Archives For Glossary

Glossary G

June 7, 2016 — Leave a comment

G-28

Attorney appearance form. Blue form that must accompany any immigration application in order for an

attorney to be officially entered as attorney of record and to receive copies of correspondence.

G-325A

Detailed biographic information form that is required with an adjustment of status application and other

petitions. One of the copies is sent to the embassy in the native country and another is sent to the CIA to

perform records checks. Required for all adjustment applicants fourteen years of age and over.

gamete

An egg or sperm cell.

gamete intrafallopian transfer (GIFT)

A technique in which eggs are placed into the intended mother’s fallopian tubes with large numbers of

sperm.

gap financing

See bridge loan.

gap loan

A temporary loan to supply needed money before a sale or longer term financing can be completed. It is

arranged quickly, easy to get, and expensive.

garnish

To order a third party to turn over to a creditor any property that is being held for a debtor.

garnishment

A legal action to withhold wages or other assets for payment of a debt.

gay straight alliance (GSA)

School support group of children of GLBT families or gay teens.

gender identity disorder (GID)

A classification by the American Psychiatric Association of transgender individuals.

general agent

A general agent is a much different concept than that of a retail agent. In the property/casualty context, some

insurers contract with general agents to perform underwriting and claims functions rather than to hire their

own employees to perform the underwriting and claims functions. In other circumstances, insurers contract

with general agents to perform underwriting functions only, commonly for limited classes of business, such

as restaurant policy programs. In the life insurance context, insurers sometimes contract with general agents

to be their exclusive marketing channel for the insurer’s products. In order to sell that company’s products,

an agent must be a subagent of the general agent.

general contractor

Party that performs or supervises the construction or development of a property. The general contractor may

use his or her own employees for this work or the services of other contractors (subcontractors).

general duty clause

The Occupational Safety and Health Act requirement that every employer furnish its employees with

employment and a place of employment free from recognized hazards that cause or are likely to cause death

or serious physical harm.

general employer

An employer who transfers an employee to another employer (called the special employer) for a limited

period of time. While the transfer is in effect, the special employer has temporary responsibility and control

over the employee’s work.

general maintenance

Upkeep that can be anticipated and performed on a regular basis or that is minor in nature.

general partner

A partner who shares ownership and has full liability for the debts of the business.

general partnership

A business that is owned by two or more persons.

general power of attorney

A power of attorney that gives the agent very broad powers, generally to conduct all kinds of business on

behalf of the principal.

general release

A legal writing setting forth the terms of the settlement. It prevents the plaintiff from seeking further legal

redress.

general warranty deed

See warranty deed.

generation-skipping trust

Trust designed to skip one generation of estate taxes because the trust leaves the principal to the grantor’s

grandchildren, not the grantor’s children.

genetic (DNA) testing

The analysis of blood or saliva to obtain genetic information that can identify the parents of a child.

genre

A particular type of music; rock or country, for example.

geriatric care manager

A professional service provider who assists in long-term care planning by seeking suitable facilities for the

elderly.

gestational surrogacy

The intended mother’s egg is implanted into the surrogate with the intended father’s sperm to conceive a

child. The surrogate has no biological relationship with the child.

GI loan

Old term for a VA guaranteed mortgage loan.

gift

Voluntary lifetime or at-death transfer of property, made without compensation.

gift letter

A letter from one who is giving money to a buyer for part of the down payment. The letter must state that

the money need not be repaid.

gift tax

Tax on lifetime transfers of property given without consideration or for less consideration than the property

is worth.

Ginnie Mae

The Government National Mortgage Association. A government agency that guarantees payment to those

who buy certain types of mortgage backed securities.

glass ceiling

The invisible barrier to advancement sometimes faced by women and minorities.

goal

The actions taken to achieve a business purpose.

golden parachute

Payments promised to key personnel in the event of a change in ownership or control of a company.

good will

In accounting, the monetary value placed on the good reputation of a business. It is considered an asset of

the business. Typically, an organization that has been in business for a number of years and enjoys a good

reputation among its customers has more good will value than a new company.

governing documents

Set of legal papers, filed by a developer with the appropriate local government office, that submit land to use

for, create and govern a Community Association.

government mortgages

Mortgages insured or guaranteed by the government.

Government National Mortgage Association (GNMA)

See Ginnie Mae.

grace period

(1) The time between when the billing cycle closes and the date you have to pay the balance by to avoid any

finance charges. (2) Time allowed to get something done.

graduate payments

Student loan payments that begin low and increase over time, often beginning with interest-only payments.

graduated payment mortgage

A mortgage loan that begins with a low monthly payment that gradually increases to an amount necessary to

amortize the loan over the term. Its purpose is to help buyers who expect future income to increase.

grandfathered

Amendment to a governing document that changes rights or restrictions while preserving an owner’s rights

who relied on the documents at the time of purchase.

grantee

A person who received property from another.

grantor

A person who transfers property to another.

grantor trust

Living trust in which the grantor maintains enough control over the assets so that the trust income received

is taxed to the grantor, not to the trust or to the trust’s beneficiaries.

green card holder

See lawful permanent resident.

green card number

See A number.

green card stamp

Refers to the temporary stamp placed by a USCIS officer into a person’s passport signifying his or her

adjustment of status.

gross estate

Property owned by a decedent at death. Value before debts are paid.

gross income

Sales less cost of goods sold.

gross monthly income

Income received each month from every source before taxes deductions for employer incentive savings

program 401(k).

groundwater

Water that is present in the subsoil.

growing equity mortgage (GEM)

Graduated payment mortgage in which increases in a borrower’s mortgage payments are used to accelerate

reduction of principal on the mortgage.

guaranteed insurability rider

Addition to a life insurance policy that allows you to purchase more insurance without going through

medical history or exams.

guaranteed issue life insurance

Life insurance that is offered regardless of a person’s risk of death.

guaranteed loan

Loan that a government agency assures the lender will be paid back even if the borrower defaults.

guarantor

Person who is also liable for another’s debt or performance.

guaranty

Agreeing to be liable for the debt of another.

guardian

A person appointed by the court to handle property and personal matters for another individual.

guardian ad litem

The person, usually an attorney, appointed by the court to watch out for the best interests of the child during

the court case.

guardian of the person

A person who is authorized by a court, pursuant to a guardianship proceeding, to make decisions regarding

the care of another person.

guardian of the property

A person who is authorized by a court, pursuant to a guardianship proceeding, to handle the financial affairs

of another person.

guardianship

(1) A legal proceeding to determine whether a person is legally incompetent and should have a guardian

appointed to care for the person or the person’s financial matters. (2) The legal relationship between a

guardian and a ward.

Glossary Z

October 19, 2006 — 1 Comment

Terms to know in Real Estate Investing

We are not lawyers, we are real estate investors!

This is an exhaustive glossary for USA, Canada, Australia and New Zealand

USA

Deeds of Trusts and Mortgages, Title Companies and Lawyer Closings, lots to know. We place great terms here.

Canada

The provinces have different terms and procedures from each other. We do our best to list terms to know in canada.

Australia

The states, especially in Lease Options, have unique differences.

New Zealand

The North Island and the South Island have close similarities, but Lease Options are brand new, and Wraps are not favored by the banks.

contact us

Glossary – Z

ZERO LOT LINE:
A zoning regulation which allows certain properties to have buildings placed up to the line dividing separate properties.ZONE:
An area of a municipality to which certain rules, regulations, bylaws or ordinances apply.

ZONING BYLAW:
A rule passed by the local government which regulates the use of property according to its location within the municipality, placement of structures on the property, maximum floor area, minimum lot area, minimum floor-to-lot area ratios, etc.

Glossary Y

October 19, 2006 — 3 Comments

Terms to know in Real Estate Investing

We are not lawyers, we are real estate investors!

This is an exhaustive glossary for USA, Canada, Australia and New Zealand

USA

Deeds of Trusts and Mortgages, Title Companies and Lawyer Closings, lots to know. We place great terms here.

Canada

The provinces have different terms and procedures from each other. We do our best to list terms to know in canada.

Australia

The states, especially in Lease Options, have unique differences.

New Zealand

The North Island and the South Island have close similarities, but Lease Options are brand new, and Wraps are not favored by the banks.

contact us

Yard

  • The Open Grounds

Yield

  • A Measurement of the Rate of Earnings from an investment
  • ex) A Loan is arrangenged to provide a 15% yield to the lender.

Yield to Maturity

  • the Internal Rate of Return (IRR) of an investment
  • considers all the inflows and outflows of the investment returns and their timing
  • ex) An Income Producing Property requires a $10,000 investment
    • It promises a $1000 annual rate of returnfor 5 years
    • then resale proceeds of $15,000
    • The Yield to Maturity (YTM) is 17.1%
    • See Internal Rate Of Return (IRR) for Formulas

Glossary X

October 19, 2006 — 2 Comments

Terms to know in Real Estate Investing

post We are not lawyers, we are real estate investors!

This is an exhaustive glossary for USA, Canada, Australia and New Zealand

USA

Deeds of Trusts and Mortgages, Title Companies and Lawyer Closings, lots to know. We place great terms here.

Canada

The provinces have different terms and procedures from each other. We do our best to list terms to know in canada.

Australia

The states, especially in Lease Options, have unique differences.

New Zealand

The North Island and the South Island have close similarities, but Lease Options are brand new, and Wraps are not favored by the banks.

contact us

X –

  1. A Signature used who is mentally or physically handicapped
  2. Sign at the “x”

Glossary V

October 19, 2006 — 6 Comments

Terms to know in Real Estate Investing

We are not lawyers, we are real estate investors!

This is a for USA, Canada, Australia and New Zealand

USA

Deeds of Trusts and Mortgages, Title Companies and Lawyer Closings, lots to know. We place great terms here.

Canada

The provinces have different terms and procedures from each other. We do our best to list terms to know in canada.

Australia

The states, especially in Lease Options, have unique differences.

New Zealand

The North Island and the South Island have close similarities, but Lease Options are brand new, and Wraps are not favored by the banks.

contact us

VACANCY RATE:
The calculation of the percentage of all available rental units in a particular area that are not occupied.

VACANT LAND:
Land that may be improved and developed but is not currently in use.

VACATE:
To leave or move out of a premises.

VACATION HOME:
An occasional-use property, often in a resort area (ski, sun, ocean), which may be rented out by the owner to other vacationers while not in use by the owner.

VALID:
Legally binding; authorized.

VALUATION:
The estimation of the worth or sale price of an asset.

VARIABLE EXPENSES:
Operating costs of a property which are not fixed, which change as a result of certain contingencies, such as percentage occupation of the property, type of use of the property, perhaps even the season of the year (for heating and air conditioning costs).

VARIABLE INTEREST RATE:
An interest rate that may change according to change in the index rate. See “adjustable interest rate“.

VARIABLE-MATURITY MORTGAGE:
A long-term loan in which the date the balance is due may be changed to adjust the level of periodic payments.

VARIABLE RATE MORTGAGE (VRM):
See “adjustable rate mortgage“.

VARIANCE:
An indulgence granted by a local zoning commission or authority to allow a non-conforming use of a property to continue. The zoning bylaw or ordinance is actually amended as it pertains to the particular property.

VENDOR:
Seller. Purchasee.

VENDOR AND PURCHASER APPLICATION:
Also known as “V&P Application”. The bringing before a court in Ontario of any dispute between parties to an Agreement of Purchase and Sale with regard to the terms of the Agreement. Named after the Vendors and Purchasers Act, the statute which sets out the procedure for such an application.

VENDOR TAKE-BACK MORTGAGE:
See “mortgage back“.

VENEER:
Any kind of thin wood or brick finish which is attached to the exterior of an item, be it a wall or a piece of furniture.

VEST:
To become the property of someone through action of law.

VIOLATION:
Any breach of a contract, rule, law or ordinance.

VOID:
Null, not legally enforceable.

VOIDABLE:
A contract that may be treated as legally unenforceable at the option of a party (usually the injured party) but remains enforceable until that party exercises her option.

VOLUNTARY ALIENATION:
Transfer of title to an asset with the consent of the owner.

VOLUNTARY LIEN:
A claim that is recorded/registered with consent of the owner.

Glossary U

October 19, 2006 — Leave a comment

Terms to know in Real Estate Investing

post We are not lawyers, we are real estate investors!

This is an exhaustive glossary for USA, Canada, Australia and New Zealand

USA

Deeds of Trusts and Mortgages, Title Companies and Lawyer Closings, lots to know. We place great terms here.

Canada

The provinces have different terms and procedures from each other. We do our best to list terms to know in canada.

Australia

The states, especially in Lease Options, have unique differences.

New Zealand

The North Island and the South Island have close similarities, but Lease Options are brand new, and Wraps are not favored by the banks.

contact us

UNDERIMPROVED LAND:
Property that is not being used so as to produce the maximum income it is capable of producing.

UNDERINSURANCE:
Insurance which would provide insufficient proceeds to compensate for the loss of the value of the insured item.

UNDERTAKING:
A promise, reduced to writing, which is legally enforceable.

UNDERWRITER:
A person who reviews and evaluates an application for a loan or insurance policy.

UNDERWRITING:
The decision as to whether or not to accept a loan or insurance application.

UNDEVELOPED LAND:
Real property that has not been subjected to man’s labour to make it more valuable of profitable. Raw land.

UNDISCLOSED AGENCY:
When a person deals with another party on behalf of a third person but does not inform the party with whom he is dealing of this relationship.

UNDISCLOSED PRINCIPAL:
The identity of the person whom an undisclosed agent represents.

UNDIVIDED INTEREST:
The term to describe the title of co-owners of a property as joint tenants such that the co-owners’ title cannot be separated.

UNDUE INFLUENCE:
The exertion by a third party of any kind of control such that a person signs a contract or other instrument which, absent the influence of the third party, he would not have signed. A contract or instrument may be set aside as not binding on any party who signs it while under undue influence.

UNENCUMBERED PROPERTY:
Land that has no claims, liens or mortgages registered against it.

UNENFORCEABLE CONTRACT:
Any agreement that will not stand up to legal challenge. May result from the incapacity of a party, the illegality of the terms of the agreement, or the presence of undue influence, threat or coercion upon a party which caused that party to sign the contract.

UNILATERAL CONTRACT:
An agreement to exchange payment for services, where payment becomes due only once the service has been successfully performed. A listing agreement for the sale of real property may be a unilateral contract.

UNIMPROVED LAND:
See “undeveloped land“.

UNINSURABLE TITLE:
Ownership of land which is subject to flaws such that a title insurance company refuses insure it.

UNIT:
A single dwelling within a larger complex: especially in condominium projects where the unit is the portion of the complex which is for the exclusive use of the owner of the unit.

UNITY OF POSSESSION:
A right of each joint tenant to use, occupy and enjoy the entire property.

UNITY OF TIME:
For joint tenants, the requirement that each of the tenants acquires her interest at the same time, as part of the same conveyance.

UNITY OF TITLE:
For joint tenants, the requirement that each of the tenants acquires her interest in the same instrument of conveyance.

UNLAWFUL DETAINER:
The illegal possession of land by one whose original possession was legal.

UNMARKETABLE TITLE:
Similar to “uninsurable title:, ownership of land which is defective such that no one would wish to purchase it.

UNRECORDED/UNREGISTERED INSTRUMENT:
A legal document which purports to affect rights and interests in land but which has not been added to the public record for the property.

UNSECURED LOAN:
A loan in air, with no asset pledged as collateral or security for it.

UP RENT POTENTIAL:
An estimate of the amount rent on a property may be reasonably raised over a period of time.

UPLAND:
Property which borders on a body of water.

URBAN RENEWAL:
The process of acquiring and redeveloping property for the purposes of increasing its profitability or utility. May be conducted by government, private interests or a combination of the two.

URBAN SPRAWL:
Slang term for the growth of cities in an unplanned and often wasteful manner.

UREAFORMALDEHYDE FORM INSULATION (UFFI):
A form of residential and commercial insulation popular in the 1970s which was found to give off toxic gases. Properties insulated with UFFI sell for much less than similar, non-UFFI properties as a result of the fear of health problems. In many jurisdictions, the Vendor of a residential property must inform a prospective purchaser of the presence of UFFI or provide a warranty that there is no UFFI in the property.

USE:
Noun: Term for the purpose for which a property is occupied, mostly related to zoning by-laws or ordinances. Some typical uses would be residential, commercial, industrial, etc.

USEFUL LIFE:
An estimation of the period of time over which a property, building or other asset will be of value or use to its owner.

USURY:
The illegal act of charging extremely high interest rates on a loan.

UTILITIES:
Services, such as gas, electricity, water, sewers, which are required in any dwelling and for which the owner must pay separately. In some jurisdictions, arrears in payment of charges for utilities may form a lien on the property.

Glossary T

October 19, 2006 — 3 Comments

Terms to know in Real Estate Investing

post We are not lawyers, we are real estate investors!

This is an exhaustive glossary for USA, Canada, Australia and New Zealand

USA

Deeds of Trusts and Mortgages, Title Companies and Lawyer Closings, lots to know. We place great terms here.

Canada

The provinces have different terms and procedures from each other. We do our best to list terms to know in canada.

Australia

The states, especially in Lease Options, have unique differences.

New Zealand

The North Island and the South Island have close similarities, but Lease Options are brand new, and Wraps are not favored by the banks.

contact us

TACKING:
Adding an extra period of time to the term of a contract.

TANGIBLE PROPERTY:
Assets that can be touched, that have a physical existence.

TAX:
1. To strain or push to the point of exhaustion.
2. To levy an assessment against, usually by government powers. Unpaid taxes usually form a special lien on property owned by the taxpayer, ahead of registered mortgages.
3. The money charged as an assessment.

TAX BASE (Canada):
The pool of property, value or income from which a government may draw assessments.

TAX HOLDBACK (Canada):
A Purchaser is required to hold back 33% of the purchase price in situations where the Vendor is not a resident of Canada unless the Vendor provides a Certificate from Revenue Canada.

TAX LIEN:
A claim registered against a property by a government authority for non-payment of assessed taxes.

TAX ROLL:
Also known as “assessment roll“, the listing of all properties in a jurisdiction that are subject to taxation, including owners’ names, assessed value of each property, municipal addresses, legal descriptions and assessment roll number.

TAX SALE:
Sale of property by a governmental body for non-payment of taxes, ether by tender or auction.

TAX-EXEMPT PROPERTY:
A property that is not subject to realty taxes.

TEASER RATE:
A lower interest rate charged on an adjustable or variable rate mortgage for a brief, introductory period as an inducement to the borrower to accept the loan from the lender.

TENANCY:
The right to use and occupy all or part of a property under a rental agreement.

TENANCY FOR LIFE:
See “life estate“.

TENANCY FOR YEARS:
Form of tenancy created by a written agreement in which the tenant has the right to occupy the premises for a stated period of time.

TENANCY FROM YEAR TO YEAR (MONTH TO MONTH):
A form of tenancy in which the tenant’s right to occupy the premises lasts for a stated period of time but may be extended by mutual consent for another period.

TENANCY IN COMMON:
Ownership of property in which several owners each own a stated portion of the property (a percentage). Each owner may deal with her portion of the property as she wishes (giving it away, mortgaging it, selling it, bequeathing it, etc.) and, upon her death, her share becomes part of her estate.

TENANCY IN SEVERALTY:
Ownership of property by a single person.

TENANT FIXTURES:
Items added to a leased premises by a tenant that might normally be considered fixtures (and, therefore, part of the premises) but that, by contract or law, the tenant is entitled to remove at the end of the lease period.

TENANT IN COMMON:
A person who owns property with one or more others, where each owns a stated portion of the property and is free to deal with his portion as he wishes.

TENDER:
1. To deliver payment or an item one is obliged to deliver;

2. To produce evidence of one’s ability to meet one’s obligations under a contract for the purposes of preserving one’s right to sue another party to the contract who is not able to carry out the contract.

TENEMENTS:
1. A legal word for a property or fixed asset (see dominant or servient tenement regarding easements).
2. Term for units in an aging apartment complex or building.

TENURE IN LAND:
The fashion in which an owner holds title to land.

TERM LOAN:
A loan that comes due on a given date, often before the periodic payments would pay the loan out.

TERM, AMORTIZATION:
Term: The period of time during which the loan contract is active, during which the borrower makes periodic payments to the lender and at the end of which the balance of the loan becomes due and payable.
Amortization: The period of time after which, if all periodic payments are made on time and in full, the loan will be paid out. Term may not be the same as amortization: a normal mortgage may be amortized over 25 years with just a five year term at which time the borrower has to refinance.

TERMITE CLAUSE:
A term in an Agreement for sale which allows the Purchaser to inspect for termites. If any are found, the Vendor may be required to treat the problem or the Purchaser may rescind. Many clauses now refer more generally to “wood-damaging or destroying insects“.

TERMITE INSPECTION:
The examination of a building for wood destroying insects.

TERMS:
The various clauses that make up a contract. Sometimes used to described the financial portions of the contract only.

TESTAMENT:
Another word for a will.

TESTAMENTARY DISPOSITION:
The transfer of ownership of an asset by way of a will.

TESTATE:
To die leaving a valid Will. Opposite of “intestate“.

TESTATOR (TESTATRIX):
The person who makes a will.

TESTIMONIUM:
The clause in a legal instrument that sets out the date and other information regarding the signing of the instrument.

THIRD PARTY:
A person who is not a party to a contract but may become involved in an indirect way or be affected by it.

TIME IS OF THE ESSENCE:
A standard statement in a contract which ensures that all dates and times of day noted in the contract are important and cannot be ignored by any of the parties without the consent of the others except in breach of the contract.

TIME-SHARING:
A form of joint ownership of property where numerous owners share title and enjoy use or occupation of the property according to a specific schedule.

TITLE:
The legal term for one’s ownership interest in land.

TITLE COMPANY:
Also known as “title insurance company” or “title insurer”. A corporation which is in the business of selling policies of insurance guaranteeing the ownership and quality of title to land.

TITLE COVENANTS:
Clauses and promises inserted into instruments of conveyance which are designed to give the Purchaser assurances that she is receiving good title.

TITLE DEFECT:
A claim against or competing interest in a property which affects the title of the registered owner.

TITLE INSURANCE POLICY:
A form of insurance contract which guarantees to indemnify an owner or mortgagee of property for damages suffered as a result of undiscovered title defects which arise later.

TITLE REPORT:
A document which sets out the current state of title to a property.

TITLE SEARCH OR EXAMINATION:
The act of examining in detail the public records relating to ownership of a parcel of land to ensure that the current owner has clear title, free of any liens, claims, mortgages or competing and adverse interests. Usually performed by a lawyer, qualified title searcher, or title insurance company on behalf of a proposed purchaser or mortgagee.

TITLE THEORY STATES:
Jurisdictions in which ownership of land is divided into two interests: legal title and equitable title. When an owner registers a mortgage in favour of a lender, legal title is transferred to the lender while the owner retains equitable (or beneficial) title. Once the mortgage is paid out, legal title is transferred back to the owner.

TOPOGRAPHY:
The form and structure of the surface of land (i.e. hilly, flat, etc.)

TORRENS SYSTEM:
Developed in Australia, a system of the registration of interests in land in which documents are closely regulated, monitored and examined by the recording authority to ensure that they are correct and that title is transferred without flaw. Property may not be transferred if uncorrected title defects exist.

TOTAL DEBT RATIO:
Comparison of the total costs of living for a person (including debt, food, utilities) over a given period with the gross income of that person.

TOTAL INTEREST PAYMENTS:
A calculation of all interest paid on a loan over its life.

TOWN HOUSE:
A type of dwelling which shares at least one common wall with neighbouring dwellings.

TRANSACTION FEE:
A charge for making a withdrawal on a line of credit or other bank account.

TRANSACTION LEVY:
A one-time insurance payment charged to lawyers in Ontario for each real estate transaction they handle. Many lawyers simply pass the levy on to clients as a disbursement.

TRANSFER TAX (Canada):
See “land transfer tax“.

TRESPASS:
Entry onto or possession of the property owned by another without the owner’s consent.

TRIPLE-NET LEASE:
A rental agreement which requires the tenant to pay all operating costs of the building.

TRUST ACCOUNT:
A bank account held by a professional for the purposes of keeping money held on behalf of clients separate from the funds of the professional or her business.

TRUST DEED:
An instrument of conveyance of title to property wherein the transferee will be holding the title to the property on behalf of another person.

TRUSTEE:
A person who holds title to property on behalf of another (a “beneficiary of the trust”).

TRUSTEE’S SALE:
Sale conducted by a trustee (often the lender) under the terms of the deed of trust.

TUDOR:
A heavy looking, fortress-like style of home in the English style. Stone and brick construction, may also feature stucco and exposed timbers. Windows feature stone trim.

TWO-STEP MORTGAGE:
A mortgage contract in which the interest rate changes after a given period of time, such that the rate charged is lower for the first part of the term of the mortgage and then market rate or higher later in the term.

Glossary S

October 19, 2006 — 3 Comments

Terms to know in Real Estate Investing

post We are not lawyers, we are real estate investors!

This is an exhaustive glossary for USA, Canada, Australia and New Zealand

USA

Deeds of Trusts and Mortgages, Title Companies and Lawyer Closings, lots to know. We place great terms here.

Canada

The provinces have different terms and procedures from each other. We do our best to list terms to know in canada.

Australia

The states, especially in Lease Options, have unique differences.

New Zealand

The North Island and the South Island have close similarities, but Lease Options are brand new, and Wraps are not favored by the banks.

contact us

SALE AGREEMENT:
Also known as “Agreement of Purchase and Sale” or “Purchase Agreement; the contract that sets out the terms and conditions agreed to by the purchaser and the vendor in the sale of land.

SALE AND LEASEBACK (SALE-LEASEBACK):
Where the vendor sells the property to the purchaser, then leases it back immediately for a long term.

SALE PRICE:
Also known as “purchase price“; the amount of money paid by the purchaser to the vendor for the property under the agreement.

SALES ASSOCIATE:
A real estate professional in the employ of another such real estate professional.

SALES COMPARISON APPROACH:
Method of estimating value of a property by comparing similar properties that have been sold recently.

SALES CONTRACT:
See “sale agreement“.

SANDWICH LEASE:
A slang term for a sublease, where the tenant is sandwiched between the owner and the subtenant, acting both as lessor and lessee at the same time.

SATELLITE TENANT:
A smaller shop in a mall.

SCARCITY:
The idea that price is driven by availability of the product. If there is not enough product to meet demand (the product is scarce), the price of the product will rise.

SCENIC EASEMENT:
A right to the use of land which is given for the purpose of ensuring that the land is never developed and the natural beauty of the area is, as a result, preserved.

SCHEDULE:
A document attached to an instrument for registration or to a contract or agreement, which may contain information required in the instrument or extra terms of the contract.

SCHEDULED MORTGAGE PAYMENT:
The periodic payment the borrower is obliged to pay on a loan.

SEARCH:
An investigation, a review of public records for problems, concerns or simply for information. See “title search“.

SEASONED MORTGAGE:
An old loan under which the borrower has proven herself capable of meeting loan obligations.

SECOND:
One sixtieth of a minute which is one sixtieth of a degree which is one 360th of a circle. Used in metes and bounds descriptions when astronomic bearings are used to describe directions.

SECOND MORTGAGE:
A mortgage loan which is registered on title after another mortgage (the first mortgage) and, therefore, is behind the first mortgage in priority. In the event of default and sale of the property, the second mortgagee will only be paid if there are funds left after the payment of the first mortgagee.

SECONDARY FINANCING:
Another term for a second mortgage; a loan which stands behind the principal loan.

SECONDARY MARKET:
The purchase and sale of mortgages among lenders.

SECTION:
Another term for Plan, usually used in Torrens System of land registration.

SECURITY:
An asset held as a guarantee of payment of a loan.

SECURITY DEPOSIT:
Money held by the landlord to ensure the tenant meets his obligations under the lease.

SECURITY INTEREST:
Legal term for the claim the lender has against the borrower’s property which has been pledged under a loan.

SEE-THROUGH BUILDING:
Slang term for a property which is mostly empty of tenants.

SELF-AMORTIZING MORTGAGE LOAN:
A loan which will be paid off by the end of its term, such that its term equals its amortization period.

SELLER FINANCING:
Also known as “vendor take-back mortgage” or “mortgage back“, where the seller of a property agrees to payment of part of the purchase price over time with the debt to the seller registered on title as a mortgage.

SELLER’S MARKET:
Demand is greater than supply, such that the vendor may demand a higher price.

SELLER-TAKE-BACK:
See “seller financing”.

SELLING AGENT:
The real estate professional who brings the eventual purchaser to the property and the vendor. As opposed to “listing agent”.

SEMIANNUAL:
Occurring twice per year.

SEMIDETACHED HOUSING:
A dwelling that shares one side wall with another dwelling.

SEPARATE PROPERTY:
Property owned by one spouse solely, rather than jointly with the other spouse.

SEPTIC SYSTEM:
A manner of dealing with sewage of a dwelling, through pipes into a septic tank.

SERIOUS DELINQUENCY:
The condition of being far behind in mortgage payments such that mortgage enforcement by the lender is imminent.

SERVICING (THE LOAN):
The act of collecting periodic payments toward a debt.

SERVIENT TENEMENT:
The piece of land which is subject to an easement. As opposed to the “dominant estate”.

SET BACK ORDINANCE/BYLAW:
A municipal government rule that establishes the minimum distance a building or other improvement must stand from property lines.

SETTLEMENT COSTS:
See “closing costs“.

SEVER:
To divide one piece of property from another to be sold or used separately.

SEVERANCE:
The word for the act of dividing one property from another or splitting a property into pieces.

SHARED APPRECIATION MORTGAGE (SAM):
A loan arrangement which allows the lender to share, in exchange for a reduced interest rate, in any gain in the value of the property against which the mortgage is secured.

SHELL LEASE:
A rental agreement wherein the tenant rents the incomplete building and agrees to complete the interior work, such as plumbing, wiring, interior walls, floors, etc.

SHERIFF:
Enforcement officer in a jurisdiction, person charged with the responsibility of enforcing writs and liens against people.

SIGN BACK:
The act of countering an offer with a return offer. The original offer document is amended, initialed by the person amending it, and sent back to the original offeror as a new, counter offer.

SIGNED SEALED AND DELIVERED:
A legal phrase suggesting that the party executing a document intends it to be enforceable even if no consideration is given to her for signing.

SIMPLE INTEREST:
A charge for the use of money which is calculated on a periodic basis as a percentage of the principal borrowed. No further interest is charged on interest accumulated in earlier periods.

SINGLE AGENCY:
The representation of only one party to a transaction.

SINGLE-FAMILY RESIDENCE (UNIT):
A property designed for the use and occupancy of one family group.

SITE:
The location of something.

SITE PLAN:
A survey and document setting out proposed development of a site.

SITE PLAN AGREEMENT:
A contract between a builder/developer and a municipal government which sets out the terms and conditions of the government’s consent to the builder/developer developing a given site.

SOFT MARKET:
Also known as “buyers’ market”, when vendors far outnumber buyers and prices fall.

SPEC HOUSE:
A new dwelling which is being built or has been completed by a builder before a purchaser has been found to buy it.

SPECIAL-PURPOSE PROPERTY:
A piece of land specifically designed and improved for a specific purpose — a school or hospital.

SPECIFIC PERFORMANCE:
A remedy for breach of contract, where the breaching party is ordered to complete the contract according to its terms.

SPECULATIVE BUILDER:
A developer who constructs housing without pre-selling.

SPECULATOR:
Someone who buys property on the expectation that its value will increase and it will be sold at a profit.

SPILLOVER EFFECT:
The impact of changes to or development of one parcel of land on a neighbouring or nearby parcel.

SPOT ZONING:
The practice of applying zoning ordinances or bylaws to specific properties when neighbouring lands may be under a different classification.

SPREADING AGREEMENT:
A contract in which the borrower gives the lender additional security for a loan by allowing it to be lodged against other property owned by the borrower.

SQUARE-FOOT METHOD:
Method of estimating cost of construction on the basis of the area of the building to be built.

SQUATTER’S RIGHTS:
The legal rights to occupy a property which accrue to a person as a result of their long-time, open, notorious and adverse possession of it.

STAKING:
A surveyor’s method of marking the boundaries of a property by placing a physical entity (a stake or bar) in the ground.

STANDARD MORTGAGE:
A mortgage which has equal periodic payments and is paid out at the end of its term.

STANDARDS OF PRACTICE:
A professional code of behaviour for real estate professionals promulgated by the National Association of REALTORS.

STARTER HOME:
A small home, inexpensive, suitable to first-time home buyers.

STATEMENT OF ADJUSTMENTS:
Document prepared by the vendor’s lawyer which sets out the purchase price and any items which need to be apportioned between the parties (i.e. realty taxes, fuel oil, insurance payments, etc.). Used to calculate the balance to be paid by the purchaser to the vendor on closing.

STATUTORY LIEN:
A claim which may be registered against property and is created by a law.

STREET ADDRESS:
See “municipal address“.

SUBDIVISION:
1. The creation of a number of smaller lots out of one or more large lots for the purposes of developing each smaller lot and selling them.
2. A newly created urban development.

SUBDIVISION AGREEMENT:
A contract between a developer and a municipality which is registered on title to all lots in a subdivision and sets out the terms and conditions which the developer must meet in exchange for the municipality’s permission to construct the subdivision.

SUBDIVISION PLAN:
Also known as “plan of subdivision”, a detailed survey setting out the new smaller lots, the streets and other improvements in a development.

SUBJECT BUILDING:
A term used to identify the building being dealt with, examined or considered, as distinguished from other buildings.

SUBJECT PROPERTY:
A term used to identify the property being dealt with, examined or considered, as distinguished from other properties.

SUBJECT TO:
An indication that title to a property includes an obligation of some sort, an easement, right of way, lien, right of claim. Opposite of “together with”.

SUBJECT TO MORTGAGE:
A term of an agreement which states that the purchaser will assume an existing mortgage registered on title to the property.

SUBLEASE:
A rental contract between a tenant and someone who rents from the tenant.

SUBLESSEE:
A tenant’s tenant.

SUBLESSOR:
A tenant who leases the premises to another person.

SUBMARGINAL LAND:
Real property that could not be developed in a financially useful way.

SUBMORTGAGE:
Where a mortgage is pledged as security for a loan to the mortgagee (the original lender).

SUBORDINATE FINANCING:
See “secondary financing“.

SUBORDINATION:
Placing the right of one person behind those of another.

SUBORDINATION CLAUSE:
An agreement by the lender which allows the current mortgage to be “postponed” or placed behind a later mortgage in priority.

SUBSTITUTE OF TRUSTEE:
An instrument registering a change of trustee under a deed of trust.

SUCCESSION:
The conveyance of property to the heirs of a deceased person under the laws governing intestate distribution of assets.

SUFFERANCE:
A legal concept, the deemed consent to the actions of another person which results when a person who could be expected to react to the other person’s actions refuses to do so.

SUIT:
A legal action commenced to enforce a claim or right.

SUPERADEQUACY:
A feature of a property which may not be recognized fully in the price of the property.

SURETY BOND:
A legal document issued to assure the completion of an act by another person.

SURFACE RIGHT:
A legal interest in the use or occupation of the top of land. As opposed to “subsurface” or “mineral rights”.

SURPLUS FUNDS:
Money gained in a mortgage enforcement sale of property which is in excess of the money required to satisfy the mortgage, interest, penalties, and costs.

SURRENDER:
To give up, to turn over something to a person claiming interest in it.

SURVEY:
A pictorial depiction of land and the improvements on it. Shows boundary lines (with measurements and bearings), buildings, sheds, easements, etc.

SURVEYOR:
A professional who is trained to map out land and improvements to land accurately.

SURVIVORSHIP:
The condition of outliving others. Surviving joint tenants have the right to take title to the land from a deceased joint tenant by right of survivorship.

SWEAT EQUITY:
Slang term for the contribution to the value of a property made by manual labour.

SWEETENER:
Slang term for an added incentive to a party to induce her to enter a transaction.

SWING LOAN:
A short-term loan designed to bridge the borrower’s finances between two events. For example, a person who buys a new home in April but cannot sell her old home until June may require a swing loan to carry both homes for the interim period until the old home may be sold and the proceeds used to pay out the swing loan. Also known as “bridge financing”.

Glossary R

October 19, 2006 — 5 Comments

Terms to know in Real Estate Investing

post We are not lawyers, we are real estate investors!

This is an exhaustive glossary for USA, Canada, Australia and New Zealand

USA

Deeds of Trusts and Mortgages, Title Companies and Lawyer Closings, lots to know. We place great terms here.

Canada

The provinces have different terms and procedures from each other. We do our best to list terms to know in canada.

Australia

The states, especially in Lease Options, have unique differences.

New Zealand

The North Island and the South Island have close similarities, but Lease Options are brand new, and Wraps are not favored by the banks.

contact us

R VALUE:
A method of measuring the insulation capabilities of materials.

RADON:
A radioactive gas which may cause health problems for occupants of some buildings.

RANCH HOUSE:
A description of a one-storey house, developed from the old, western-style homes.

RATE CAP:
A limit of how much an interest rate can change in a variable of adjustable rate mortgage either in a given period or over the life of the loan.

RATE COMMITMENT:
A written promise by a lender to lend money to a borrower at a stated rate of interest — usually time limited.

RATE LOCK-IN:
See “rate commitment“. A written agreement in which the lender guarantees the borrower a specified interest rate, provided the loan closes within a set period of time.

RATIFIED SALES CONTRACT:
A firm and binding agreement for the purchase and sale of land.

RAW LAND:
Property that has not been developed or improved.

READY, WILLING, AND ABLE:
A term of art meaning in a position to complete a contract. In order to enforce a contract against another party, you must be ready, willing and able to complete the contract yourself.

REAL ESTATE:
Term for land and all fixtures to land, including buildings and other improvements.

REAL ESTATE AGENT:
A trained professional involved in the purchase, sale and marketing of real property. The “listing agent” acts for the vendor, the “selling agent” for the successful purchaser.

REAL ESTATE BROKER:
A real estate professional who is licensed to run a real estate firm, to hold trust funds, etc.

REAL ESTATE COMMISSION:
1. The fee paid to the real estate agents after a transaction.
2. An agency that enforces real estate license laws.

REAL ESTATE MARKET:
A term for the pool of potential buyers and sellers of property at a given time.

REAL ESTATE SALES PROFESSIONAL:
See “real estate agent” or “real estate broker”.

REAL PROPERTY:
Also known as “real estate”. Land, property, plus improvements to land.

REALTOR:
Professional designation for a member of the National Association of REALTORS or its affiliated local groups. Must be a real estate broker.

REALTOR’S ASSOCIATE:
Professional designation of a licensed real estate agent or salesperson who is a member of the National Association of REALTORS but who has not been licensed as a broker.

REALTY:
See “real estate“.

REAPPRAISAL LEASE:
A rental agreement in which the periodic payment is adjustable according to scheduled re-appraisals of the rental value of the premises.

REASSESSMENT:
A change in the estimated value of a property for realty, municipal or ad valorem tax purposes.

REBATE:
Any refund of all or a portion of money paid.

RECAST PAYMENT:
Adjustment of the periodic payment on an adjustable or variable rate mortgage to ensure that the mortgage will be paid out by maturity date.

RECASTING:
Adjusting the terms of a loan agreement in light of new developments (i.e. lower rates, possible default).

RESCISSION OF CONTRACT:
The act of declaring a contract null and void and taking the necessary actions to return the parties to the position they were in prior to entering the contract.

RECITAL:
An unsworn statement of fact included in a document. In many jurisdictions, recitals in registered documents are deemed true and unassailable if unchallenged after a certain period of time.

RECONVEYANCE:
The return of title to property to its original owner. May occur as a result of the pay-out of a mortgage or at the end of a limited estate.

RECOURSE:
The right of a lender to pursue a borrower personally for moneys owed.

REDEEM:
To bring mortgage payments up-to-date after the lender has begun default proceedings. Once a borrower (or other lien holder) redeems, the mortgage is back in good standing and the relationship continues as before the default.

REDEMPTION PERIOD:
The length of time during which the borrower may redeem a mortgage.

REDEVELOP:
To remove existing improvements and buildings on a parcel of property and replace them with new, more useful and profitable improvements.

REDLINING:
An illegal practice, refusing to lend money to owners of property in certain neighbourhoods or to owners on the basis of their race, colour, religion, creed, age, gender, etc.

REEVALUATION LEASE:
See “reappraisal lease“.

REFERRAL:
A recommendation, a suggestion to a client of the value of the services of a person or firm. (i.e. a real estate agent may refer a purchaser to a particular banker or lawyer.)

REFINANCE:
To replace an existing and perhaps mature mortgage with a new mortgage on the same property. New mortgage may have different terms than the old one.

REGENCY HOUSE:
A two-storey or three-storey house in a traditional English style of the Regency Period, symmetrical in construction with a hip roof. May have a small, eight-sided window above the front door.

REGISTRAR:
The person who has the task of collecting, recording, and maintaining instruments related to title of land. May also have responsibility of ruling on the acceptability of documents submitted for registration and for making decisions as to how to correct title defects.

REGISTRATION:
The submission for recording in the public records of instruments relating to title in land. Each jurisdiction may have specific requirements as to documents which will be accepted for registration; once registered, documents will be given a registration number and recorded on the title abstract index for the property to which the apply.

REHABILITATE:
To restore, refurbish, bring back to original condition.

RELEASE CLAUSE:
A term of a mortgage which allows the borrower to pay out the loan and have the mortgage removed from title.

RELEASE OF LIEN:
A document which, once registered, removes certain kinds of claims from title to property.

RELICTION:
The gradual migration of a body of water such that additional dry land is left behind.

RELOCATION CLAUSE:
A term in a lease which allows the landlord to move the tenant to a new unit, within the same building or elsewhere.

RELOCATION NETWORK:
An organization of real estate professionals in a number of different areas specifically designed to allow information to be shared to allow easier movement of clients from one area to another.

RELOCATION SERVICE:
A firm that specializes in helping employees who are transferred by their employer to a new area take care of the move.

REMAINDER:
An interest in property that only arises once another interest ends.

REMODEL:
To refurbish, redesign, redecorate.

RENEWAL OPTION:
A right which arises out of a term in a contract and takes effect at or near the termination date of a contract; the party who enjoys the right may choose to continue the agreement on terms as set out in the option clause or to treat the contract as at an end upon the termination date.

RENOVATE:
Similar to remodel, with an emphasis on upgrading the existing property.

RENT:
1. Verb — to lease premises from the owner or a representative of the owner.
2. Noun — the periodic payments made by a tenant to the landlord for the right to occupy the premises.

RENT CONTROL:
Government initiative to control raises in the amount charged for the lease by tenants of residential premises.

RENT-FREE PERIOD:
An inducement to enter a lease, a specified number of months at the beginning of the lease in which the tenant is not required to pay the periodic rental payments.

RENTABLE AREA:
See “net leasable area“.

RENTAL RATE:
The amount charged for the occupation of a premises. property.

REPAYMENT PLAN:
A schedule arranged between a lender and borrower to set out how a debt is to be paid out.

REPLACEMENT COST:
An insurance term, the total cost of erecting a new home or building which adequately takes the place of the existing one.

REPORT:
A document sent by a lawyer to a bank certifying that title to the subject property is clear and marketable.

REPORTING LETTER:
A letter sent by a lawyer to a client after a transaction is completed (or when sent during the process of the transaction, called “interim reporting letter”) in which the lawyer certifies title to the property and informs the client of all other matters relating to the transaction.

REPRODUCTION COST:
The cost of making an exact duplicate of a property.

REQUIRED CASH:
Collective term for the total sum of money required to complete a transaction, including purchase price, taxes, legal fees, mortgage fees, etc.

REQUISITIONS:
The list of things that the lawyer for the purchaser requires the vendor to complete, provide or comply with on or before closing in order to ensure clear title. Also known as “objections”, requisitions are sent in the form of a letter which must be received by the vendor’s lawyer on or before the title search date set out in the Agreement of Purchase and Sale.

RESCIND:
To treat a contract as being at an end, to withdraw one’s offer or acceptance of an agreement.

RESCISSION:
The act of treating a contract as being at an end as a result of the failure, breach or misconduct of another party.

RESERVE FUND:
A pool of money held for use for future contingencies, usually in the management of a building, condominium corporation or cooperative unit.

RESERVE PRICE:
The amount set prior to an auction which must be met in the bidding for a particular item before the item will be sold. Also known as “reserve bid”.

RESIDENCE:
The dwelling in which a person lives, may also refer to the country or state where a person lives.

RESIDENTIAL BROKER:
A real estate professional who deals in dwelling properties.

RESIDENTIAL PROPERTY:
Real estate that is occupied by the owner.

RESIDENTIAL SERVICE CONTRACT:
A warranty or insurance contract which covers services such as electrical, plumbing etc. in a resale home.

REISSUE RATE:
See “re-insurance rate“.

RESTORE:
To refurbish a building or other asset to its original condition.

RESTRAINT ON ALIENATION:
Any limit on the ability of an owner to sell or transfer property.

RESTRICTION:
Any limit or control on the owner’s ability to use the property. May be contained in a deed and be binding on the land and future owners of it.

RESTRICTIVE COVENANT:
See “restriction”.

RETIRE (A DEBT):
To fulfill one’s obligations under a loan or mortgage so that the lender has no further claims against the borrower.

REVERSE ANNUITY MORTGAGE (RAM):
A type of mortgage where the equity in the home serves as security for periodic payments made by the lender to the borrower. Mortgage is generally paid out upon the sale of the property.

REVERSE LEVERAGE:
A term for the situation where the income from ownership of property is lower than the rate of interest paid to finance the ownership.

REVERSION:
The return of a property to the original grantor upon the occurrence of an event specified in the grant.

REVERSIONARY INTEREST:
The legal right to a property of a person under a reversion clause.

REVERSIONARY VALUE:
The value of the property at the time of reversion.

REVOCATION:
Taking back, recalling. One might revoke a power of attorney or a consent given.

REZONING:
The amendment of the classification of a property under use and building by-laws or ordinances. A property may rezoned from industrial to residential to allow a warehouse to be converted into condominiums.

RIDER:
A document which contains additional or amending clauses to a contract.

RIGHT OF FIRST REFUSAL:
The ability to make an offer for a property before the owner puts it up for sale on the open market.

RIGHT OF REDEMPTION:
See “equity of redemption“.

RIGHT OF SURVIVORSHIP:
The legal term for the right of a surviving joint tenant to take title to a property alone upon the death of the other joint tenant.

RIGHT TO RESCISSION:
Being legally entitled to treat a contract as being at an end.

RIGHT-OF-WAY:
A form of easement, the legal entitlement to pass over a portion of the land of another.

RIPARIAN OWNER:
A person who has title to land bordering on a body of water.

RIPARIAN RIGHTS:
The rights of an owner of land bordering a body of water to use or control that body of water or a part thereof.

ROD:
160 feet measured in a line, a unit of measurement.

ROLLOVER LOAN:
A loan where the amortization period is much longer than the term and the borrower is allowed to refinance at the end of the term at the interest rate then applicable.

ROOT DEED:
The first conveyance in a chain of title. If a jurisdiction has legislation which cures any title defects that are older than a certain number of years, the root deed will be the first deed beyond that period.

ROOT OF TITLE:
Any defect in ownership of property which throws into question the very basic issue of who actually owns the property. An unresolved problem going to the root of title is grounds for rescission of the Agreement of Purchase and Sale no matter when it is discovered before closing.

ROW HOUSE:
A dwelling that is attached to its neighbours by way of common walls.

RULE OF 72’S:
To calculate the number of years it will take to double money while earning compound interest, divide the interest rate into 72. Money invested at 10 percent compound interest will take 7.2 years to double.

RULES OF PROFESSIONAL CONDUCT:
The ethical guidelines which a lawyer must follow in her interactions with clients, courts, the public and other lawyers.

RUN WITH THE LAND:
A legal term which suggests that a rule, restriction, right or obligation forms part of the land itself and is transferred to each new owner along with the land.

RURAL:
A term to describe something which is not of an urban centre.

Glossary Q

October 19, 2006 — 3 Comments

post We are not lawyers, we are real estate investors!

This is an exhaustive glossary for USA, Canada, Australia and New Zealand

USA

Deeds of Trusts and Mortgages, Title Companies and Lawyer Closings, lots to know. We place great terms here.

Canada

The provinces have different terms and procedures from each other. We do our best to list terms to know in canada.

Australia

The states, especially in Lease Options, have unique differences.

New Zealand

The North Island and the South Island have close similarities, but Lease Options are brand new, and Wraps are not favored by the banks.

contact us

QUADRAPLEX:
A building containing four dwelling units.

QUALIFICATION RATE:
The rate of interest used to calculate whether or not a borrower qualifies for a mortgage.

QUALIFICATION REQUIREMENTS:
Those guidelines set by lenders to be used when deciding whether or not an applicant will be given a loan.

QUALIFIED ACCEPTANCE:
Also known as “conditional acceptance”. Agreeing to enter a contract provided certain conditions are met.

QUALIFIED BUYER:
A purchaser who has been pre-approved for financing.

QUALIFIED FEE ESTATE:
A legal interest in land which is limited.

QUANTUM:
Literally, the amount.

QUIET ENJOYMENT:
The legal right of an owner or tenant to have uninterrupted use of the property or premises without interference.

QUIT CLAIM DEED:
A conveyance which releases any interest the conveying party may have in a property without any warranty as to that party’s claim.