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Terms to know
| Question | Answer |
|---|---|
| 100 year flood plain | an area where a flood has a 1% chance of being equaled or exceeded each year. A 100 year flood could occur more than once in a short period |
| abstract of title | the condensed history of a title to a particular parcel of real estate, consisting of a summary of the original grant and all encumbrances affecting the property and a certification by the abstractor that the history is complete and accurate |
| acceleration clause | the clause in a mortgage or deed of trust that can be enforced to make the entire debt due immediately if the borrower defaults on an installment payment |
| accession | acquiring title to additions or improvements to real property as a result of the annexation of fixtures |
| accretion | the increase or addition of land by the deposit of sand or soil washed up naturally from a river, lake, or stream |
| action to quiet title | a lawsuit brought in a court in order to establish a party's title to real property and quiet any challenges or claims to the title |
| adverse possession | to open, continuous, exclusive, adverse, notorious (OCEAN) possession of another's land under a claim of title. |
| age-life method | a method of depreciation computed by dividing the replacement cost of a property by the numbers of years remaining useful life |
| alienation | the act of transferring property to another |
| alienation clause | the clause prevents the borrower from letting someone else assume the debt without the lender's approval |
| amendment | a change to contact terms or conditions |
| American land title association ALTA policy | a title insurance policy that protects the interest in a collateral property of a mortgage lender than originates a new real estate loan |
| amortized loan | a loan in which client as well as interest is payable in periodic installment over the term of the loan |
| amount realized | a calculation performed to determine capital gain; the difference between the actual sales price and expenses of the sale |
| annual percentage rate APR | the relationship of the total finance changes associated with a loan |
| appurtenance | a right, a privilege, or an improvement belonging to and passing with the land |
| arm's length transaction | a transaction where the parties are dealing from equal bargaining positions |
| asbestos | fire-resistant fiber used in a wide variety of building supplies prior to 1978 |
| assignment | the transfer to another party in writing of rights or interest in a bond, mortgage, a lease, or another instrument |
| avulsion | sudden tearing away of land by earthquake etc. |
| balloon payment | final payment of a mortgage loan that is larger than the required periodic payments because the loan amount was not fully amortized |
| bargain and sale deed | 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 |
| base board | a board around the bottom of a wall perpendicular to the floor |
| base line | the main imaginary line running east and west and crossing a principal median at a definite point |
| benchmarks | permanent reference marks or points established for use by surveyors in measuring differences in elevation |
| bill of sale | a written instrument that attests to a buyers purchase of personal property from a seller. like a receipt. |
| blanket loan | a mortgage covering more than one parcel of real estate, providing for each parcels partial release from the mortgage lien upon repayment of a definite portion of the debt |
| blockbusting | illegal practice of inducing homeowners to sell their properties by making representations regarding the entry of persons of a particular protected class into the neighborhood |
| buffer zone | a strip of land, usually used for a park, separating and screening land dedicated to one use from land dedicated to another use (ex. residential from commercial) |
| Buydown | reduces the monthly payments for the first few years of a loan |
| capital gain | the taxable profit earned from the sale of a capital asset such as real property |
| capital improvement | the addition of a permanent structural improvement or the restoration of some aspect of a property that will either enhance the properties overall value or increase its useful life. |
| capitalization | a math process for estimating the value of a property using a proper rate of return on the investment and the annual net operating income expected to be produced by the property. |
| cash-on-cash rate of return | derived by dividing the before tax cash flow by the owners cash investment |
| caveat emtor | "let the buyer be aware" sellers in these states don't have to disclsoe any facts about their property when selling |
| chain of title | the succession of title conveyances, from some accepted starting point, whereby the present holder of real property derives title |
| civil rights act of 1866 | prohibits racial discrimination in the sale and rental of all real and personal property |
| clustring | grouping of homesites within a subdivision on smaller lots than normal, with the remaining land used as common area |
| codicil | addition to a will |
| coinsurance clause | a clause in insurance policies covering real property that requires that the policy holder maintain fire insurance coverage generally equal to at least 80% of the properties actual replacement cost |
| common law of agency | the basic framework of law that governs the legal responsibilities of the broker to the people the broker represents |
| comprehensive loss underwriting exchange (CLUE) | a report which generally contains up to seven years of personal auto and property data, used by insurance companies to determine the insurability of a property and auto owner |
| concurrent ownership | ownership involving two or more owners |
| condemnation | a proceeding to exercise the power of eminent domain. government take private property for public use. not the actual taking! |
| conditional-use permit | written government permission allowing a use inconsistent with zoning but in the public interest |
| conforming loan | a standardizing conventional loan that meets fannie mae or freddie macs purchase requirements |
| conformity | the appraisal principal that holds that the greater the similarity among properties in an area, the better they will hold their value |
| connor act | NC law that requires many type of real estate documents to be recorded for protection against claims from third parties |
| constructive eviction | the actions of a landlord that so materially disturb a tenants enjoyment of the leased property |
| contingency | a provision in a contract that requires a certain act to be done or a certain event to occur before the contract becomes binding |
| conventional loan | a loan from private investors that requires no government insurance or guarantee |
| conveyance | a term used to refer to any document that transfers title to real property |
| cooperative ownership | a residential multiunit building whose title is held by a trust or corporation that is owned by and operated for the benefit of a persons living within the building, who are beneficial owners of the trust or stockholders. |
| cost approach | the process of estimating the value of a property by adding the appraisers estimate of the reproduction or replacement cost of th ebuilding, less depreciation to the estimated land value |
| cost recovery | an internal revenue system term for depreciation |
| covenant | a written agreement between 2 or more parties in which a party or parties pledge to perform or not perform specifies acts with regard to property; usually found in such real estate documents |
| covenant of quiet enjoyment | a landlord guarantees that a tenant may take possession of leased premises and that the landlord will not interfere ib the tenants possession or use of the property |
| credit | amount the party has paid or received from another party |
| debit | amount charged |
| debt service | the principal and interest payment on a loan |
| decendent | a person who has died |
| declaration of restrictive covenants | a statement of all covenant, conditions and restriction affecting a parcel of land |
| dedication | the voluntary transfer of private property by its owner to the public for some public use, such as for streets or schools |
| deductible | loss not covered by the insurer |
| deed | a written instrument that, when executed and delivered, conveys title to or interest in real estate; evidence of title |
| deed in lieu for foreclosure | a deed given by the mortgagor to the mortgagee when the mortgagor is in default under the terms of the mortgage. |
| deed of trust | an instrument used to create a mortgage lien by which the borrower conveys title to a trustee, who holds it as security for the benefit of the note holder (the lender) |
| deed restriction | clause placed in a deed by the owner to control the future use of the property |
| defeasance clause | a clause used in leases and mortgages that cancels a specified right upon the occurrence of certain condition, such as a cancellation of a mortgage upon repayment of the mortgage loan |
| defeasible fee estate | a estate in which the holder has a fee simple title that may be terminated upon the occurrence or nonoccurrence of a specified event |
| deferred maintance | the act of postponing necessary maintenance and repairs on rental properties |
| deficiency judgment | a personal judgment levied against the borrower when a foreclosure sale does not produce sufficient funds to pay the mortgage debt in full; a general lien |
| depreciation | loss of value in property in an appraisal |
| descent | the acquisition of an estate by inheritance in which an heir succeeds to the property by interstate succession |
| devise | a gift of real property bu will |
| discount point | interest paid in advance; one point is 1% of the loan amount for the borrower and increased the yield for the investor approximately 1/8% |
| doctrine of prior appropriation | followed by western state, water rights are determined by who would have the most beneficial use |
| dodd frank wall street reform and consumer protection act (dodd-frank) | affecting financial institutions and their consumers in an effort to prevent a recurrence of events that cause the economic recession during mid 2000s |
| dominent tenament | a property that includes in its ownership the appurtenant right to use an easement over another persons adjacent properties for specific purpose |
| dormer | a projection built out from the slope of a roof, used to house windows on the upper floor and to provide additional head-room |
| due-on-sale clause | a provision in a mortgage that states that the entire balance of the note is immediately due and payable if the mortgagor sells the property |
| duress | The unlawful constraint or action exercised on a person whereby the person is forced to perform an act against that person's will. A contract entered into under duress is voidable |
| easement appurtenant | runs with the land. its part of both the dominant and the serbient tracts and conveys with the title to either tenement |
| easement by necessity | easement allowed by law as necessary for the full enjoyment of a parcel of real estate |
| easement by perscription | easement acquired through adverse use of another's land for 20+ years |
| easement in gross | easement not created for the benefit of any land owner but that attaches personally to the easement owner. owner lets people fish on their land for enjoyment, |
| eave | overhand of a sloping roof that extends beyond walls of house |
| effective age | the apparent age of a building based on observed condition |
| effective gross income (EGI) | the anticipated income from a rental property resulting from potential gross income minus an allowance for vacancy and bad debts |
| emblementss | growing crops that are produced annually through labor |
| eminent domain | the right of government to acquire property for public use through a court action called condemnation |
| encroachment | an unauthorized intrusion of an improvement, or any part of an improvement, on the real property of another party |
| encumbrance | any charge by someone other than the owner of property that may diminish the value or enjoyment of a property |
| equitable title | the interest held by the grantor in a deed of trust that allows possession and use of the pledged property |
| erosion | the gradual wearing away of land by water, wind, or other natural forces. may cause loss of ownership |
| escheat | the reversion of property to the state, as provided by state law, in cases where a decendant dies without heirs |
| escrow | closing of a transaction through a third party |
| estate tenancy at sufferance | the tenancy of a lessee who lawfully comes into possession of a landlords real estate who continues to occupy the premises after the lease has expired against the landlords wishes |
| estate tenancy at will | an estate that gives the lessee the right to possession untilt the estate is terminated by either party |
| estate tenancy for years | possessory interest in property for a definite period of time leased for a specified consideration |
| estate tenancy from period to period | a possesory interest in lease property that automatically renews from period to period |
| estoppel | a method of creating an agency relationship in which a person states incorrectly that a second person is the first persons agent and a 3rd person relies on that representation |
| excise tax | deed tranfer tex paid by the seller and required to be noted on a deed by state law |
| excusive agency listing | if the seller finds someone, they dont have to pay the broker/brokerage |
| extender clause | protection in a listing contract that says the listing broker is entitled to commission for a period of time after expiration of the listing term if the property is transferred to a prospect that the broker introduced during the listing term |
| fannie mae (FNMA) | government agency established to purchse any kind of mortgage loans in the secondary mortgage market from the primary lender |
| fee simple absolute | max possible estate in real property. indefinite in duration |
| fee simple detrminable | real estate that continues as so long as perscribed land use continues |
| freddie mac | a corporation established to purchse primarily conventional mortgage loans in the secondary market |
| gap | a defect in the chain of title of a particular parcel of real estate |
| general agent | authorized to represent the client in a broad range of matters. property manager. |
| general lien | the right of creditor to have all of debtors current and future property for the next 10 years . sold to satisfy a debt. |
| general warrenty deed | a deed where the grantor fully warrents good clear title to the premise through 4 covenents in the deed |
| ginnie mae | government agency under HUD that plays an important role in the secondary mortgage market |
| graduated lease | commercial lease that contacts for pre set rental increased over the lease period |
| granting clause | words in a deed of conveyance that state the grantors intention to convey the property at the present time. |
| gross income multiplier (GIM) | a figure used as a multiplier of the gross annual income of a property to produce an estimate of the property's value |
| gross rent multiplier | the figure used as a multiplier of the gross monthly income of a property to produce an estimate of property value |
| growing equity mortgage | a loan in which the monthly payments increase annualy |
| home equity loan | a loan under which a property owners use their residence as collateral and can then draw funds up to the prearranged amount against the property |
| hypothecation | the pledging of property as security for an obligation or loan without losing possession of it |
| income capitalization approach | the process of eximating the value of an income-producing property through capitalization of the annual net income expected to be produced by the property during its remaining useful life |
| index lease | commercial lease that allows the periodic adjustment of rent based on naed index such as customer price index CPI |
| in house sale | transaction where the listing firm produces the buyer for their listing |
| insured | the property owner who is reimbursed by the insurer, the insurance company for losses caused by a covered event |
| interim financing | short term loan usually made during the construction phase of a building project |
| interstate | the condition of a property owner who died without leaving a valid will. the property title will pass to the decedent heirs as provided in the state law of descent |
| intrinsic value | an appraisal term referring to the value created by a persons personal preferences for a particular type of property |
| involuntary lien | a lien placed on property without the consent of the property owner |
| joint tenancy | a concurrent form of ownership of real estate between 2+ parties who have been named in one conveyance as joint tenants. right of survivorship is not automatic. |
| joint venture | the joining of 2+ people to a conduct a specific business enterprise |
| jumbo loan | a residential mortgage loan in excess of acceptable loan amounts for purchased by fannie mae or freddie mac |
| junior mortgage | a mortgage that is subordinate in right or lien priority to an existing lien on the same realt |
| lateral support | the support a parcel of land receives from adjacent land |
| law of negligence | if a tenant or guest is injured on the landlords rental property, the landlord and agent may be held liable due to their responsibility to maintain common areas |
| levy | to assess; to seize or collect. sets the rate of taxation. |
| lien | a right given by law to certain creditors to have their debts paid out of the property of a defaulting debtor, usually by court sale |
| lien theory | some states interpret a mortgage as being purely a lien on real property. the mortgage thus has no right of possession but must foreclsor the lien and sell the propety if the mortgagor defaults |
| life estate | an interest in real or personal property that is limited in duration to the lifetime of its owner or some other designated person |
| limited common elements | common elements of a condo project reserved for the exclusive use of one of more units, such as parking spaces or storage areas |
| limited services agreement | listing agreement that offers a menu of services and fees for seperate broker activities that the client desires |
| liquidated damages | an amount predetermined by the parties to a contact as compensation to an injured party if the other party breaches the contact |
| liquidity | the ability to sell an asset and concert it into cash, at price close to its true value, in a short period of time |
| lis pendens | a recorded legal document giving constructive notice that an action affecting title has been filed |
| littoral rights | a landlords claim to use water in large navigable lakes and oceans adjacent to the property |
| loan estimate | a form required to be given by lenders to most residential mortgage borrowers |
| loan origination fee | a admin fee charged to the borrower by the lender for making a mortgage loan |
| loan to value ratio LTV | the relationship between the amount of the mortgage loan and the value of the real estate being pledged as collateral |
| machinery act | the NC general statues that govern the ad valorem tax of property |
| mailbox rule | once written acceptance is placed in control of the mailing service and out of control of the offeree, it is considered accepted |
| lot and block recorded play system | describing real property that identifies a parcel of land by reference to lot and block numbers within a subdivision |
| marketable title | a good or clear title, reasonably free from the risk of litigation over possible defects |
| mass appraisal | a valuation technique sometimes used for tax assessment purpose that applies a standard percentage increase or decrease to all property in a given location |
| master plan | a comprehensive plan to guide the long term physical development of a particular area |
| mitigation | systems to limit the source of environmental hazards and reduce their effect on humans and the surrounding environment |
| monetary policy | governmental regulation of the amount of money in circulation through such institutions as the federal reserve board |
| monument | a fixed natural or artificial object used to establish real estate boundaries for a metes and bounds description |
| multiperil policy | an insurance policy that offers protection from a range of potential perils, such as those of fire, hazard, public liability, and casualty |
| mutual assent | a deliberate agreement between parties, offer and acceptace |
| negative amortization | when debt service payment on a loan is not large enough to pay the interest due |
| net lease | a lease requiring that the tenant pay rent plus sum or all of the property charges such as taxes |
| net listing | a listing based on the net price the seller will receive if the property is sold. the broker can offer the property for sale at the highest price to increase commission. not encouraged in NC |
| nonconforming use | an existing use of property that is permitted to continue after a zoning ordinance prohibiting it has been established for the area. grandfathered in. |
| nonhomogeneity | a lack of uniformity because no two parcels of land are exactly alike |
| novation | substituting a new contract for an old one |
| obsolescence | the loss of value due to factors that are outmoded or less usefull |
| open end loan | a mortgage loan that is expandable by increments up to a maximum dollar amount |
| operating statement | periodic and necessary expenses essential to the continuous operation and maintenance of an income property |
| opinion of title | an abstract of title that a lawyer has examined and has certified to be, in the lawyers option, an accurate statement of the facts concerning the property ownership |
| overlay district | a type of zoning that is superimposed over another type of zoning and can modify the use of the original zone |
| package loan | an insurance policy that combines the coverage of property insurance and liability insurance |
| parol evidence rule | a rule of evidence providing that a written agreement is the final expression of the agreement of the parties, not to be varied or contradicted by prior oral or written negotiations |
| partition | the division of continents interest in real property when all parties do not voluntarily agree to terminate the co ownership |
| percolation test | test of the soil to determine whether it will absorb and drain water well |
| potential gross income | the amount of rental income the property could produce with 100% occupancy and with all tenants paying full rent |
| power of attorney | a written instrument authorizing a person, sometimes referred to as an attorney-in-fact, to act as agent for another person to the extent indicated in the instrument |
| power of sale foreclosure | the form of foreclosure used in a title theory state, NC |
| predatory lending | unscrupulous, sometimes fraudulent lending practices usually intending to make repayment impossible. takes advantage of unwary borrowers that are in low income or non english speaking |
| preemptive right | a provision giving a person the first right to purchase real property |
| primary mortgage insurance PMI | insurance coverage used for obtaining conventional loans with loan to loan ratios exceeding 80% |
| primary mortgage market | the mortgage market in which loans are originated, consisting of lenders such as commercial banks, savings, associations, and mortgage brokers |
| principal meridian | the main imaginary line running north an south and crossing a base line at a definite point. used for surveyors for referance |
| private mortgage insurance | insurance provided by a private carrier that protects a lender against a loss in the event of a foreclosure |
| privity of estate | the legal relationship that exists between parties who hold interest in the same real property at the same time |
| promissory note | a financing instrument that states the terms of the underlying obligation, is signed by its maker, and is negotiable |
| property management agreement | an agency contract between the owner of income property and a management firm that outlines the scope of their authority |
| property report | the mandatory federal or state documents compiled by developers to provide potential purchases with material facts about a property prior to its purchase |
| prorations | shared expenses, either prepaid or paid in arrears, that are divided equitably between buyer and seller at settlement |
| protection agreement | agreement between an unlisted property owner and a broker to secure payment for the broker if the property is sold to the particular buyer named in the agreement |
| puffing | exaggerated opinions |
| pur autre vie | for the life of another. a life estate that is measure by the life of another person thats not the grantee |
| purchase money mortgage | a note secured by a mortgage or deed of trust given by a buyer, as a borrower, to a seller, as lender, as part of the purchase price of the real estate |
| quantity survey method | the appraisal method of estimating building costs by calculating the cost of all the physical components in the improvement, adding the cost to assemble them,a nd then including the indirect costs associated with such construction |
| quitclaim deed | a conveyance by which the grantor transfers interest in the real estate, if any, without warranties or obligations, used to remove clouds on title |
| rate cap | the limit on the amount the interest rate can be increased at each adjustment period in an adjustable rate loan |
| rate lock | a guarantee from mortgage lenders that they will give mortgage loan applicants a certain interest rate, at certain price, for specific time period |
| ratification | a method of creating an agency relationship in which the principal accepts the conduct of someone who acted without prior authorization as the principals agent |
| real estate | land and whats attached to it |
| real property | the land plus permanent improvements and rights |
| reconciliation | the final step in the appraiser process, in which the appraiser combines the estimates of value received from the sales comparison, cost, and income capitalization approaches to arrive at a final estimate of market value for the subject property |
| redemtion period | 10 day period after a foreclosure auction during which a property owner in default has the right to redeem the pledged real estate by paying the loan balance plus interest and costs |
| redlining | the illegal practice of a lending institution denying loans or restricting their number for certain areas of a community |
| reduction certificate | document signed by a lender indicating the amount required to pay a loan balance in full and satisfy the debt |
| regression | an appraisal principle that states that between dissimilar properties, the value of the better quality property is affected adversely by the presence of the lesser quality property |
| regulation X | the rules which implement and interpret the real estate settlement procedures act RESPA of 1974 |
| regulation Z | implements the truth in lending act requiring credit institutions to inform borrowers of the true cost of obtaining credit |
| reliction | gradual recession of water which uncovers land that usually belongs to the riparian owner |
| remainder interent | a future interest in real estate created by the grantor for some third party that will be enjoyed after the termination of a prior estate, such as when an owner conveys a life estate to one party and the remainder to another |
| remainderman | one entitled to receive a remainder interest in some estate sometime in the future |
| reproduction cost | the construction cost at current prices of an exact duplicate of the subject property |
| rescission | the legal remedy of canceling, terminating, or annulling a contract and restoring the parties to their original positions. contracts may be rescinded due to mistake, fraud, or misrepresentation. there is no need to show any money damage |
| reserves | a portion of earnings set aside to cover possible future losses |
| restriction covenant | private agreements usually imposed by the owner when property is sold that limits the way real estate ownership may be used |
| retainer fee | small fee paid by the client upon creation of a buyer agency relationship as an advance partial compensation for servuces |
| reverse mortgage | a loan under which the homeowner receives monthly payments based on the homeowners accumulated equity rather than a large sum. the loan must be repaid at a prearranged date, upon the death of the owner, or the sale of the property |
| riparian rights | owners right in land that borders rivermstrem, and lake |
| r value | the insulation value of materials. the higher the R value, the more resistant the material is to the transfer of heat |
| sandwhich lease | the sublessors (original lessee's) interest in the real estate |
| self dealing | illegal act by a licensee who takes advantage of clients by failing to disclose the appropriate value of property |
| self help eviction | illegal eviction practices used by landlords instead of lawful use of summary ejectment |
| servient tenement | land on which an easement exists in favor of an adjacent property (dominant tenement) |
| setback | the amount of space local zoning regulations require between a lot line and a building line |
| settlement | process of adjusting and prorating credits, debits, and closing expenses to conclude a real estate transaction |
| severance | The process of separating land or property into smaller, separate pieces, or separating something attached to the land from it. |
| sharecropping | An arrangement where a person farms someone else’s land and pays the landowner a share of the crops produced instead of rent. |
| short sale | When a homeowner sells their property for less than the amount they owe on the mortgage, with the lender’s approval. |
| situs | the location of a property, which affects its value. |
| special assessment | An extra tax charged to property owners to pay for specific public improvements, like new sidewalks or roads. |
| special warranty deed | A deed in which the seller guarantees they haven’t caused title problems during the time they owned the property. |
| specific performance | A court order requiring someone to fulfill their part of a contract, such as completing a real estate sale. |
| statue of limitaitons | The legal time limit for filing a lawsuit after an event occurs. |
| steering | Directing buyers toward or away from certain neighborhoods based on protected characteristics, such as race or religion. This is illegal under fair housing laws. |
| subordination | When a lender agrees to let another loan take priority over their loan in the order of repayment. |
| subprime loan | A loan given to a borrower with a lower credit score, usually with a higher interest rate. |
| subrogation clause | A clause that allows an insurance company to seek repayment from the person responsible for a loss after paying a claim. |
| substitution | The principle that a buyer will not pay more for a property than the cost of buying a similar property with the same value. |
| success fee | A fee paid only when a specific result is achieved, such as successfully completing a real estate sale. |
| suit to quiet title | A lawsuit used to settle ownership disputes and confirm who legally owns a property. |
| summary ejectment | A legal process a landlord uses to evict a tenant from a rental property. |
| surety bond | A guarantee that a person or business will fulfill their legal or financial obligations, with another party agreeing to pay if they fail. |
| syndicate | A group of investors who pool their money to buy or invest in real estate together. |
| tacking | Adding one period of ownership or possession to another to meet the time requirement for adverse possession. |
| tenancy in common | When two or more people own a property together, each with a share that can be passed to their heirs. |
| term loan | A loan that must be repaid within a specific period of time. |
| tier | A level or layer of land, property, or a system used to organize or describe something. |
| title insurance | Insurance that protects a property owner or lender against financial losses from problems with the property’s legal ownership. |
| title theory | A system where the lender holds legal title to a property until the mortgage is paid off. |
| topographic survey | A survey that shows the land’s elevation, slopes, and natural or man-made features. |
| torrens system | A system that officially registers property ownership with the government to prove who legally owns the property. |
| tort | A civil wrong that causes harm to another person and can result in a lawsuit. |
| township lines | Imaginary north–south lines used in the rectangular survey system to divide land into townships. |
| transfer tax | A tax charged when ownership of real estate is transferred from one person to another. |
| trust | A legal arrangement where one person holds and manages property for the benefit of another person. |
| trust finds | Money held by a third party until it is properly distributed to the people entitled to receive it. |
| unilateral contract | A contract where one person promises to pay or perform something if another person completes a specific action. |
| unit in place method | An appraisal method that estimates construction costs by calculating the cost of each building component, including materials and labor. |
| usury | Charging interest on a loan at a rate higher than the legal limit. |
| vacancy and collection losses | Rental income lost when a property is vacant or tenants fail to pay rent. |
| vacancy rate | The percentage of rental units that are empty and available for rent. |
| variance | Permission to use land in a way that differs from local zoning rules. |
| vicarious liability | When one person is held legally responsible for another person’s actions, such as an employer being responsible for an employee’s actions. |
| voluntary lien | A lien a property owner agrees to, such as a mortgage used to buy a home. |
| misrepresentation | Giving false or misleading information about a property, whether intentionally or unintentionally. |
| omission | Leaving out important information about a property that should be disclosed. |
| wraparound loan | A loan where the seller finances the buyer’s purchase while keeping the original mortgage in place. |
| writ of attachment | A court order allowing property or assets to be seized or held to secure payment of a debt. |
| writ of execution | A court order allowing a creditor to seize and sell a debtor’s property to pay a debt. |
| yield spread premium | A payment a lender gives a mortgage broker for arranging a loan with a higher interest rate. |
| zoning ordinance | A local law that controls how land can be used, such as for residential, commercial, or industrial purposes. |
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