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Real Estate Law

TermDefinition
fixture item of personal property that becomes real property because of its attachment to the land or a building
real property land, and things such as buildings that are permanently attached to the land
riparian rights rights of the owners of lands adjoining streams, rivers, and lakes relating to the water and its use
appropriation in regard to water law, the doctrine stating that water belongs to the person who first makes beneficial use of it
possession occupation of land, evidenced by visible acts, such as: enclosure, cultivation, the construction of improvements, or the occupancy of existing improvements
inheritance ability to acquire ownership to real property because of one's kinship to a deceased property owner who dies without a will
devise transfer of real property by means of a last will and testament
will legal document by which a person disposes of his property; taking effect upon person's death
conveyance the transfer of title of some or all of the ownership rights to real property from one person to another; usually by instrument such as a deed, lease, or mortgage.
deed written document that transfers ownership of real property from one person to another
adverse possession method of acquiring ownership to real property by possession for a statutory time period
tacking the addition of possession periods by different adverse possessors
color of title a form of adverse possession where the original possession of the property by a prescriber is based upon a written instrument such as a deed or court decree
quiet title judicial proceeding to establish ownership to real property
fee simple (fee simple absolute) estate of property with infinite duration and no restrictions on use
fee simple determinable estate of real property with potential infinite duration; subject to a condition, the breach of which can result in termination of the estate; automatically expires on the occurrence or non-occurrence of a condition
fee simple on condition subsequent estate of real property with potential infinite duration; subject to a condition, the breach of which can result in termination of the estate; continues in existence until an action is brought to recover the property
life estate estate of real property, the duration of which is measured by the life or lives of one or more persons
waste action or non-action that causes a loss of value to real property, leading to the termination of a life estate
estate for years estate of real property, the duration of which is for a definite period
estate at will estate of real property, the duration of which is for an indefinite period; can be terminated at the will of the parties
joint tenancy with the right of survivorship ownership of real property by two or more persons, who hold equal interest in the real property, and on the death of any owner, the deceased owner's interest in the real property passes to the surviving owner
tenancy in common ownership of real property by two or more persons; each owner's interest in the real property is capable of inheritance
contribution right of a co-owner of real property to receive reimbursement from other co-owners for their share of expenses that are common to the real property
partition method by which co-owners of real property can divide the common property into separate ownerships; may be by voluntary agreement of the co-owners, or by court action
tenancy by the entirety ownership of real property by a husband and wife; husband and wife are treated as a single owner; neither can transfer the property without the other's consent
community property rule of law which provides that real property acquired during marriage is owned equally by the husband and wife
separate property property owned by a spouse in a community property state that is not considered to be community property
prenuptial agreement agreement entered into by a married couple that outlines the division and ownership of property in the event of separation or divorce
dower widow's interest in real property of her husband that provides a means of support after the husband's death
curtesy interest in real property of the wife that the law in some states gives to the surviving husband
elective share (forced share) right given to a widow in many states, to elect, at her husband's death, to receive either dower or some ownership (fee simple) share of her husband's property
corporation a legal entity wherein the owners do not have personal liability for the debts or actions of the entity
general partnership an association of two or more persons to carry on a business for profit as co-owners
limited partnership a legal entity made up of two classes of ownership: general partners have full liability for debts and obligations; limited partners have liability to the extent of their investment in the partnetship
limited liability company an entity that offers the tax advantages of a partnership and the limited liability of a corporation
condominium a form of ownership of real property in which the owner owns an individual unit in a multi-unit building and is a tenant in common with other owners in certain common areas
common areas that portion of the condo property that is owned in common by all owners of units in the condo property
condominium declaration legal document required by state to create a condominium; contractual covenants governing the ownership and control of governance of the condominium
condominium plat plat of survey of condo property showing in detail the location and dimensions of the property as well as the units located on the property
limited common areas common areas of a condo limited in use to one or more unit owners
condominium association governing body of a condominium, the members of which are the unit owners; is usually a non-profit corporation
assessment sum of money owed by a condo owner for monthly upkeep of the common areas of the condo
cooperative a form of ownership of real property in which a corporation owns a multi-unit building and leases living space to the shareholders of the corporation
time-share a form of ownership of real property in which an owner owns the property for a short period, usually one or two weeks out of each year; typically used for vacation or recreational property
rescission right to terminate a contract
legal description description of real property by a government survey, metes and bounds, or lot number of a recorded plat, which description is complete enough that a particular parcel of land cab be located and identified
survey a visual representation of the physical boundaries of real property; used to describe real property
as-built survey a survey that locates all physical improvements on the land in relation to the boundaries of the land
principal meridians imaginary north-south lines used in a government rectangular survey system; the intersection with base lines provide a starting point for the measurement of land
base lines imaginary east-west survey line used in the government survey system to establish township lines
township lines lines used in a government rectangular survey system that run east-west at 6 mile intervals parallel with base lines and that form strips of land or tiers called townships
range lines the division of a state in a government rectangular survey comprising 6 mile wide row of townships running north-south
township a 6-square mile tract of land (36 s.m.) in a government rectangular survey
section the division of a parcel of land in a government rectangular survey comprising 1 square mile, or 640 acres
plat a survey of real property that often is recorded
course the direction of a property boundary line in a metes and bounds survey
distance the length of a property boundary line of land in a metes and bounds land description
call the course and distance describing a boundary line of land in a metes and bounds land description
chord a straight line drawn from the beginning point of an arc to the ending point of that arc
encumbrance a claim or charge on a property, such as a lien or mortgage, which lessens the property's value
zoning legitimate police power of government to regulate the use of real property
non-conforming use a use of real property that was being carried on prior to the enactment of a zoning ordinance that prohibits such use
building codes public laws that regulate the methods and materials to be used on the construction of improvements
eminent domain power of the government to take private property for public use
ad valorem taxes taxes assessed against real property, measured by the value of the property
lien money debts attached to real property; holder of the lien can sell the property to pay the debt
judgment lien money debt resulting from a lawsuit; judgments are liens on real property owned by the judgment debtor
mechanics' or materialsmen's lien a lien imposed by law on real property to secure payment for work performed or materials furnished for construction, repair, or alteration of improvements on the real property
easement a right granted to a non-owner of real property to use the real property for a specific purpose
appurtenant easement an easement created to benefit a particular parcel of real property; the easement transfers automatically with a transfer of the ownership of the real property benefited by the easement
easement in gross an easement granting the owner of the easement the right to use the real property for a particular purpose; does not benefit a parcel of real property owned by the owner of the easement
dominant tenement a parcel of land benefited by an appurtenant easement
servient tenement a parcel of land on which an appurtenant easement is located
implied easement an easement created by the conduct of the parties to the easement; not by written agreement
prescriptive easement an easement created when a person uses real property for a period of time without the owner's permission
easement by necessity an easement for access to a public street that is necessary for the use and enjoyment of the property benefited by the easement
license a revocable privilege or permission to do an act or a series of acts on land possessed by another
contract an agreement between two or more parties consisting of a promise or mutual promises that the law will enforce or the performance of which the law recognizes as a duty
legal capacity to contract the law will make a person responsible to perform his contractual promises
trustee a person who holds legal title to property of a trust and who is responsible to administer the terms of the trust agreement for the benefit of the trust beneficiaries
agent a person authorized to perform acts or sign contracts on behalf of a principal; principal is responsible to third parties for the acts of the agent
attorney-in-fact an agent appointed by a principal by a written power of attorney
power of attorney written document authorizing another person to act as one's agent
principal a person who hires an agent to act on his behalf; is responsible for the acts of the agent
consideration something of value given to make the promises of the contract enforceable; given by grantee for deed
specific performance remedy for breach of contract that requires the defaulting party to perform the promises under the contract
money damages money awarded for a default under a contract; amount is the difference between the contract price and the fair market value of the real property at the time and place and the default
rescission termination of a contract and the reimbursement to the injured party for expenses incurred in connection with the contract
liquidated damages amount of money agreed on by the parties to a contract to be the damages in the event of a default of the contract
fiduciary a person who holds a special relationship of confidence and trust to a principal and owes to the principal a duty to exercise all of the affairs of the principal in good faith and with loyalty
express authority authority that has been given by a principal to an agent
implied authority authority implied by law to be necessary and proper for an agent to carry out the duties of an agency
listing agreement agreement entered into between an owner and a real estate broker retaining the broker to assist the owner in selling real property
certified check a personal check in which the bank certifies that the funds are in the account
cashier's check a check issued by a bank, the payment of which is guaranteed by the full faith and credit of the bank
closing date date set forth in the real estate contract on which the parties agree to perform all the promise of the contract; date on which ownership of the property is transferred to the purchaser and the purchaser pays the seller the purchase price of the real prop
earnest money money paid by the purchaser at the time the real estate contract is signed; may be used as down payment or retained by seller for damages in the event the buyer defaults
time is of the essence provision contained in a contract that requires strict performance of the contract by the date or dates provided therein
condition precedent condition in a contract that must be satisfied in accordance with the terms of the contract before one or both parties are required to perform
parole evidence rule rule of evidence that provides that a written agreement is the best and only evidence of the agreement between the parties and that the parties are not permitted to bring in oral testimony regarding other agreements concerning the transaction
execution signature of a party to a legal document; the act of signing a legal document
seller disclosure form a form a residential seller must furnish that informs the buyer about all known physical conditions on the property and its improvements
underwater mortgage the indebtedness secured by the mortgage is greater than the value of the real property pledged in the mortgage
short sale a sale of real property where the mortgage lender agrees to release its mortgage for less than what is due
option a contract in which an owner of property (optionor) agrees with another (optionee) that the optionee shall have the right to buy the owner's property at a fixed price, within a certain time, on agreed upon terms and conditions
general warranty deed a deed containing full warranty of title
covenant or warranty a promise that a fact is true or that an event will take place
grantor transferor of real property by deed
grantee person to whom real property is transferred by deed
limited (special) warranty deed a deed wherein the grantor covenants and warrants only against there lawful claims of people claiming by, through, or under the grantor
grant deed a type of limited warranty deed commonly used in California
quitclaim deed a deed that conveys no warranties of title; transfers only the interest that a grantor has in the land without warranty
habendum a clause found in a deed that indicates what estate in real property is being transferred by the deed
caption portion of the deed that indicates the county and state in which the deed was signed by the grantor
preamble the portion of the deed that sets forth the parties to the deed and the date of the deed
testimonium the portion of the deed where the grantor signs and the signature is witnessed or notarized
bona fide purchaser for value person who purchases real property in good faith, for valuable consideration, without notice of any claim to or interest in the real property by another party
actual notice title matters about which a buyer has direct knowledge or information
constructive notice a presumption of law that charges a person with notice of ll title matters that can be discovered from an inspection of the real property or an examination of public real property records
chain of title historical sequence of all owners to a particular tract of real property, beginning with the original owner and including all successive owners who have derived their title from the original owner
recording statutes state statutes that regulate the recordation of real property documents
title examination examination of real property records to determine ownership to a particular tract of real property
grantee index alphabetical index of the public real property records that lists the last names of all people who are grantees of real property interests during a given year in the county
grantor index alphabetical index of the public real property records that lists the last names of all people who are grantors of real property interests during a given year within the county
plat (tract) index index of all plats that have been recorded within the county within a given year
lis pendens notice recorded in real property records that informs that a lawsuit affecting title to real property described in the notice has been filed and is pending
title insurance contract to indemnify the insured against loss through defects in the title to real property
owner's policy policy of title insurance that insures an owner's title to real property
affidavit sworn statement of fact
marketable title title to real property that is free from doubt and enables the owner to hold the real property in peace, free from the hazard of litigation of adverse claims
endorsement amendment to a title insurance policy that generally modifies existing coverage or adds special coverage to the policy
mortgage or loan policy policy of title insurance that insures the interests of a mortgagee or lender to the tile of real property
pending disbursement clause a clause found in a construction loan title insurance policy that provides that the title insurance coverage under the policy will be the amount of the loan as it is disbursed to the borrower up to and not to exceed the face amount of the policy
title insurance commitment commitment or contract by a title insurance company to issue a title insurance policy
pro forma title insurance policy an example of the title insurance policy that will be issued following the conclusion of the transaction
promissory note legal document that contains a promise by one party to pay money to other party
maker party to a promissory note who promises to pay money
payee party to a promissory note to whom a promise to pay money has been made
holder person who is the owner of a promissory note
endorsement method of transferring ownership of a promissory note
usury interest rates that are determined to be in excess of the maximum permitted by law
guaranty legal document that obligates the maker of the document to pay the debt of the another person
guarantor person who signs a guaranty promising to pay the debt of another person
mortgage legal document that creates an encumbrance on real property to secure a debt
deed of trust legal document that conveys title to real property to a trustee who holds the title as security for a debt to a lender
deed to secure debt legal document that conveys title to real property to a lender to secure a debt
mortgagor person who signs a mortgage pledging real property to secure a debt
mortgagee person who receives a mortgage
open-end, or dragnet, clause mortgage provision that provides that the mortgage secures any and all debt between the mortgagor and mortgagee, including past debt, present debt, and future debt incurred after the mortgage is signed
due on sale clause clause found in a mortgage that prohibits the sale of the real property described in the mortgage without the lender's consent; a sale in violation of this provision is a default of the mortgage
estoppel certificate a written statement, generally signed by the holder of a first mortgage and given to the holder of a second mortgage, swearing as to certain facts concerning the first mortgage loan; may also obligate first mortgage holder to notify second mortgage holder
Uniform Commercial Code fixed set of laws adopted in every state (except LA) that govern many aspects of commercial law, including promissory notes and secured transactions
foreclosure sale brought by a holder of a mortgage of real property for the purpose of paying the debt secured by the real property
redemption right of a property owner to buy back his property after a foreclosure
interpleader judicial proceeding in which money is paid into the court and all parties who claim an interest are allowed to process their claims to the money in the court proceeding
receiver third party appointed by a court to take possession of real property in the event of a mortgage default; acts as caretaker for the property
conversion act of taking a person's property without the legal right to do so
betterment tax lien a special property tax for improvements that the town makes upon a property i.e. new road, new water line, hook up to town sewer.
bill of sale legal document that transfers ownership to personal property
lease legal document that transfers possession of real property from one party to another; contains terms and conditions involving the use and possession of the property
residential lease the lease for the possession and use of a residence, such as an apartment or house
commercial lease the lease for possession and use of a business or commercial space, such as a retail store, warehouse, or office
landlord (lessor) owner of the real property who transfers possession and use under a lease to a tenant (lessee)
tenant (lessee) person who receives possession and use of real property pursuant to a lease
lease guaranty a legal document that obligates the maker of the document to perform the obligations of the tenant under the lease, including, but not limited to paying rent to the landlord
premises land and buildings located on the land; used to describe the real property covered by a lease
rent sum of money paid by a tenant to a landlord for the use and possession of real property pursuant to a lease
percentage rent rent based on a percentage of sales or income from a specific location, often found in retail store leases
radius clause a clause contained in a lease that prohibits the tenant from operating another retail business within a certain geographical radius of the leased premises
gross lease lease wherein the tenant pays rent only; operating expenses are paid by the landlord
net lease lease in which tenant is responsible for all expenses of the leased premises, such as utilities, taxes, and insurance
security deposit a sum of money paid by a tenant to the landlord to secure the tenant's performance of the lease terms
subrogation the right to be substituted to the rights of another
estoppel certificate written statement swearing to certain facts concerning a lease
assignment with regard to a lease, transfer by a tenant of all of his interest under a lease
sublease transfer by a tenant to a third party of a partial portion of his interest under the lease
attornment and non-disturbance agreement an agreement, usually entered into by a tenant and a mortgage holder, wherein each party agrees to recognize the other in the event of foreclosure; mortgage holder also agrees not to terminate lease or disturb possession
Created by: pfmerriell