REAL ESTATE DICTIONARY

Real Estate Terminology

Abatement - The termination of an offensive activity, as the abatement of a nuisance.

Abstract of title - A condensed compilation of the history of the title to a piece of property; starts with the original grant and contains all subsequent conveyances, liens, or other encumbrances.

Abut - To be next to or touch another property or body of water.

Acceleration Clause - A provision in a note, such that if payments are in default, the owner of the note can declare the entire balance due and payable earlier than the stated due date.

Acceptance - An act by which a grantor receives a deed with the intention of retaining it in order to vest himself with title to the real estate; an express or implied indication of willingness to be bound to the terms of an offer to contract.

Access - The right of a property owner to have a means of entry and exit from his property to a public street.

Accretion - Addition to land by deposit of soil or sand as a result of natural action by stream, lake, river, or sea.

Accrued Depreciation - The actual depreciation in a property that has already accrued as of a given date; past depreciation.

Acknowledgment - The process whereby a person goes before a notary public or other recognized officer and executes a legal document and at the same time declares that he is executing the document as a free and voluntary act.

Acre - A measure of land equal to 43,560 sq. ft.

Action - A court process to enforce a right.

Actual age - The number of years a building has been in existence; chronological age.

Administrator - A person appointed by a probate court to handle the estate of a deceased person who left no will.

Ad valorem - According to value.

Ad valorem rax - A real property tax based on the value of the property.

Adverse possession - The continuous, visible, hostile use or occupation of the property of another. Title may be acquired by adverse possession for a period prescribed by law.

After Acquired Title - A doctrine under which a prior grantee automatically obtains title to real estate acquired by a grantor who previously attempted to convey title which he did not in fact own.

Agency - The relationship between a principal and agent whereby the agent represents the principal in dealing with third parties.

Agent - A person who has authority to act for another.

Air rights - A landowner's right to the use and enjoyment of the space above his land to the extent that he can effectively enjoy it.

Alienate - To convey or transfer title to property.

ALTA - American Land Title Association.

ALTA title insurance policy - A broad form of title insurance policy, which includes unusual risks such as factors, which could be disclosed by inspection of the land or by a survey.

Amenities - Those qualities which are pleasing and agreeable; intangible benefits of property ownership such as pride of ownership or scenic beauty.

Common elements - Those areas within a condominium which each owner of a condominium unit has the right to use in common with each other.

Common Law - The body of law based on custom and usage, some derived from English law.

Community property - Property owned half by each married partner, if acquired during the marriage period with joint funds or efforts; exists in only a few states.

Concurrent ownership - Ownership where two or more persons possess simultaneous estates in the same property.

Condemnation - The process whereby the government or a quasigovernment ownership takes title to private property for public use in exchange for just compensation under the power of eminent domain.

Conditional - Depends upon the occurrence of certain terms or events.

Condominium - A unit in an apartment or multifamily structure, which is owned by an individual in the same way an individual, can own other real property.

Conservator - A person appointed by a court to take legal charge of the person and property of a person incapable of managing his affairs.

Consideration - Anything of value, whether tangible or not, given by one party in a contractual agreement.

Constructive notice - Other than actual notice- notice given to the public through the process of recording documents in the public records office; notice imputed to a buyer by persons in possession of property.

Consummate Dower - After the death of a husband, the dower interest which the wife had in her husband's estate.

Contiguous - Next to and in actual contact.

Contingent - Dependent upon a future event which is uncertain.

Contingent remainder - An estate in land, the possession and enjoyment of which is delayed until the termination of a preceding estate and the occurrence of a condition. Contour Surface shape of land.

Contract - A legally enforceable agreement.

Contract for deed - See Installment land contract.

Contract rent - The rent stipulated in a lease agreement or contract.

Conventional mortgage - A mortgage other than one guaranteed by FHA or VA.

Conveyance - The transfer of title to real estate from one party to another by written instrument.

Cooperative - An apartment or multifamily building owned by several persons through a corporation, such that each owner is a stockholder and also leases a portion of the building.

Co-owners - Two or more persons who possess simultaneous estates in the same property.

Corporation - An artificial entity created by and under the authority of a state or other government for private or public purposes.

Cost approach - A property appraisal process in which the appraiser estimates building value as replacement cost minus depreciation.

Cul de sac - A circular turn-around street in a property development.

Courtesy - The right which a husband by law in his deceased wife's estate; applicable in only a few states.

Damages - The amount recoverable by a person who has suffered an injury, either in person or property, due to the wrong of another.

Datum - A plan of elevation from which heights and depths are measured.

Debtor - The owner of a property in a security agreement; sometimes called mortgager.

Declaration of restrictions - An instrument other than a deed containing restrictive covenants which is incorporated by reference and made part of a deed.

Decree - A court order as a result of a judicial proceeding.

Dedication - A voluntary giving of property by the owner for use by authorized public officials on behalf of the public.

Deed - A written instrument by which title to real property is conveyed from one person to another.

Default - The failure to fulfill a contractual obligation.

Defeasance Clause - The clause in a mortgage note that allows the mortgager to redeem his property after all payments due the mortgagee are paid.

Deficiency Judgment - A judgment rendered after default when the security pledged for a loan does not satisfy the debt.

Exception - A right or portion of property reserved in the grantor in a conveyance by deed.
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Exclusive agency listing - A listing agreement between a seller and a broker where either has a right to sell the property; if sold by the broker, a commission will be due.

Exclusive right to sell - A listing agreement between a seller and a broker whereby the broker receives a commission, whoever sells the property.

Execute - To sign and deliver an instrument, such as a deed.

Executor - A person specified in a will to carry out the provisions of the will.

Express Contract - A contract whose elements are stated orally or in writing.

Fee on a condition subsequent - A fee simple which is conveyed reserving to the grantor the right of entry upon occurrence of a condition subsequent.

Fee simple - The highest interest a person may have in real property.

Fee simple Determinable - (Qualified fee) Fee simple subject to a condition or limitation, the occurrence of which causes title to revert back to its grantor or his heirs automatically.

FHA - Federal Housing Administration; a federal agency which insures home mortgages.

Fiduciary - A relationship of trust and confidence as between a principal and agent.

Financing statement - An instrument filed with the recorder or register of deeds indicating that personal property is encumbered.

Fixture - An item that was originally personal property but is so attached to the property that it becomes part of the real estate.

Flashing - Sheet metal or other material used around chimneys or other places to prevent water seepage.

Footing - The base on which a home foundation stands.

Foreclosure - A legal proceeding by a lien claimant to force sale of a property to pay the amount due the lien claimant.

Forfeiture - The loss of money or right due to default or failure to perform in accord with a contract.

Foundation - The portion of a structure which supports the first floor and construction above it.

Fraud - Successful deception with the intent of deceiving another person.

Freehold Estate - An estate existing for an indefinite length of time; an estate of inheritance or for life.

Frontage - Property on a street, highway, or lake.

Front foot - A measure of property value where the distance is measured along the street, highway, stream, or other body of water.

Functional Obsolescence - Things internal to a structure that detract from a building value.

General lien - A lien effective against all of a person's property, both real and personal.

Grade - The level of the ground at the structure foundation.

Graduated lease - A lease providing for a variable rate of rend depending upon some future event.

Grantor - A person who transfers property, such as a seller.

Gross lease - A lease agreement whereby the pro0perty owner pays taxes, insurance, repairs, and other costs.

Ground lease - An agreement for rental of land only.

Ground rent - The portion of property income attributed to the ground value itself'; used in a few states whereby a person can own a structure and rent the ground.

Guardian - A person granted power by a court to take care of and manage the property of another person who has been declared legally incapable of administering his own affairs.

Habendum - A provision in a deed, which defines the extent of the ownership to be granted to and enjoyed by the grantee.

Heirs - The persons designated by statute to receive an estate where there is no will.

Highest and best use - The use of a property, which will yield the greatest return on the property.

Homestead - Any real estate where the owner resides and which is exempt from creditor's claims to an amount specified by state law.

HUD - Federal Department of Housing and Urban Development.

Hypothecate - To give something as security without giving up its possession.

MAI - A member of the American Institute of Appraisers qualified to specified requirements.

Marginal land - Land in use which barely pays the cost of working it.

Market approach - The process of property appraisal by comparing it to sales of equivalent properties.

Market value - The highest price which property would be expected to bring in the open market under normal conditions.

Meandered - Area such as a lake on which taxes are not paid.

Meander line - The approximate border of a natural body of water.

Mechanic's lien - A lien which can be filed by mechanics or material men who supply labor or materials for property improvement to secure payment.

Meridian - Map lines running north and south to locate land under the governmental survey system.

Metes and bounds - A method of legal description by use of measurements, boundaries and directions.

Mineral rights - A legal interest in minerals in land, which includes the right to take minerals from land.

Minor - A person not of legal age.

Modernization - Replacement of outmoded fixture, equipment, and other features of an improvement with modern features.

Monument - A fixed object, either natural or artificial, which surveyors use to measure.

Mortgage - A written instrument in which real estate is used as security for repayment of a debt or obligation.

Mortgage - The party who lends money for a mortgage.

Mortgager - The party who borrows money with his property as security.

Multiple Listing - A listing agreement whereby other brokers in an organization are allowed to sell a listed property.

NAR - National Association of Realtors

Navigable water - A waterway capable of passage by watercraft; navigable if so designated on a U.S. Map.

Net lease - A lease agreement in which the tenant pays rent plus all taxes, insurance, repairs, and other costs.

Net listing - A listing agreement whereby the owner receives a set amount and the broker receives all above that amount.

Nominal consideration - Consideration having no relationship to the actual value of the contract or property conveyed.

Nonfreehold estate - An estate in land of a certain duration, i.e., leasehold estate.

Note - A written instrument promising payment.

Notice to quit - Notice given to a tenant to vacate a rented property.

Nuisance - Anything that is offensive to a person or property.

Obsolescence - Loss in value due to obsolete or out-of-date design or construction.

Open end mortgage - A mortgage agreement such that the mortgager can borrow additional funds in the future without rewriting the mortgage.

Open listing - A listing agreement whereby either the owner or the broker can sell the property; if the broker is the procuring cause, a commission is due.

Option - A contractual right given for a consideration permitting a person to lease or buy the property at a specified price within a given period.

Optionee - A person who holds an option.

Optionor - A person who gives an option to another person.

Ordinance - A law passed by the legislative body by a municipal corporation.

Overhang - The portion of a roof extending beyond the walls.

Partition - An action seeking to have property owned by two or more persons sold and the proceeds divided between the parties; or to have the property divided into two or more portions.

Partnership - An association of two or more persons to carry on a business for profit as co-owners.

Party wall - A wall erected on the line between two adjacent properties for the use of both parties.

Replacement cost - The cost incurred in replacing one property with another of similar utility using modernized equipment, materials, and techniques.

Reproduction cost - The cost of reproducing an exact replica property based on current prices.

Rescind - To declare a contract void in its inception and put an end to it as though it never existed.

Reservation - A right kept by a grantor when conveying property.

Restriction - An encumbrance created by deed or special agreement which limits use of the property.

Reversion - The portion of an estate remaining with the original grantor after the termination of a leasehold or life estate.

Right of redemption - A person's right by law to buy back property taken by forced sale for a period of time stated by law.

Right of way - The right to cross over or under another person's property for ingress, egress, utility lines, sewers, etc.

Riparian rights - Rights of an owner of property abutting water to use the water and have uninterrupted flow and drainage.

Rod - A measure of length equal to 161/2 ft.

Rural - Pertaining to the country; rather than urban.

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Satisfaction - Discharge of lien upon payment of debt.

Seal - An impression made to attest to the execution of a written instrument; also the word "seal" typed in to form a sealed document.

Section - A unit of land measure one-mile square containing 640 acres.

Security Deposit - Earnest money.

Seize - The possession of land under a claim of freehold estate.

Septic Tank - An underground tank used where city sewage is not available.

Servient estate - An estate burdened by an easement.
Setback - A distance from the curb to the building, often specified by ordinance.

Settlement - The process of completing the sale of real property; same as closing.

Severalty - Sole ownership; by one person.

Sheriff's deed - A deed given as a result of a court order to sell property in satisfaction of a judgment.

Signature - The act of putting down a person's name, mark, or symbol with the intent that it attest the validity of a written instrument.

Site - A plot of ground upon which anything is, has been, or will be located.

Situs - Location.

Special assessment - An assessment against real estate to pay for improvements such as sidewalks, curbs, streetlights, or other things which benefit certain property owners.

Special warranty deed - A form of deed whereby the grantor warrants the title only against claims generated while the grantor owned the property.

Specification - A document describing requirements for a house, subdivision, or other project.

Specific performance - A legal action to compel the performance of the terms of an agreement, such as the sale of a home.

Specific Lien - A lien which affects only a single parcel of property.

SRA - Designates a member of the Society of Real Estate Appraisers.

Statute - State or federal law.

Statute of frauds - The state law which requires that certain contracts, including those for the sale of real property, must by in writing.

Strict foreclosure - A court decree vesting title to mortgaged property in the mortgagee upon the default of the mortgagor without any sale of the property.

Stud - Vertical timbers in a house wall.

Subdivision - A tract of land divided into lots suitable for residential purposes.

Subject to - The purchase of real property subject to a mortgage, whereby the original holder remains personally liable for the mortgage.

Sublease - A lease given to another by a lessee.

Subordinate - To make a mortgage subservient to another mortgage.

Subsequent purchaser for value - A purchaser for value in good faith and without notice of any adverse interest in the property purchased.

Suburb - The area close and adjacent to a city or town.

Survey - The process of measuring land; the resulting map of the property.

Syndicate - A group of persons joining together to deal in real property.

Tangible - Existing physically; that which can be touched.