principal (expressly or by implication).

Actual eviction

Forcing someone physically off real property or preventing someone from re-entering the property or using legal action to make someone leave the premises.

ADA

Americans with Disabilities Act

Addendum

A page containing additional provisions attached to a purchase agreement or any other contract.

Adjacent

Next to, nearby, bordering, or neighboring (not necessarily in real contact).

Adjustable-rate mortgage ARM

Loan in which the interest rate increases or decreases to reflect changes in cost of money.

Adjusted basis

Purchase price of property plus cost of specified improvements, minus any depreciation deductions taken.

Adjustment period

The time period between when the interest rate or monthly payment for an adjustable-rate mortgage is changed.

Administrative agency

Government agency administering a complicated area of law and policy, implementing and enforcing detailed regulations that have the force of law. For example, the Bureau of Real Estate is the administrative agency charged with regulating the real estate business.

Administrator

Individual appointed by the probate court to manage and distribute the estate of a deceased person if no executor is named in the will or there is no will.

Ad valorem

Latin phrase meaning "according to value" referring to taxes assessed on the value of property.

Adverse possession

A way of acquiring title to real property belonging to someone else by occupying it without permission, and fulfilling other statutory requirements.

Affidavit

Acknowledged sworn statement in writing made before a notary public (or any other official authorized to administer an oath).

Affiliated licensee

A real estate salesperson or associate broker employed by a broker.

Affirm

A. To confirm or approve.


B. To make a sincere declaration that is not under oath.

After-acquired title

If the title is acquired by a grantor only after a conveyance to a grantee, the deed to the grantee becomes effective at the time the grantor actually receives title.

Agency

The association between a principal and the agent of the principal that is formed by way of a contract, that may be oral or written, express or implied, by which the agent is employed by the principal to do certain acts dealing with a third party.

Agency apparent / ostensible

When the impression given to a third party is that someone who hasn't been approved to represent another is that person's agent, or are given the idea that an agent has been approved to perform acts which are actually beyond the capacity of his authority. AKA - ostensible agency.

Agency dual

An agency relationship where the agent represents two principles in their dealings with each other.

Agency exclusive

Listing agreement that employs a broker as sole agent for a seller of real property for which the broker is entitled to compensation if the property is sold via any other broker, but not if a sale is negotiated by the owner without the services of an agent.

Agency ostensible / apparent

When the impression given to a third party is that someone who hasn't been approved to represent another is that person's agent, or are given the idea that an agent has been approved to perform acts which are actually beyond the capacity of his authority. AKA agency apparent.


Agency confirmation statement

Written statement indicating the representation of a real estate agent of a party. It should be signed by both the buyer and the seller before they enter into a residential purchase agreement.

Agency disclosure form

Form explaining the duties of a seller's agent, a buyer's agent, and a dual agent, required to be signed by both the buyer and the seller before they enter into a residential purchase agreement.

Agency law

Body of legal rules governing the relationship between agent and principal by imposing fiduciary duties on the agent as well as liability for the actions of the agent on the principle.

Agent

Individual authorized to represent another (known as the principal) in dealings with third parties.

Agents in production

Elements necessary to generate income and establish a value in real estate: labor, coordination, capital, and land.

Age of majority

Age of a person when he / she becomes legally competent (usually the age is 18 years).

Agreement

Contract between two or more persons to do or not do a certain thing, for consideration.

Air rights

The right to unobstructed use and possession of the air space over a parcel of land. This right may be transferred separately from the land.

Alienation

The transfer of ownership or an interest in property from one person to another, in any way

Alienation involuntary

Transfer of an interest in property against the will of the owner, or without any action by the owner (ensuing through operation of law, natural processes, or adverse possession).

Alienation voluntary

When an interest in property is voluntarily transferred by the owner to someone else (generally by deed or will).

Alienation clause

A security instrument provision giving the lender the right to declare the full loan balance due immediately if the borrower sells or else transfers the security property. AKA: due-on-sale clause

All-inclusive deed of trust

Mortgage, wrap around

Alluvion

Increase of soil along the banks of a body of water by natural forces.

Alquist-Priolo Act

A law in California that requires applications for development of property in an earthquake fault zone to include a geologic report.

ALTA

American Land Title Association is a nationwide organization of title insurance companies.


AKA: extended coverage title policy

Amendment

A supplementary agreement that changes one or more terms of a contract. It needs to be signed by all the parties to the original contract.


AKA: contract modification

Amenities

The features of a property that adds to the pleasure and/or convenience of owning it, such as a swimming pool, a beautiful view, a gym and so on.

Americans with Disabilities Act

Federal law mandating that public facilities must be accessible to disabled people.

Amortization negative

The adding of interest - not - paid to the principal balance of a loan.

Amortize

To pay off a debt gradually, with installments that include both principal as well as interest.

Annexation

When personal property is attached to real property, so that the personal property becomes part of the real property by law.

Annexation actual

Physically attaching personal property to real property, so that it can be made part of the real property.

Annexation constructive

Associating personal property with real property so that it is treated as a fixture by law, although not attached physically. Example: Jewelry

Annual percentage rate APR

All the charges paid by the borrower for the loan (including the interest, origination fee, discount points and mortgage insurance costs) expressed as an annual percentage of the amount borrowed.

Annuity

Sum of money received in a series of payments at regular intervals (usually annually).

Anticipation, principal of

In appraisal, when value is created by the expectation of benefits to be obtained in the future.

Anticipatory repudiation

Action taken by one party to a contract to inform the other party, before the time set for performance, that he does not intend to fulfill the contract.

Anti-deficiency rules

Laws prohibiting a secured lender from suing the borrower for a deficiency judgment in certain circumstances.

Apportionment

A division of property or liability to proportionate parts (may not be equal parts).

Appraisal

An estimate or opinion of the value of a piece of property as of a specific date.

Appraiser

Person who evaluate the value of the property, especially a trained and experienced person who has expertise in this field.

Appraiser fee

A self-employed appraiser hired to appraise real estate for a fee, as opposed to an appraiser who works for a lender, a government agency, or some other entity as a salaried employee.

Appreciation

An increase in value; the opposite of depreciation.

Appropriation

Keeping property or reducing it to a personal possession, excluding others from it.

Appropriative rights system

A water rights allocation system, in which a person wanting to make use of water from a certain body of water (like a river or lake) is supposed to have a permit. A permit that is issued earlier has precedence over a newer permit.


AkA: the prior appropriation system

Appropriated rights

A person's right to a water appropriation permit.

Appurtenances

Rights that go along with ownership of a particular piece of property, such as air rights or mineral rights. These are generally transferred with the property, but in some cases they may be sold separately.

Appurtenances intangible

Rights concerning ownership of a piece of property that does not comprise physical objects or substances. An access easement is a good example of this.

APR

Annual percentage rate

Area

A) Locale or region.


B) The size of a surface, normally in square units of measure, as in square feet or square miles.

Arm's length transaction

Transaction where there is no family relationship, friendship, or pre-existing business relationship between the two parties.

Arranger of credit

Real estate licensee or attorney who arranges a transaction for credit to be extended by seller of residential property.

Artificial person

A legal unit, such as a corporation, treated as an individual having legal rights and responsibilities by the law; as distinguished from a normal being, a human.


AKA: a legal person.

Assemblage

Merging two or more adjoining properties into one expanse.

Assessment

Property valuation for taxation purposes.

Assessor

Officer responsible for determining the value of the property for taxation.

Asset

A thing of value owned by a person.

Assets capital

Assets that a taxpayer holes, other than


A) property held for sale to customers.


B) depreciable property or real property used in the taxpayer's trade or business. Real property is a capital asset if it is used for personal use or for profit

Assets liquid

Any assets or cash that can be turned into cash (liquidated) such as stock in a company.

Assets section 1231

Properties used in a trade or business or held for the production of income. (Referred to as Section 1231 in a federal income tax code.)

Assign

Transfer of rights (particularly contract rights) or interests to another.

Assignee

One to whom rights or interests are assigned.

Assignment

A) Transferring contract rights from one person to another.


B) In case of a lease, the transfer of the entire leasehold estate by the original tenant to another.

Assignment of contract and deed

The instrument through which a new vendor is substituted for the original vendor in a land contract.

Assignor

Someone who assigns his rights or interest to another.

Assumption

Action by a buyer to take on personal liability for paying off the seller's existing mortgage or deed of trust.

Assumption fee

A fee paid to the lender, generally by the buyer, when a mortgage or deed of trust is assumed.

Attachment

Court-ordered seizure of property belonging to a defendant in a lawsuit, so it will be available to satisfy a judgement if the plaintiff wins. An attachment creates a lien in case it is real property.

Attestation

The act of witnessing the execution of an instrument, such as a deed or will.

Attorney general

The principal legal advisor for state government, including legal advisor to the Department of Real Estate on matters regarding the real estate law.

Attorney in fact

Someone who is authorized to represent another by a power of attorney, not necessarily a lawyer.

Attractive nuisance

A dangerous feature appealing to children, thus posing a potential source of liability for the property owner.

Auditing

Verifying and examining records, particularly the financial accounts of a business or other organization.

Avulsion

A) A sudden (not slow) tearing away of land by the action of water.


B) A sudden shift in a water course.

Bad debt / Vacancy factor

A percentage deducted from a property's potential gross income to find the effective gross income, estimating the income that will probably be lost due to vacancies and non non-payment of rents by the tenants.

Balance, principal of

An appraisal principle which holds that the maximum value of real estate is achieved when the agents in production (labor, capital, land, and co-ordination) are in proper balance.

Balloon payment

A payment on a loan (usually the final payment) that is substantially larger than the regular installment payments.

Bankruptcy

A) A condition resulting when the liabilities of an individual, corporation, or firm exceeds assets. B) A court declaration that an individual, corporation, or firm is insolvent, resulting in the assets and debts being administered under bankruptcy laws.

Barter

To exchange or trade one commodity or piece of property for another without the use of money.

Bass line

Main east-west line in the government survey system from which township lines are established. Each principal meridian has one base line associated with it.

Basis

Figure used in calculating the gain on the sale of real estate for federal income tax purposes.


AKA: cost basis

Basis adjusted

The initial basis of the owner in the property, plus capital expenditures for improvements and minus any allowable depreciation deductions.

Basis initial

The amount of the owner's original investment in the property: the cost of acquiring the property including closing costs and other expenses along with the purchase price.

Bearer

A person in possession of a negotiable instrument.

Beneficiary

A) One for whom a trust is created and on whose behalf the trustee administers the trust.


B) The lender in a deed of trust transaction.


C) Someone who is entitled to receive real or personal property under a will (a legatee or devisee).

Beneficiary's statement

Document in which a lender confirms the status of the loan (the interest rate, principal balance, etc.) and describes any claims that could affect an interested party.

Bequeath

To transfer personal property to someone by will.

Bequest

Personal property (including money) that is transferred by will.

Betterment

An improvement to real property that is more extensive than ordinary repair or replacement which increases the value of the property.

Bilateral contract

Contract under which each party promises performance.

Bill of sale

A document used to transfer title to personal property from a seller to a buyer.

Blanket mortgage

Mortgage that include more than one property parcel as security.

Blind ad

An advertisement placed by a real estate licensee that does not indicate the ad is from a licensee.

Block

A group of lots surrounded by streets or unimproved land in a subdivision.

Blockbusting

Attempting to lure owners to list or sell their homes by predicting that the members of another race or ethnic group, or people suffering from some disability, will be moving into the neighborhood. AKA: panic selling. It is a violation of the antidiscrimination laws.

Blue sky laws

Laws regulating the promotion and sale of securities in order to protect the public from fraud.

Board of Directors

The body responsible for governing a corporation on behalf of the shareholders.

Bonafide

In good faith; genuine, not fraudulent.

Bond

A) A written obligation, normally interest-bearing, to pay a certain sum at a specified time.


B) Money put up as a surety, protecting against failure to perform, negligent performance, or fraud.

Bonus

An additional payment, over and above the due payment.

Boot

Something given or received in a tax-free exchange, which is not like-kind property. For instance, in an exchange of real property where one party gives another one cash in addition to real property, the cash is the boot.

Boundary

The perimeter or border of a parcel of land; the dividing line between two pieces of property.

Branch manager

An associate broker appointed by a firm's primary broker to manage the operations of a branch office.

Breach

Violation of an obligation, duty, or law.

Breach of contract

Failure to perform a contractual obligation.

Broker associate

Someone who is qualified as a broker and is affiliated with another broker.

Broker cooperating

A broker belonging to a multiple listing service who helps sell a property listed with another member of the listing services.

Broker designated

A corporate officer or a general partner who is authorized to act as the broker for a licensed corporation or for a partnership.

Broker, fee

A real estate broker who allows the use of his license to another person to carry on a brokerage, in violation of the license law.

Broker listing

A broker having a listing agreement with a property seller.

Broker, real estate

Someone who is licensed to represent members of the public in real estate transactions in exchange for compensation.

Brokerage

Business of a real estate broker.

Brokerage fee

Service charges of a real estate broker that is paid as a commission or as other compensation.

Buffer

Undeveloped area that separates two areas zoned for incompatible uses.

Building codes

Regulations that set minimum standards for construction methods and materials.

Building restrictions

These are rules that apply to building size, type, or placement. They may be public restrictions, such as in a zoning ordinance or private restrictions, like CC&R's.

Bulk transfer

The sale of all or a substantial part of the merchandise, equipment, or any other inventory of a business that is not in the ordinary course of business.

Bulk transfer law

A law that requires a seller who negotiates a bulk transfer (generally connected with the sale of the business itself) to furnish the buyer with a list of creditors and a schedule of the property being sold, and to notify creditors of the impeding transfer.

Bump clause

A provision in the purchase agreement allowing a seller to keep the property on the market while waiting for a contingency clause to be fulfilled. In the meantime, if the seller receives another good offer, he can ask the buyer either to waive the contingency clause or terminate the contract.

Bundle of rights

The rights inherent in ownership of property, including the right to use, lease, enjoy, encumber, will, sell, or do nothing with the property.

Business opportunity

A business that is for sale.

Buy down

Discount points paid to a lender to reduce (buy down) the interest rates charged to a borrower, especially when the seller pays discount points to help the buyer (borrower) qualify for financing.

Buyer representation agreement

A contract in which a prospective buyer hires a real estate broker to act as his agent for locating desirable property and negotiating its purchase, or in negotiating the purchase of a property that the buyer has already found.


AkA: Buyer Agency Agreement.

California Coastal Act CCA

Law that is designed to protect and control development along the California coastline.

California Fair Housing Law CFHL

Law that guarantees equal treatment for everyone in all business establishments.


AKA: The Rumford Act

CA highest and lowest points

Mt. Whitney at 14,494 ft and Death Valley at 282 ft below sea level (also lowest in USA). These are 85 miles apart.

CA Veterans Farm and Home Purchase Program

State sponsored residential finance program utilized to provide cheap home and farm loans to veterans. AKA: Cal-Vet Program

Call

A specification that describes a segment of the boundaryin a metes and bounds description; for example, "South 20* west 100 ft" is a call.

Cancellation Clause

Terminating a contract without undoing acts that have already been performed under the contract.

Cap

A limit on how much a lender may raise an adjustable rate mortgages interest rate or monthly payment per year, or over the life of the loan.

Capacity

The legal ability or competency to perform any act, such as enter a binding contract (contractual capacity) or execute a valid will (testamentary capacity).

Capital

Money or other forms of wealth available for use in producing more money.

Capital Assets

Assets held by a taxpayer other than property held for sale to customers in the normal course of the taxpayer's business. It also comprises depreciable property of real property used in the taxpayer's trade or business. Therefore, real property is a capital asset if owned for personal use or for profit.