Real Estate Terms: A to Z Glossary

The voluntary surrender or relinquishment of possession of real property without the vesting of this interest in any other person

The condensed history of a title to a particular parcel of real estate

An abstract of title that a lawyer has examined and has certified to be, in his or her opinion, an accurate statement of fact

The clause in a note or mortgage that can be enforced to make the entire debt due immediately if the mortgagor defaults

The increase or addition of land by the deposit of sand or soil washed up naturally from a river, lake, or sea

On a closing statement, items of expense that are incurred but not yet payable, such as interest on a mortgage loan or taxes on real property

A formal declaration made before a duly authorized officer, usually a notary public, by a person who has signed a document.

A measure of land equal to 43,560 square feet, 4,840 square yards, 4,047 square meters, or 160 square rods

Action whereby a defaulted tenant is physically ousted from rented property pursuant to a court order.

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

A mortgage loan in which the interest rate may increase or decrease at specific intervals, following an economic indicator

Original cost plus improvements, minus depreciation.

A person appointed by the court to administer the estate of a deceased person who left no will; i.e., who died intestate

A tax levied according to value; generally used to refer to real estate tax. Also called general tax

The actual, visible, hostile, notorious, exclusive, and continuous possession of another's land under a claim of title

A written statement sworn to before an officer who is authorized to administer an oath or affirmation

That relationship wherein an agent is employed by a principal to do certain acts on the principal's behalf

One who undertakes to transact some business or to manage some affair for another by authority of the latter

The right to use the open space above a property, generally allowing the surface to be used for another purpose

The act of transferring property to another

The clause in a mortgage stating that the balance of the secured debt becomes immediately due and payable at the mortgagee's option if the property is sold or title is otherwise transferred

An acronym to remember the six items that the lender must obtain before issuing a Loan Estimate (LE):
Address of the subject property
Loan amount
Income
Estimate of property value
Name of borrower(s)
Social security number(s)

Some extra that contributes to owner satisfaction: clean air, view, etc.

Mandates that certain adaptations of real estate to accommodate various disabilities

Written listing of each payment, broken down into interest, principal, and remaining debt

A loan in which the principal as well as the interest is payable in monthly or other periodic installments over the term of the loan, resulting in a zero balance due at the end of the term

Rate of interest charged on a loan, calculated to take into account upfront loan fees and points. Usually higher than the contract interest rate

Laws designed to preserve the free enterprise of the open marketplace by making illegal certain private conspiracies and combinations formed to minimize competition.

An estimate of a property's value by someone who has specific training as an appraiser

Independent person trained to estimate value.

An increase in the worth or value of a property

A right, privilege, or improvement belonging to, and passing with, the land.

A transaction between two relative strangers, each trying to do the best for himself or herself

The opposite of "in advance;" payment after the service has been rendered

A mineral once used in insulation and other materials that can cause respiratory diseases.

The valuation placed upon property as a basis for taxation

The imposition of a tax, charge, or levy, usually according to established rates.

The transfer in writing of interest in a contract, mortgage, lease, or other instrument

Of a mortgage, able to be transferred to another owner of the property

Acquiring title to property on which there is an existing mortgage and agreeing to be personally liable for the terms and conditions of the mortgage, including payments.

Written statement about Fair Housing Laws to be presented to buyers and sellers.

The sudden changing of course of a stream

A final payment of a mortgage loan that is considerably larger than the required periodic payments because the loan amount was not fully amortized.

A deed that carries with it no warranties against liens or other encumbrances but that does imply that the grantor has the right to convey title.

A deed in which the grantor warrants or guarantees the title against defects arising during the period of his or her tenure and ownership of the property but not against defects existing before that time.

The cost of a property that the Internal Revenue Service uses to determine annual depreciation and gain or loss on the sale of the asset

A permanent reference mark or point established for use by surveyors in measuring differences in elevation.

The person who receives or is to receive benefits resulting from certain acts

To give or hand down personal property by will; to leave by will

Personal property given by the terms of a will.

An agreement entered into by two or more legally competent parties that is binding on all parties

A written instrument given to transfer title of personal property

An agreement that may accompany an earnest money deposit for the purchase of real property as evidence of the purchaser's good faith and intent to complete the transaction.

Repayment plan in which half a monthly payment is made every two weeks, the equivalent of 13 full payments a year.

A mortgage covering more than one parcel of real estate

Also known as panic peddling, the illegal practice of inducing homeowners to sell their property by making representations regarding the entry or prospective entry of minority persons into the neighborhood

Common name for laws that regulate the registration and sale of investment securities.

elected managing body of a corporation, specifically of a cooperative apartment building

Elected managing body of a condominium.

The instrument that creates a personal obligation for a debt that is secured by a mortgage or other lien on real estate

Money or property given to make up any difference in value or equity between two properties in an exchange.

Licensee's written estimate of market value, used by lenders and mortgage companies where they believe the expense and delay of an appraisal is not needed.

A secondary place of business apart from the principal or main office from which real estate business is conducted.

Violation of any terms or conditions in a contract without legal excuse; for example, failure to make a payment when it is due.

One who buys and sells for another for a fee.

the business of buying and selling for another for a fee

A qualified broker who practices real estate in the position of a salesperson in another broker's office.

Regulations established by state and local governments setting forth the structural requirements for building.

A line fixed at a certain distance from the front and/or sides of a lot, beyond which no building can project.

State agency that approves and registers some out-of-state property

payment of extra points in return for lower interest rate

A real estate broker retained by a prospective purchaser, who becomes the broker's principal or client and to whom fiduciary duties are owed.

Rules and regulations adopted by an association

New Jerseys Coastal Area Facilities Review Act, which sharply limits development in environmentally sensitive areas

With an adjustable-rate mortgage, a limit, usually in percentage points, on how much the interest rate or payment might be raised in each adjustment period

Profits realized from the sale of assets like real estate

The conversion of future income to be derived from an investment property into an estimate of the present value

The rate of return a property produces on the owner's investment.

A colorless, odorless gas that occurs as a by-product of fuel burning. Carbon Monoxide (CO) poisoning has been linked to dizziness, nausea, and death

The net spendable income from an investment after deducting expenses

a Latin phrase meaning "let the buyer beware"

Covenants, conditions, and restrictions of a condominium or cooperative development.

With an adjustable-rate mortgage, a limit, usually in percentage points, beyond which the interest rates or monthly payment on a loan may never rise. Sometimes known as a lifetime cap

The Comprehensive Environmental Response, Compensation, and Liability Act. A federal law administered by the Environmental Protection Agency that establishes a process for identifying parties responsible for creating hazardous waste sites, forcing liable parties to clean up toxic sites, bringing legal action against responsible parties, and funding the abatement of toxic sites.

Inspector's statement that property is fit for human habitation

Document issued by a municipal authority stating that a building complies with building, health, and safety codes and may be occupied

VA appraisal statement

A statement of opinion of title status on a parcel of real property based on an examination of specified public records.

The conveyance of real property to one owner from another, reaching back to the original grantor.

movable personal property

a mortgage on personal property

The one by whom a broker is employed in an agency relationship

The date upon which the buyer takes title to the property.

The statement of final loan terms and closing costs; is compared to the Loan Estimate (LE)

A detailed cash accounting of a real estate transaction showing all cash received, all charges and credits made, and all cash paid out in the transaction.

an outstanding claim or encumbrance that, if valid, would affect or impair the owner's title

The grouping of homesites within a subdivision on smaller lots than normal, with the remaining land used as common areas.

Standards of conduct adopted by the National Association of REALTORS

That which appears to be a good title but which is not

payment to a broker for services rendered, such as in the sale or purchase of real property

Parts of a property that are necessary or convenient to the existence, maintenance, and safety of a condominium or are normally in common use by all of the condominium residents.

Properties listed in an appraisal report or a CMA that are substantially equivalent to the subject property. Also called comps

A study intended to assist an owner in establishing a listing price for a property.

Those recognized by law as being able to contract with others; usually those of legal age and sound mind.

court action by which government takes property, exercising the right of eminent domain

A judicial or administrative proceeding to exercise the power of eminent domain through which a government agency takes private property for public use and compensates the owner

the absolute ownership of an apartment of a unit (generally in a multi-unit building) plus an undivided interest in the ownership of the common elements, which are owned jointly with the other condominium unit owners

1. That received by the grantor in exchange for a deed
2. Something of value that induces a person to enter into a contract.
May be valuable (e.g., money) or good (love and affection)

Claim placed against property by a worker who has not been paid

Landlord actions that so materially disturb or impair the tenant's enjoyment of the leased premises that the tenant is effectively forced to move out and terminate the lease without liability for any further rent.

Notice given to the world by recorded documents. Occupation of property is also considered as giving constructive notice.

Written explanation of agency relationships presented to buyers and sellers.

Certain happening without which a contract will not be valid

12 hours of study required for license renewal

An agreement entered into by two or more legally competent parties by the terms of which one or more of the parties, for a consideration, undertakes to do or refrain from doing some legal act or acts

A contract for the sale of real estate wherein the purchase price is paid in periodic installments by the purchaser, who is in possession of the property even though the title is retained by the seller until final payment. Also called an installment contract or land contract

a loan not insured or guaranteed by a government agency

To transfer ownership by sale or gift

The transfer of the title of land from one to another. The means or medium by which title of real estate is transferred.

A residential multi-unit building whose title is held by a corporation owned by and operated for the benefit of persons living within the building, who are the stockholders of the corporation, each possessing a proprietary lease

An entity or organization created by operation of law whose rights of doing business are essentially the same as those of an individual

The process of estimating the value of a property by adding to the estimated land value the appraiser's estimate of the reproduction or replacement cost of the building, less depreciation.

A new offer made as a reply to an offer received

Agreement written into deeds and other instruments promising performance or nonperformance of certain acts or stipulating certain uses or nonuses of the property

Certified Property Manager, a designation awarded by the Institute of Real Estate Management

On a closing statement, an amount entered in a person's favor

cooperative organization for savers and borrowers

A technique for estimating building costs per cubic foot.

Third party in a transaction owed honest treatment but not owed fiduciary duties

The indemnity recoverable by a person who has sustained an injury, either to person, property, or rights, through the act or default of another

Point from which elevations are measured. Mean sea level in New York harbor, or local datum

a person who has died

The voluntary transfer of private property by its owner to the public for some public use, such as for streets or schools.

A written instrument that, when executed and delivered, conveys title to or an interest in real estate.

An imposed restriction in a deed for the purpose of limiting the use of the land by future owners.

The nonperformance of a duty, whether arising under a contract or otherwise; failure to meet an obligation when due.

A personal judgment levied against the mortgagor when a foreclosure sale does not produce sufficient funds to pay the mortgage debt in full.

Unpaid past-due taxes.

The transfer of the possession of a thing from one person to another

Final action with a deed that transfers title.

a transfer of property by lease

A clause in a lease whereby the landlord (lessor) leases and the tenant (lessee) takes the property depreciation

New Jersey agency overseeing natural resources

In appraisal, a loss of value in property due to any cause including physical deterioration, functional obsolescence, and locational obsolescence. For income tax purposes, yearly write-off of a percentage of the cost of a building as an expense

One who improves land with buildings, usually on a large scale, and sells to homeowners and/or investors

a gift of real property by will; the act of leaving real property by will

one who leaves real estate by will

An added loan fee charged by a lender to make the yield on a lower-than-market-value loan competitive with higher interest loans.

A property that includes in its ownership the right to use an easement over another persons property for a specific purpose

Representing both parties to a transaction

Unlawful constraint or action exercised upon a person who is forced to perform an act against his or her will

money deposited by a buyer that is applied to the purchase price if the sale is closed

A right to use the land of another for a specific purpose, as for a right-of-way or utilities; an incorporeal interest in land

An easement that passes with the land when conveyed

An easement allowed by law as necessary for the full enjoyment of a parcel of real estate; for example, a right of ingress and egress over a grantor's land.

An easement acquired by continuous, open, uninterrupted, exclusive, and adverse use of the property for the period of time prescribed by state law

An easement that is not created for the benefit of any land owned by the owner of the easement but that attaches personally to the easement owner.

Energy fields generated by the movement of electrical currents

Growing crops, such as wheat and corn, that are produced annually through labor and industry; also called fructus industriales. Emblements are considered to be the personal property of a tenant

The right of a government or quasi-public body to acquire property for public use through a court action called condemnation

The extension of an improvement beyond the land of the owner, illegally intruding on land of an adjoining owner.

Any claim by another such as a mortgage, tax or judgment lien, an easement, encroachment, or a deed restriction on the use of the land that may diminish the value of a property

Engineer's report often required before a building permit is issued.

figure that adjusts assessments for varying community standards

The interest held by a vendee under a land contract or an installment contract; the equitable right to obtain absolute ownership to property when legal title is held in anothers name

The interest or value that an owner has in property over and above any mortgage indebtedness and other liens

The right of an owner to reclaim property before it is sold through foreclosure by the payment of the debt, interest, and costs

The gradual wearing away of land by water, wind, and general weather conditions; the diminishing of property caused by the elements

A form of malpractice insurance for real estate licensees

Protection for seller with a contact is subject to the sale of buyer's present home

The reversion of property to the state or county, as provided by state law, in cases where a decedent dies intestate without heirs capable of inheriting, or when the property is abandoned.

The closing of a transaction through a third party called an escrow agent. Also can refer to earnest money deposits or to mortgages trust account for insurance and tax payments

The degree, quantity, nature, and extent of interest a person has in real property.

An interest for a certain, exact period of time in property leased for a specified consideration.

A document in which a borrower certifies the amount he or she owes on a mortgage loan and the rate of interest.

A legal process to oust a person from possession of real estate

Proof of ownership of property; commonly a certificate of title, a title insurance policy, an abstract of title with lawyers opinion, or a Torrens registration certificate

A transaction in which all or part of the consideration for the purchase of real property is the transfer of like kind property (for example, real estate for real estate)

local regulations that discriminate, usually against low income housing

A listing contract under which the owners appoint a real estate broker as their exclusive agent for a designated period of time to sell the property, on their stated terms, for a commission. The owners reserve the right to sell on their own without paying anyone a commission.

A listing contract under which the owner appoints a real estate broker as his or her exclusive agent for a designated period of time, to sell the property on the owner's stated terms, and agrees to pay the broker a commission when the property is sold, whether by the broker, the owner, or another broker.

1. A contract in which all parties have fulfilled their promises and thus performed the contract
2. A signed contract

The signing and delivery of an instrument. Also, a legal order directing an official to enforce a judgment against the property of a debtor.

A male person, corporate entity, or any other type of organization designated in a will to carry out its provisions

A contract under which something remains to be done by one or more of the parties.

A woman appointed to perform the duties of an executor

An oral or written contract in which the parties state the contract's terms and express their intentions in words.

Reduction in property's value caused by factors outside the subject property, such as social or environmental forces or objectionable neighboring property. Also called locational obsolescence or economic obsolescence

An agreement between HUD and the National Association of REALTORS to promote principles of fair housing to the public and within individual firms

Sets standards and buys mortgages

Insures low-down-payment mortgages.

The maximum possible estate or right of ownership of real property, continuing forever. Sometimes called a fee or fee simple absolute

The most popular FHA mortgage plan, with 3% or less as required down payment.

A loan insured by the Federal Housing Administration and made by an approved lender in accordance with the FHA's regulations.

One legally placed in a position of trust and confidence

A relationship of trust and confidence as between trustee and beneficiary, attorney and client, or principal and agent.

An item of personal property that has been converted to real property

A procedure whereby property pledged as security for a debt is sold to pay the debt in the event of default in payments or terms

An organization that leases a standardized trade name, operating procedures, supplies, and referral service to member real estate brokerages

Intentional deception that harms another

Intentional fraud and/ or deliberate lying

Warehouses packages or mortgages

An estate in land in which ownership is for an indeterminate length of time

A standard measurement, one foot wide, of the width of land, applied at the frontage on its street line. Each front foot extends the depth of the lot.

A loss of value to an improvement to real estate due to becoming outdated, often caused by age or poor design

A person's present right to an interest in real property that does not result in possession or enjoyment until some time in the future

A defect in the chain of title of a particular parcel of real estate; a missing document or conveyance that raises doubt as to the present ownership of the land.

One authorized to act for his or her principal in a wide range of matters.

Financial claim placed against all property owned by the debtor.

Group in which each partner shares complete liability

Pools mortgages for investors

Designation awarded by the National Association of REALTORS after specific study.

A lease that provides for a graduated change at stated intervals in the amount of the rent to be paid; used largely in long-term leases.

A person who receives a conveyance of real property from a grantor.

Words in a deed of conveyance that state grantor's intention to convey the property. This clause is generally worded as "convey and warrant," "grant," "grant, bargain, and sell," or the like

The person transferring title to or an interest in real property to a grantee

Total income from property before any expenses are deducted

A lease of property under which a landlord pays all property charges regularly incurred through ownership, such as repairs, taxes, and insurance.

A figure used as a multiplier of the gross rental income of a property to produce an estimate of the property's value

A lease of land only, on which the tenant usually owns a building or constructs a building as specified in the lease

Money set aside to reimburse persons defrauded or badly served by real estate licensees.

Awareness of wrongdoing without any attempt to stop it.

That part of a deed beginning with the words "to have and to hold," following the granting clause and defining the extent of ownership the grantor is conveying.

One who inherits property under a will; one who will inherit under the state law of descent when someone dies intestate

That possible use of land that would produce the greatest net income and thereby develop the highest land value.

A tenancy whereby a lessee retains possession of leased property after the lease has expired and the landlord, by continuing to accept rent, agrees to the tenant's continued occupancy

A will that is written, dated, and signed in the testator's handwriting but is not witnessed

Additional financing for homeowner; type of second mortgage

A nonprofit group of homeowners in a condominium, cooperative, or PUD that administers common elements and enforces covenants, conditions, and restrictions.

Law regulating the creation of condominiums.

A pledge of property as security for a loan without giving up possession of it.

Charges to developers for extra roads, expanded schools, etc.

A contract under which the agreement of the parties is demonstrated by their acts and conduct

landlord's responsibility for decent living conditions

Any structure erected on a site to enhance the value of the property--buildings, fences, driveways, curbs, sidewalks, or sewers.

The process of estimating the value of an income-producing property by capitalization of the annual net income expected to be produced by the property during its remaining useful life

Salesperson who sets his or her own hours and who is not covered by income tax withholding; contrasted with an employee

Unintentional misleading of a buyer committed in ignorance

A proceeding against realty directly as distinguished from a proceeding against a person

A method of reporting income received from the sale of real estate when the sales price is paid in two or more installments over two or more years.

A written legal document

Bridge or swing loan to cover the gap between purchase of a new home and sale of the old one

The condition of a property owner who dies without leaving a valid will.

A lien imposed against property without consent of the owners; e.g., taxes, special assessments

The Industrial Site Recovery Act, a New Jersey statute that provides for mandatory cleanup of industrial and some commercial sites when they are closed, sold, or otherwise change ownership

Ownership of real estate between two or more parties who have been named in one conveyance as joint tenants. Upon the death of a joint tenant, his or her interest passes to the surviving joint tenant or tenants by the right of survivorship.

The joining of two or more people to conduct a specific business enterprise

The formal decision of a court regarding the respective claims of the parties to an action. After a judgment has been recorded, it usually becomes a general lien on the property of the defendant

Loan for a higher amount than those generally bought by the secondary market.

An obligation such as a second mortgage that is subordinate in priority to an existing lien on the same realty

Loss of a legal right through undue delay in asserting it.

The earth's surface, extending downward to the center of the earth and upward infinitely into space

One who rents property to another

Problem with property not discoverable by ordinary prudent inspection.

New Jersey's law listing protected classes for fair housing practice.

Once used as a pigment and drying agent in alkyd oil-based paint, exposure to lead has been linked to serious brain, kidney, nervous system, and blood damage. Lead-based paint has been banned since 1978. Other sources of lead exposure include plumbing, incinerators, and lead-based gasoline. Federal law requires the disclosure of known lead-based paint in a property

A written or oral contract between a landlord (the lessor) and a tenant (the lessee) that transfers the right to exclusive possession and use of the landlord's real property to the lessee for a specified period of time and for a stated consideration (rent).

A tenant's right to occupy real estate during the term of a lease, generally considered to be personal property

A disposition of money or personal property by will

A description of a specific parcel of real estate complete enough for an independent surveyor to locate and identify it.

A non-binding (usually) recitation of what the parties intend to do, preceding entering into a contract

The use of borrowed money to finance investments

1. A privilege or right granted to a person by a state to operate as a real estate broker or salesperson
2. The revocable permission for a temporary use of land

A right given by law to certain creditors to have their debt paid out of the property of a defaulting debtor, usually by means of a court sale.

An interest in real or personal property that is limited in duration to the lifetime of its owner or some other designated person

A person in possession of a life estate.

Organization that combines the simplicity and tax treatment of a partnership with the protection from liability offered by a corporation

sum agreed upon to serve as compensation if one party defaults

The ability to sell an asset and convert it into cash at a price close to its true value in a short period of time

A recorded legal document giving constructive notice that court action affecting a particular property is pending

A contract between a property owner (as principal) and a licensed real estate broker (as agent) by which the broker is employed as agent to sell real estate on the owner's terms within a given time, for which service the landowner agrees to pay a commission or fee

The broker in a multiple listing situation, from whose office a listing agreement is initiated, as opposed to the selling broker, from whose office negotiations leading up to a sale are initiated.

1. A landowner's claim to use water in large navigable lakes and oceans adjacent to his or her property.
2. The ownership rights to land bordering these bodies of water up to the mean high-water mark.

A three-page, TRID-required document that itemizes important details of the mortgage loan; lender must provide the borrower within three business days after receiving the borrower's intent to proceed

Ratio between property's value and the amount lent on it

The rate at which the investor's top dollar is taxed

Good or clear title reasonably free from the risk of litigation over possible defects.

The probable price a ready, willing, able, and informed buyer would pay and a ready, willing, able, and informed seller would accept, neither being under any pressure to act, and after allowing for a reasonable exposure on the market

A comprehensive plan to guide the long-term physical development of a particular area.

A New Jersey law requiring that communities be alerted to the presence of convicted sex offenders. All contracts and leases must include a Megan's Law Statement advising purchasers and lessees that a list of any known sex offenders who live in the area may be obtained from the county prosecutor

A legal description of a parcel of land that begins at a well-marked point and follows the boundaries, using direction and distances around the tract back to the place of beginning.

One-tenth of one cent. A tax rate of 52 mills would be \$0.052 tax for each dollar of assessed valuation of a property

Subsurface rights, which can be sold or retained separately.

a person under 18 years of age

Mortgage Insurance Premium

A periodic tenancy; that is, the tenant rents for one period at a time. In the absence of a rental agreement (oral or written), a tenancy is generally considered to be month to month

A fixed natural or artificial object used to establish real estate boundaries for a metes-and-bounds description.

A halt to development, often temporary

A conditional transfer or pledge of real estate as security for the payment of a debt. Also, the document creating a mortgage lien.

Institution set up to make mortgage loans.

A lender in a mortgage loan transaction.

Lender's claim against specific parcel of real estate pledged as security for a debt.

An instrument executed by the mortgagee, setting forth the present status and the balance due on the mortgage as of the date of the execution of the instrument.

A borrower who conveys his or her property as security for a loan.

A judicial interpretation that requires local zoning boards to provide realistic opportunities for housing that low- to moderate-income households can afford

An organization in which brokers share listings with each other.

Private nationwide organization of salespersons and brokers.

Gradual building up of a large mortgage debt when payments are not sufficient to cover interest due and reduce the principal.

fraud committed, not necessarily on purpose, by someone who should have known better

A lease requiring the tenant to pay not only rent but also some or all costs of maintaining the property, such as taxes, insurance, utilities, and repairs.