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The Ultimate Guide To Real Estate Terms For Your Real Estate Exam

So you want to be a real estate agent? If so, you must know these 500 real estate terms for your real estate test. Use this page as a study guide for your real estate exam prep and don’t forget to check out our material at Real Estate Exam Ninja.

 

SPECIAL NOTE: We have hidden a 50% off coupon to our top rated real estate exam prep material in this article. Are we evil? Nah. Fun? Absolutely.

 

What should I do with these real estate terms and real estate vocabulary?

Use it as a study guide for getting the real estate test. If you want flashcards already done for you, we have that at Real Estate Exam Ninja

Should I memorize all of these 500 real estate terms to pass the real estate exam?

Eh, probably not. There isn’t a need to get a perfect score on your real estate exam, although 500 definitions are not too hard to learn if you study a little at a time. Studying these terms will help prepare you for the real estate exam.

 

 

The Top 500 Real Estate Terms & Definitions

 

Real estate terms that start with A

Abandonment

The deliberate and permanent cessation of utilization or satisfaction with no aim to continue or recover one’s belonging or intrigue. May relate to an easement of real property.

 

Abutting

An area of land or a building, be next to or have a common boundary.

 

Accelerated depreciation

A method of calculating for tax purposes and reduction of an income property.

 

Accession

Title to improvements or additions to the real property gained because of the accumulation of alluvial stores along the banks of streams or because of the extension of installations.

 

Accrued depreciation

The genuine devaluation that has struck a property at some random date.

 

Acknowledgment

An assertion made by an individual to a legal official open or other open authority approved to take affirmation that the individual had executed an instrument as a free and willful act.

 

Actual eviction

A tenant was physically ousted from the rental property under a court order originated by a lessor.

 

Actual notice

Specific information or fact; that which is known; actual knowledge.

 

Ad Valorem tax

An assessment required by esteem; for the most part, used to allude to real estate tax

 

Adverse possession

The real, unmistakable, infamous, selective, and ceaseless ownership of another’s territory under a case to the title. Ownership for a statutory period might be a method for procuring title.

 

Affidavit

A composed articulation marked and vowed to before an individual approved to regulate a pledge.

 

Agent

One who speaks to or can represent someone else (called the primary). The approval might be express, inferred, or obvious. A trustee relationship is made under the law of organization when a property proprietor, as the vital, executes a posting understanding or the board contract approving an authorized land merchant to be her or his specialist.

 

Agreement of sale

A composed understanding by which the buyer consents to purchase explicit land and the seller agrees to sell, on the terms and conditions illustrated in the understanding.

 

Air lot

Assigned airspace over a real estate parcel. Air lot, similar to a surface property, might be exchanged.

 

Air rights

The privilege to utilize open space over one’s property. It very well may be sold to fabricate a skywalk or for a service organization to raise electrical cables. In case an undertaking is made to do all things considered without before consent, most of the sold equality ends up due on the closeout of the property.

 

Alienation clause

A condition in a mortgage instrument that does not enable the borrower to sell (without lender permission) on suspicion or contract-for-deed.

 

Amendments

Changes to recently endorsed and received composed understandings are alterations.

 

Amenities

Neighborhood offices and administrations that upgrade a property’s estimation. They are regularly outside of the property. Pools, three-vehicle carports, decks, and so forth that are on the property are called highlights.

 

Amortization

The liquidation of a monetary weight by portion installments, which incorporate main and intrigue.

 

Amortized loan

A credit wherein the important and intrigue are payable in a month to month or other intermittent portions over the term of the loan.

 

Anticipation

An assessing guideline made by the desire for some future events making esteems either raise or lessens.

 

Antitrust laws

The laws intended to safeguard the free endeavor of the open commercial center by making illicit certain private connivances and blends framed to limit rivalry. Infringement of antitrust laws in the land business, by and large, includes either value fixing (representatives plotting to set fixed pay rates) or designation of clients or markets (specialists consenting to restrict their exchanges or dealings to specific territories or properties).

 

Appraisal

An estimate of the amount, quality, or benefit of something. The procedure through which decisions about property estimation are acquired; likewise alludes to the report that puts forward the technique for evaluation and assurance of significant worth.

 

Appraised value

An evaluation of a property’s present worth.

 

Appreciation

An increase in the value or estimation of a property, because of monetary or related causes, which may demonstrate to be either brief or lasting.

 

Arbitrage

The concurrent buy and closeout of security to get a higher yield from the differential between its obtaining and selling cost.

 

 

Arbitration

Methods for settling a contention between two gatherings through the vehicle of an unprejudiced outsider whose choice on the debate (whenever decided upon) will be conclusive and authoritative.

 

Assignment

The move recorded as a hard copy of rights or enthusiasm for a bond, home loan, rent, or different instruments.

 

Assumption of mortgage

The exchange of title of the property to a grantee, by which the grantee expect obligation for an installment of a current note verified by a home loan against the property. Should the mortgage be abandoned and the property sold for a lesser sum than that due, the grantee/buyer who has accepted and consented to pay the obligation verified by the home loan is by and by subject for the inadequacy. Before a seller might be calmed of liability under the current home loan, the bank must acknowledge the exchange of duty regarding the installment of the note.

 

Attorney-in-fact

The holder of a power of attorney.

 

Attorney’s opinion of title

An instrument was composed and signed by the lawyer who looks at the title, expressing her or his assessment concerning whether a seller may pass on the great title.

 

Avulsion

An unexpected tearing away of land by the activity of natural forces.

 

Real estate terms that start with B

Balloon payment

The last payment of a mortgage loan that is considerably bigger than the required periodic payments because the loan amount not amortized.

 

Base line

One of a position of imaginary lines running east and west and crossing a principal meridian at a certain point. Surveyors use base lines for reference in locating and describing land under the rectangular survey system (or government survey method) of property description.

 

Beneficiary

The individual for whom a trust works or for whose sake the pay from a trust estate is drawn. A lender who loans cash of land and reclaims a note and deed of trust from the borrower.

 

Bilateral contract

An agreement where each party guarantees to deliver an act in return for the other party’s promise to carry.

 

Bill of sale

A composed instrument was given to pass title to individual property.

 

Binder

An understanding that may go with an earnest money deposit for the buy of genuine property as proof of the buyer’s great confidence and goal to finish the exchange

 

Blockbusting

The illegal practice with regards to instigating mortgage holders to sell their properties by making representations in regards to the passage, or forthcoming section, of minority people into the area.

 

Boycotting

At least two or more organizations contrive against different organizations to reduce rivalry.

 

Breach of contract

The failure, without a legitimate reason, of one of the gatherings to an agreement to perform as per the contract.

 

Bridge loan

A loan that bridges the sale of a property.

 

Broker

One who purchases and sells for another for a commission.

 

Broker/Salesperson

An individual who has passed the broker’s licensing examination; however, it is authorized to work just in the interest of an authorized dealer and who might be permitted to deal with an office. In numerous states, referred to as (and licensed as) associate broker or broker/associate.

 

Budget loan

A loan wherein the monthly regularly scheduled installments made by the borrower spread not only interest and a payment on the primary amount, but also a part of 12 of such expenses as taxes, protection appraisals, private home loan protection premiums, and comparable charges.

 

Buffer zone

A segment of land that isolates one land use from another.

 

Building code

An ordinance which specifies the minimum standards of construction of buildings for the protection of public safety and health.

 

Building restrictions

The limitations on the dimensions or sort of assets enhancements hooked up with the aid of zoning acts or by way of deed or rent regulations. Building regulations are taken into consideration encumbrances, and violations render the identity unmarketable.

 

Bundle of legal rights

The principle that land ownership entails ownership of all criminal rights to the land, along with ownership, manipulate within the law, and enjoyment, rather than ownership of the property itself.

 

Buydown

A payment created, often by the seller, to assist the buyer qualify for the loan.

 

Real estate terms that start with C

Canvassing

The act of making phone calls or visiting from door to door to look for planned purchasers or dealers; in the land business, for the most part, connected with obtained postings in a given territory.

 

Capital gain

Benefit earned from the sale of an asset.

 

Capitalization

The way toward changing over into present value (or acquiring the current worth of) a progression of foreseen occasional future portions of total compensation. In the land evaluation, for the most part, appears as limits. The formula is Value=Income/Rate.

Capitalization rate

The rate of return a property will deliver on the owner’s investment.

 

Casualty insurance

A sort of insurance policy that secures a property owner or other individual from misfortune or damage supported because of burglary, vandalism, or comparative events.

 

Caveat emptor

Means “let the buyer beware” in Latin.

 

Certificate of title

The announcement of opinion on the status of the title to a package of real property, in light of an examination of determined open records.

 

Chain of title

The succession of conveyances from some acceptable starting point by which the present holder of real property derives his or her title.

 

Chattels

Personal property.

 

Collateral

Something of significant worth given or promised to a moneylender as security for an obligation or commitment.

 

Color of title

Used as a factor in an adverse belonging case when the possessing party got the land title, however, by a damaged or off base deed (shade of the title).

 

Commercial property

A classification of land that incorporates salary creating a property. For example, places of business, eateries, strip malls, lodgings, and stores.

 

Commingled property

Property of a wedded couple that is so blended or intermixed that it is hard to decide if it is isolated of network property. A mixed property moves toward becoming network property.

 

Commingling

The illicit demonstration of a real estate broker who blends the cash of other individuals with that of his or her own; specialists are legally necessary to keep up a different trust represent other gatherings’ supports held briefly by the agent.

 

Commission

The payment made to a dealer for administrations rendered, for example, in the deal or buy of real property; this is usually a level of the selling cost of the property.

 

Common Law

A type of law based on practice, court decisions, or usage.

 

Community property

A strategy for property possession dependent on the theory that every life partner has equal interest for the real estate property gained by the endeavors of either spouse during marriage.

 

Comparables

The sold properties, recorded in an appraisal report, which are significantly identical to the subject property. Continuing or procedure to practice the intensity of a prominent area.

 

Condominium

The most significant responsibility for an apartment or a unit, for the most part in a multi-unit building, in light of a lawful depiction of the airspace the unit involves, in addition to a unified interest for the responsibility for standard components, which are claimed together with the other condominium unit proprietors.

 

Conforming Mortgages

Securitized contracts sold on the auxiliary market that meet specific necessities and requirements established by Fannie Mae and Freddie Mac.

 

Consideration

Something of significant worth that incites one to go into an agreement. Thought might be “valuable”  (money or commodity) or “good” (love and affection”). Likewise, a demonstration of avoidance, or the guarantee thereof, given by one gathering in return for something from the other. Forbearance is a guarantee not to accomplish something.

 

Constructive Eviction

Acts by the landowner that so really exasperate or hinder the inhabitant’s satisfaction in the rented premises that the occupant is adequately compelled to move out and end the rent without obligation for any further lease. A buyer’s powerlessness to acquire clear title.

 

Constructive Notice

Notice is given to the world by recorded archives. All people are accused of learning of such records and their substance, regardless of whether they have analyzed them. Ownership of property additionally is viewed as important notice that the individual under lock and key has an interest in the property.

 

Contingencies

An arrangement or condition in the buy of land requiring a particular activity to be done or an occasion to occur before the agreement becomes official.

 

Contract

An agreement went into by at least two legally competent by the terms of which at least one of the gatherings, for a thought, undertakes to do or to cease from doing some lawful demonstration or acts. An agreement might be either one-sided (where just a single gathering will undoubtedly act) or reciprocal (where all parties to the instrument are legitimately obliged to execute as recommended).

 

Contract for deed (Land Contract)

An arrangement for the purchase of land under which the sale cost is paid in intermittent portions by the buyer, who is in the ownership and holds the equitable title, although, until the last installment, the actual title is with the seller.

 

Contract for exchange of real estate

A contract for the selling of real estate in which the consideration is paid wholly or partly in a property.

 

Corporation

An entity or association made by the task of law whose privileges of doing business are essentially equivalent to those of a person. The substance has a nonstop presence until broken down as indicated by lawful procedures.

 

Correction Lines

The level arrangements within the rectangular summary framework created to make up for the curvature of the world’s surface. Every fourth territorial division line is employed as a rectification line on that the interims linking the north and south range lines are sized and helped to an entire six miles.

 

Cost Approach

The way toward evaluating the estimated value of a property by including the appraiser’s gauge of the reproduction or substitution cost of the structure, less deterioration, to the assessed land esteem.

 

Counseling

The business of providing individuals with knowledgeable recommendation on a subject matter supported the counselor’s in-depth, knowledgeable information about the topic.

 

Curtesy

An estate, sometimes an aliquot interest, given by some states to the living husband in property owned by his deceased spouse. Most states have abolished curtesy.

 

Cycle

A continual sequence of events that often follow each other, typically inside a hard and fast interval of your time.

 

Real estate terms that start with D

Datum

Heights and depths are measured on a horizontal plane.

 

Defeasible fee estate

A qualified property in which the grantee may lose his or her interest upon the incidence or non-prevalence of a special event. There are two styles of defeasible charge estates:

(1) Those referred to as a situation subsequent where the opportunity of re-access takes location.

(2) A certified issue, in which the grantee’s possession mechanically ends with the option of reverter (in any other case referred to as a fee simple determinable). The words as long as, while, or at some stage in are essential to developing a certified difficulty defeasible fee estate.

 

DBA

Doing business as

 

Debenture

A note or bond is given as evidence of credit and issued without protection.

 

Debt

An obligation to settle payment or return what is owed.

 

Declining balance method

An accounting system of calculating reduction for tax purposes designed to provide considerable deductions in the initial years of the purchase of the property.

 

Deed

A written instrument that after achieved and brought conveys name to, or an interest in, actual property.

 

Deed in lieu of foreclosure

A method by which the mortgagor can avoid foreclosure. Mortgagor gives a deed to the mortgagee when the mortgagor is in default according to terms of the mortgage.

 

Defeasance clause

A clause utilized in rentals or mortgages that cancels an exact right on the incidence of a selected circumstance, which includes cancellation of a lease on repayment of the mortgage.

 

Deficiency judgment

A private judgment levied towards the mortgagor while a foreclosures sale does not produce enough price range to pay the loan debt in full.

 

Delinquent taxes

Past due to unpaid taxes.

 

Delivery

The legal act of moving ownership. Documents which include deeds and purchase agreements ought to be delivered and admitted to being valid.

 

Delivery in escrow

Delivery of a deed to a 3rd individual till the overall performance of a few act or situation by way of one of the parties.

 

Demand

The willingness of individuals to shop for available items at a given rate.

 

Density zoning

The zoning ordinances that limit the common most variety of houses in keeping with an acre that can be built inside a particular place, commonly a subdivision.

 

Devise

A switch of real estate using will or final testimony. The giver is the divisor, and the receiver is the devisee.

 

Diminishing returns

The system that applies when a given parcel of land reaches its maximum percent return on investment and similarly charges for enhancing the assets yield a lowering cross back.

 

Discount points

A brought mortgage price charged by a lender to make the yield on a lower-than-market-fee loan competitive with better-interest loans.

 

Discount rate

The fee of interest a commercial, financial institution ought to pay when it lends from its federal reserve financial institution. Consequently, the cut-price charge is the fee of interest the banking system incorporates inside its framework. Member banks may additionally take positive promissory notes that they have received from customers and promote them to their district federal reserve financial institution for less than face price. With the funds acquired, the banks could also make loans. Changes in the bargain rate may also purpose banks and other creditors to reexamine credit policies and situations.

 

Duress

The use of unlawful pressure that forces action or inaction against a person’s will.

 

DVA loan

A mortgage loan on the authorized assets made to a certified veteran through an approved lender and warranted through the Department of Veterans Affairs to restriction possible loss through the lender.

 

Real estate terms that start with E

Earnest money deposit

An amount of money deposited through a consumer below the terms of a settlement. If if the purchaser, for no valid or criminal purpose, backs out of the transaction, the earnest money is now and then used as liquidated damages.

 

Easement

A right to use the land of every other for a particular motive, including for a proper-of-manner or utilities; an incorporeal hobby in land. An easement appurtenant crosses with the area when conveyed.

 

Economic obsolescence

The impairment of desirability or useful life resulting from circumstances external to the property, which include economic and financial forces or environmental modifications, that affect deliver-call for relationships in the market. Loss within the use and fee of assets bobbing up from the elements of financial obsolescence is to be outstanding from the loss in price from physical deterioration and practical obsolescence, both of that are inherent in the property.

 

Employee status

The status of the one who works as an instantaneous employee of an agency. An employer is committed to withholding income taxes and Social Security taxes from the payment of his or her employees.

 

Employment contract

A record is evidencing formal employment among the organization and the worker or the most important and the agent. In the real estate commercial enterprise, this usually takes the shape of a list or management settlement.

 

Encroachment

A fixture or shape, which includes a wall or fence that invades a part of a property belonging to any other.

 

Encumbrance

Any lien that may decrease the price of the property, such as a mortgage, tax, or judgment lien; easement; limitation on the effectiveness of the land; or an excellent dower right.

 

Endorsement

The act of signing one’s name, either with or without additional words, on a negotiable instrument or a paper attached to such instrument.

 

Equal Credit Opportunity Act (ECOA)

Federal legislation ordering lenders to make loan equally accessible without discrimination based on race, sex, color, religion, marital status, age, national origin, or declaration of income from public assistance.

 

Equitable title

The interest was taken by a vehicle under a contract for deed or an installment contract; the equal right to obtain absolute ownership to the property when the legal title is kept in another’s name.

 

Equity

The hobby or fee that an owner has in a property over and above any loan indebtedness.

 

Escrow

The remaining of a transaction via a third birthday party called an escrow agent, or escrowee, who receives positive price range and documents to be added on the overall performance of certain situations within the escrow settlement.

 

Estate for years

A hobby for a particular, exact time in assets leased for a unique consideration.

 

Estate in land

The degree, amount, nature, and quantity of hobby that a persona has in real property.

 

Estate in severalty

One person only owns the estate.

 

Estoppel certificate

A legal instrument has done via a mortgagor displaying the quantity of the unpaid balance due on a mortgage and mentioning that the mortgagor has no defenses or offsets toward the mortgagee at the time of doing of the certificate.

 

Estovers

Legally allowed claims, such as the right of a tenant to use timber on leased property to help the least need for fuel or repairs.

 

Evidence of title

A proof of possession of assets, which is usually a certificate of name, a identify coverage, an abstract of name with legal professional’s opinion, or a Torrens registration certificates.

 

Exchange

A transaction wherein all part of the attention for the acquisition of actual belongings is the switch of like-kind assets. Ex. Real estate for real estate.

 

Exclusive-agency listing

A listing agreement underneath which the proprietor appoints an actual estate broking as his or her different agent for a delegated period of time to promote the assets on the proprietor’s said stated terms for a commission. The proprietor, however, reserves the proper to sell without paying all of us a fee using selling to a prospect who has no longer been brought or claimed by way of the broker.

 

Executed contract

A contract in which all individuals have fulfilled their obligations and thus completed the contract.

 

Expressed contract

An oral or printed contract in which the individuals state their terms and express their intentions in words.

 

Real estate terms that start with F

Fair Housing Act of 1968

The term which forbids discrimination or judgment based on the color of skin, race, sex, religion, handicaps, national origin and familial status in the sale and rental of residential property is for  Civil Rights Act of 1968 as revised.

 

Federal Home Loan Mortgage Corporation (FHLMC)

A federally chartered corporation designed to accommodate a secondary mortgage market for traditional loans (Freddie Mac).

 

Federal Housing Administration (FHA)

It was created by the National Housing Act in 1934 to encourage growth in housing examples and conditions, to provide a sufficient home financing way through the insurance of housing mortgages and credit, and to exercise a stabilizing impact on the mortgage market.

 

Federal income tax

An annual tax based totally on earnings, consisting of monies derived from the lease, use, or operation of actual estate.

 

Federal National Mortgage Association (FNMA)

Fannie Mae” is the generic name for this federally chartered corporation, which produces a secondary market for existing mortgages. FNMA does not credit the money directly instead buys DVA, FHA, and traditional loans.

 

Fee-simple estate

The best possible estate or claim of ownership of real property proceeding forever.

 

FHA appraisal

An FHA assessment of assets as protection for a loan. FHA appraisal includes the look at of the physical traits of the property and the environment and the region of the property.

 

FHA loan

A credit insured by the FHA and made by an authorized lender following the FHA guidance.

 

Fiduciary relationship

A relationship of considering and confidence, as among trustee and beneficiary, lawyer and purchaser or primary agent.

 

Fixture

An article that becomes once personal property, however, has been so affixed to the actual estate that it has to turn out to be real property.

 

Forcible entry and detainer

A review proceeding for restoring to ownership of land one who is wrongfully kept out or has been unjustly deprived of the ownership.

 

Freehold estate

An estate in land wherein ownership is for an indeterminate length of time, in comparison to a leasehold property.

 

Functional obsolescence

The impairment of purposeful capability or performance; the inability of a shape to carry out appropriately the characteristic for which it currently is employed. Functional obsolescence displays the loss in cost added about using factors that affect the property, together with overcapacity, inadequacy, or changes within the artwork.

 

Funding Fee

A rate required by using the Department of Veterans Affairs for creating a VA guaranteed mortgage. The investment charge is added in with the mortgage after which forwarded to the VA to guarantee a veteran’s mortgage.

Real estate terms that start with G

Gap

A deficiency in the chain of title of a particular parcel of real estate; a lost document or conveyance that proposes doubt as to the present ownership of the land.

 

General contractor

A production specialist who enters right into a formal construction contract with a landowner or master lessee to construct a real property constructing or venture. The fashionable contractor regularly contracts with several subcontractors focusing on various aspects of the constructing procedure to perform unique jobs.

 

Government lots

Fractional parts in the rectangular survey system (government survey system) that are less than one full quarter-section in area loan.

 

Grant

The order of sending or transferring title to real property.

 

Grant Deed

A form of deed that includes three basic warranties:

(1) the owner warrants that he or she has the proper to bring the property

(2) The owner warrants that the property isn’t encumbered aside from with those encumbrances listed in the deed

(three) The proprietor promises to carry any after-received name to the property. Grant deeds are famous in states that rely strictly on title insurance.

 

Grantee

The buyer. A person to whom real estate is conducted.

 

Grantor

The seller. A person who conducts real estate by deed.

 

Gross Lease

A lease or property below which a landlord will pay all belongings charges often incurred through ownership, which includes repairs, taxes, coverage, and working costs and residential leases are gross leases mostly.

 

Gross national product (GNP)

The total price of all goods and services produced inside the United States (or another country) in a year.

 

Gross rent multiplier (GRM)

A figure applied as a multiplier of the total month-to-month condominium profits of assets to supply an estimate of the assets’ cost.

 

Ground Lease

Rent of land only, on which the tenant owns a part of the building or is required to build her or his building as unique in the hire. Such rentals are generally lengthy-term internet leases; a tenant’s rights and responsibilities preserve until the contract expires or is terminated via default.

 

Guaranteed sale plan

A settlement between the dealer and the seller that if the seller’s actual property isn’t sold earlier than a specific date, the broker will purchase it for a precise rate.

 

Real estate terms that start with H

Habendum clause

The deed clause starting “to have and to hold,” which defines or limits the extent of ownership in the state given by the deed.

 

Heir

One who would possibly inherit or succeed to an interest in the land beneath the state law of descent while the owner dies without leaving a legitimate will.

 

Holographic will

A will that is dated, and signed in the handwriting of the maker.

 

Homestead provision

The land and the upgrades thereon precise by using the proprietor as his or her homestead and, consequently, blanketed by using country regulation, either incomplete or in part, from pressured sale by way of positive creditors of the proprietor.

 

HUD

Regulates FHA and GNMA. The Department of Housing and Urban Development

 

Hypothecation

The pledge of belongings as protection of a loan wherein the borrower maintains ownership of the belongings even as it is pledged as safety.

 

Real estate terms that start with I

Implied contract

A contract under which their acts and conduct demonstrate the agreement of the parties.

 

Implied grant

A way of creating an easement. One party can be using another’s property for the advantage of both companies.

 

Improvement

  1. Developments on land: any structure, usually privately owned, built on a site to improve the value of the property; 2. Improvements to land: usually a publicly controlled structure.

 

Index lease

The lease that allows the rent to be increased or decreased periodically, based on changes in a chosen economic index, such as the Consumer Price Index.

 

Insurable title

A title company will ensure a title to land

 

Insurance

The indemnification towards loss from a selected danger or peril through an agreement (referred to as a coverage) and for a consideration (referred to as a top premium).

 

Interest

A lender for the use of money will make a charge.

 

Interim financing

A short-term loan usually made through the construction phase of a building project often suggested as a construction loan.

 

Investment

Money aimed toward the acquisition, development, and improvement of an asset in the expectation of earnings or profits. An excellent monetary investment has the following characteristics: safety, the regularity of yield, marketability, desirable denominations, valuable collateral, adequate length, required interest, and ability appreciation.

 

Real estate terms that start with J

Joint tenancy

The possession of an actual estate by two or extra persons who’ve been named in one conveyance as joint tenants. On the loss of life of a joint tenant, her or his hobby passes to the surviving joint tenant or tenants by the proper of survivorship.

 

Judgment clause

A provision that may be covered in notes, leases, and contracts with the aid of which the debtor, lessee, or obligor authorizes any attorney to enter the courtroom to confess judgment in opposition to him or her for default in charge. Also called a cognovit.

 

Real estate terms that start with L

Laches

An equitable doctrine utilized by the courts to bar a legal claim or save you the statement of a right because of undue postpone negligence, or failure to claim the request or right.

 

Lessee

The tenant who leases a property.

 

Lessor

One who leases the property to a tenant

 

Leverage

The use of borrowed money to finance the bulk of the investment.

 

Levy

Too take officially the property of a person to satisfy an obligation.

 

Life estate

A hobby in real or private ownership that is confined in length to the lifetime of its proprietor or a few other specific man or woman.

 

Life tenant

An individual in possession of a life estate.

 

Liquidated damages

Liquidated damages occur while, through contractual agreement, defaulted earnest cash becomes the personal assets of the vendor.

 

Liquidity

The capacity to sell an asset and convert it into cash at a price close to its real value.

 

Lis pendens

A lawsuit affecting title to or use,  possession, and enjoyment of a parcel of real estate has been listed in either a state or federal court was announced.

 

Liquidity

The capability to sell an asset and convert it into cash at a charge near its actual value.

 

Lis pendens

A public notice that a lawsuit affecting identify to or ownership, use, and leisure of a parcel of actual property has been filed in both a kingdom or federal court.

 

Listing agreement

A settlement between a landowner (as primary) and an actual authorized property broking (as agent) by using which the dealer is employed as agent to list and promote the real property at the owner’s terms inside a given time, for which carrier the landowner concurs to pay a fee.

 

Littoral rights

A landowner’s right to use water in large lakes and oceans adjoining to her or his property. The ownership rights to land adjoining these bodies of water up to the high-water mark.

 

Lot and block description

A type of real property that identifies a parcel of land by reference to lot and block numbers within a subdivision, as known on a subdivided plat duly registered in the county recorder’s office.

 

Real estate terms that start with M

Management agreement

A contract between the proprietor of profits property and a control firm or individual belongings manager describing the scope of the manager’s jurisdiction.

 

Marginal lease

A lease agreement that barely covers the costs of operation for the property.

 

Market/data approach

An approach of appraising or evaluating an actual property primarily based at the proposition that a knowledgeable customer might pay no extra for an asset than the fee to him or her of acquiring current belongings with the same application. This approach is relevant, while a lively market offers sufficient quantities of reliable facts that can be tested from authoritative sources. The technique is highly unreliable in an inactive marketplace or in estimating the fee of homes for which no real similar sales information are to be had. It also is questionable while sales records can’t be validated with principals to the transaction — also known as the marketplace comparison or direct income comparison approach.

 

Market price

The actual selling price of a property.

 

Mechanic’s lien

A statutory lien created in the desire of contractors, people, or material suppliers who have executed work or provided substances in improving real property.

 

Metes-and-Bounds description

Legal information of a parcel of land that starts at a properly-marked point and follows the bounds, the usage of route and distances across the tract, lowers back to the starting point.

 

Mill

A tax rate used by municipalities to compute property tax.

 

Monetary policy

The government regulation of the amount of money in circulation through such institutions as the Federal Reserve Board. If you are looking for the 50% off coupon, you just found it. Sign Up Here And Use The Code: realestateterms

 

Money judgment

A court judgment ordering amount of money rather than the specific performance of a particular action.

 

Money market

Those institutions, such as banks, savings-and-loan associations, and life insurance companies, which supply money and credit to borrowers.

 

Month-to-Month Tenancy

A periodic tenancy – the tenant rents for one period at a time. In the absence of a rental settlement (oral or written), a tenancy generally is taken as a month to month.

 

Monument

Fixed natural or artificial objects, used in the metes-and-bounds description, to establish the boundaries; located at the corners.

 

Mortgage

The document is creating a mortgage lien. Also a conditional transfer or pledge of real estate as security for a loan.

 

Municipal ordinances

The laws, regulations, and codes enacted by the governing body of a municipality.

 

Mutual rescission

The action of placing an end to a contract by an agreement of the participants.

 

Real estate terms that start with N

 

Net operating income

The total income of the property deducting vacancy, collection losses, and operating expenses (not including debt service).

 

Nonconforming use

The use of a property that is permitted to continue after a zoning ordinance prohibiting it has been set for the area.

 

Nonhomogeneity

A lack of agreement; difference. Because no two parts of the land are geographically alike, real estate is said to be nonhomogeneous, or heterogeneous.

 

Notarize

A way to certify or attest to a document, as by a notary public.

 

Notary public

A public official empowered to certify and attest to documents, take acknowledgments, take affidavits, administer oaths, and perform other such acts.

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Real estate terms that start with O

Offer and notification of acceptance

The two parts of a legal contract; a “meeting of the minds.”

 

Officer’s deed

A deed by sheriffs, trustees, guardians, etc.

 

Optionee

The individual that acquires and holds an option.

 

Optionor

The party that allows or gives an option.

 

Ownership

The special proper to preserve, own or manipulate, and dispose of a tangible or intangible component. Ownerships may be held by someone, company, or governmental entity.

 

Real estate terms that start with P

Package mortgage

A method of financing in which the purchase of the land also finances the purchase of certain personal property items.

 

Parol evidence rule

A law that states that no prior or contemporary oral or extraneously written agreement can change the terms of a contract.

 

Partnership

An organization of or extra individuals that keep on an ongoing enterprise for profit as co-owners. Under the law, a partnership appears as a set of people as opposed to as a single entity. A trendy partnership is a regular shape of the joint mission in which every standard associate share inside the administration, income, and losses of the operation. A limited company is an enterprise arrangement with the aid of which one or extra trendy partners administer the procedure and fund using constrained or silent companions, who’re by regulation liable for losses most useful to the volume in their investment.

 

Party wall easement

A wall that is placed on or at a boundary line between two adjacent parcels for the use of the proprietors of both properties.

 

Performance bond

A binding agreement, often accompanied by the surety and usually posted by one who is to perform work for another, that assures that project or undertaking will be completed as per the agreement or contract.

 

Periodic estate

An interest in leased property that extends from period to period – week to week, month to month, or year to year.

 

Permanent reference marker

Referred to as a PRM, it is a fixed object that leads the surveyor to the point of starting (POB). In most surveys, two different PRMs are used to locate the POB.

 

Personal assistant

A man or woman working for a broker or salesclerk who handles non-sales-related elements of real estate transactions. However, if the non-public assistant is certified, then she or he can also manipulate the income-associated aspects of the sale.

 

Power of attorney

A written device authorizing a person (the attorney-in-reality) to behave on behalf of the maker to the extent indicated inside the instrument.

 

Premises

The particular segment of a deed that states the names of the parties, recital of consideration, operative words of conveyance, legal assets description, and appurtenance provisions.

 

Prepayment clause

In a mortgage, the announcement of the terms on which the mortgagor may also pay the whole or said the quantity of the loan necessary at some time earlier than the due date.

 

Principal Meridian

One of 35 north and south survey traces hooked up and described as a part of the square survey gadget (government survey method).

 

Principle of conformity

The appraisal concept is declaring that homes which might be similar in design, creation, and age to different buildings inside the place have a higher price than they could have in a community of different structure.

 

Procuring cause

The effort that brings approximately the preferred result. Under an open list, the broker who is the procuring purpose of the sale gets the commission.

 

Property disclosure acts

State-mandated vendor’s property disclosure reports. These reports place the responsibility of defect disclosure on the vendor. Agents are not obliged to discover property defects but are expected to disclose them if they are considered.

 

Property management

The operation of the property of any other for payment. Involves marketing space; advertising and condo sports; collecting, recording, and remitting rents; preserving the assets; tenant relations; hiring employees; retaining right money owed, and rendering periodic reviews to the owner.

 

Property tax

Taxes levied by using the authorities against either actual or personal property. The proper to real tax belongings inside the United States rests solely with the states, no longer with the federal government.

 

Pur autre vie

It means “for the life of another” in Latin. A life land pur autre vie is a life estate measured by the life of a person other than the grantee.

 

Purchase-money mortgage

A notice secured through a mortgage or deed of trust given through a buyer, as a mortgagor, to a supplier, as a mortgagee, as a part of the purchase fee of the actual property.

 

Real estate terms that start with Q

Qualifying

The act of figuring out a prospect’s motivation, then matching his or her needs with the available inventory.

 

Quitclaim deed

A conveyance using which the grantor transfers something interest she or he has inside the actual estate without warranties or duties.

Real estate terms that start with R

Range

A land, six-mile strip, measured east and west from the meridian traces.

 

“Ready, willing, and able” buyer

One who is prepared to buy assets on the vendor’s phrases and is ready to take high-quality steps to consummate the transaction.

 

Real estate

Land; a portion of the earth’s floor extending downward to the center of the earth and upward infinitely into space, including all matters wholly connected to it, whether through nature or using a man.

 

Real estate broker

Any man or woman, partnership, association, or enterprise that sells (or offers to promote), buys (or gives to shop for), or negotiates the acquisition, sale, or change of actual property, or that leases (or provides to rent) or rents (or offers to lease) any actual ownership or the changes thereon for others and for a compensation or treasured attention. A real property dealer won’t behavior business without an actual property broker’s license.

 

Real property

Real property consists of land, whatever affixed to it to be appeared as an everlasting a portion of the land, that which is appurtenant to the land, and that that’s stable by using law, including all rights and interests.

 

REALTOR®

A certified trademark term kept for the sole use of active affiliates of local REALTORS® boards affiliated with the  National Association of REALTORS®.

 

Recapture

In the year of the sale, all depreciation or cost recovery taken on the depreciable property more than the amount allowed by the straight-line method is subject to recapture provisions as established by the IRS, which has the effect of taxing the excess at ordinary income rates. Recapture is designed to prevent a taxpayer from taking advantage of both accelerated depreciation and capital gain treatment.

 

Receiver

The court-appointed custodian of property involved in litigation, pending final disposition of the matter before the court.

 

Reconciliation

The very last step in the appraisal system wherein the appraiser reconciles the estimates of fee obtained from the market/information, cost, and profits techniques to reach a very last estimate of market value for the situation belongings. An accounting system that balances a trust account by way of evaluating the general ledger with the mixed general of the account’s ledger balances.

 

Recovery fund

A fund set up in a few states from real property license price range to cowl claims of aggrieved parties who have suffered economic harm thru the actions of an actual estate licensee. Some states mandate errors and omissions insurance as a requirement for licensure to protect the public.

 

Rectangular survey system

A method established in 1785 by the federal government that provides for surveying and describing land by relating to principal meridians and base lines.

 

Redemption period

A time period installed using nation law in the course of which a assets proprietor has the right to redeem her or his real property from a foreclosure or tax sale by using paying the income price, hobby, and costs. Many states do now not have loan legal redemption guidelines.

 

Release

To relinquish a hobby in or claim to a parcel of property.

 

Relocation service

An organization that aids a person in selling a property in one region and buying another property in any other location.

 

Remainder

The remnant of a property that has been conveyed to take effect and be loved after the termination of a prior property, which includes when a proprietor conveys a life estate to one party and the rest to another.

 

Renegotiable rate mortgage

A mortgage loan that is granted for a term of 3 to 5 years and acquired by a long-term real estate loan of up to 30 years with the interest rate remaining renegotiated or adjusted each period.

 

Rent

A fixed, periodic charge made using a tenant of assets to the proprietor for ownership and use; typically with the aid of prior agreement of the parties.

 

Recission

The termination of a contract by agreement of the parties.

 

Reservation in a deed

The creation by a deed to the property of a new right in favor of the grantor. Usually involves an easement, a life estate, or a mineral interest.

 

Restriction

A limitation on using real belongings commonly originated with the aid of the proprietor or subdivider in a deed.

 

Reverse annuity mortgage

A loan that permits the proprietor to receive periodic payments primarily based on the equity within the home.

 

Reversion

The remnant of a property that the grantor holds after he or she has granted a lifestyles estate to some other individual; the estate will return or revert to the grantor. Also known as reverter.

 

Reversionary right

An owner’s right to regain possession of the leased property on termination of the lease agreement.

 

Rezoning

The process involved in changing the existing zoning of a property or area.

 

Right of first refusal

A man or woman’s right to have the primary possibility to either hire or purchase actual assets.

 

Riparian rights

An owner’s rights in land that border water, such as a creek or river. These advantages include access to and use of the water.

 

Rural development

The U.S. Department of Agriculture that channels credit to rural residents and communities.

 

Real estate terms that start with S

Sale and leaseback

A transaction wherein an owner sells her or his progressed assets and, as part of the same transaction, signs a protracted-term lease to stay in possession of the premises.

 

Sales contract

An agreement containing the entire terms of the agreement among customer and seller for the sale of a particular parcel or parcels of actual estate.

 

Salesperson

A man or woman who performs actual estate sports while hired by way of or related to a licensed actual estate broker.

 

Separate property

The real property owned by a husband (and wife) before tying the knot.

 

Servient tenement

Also named a servient estate. The land on which an easement is in favor of neighboring property.

 

Setback

The quantity of area nearby zoning regulations require between lots line and the building line.

 

Severalty

The ownership of real property by one person only; also called sole ownership.

 

Short sale

A sale of secured assets that produce much less cash than is owed to the lender, however, to expedite the sale and keep away from foreclosure expense, the lender releases its interest so the property can be bought.

 

Situs

The non-public desire of people for one place of land over another, not necessarily primarily based on goal facts and knowledge.

 

Sovereignty of the soil

The starting of the record of ownership of land by conveyance from the sovereign or the state. Historically, this is also known as a patent.

 

Specific lien

A lien is affecting or attaching only to a particular parcel of land or piece of property.

 

Specific performance suit

A criminal movement brought in a court of equity in super instances to compel a party to take out the phrases of a settlement. The foundation for an equity courtroom’s jurisdiction in breach of a real property agreement is that land in particular, and mere felony damages could not competently compensate the consumer from the vendor’s breach.

 

Statute of frauds

The part of a state law that needs specific instruments, such as deeds, real estate sales contracts, and individual leases to be in writing to be legally enforceable.

 

Statute of limitations

That law about the period within which certain actions must be brought to court.

 

Statutory lien

A lien imposed on the property by statute, for example, a tax lien; in contrast to a voluntary lien, which an owner places on his or her real estate, for example, a mortgage lien.

 

Steering

The illegal usage of channeling home seekers to particular areas or avoiding specific areas. It is either to maintain or to change the character of an area or to create a speculative situation.

 

Subordination

The relegation to a lesser position usually in respect to a right or security.

 

Subordination agreement

An agreement that modifies the order of preference of liens between two creditors.

 

Subrogation

The substitution of one creditor for some other, with the substituted character succeeding to the legal rights and claims of the authentic claimant. Subrogation is utilized by name insurers to accumulate the proper the sue from the injured party to get better any claims they have got paid.

 

Substitution

An appraisal principle declaring that the maximum price of a property tends to be set with the aid of the price of purchasing likewise proper and precious replacement assets, assuming that no pricey put off is encountered in making the substitution.

 

Suit for possession

A court suit initiated by way of a landlord to evict a tenant from leased premises after the tenant has violated one of the phrases of the rent or has held ownership of the assets after the expiration of the lease.

 

Suit for specific performance

A legal action brought by either a buyer or a seller to enforce performance of the terms of a contract.

 

Suit to quiet title

A legal action intended to establish the title to a particular asset.

 

Syndicate

A combination of two (or more) persons or firms to accomplish a joint venture of mutual interest.

 

Real estate terms that start with T

Taxation

How a central authority or municipal quasi-public body raises monies to fund its operation.

 

Tax lien

A rate towards belongings created by the operation of regulation. Tax liens and tests take priority over all other liens.

 

Tax rate

The price at which real property is taxed in a tax district or county.

 

Tax sale

A court-ordered sale of actual assets to raise money to cover delinquent taxes.

 

Tenancy at sufferance

The tenancy of a lessee who legally comes into ownership of a landlord’s real estate but who proceeds to hold the premises improperly after her or his lease rights have expired.

 

Tenancy in common

A form of co-ownership by which each operates an undivided interest in real property as if he or she were is the only owner. Each has the right to partition. Not like a joint tenancy, there is no right of survivorship between tenants in general, and owners may have unequal interests.

 

Termination (listing)

The cancellation of a broker’s most important employment contract. A listing can be terminated with the aid of death or insanity of either birthday party, expiration of a list duration, mutual settlement, enough written be aware, or the completion of performance under the settlement.

 

Testate

Having made and left a valid will.

 

Testator

A will maker

 

“Time is of the essence”

A phrase in a settlement that requires the overall performance of a particular action inside a stated time.

 

Township

The central unit of the rectangular survey method. A township is a square, an area of 36 square miles and with six-mile sides.

 

Trust

A fiduciary arrangement by using which belongings is conveyed to someone or institution, called a trustee, and held and administered on behalf of some other man or woman, called a beneficiary.

 

Trust deed

An instrument used to make a lien by which the trustor conveys his or her identify to a trustee, who holds it as protection for the benefit of the word holder (the lender).

 

Trustee

One who as agent for others manages money or takes title to their land.

 

Trustee’s deed

A deed executed through a trustee conveying land held in the trust to the beneficiary.

 

Real estate terms that start with U

Unearned increment

A change in the price of a property caused by increased population, development, or demand for which the owner is not responsible.

 

Unilateral contract

A one-sided settlement by way of which one celebration makes a promise to induce a 2d party to do something. The 2nd party is not legally sure to perform; if the second one party does comply; but, the first celebration is obligated to hold the promise.

 

Unity of ownership

The four unities historically had to create a joint tenancy – harmony of identity, time, interest, and possession.

 

Usury

The exercise of charging more than the rate of interest allowed through law.

 

Real estate terms that start with V

Valid contract

A contract that complies with all the vital factors on an agreement and is binding and enforceable on all parties to it.

 

Variable rate mortgage

A loan mortgage that consists of an interest price provision associated with a particular index. Under this provision, the interest rate may be adjusted annually either up or down.

 

Variance

An exception from the zoning ordinances; permission granted by zoning government to construct a structure or conduct a use this is expressly forbidden with the aid of the zoning law.

 

Real estate terms that start with W

Writ of attachment

The approach via which a debtor’s belongings are positioned within the custody of the regulation and kept as security, pending the outcome of a creditor’s fit.

 

 

 

Whew! That is an exhaustive list of real estate terms. Real Estate Agents make great money, but you have to put in the work. If you would like to access these real estate terms flashcards as well as hundreds of other questions for your real estate exam, let’s get started now.

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