Enter Part of a Word or any Complete Word

ABANDONMENT:When a tenant leaves a property before the expiration of the lease agreement. ABROGATION:To nullify or replace. Signing of the closing documents nullifies the Real Estate Purchase Contract except for warranties that extend beyond the closing date. ABSTRACT OF TITLE:A historical record of land ownership and liens or encumbrances against the property. Also known as a chain of title. ACCELERATION CLAUSE:"Allows a loan to become due and payable immediately if certain requirements are not met, such as making payments, maintaining the physical condition of the property or paying property taxes and hazard insurance." ACCESSION:The process of adding to real property. ACKNOWLEDGE:The legal process of having the signature on a contract or other legal document verified by a notary public. ACRE:"43,560 square feet" ACTUAL DELIVERY:Transferring a deed from the grantor to the grantee by handing the deed to the grantee or sending it by certified mail. ACTUAL EVICTION:The legal process by which a lessor evicts the lessee and regains possession of the property. AD VALOREM TAX:A tax levied according to the value of the property ADDENDUM:Additions or changes incorporated into the real estate purchase contract by reference. ADJUSTABLE RATE MORTGAGE:A loan where the interest rate is periodically adjusted based on a specific economic indicator. ADJUSTED COST BASIS:"Cost basis plus improvements, minus depreciation claimed during the years the property was owned." ADMINISTRATOR:A person appointed by the court to carry out the terms of a will. ADVERSE POSSESSION:"The process whereby a non-owner can gain ownership of property by occupying it in hostile, continuous, open, and notorious possession, and in some states, paying the property taxes for the statutory period of time." AGENCY:A relationship between two parties wherein the principal hires another person to represent him or her. AGENCY BY ESTOPPEL:"The principal seeks to deny an agency relationship, but the court stops him from denying the agency, and thereby confirms it." AGENCY BY RATIFICATION:"The agency is created by implication, or actions, and the principal approves it by agreeing to compensate the agent after the agency service has been performed." AGENCY BY STATUTE:"The law has given rise to the agency, such as a Sheriff appointed by the court to be the agent of the owner in a foreclosure sale." AGENT:"The person hired by a principal to act for and in behalf of, or to represent the principal, always acting in the principal's best interest." ALIENATION CLAUSE:"A clause that allows the lender to call the loan due and payable immediately if the property is sold or the loan is assumed. Also known as due-on-sale, or non-assumption. " ALIENATION OF TITLE:A change of ownership. May be voluntary (sold the property) or involuntary (foreclosure sale). ALL-INCLUSIVE TRUST DEED (AITD):"A document used for security, usually in seller financing, where the financing is structured as a wraparound. It is security for the promissory note." ALLODIAL:A socio-economic system that allows for private ownership of real property. ALTA POLICY:"The title insurance policy covering the lender, which offers coverage in the amount of the loan and includes a site visit to discover unrecorded encumbrances." AMENITY:"A ""nice, but not necessary"" feature which provides personal pleasure to the owner of real property. It can be tangible or intangible." AMERICANS WITH DISABILITIES ACT (ADA):"An act designed to eliminate discrimination against handicapped persons in employment, government services, and all facilities and services offered to the public." AMORTIZED LOAN:A loan which has regular monthly payments of both principle and interest. ANNUAL PERCENTAGE RATE OR A P R:"The interest rate plus any other charges for the loan, including such things as discount points and origination fees, computed as a yearly percentage rate. It is used for comparing loans." ANTICIPATION:The appraisal principle that weighs the value of the future benefits a product or property will bring. APPRAISAL:A professional process for estimating the value of real property. APPRECIATION:A percentage of increase in the value of the property over it's value when it was originally purchased. APPURTENANT:Attached to the land (such as a house) or the deed (such as a recorded easement). ARBITRATION:The two parties in disagreement agree to accept the decision of a third party who acts both as a mediator and a judge. It avoids the excessive time and high costs of a court action. AS IS CLAUSE:The clause in the Real Estate Purchase Contract that stipulates the buyer is buying the property in its current condition and with the faults that have been disclosed. ASSEMBLAGE:Combining two or more parcels of land into one. ASSESSED VALUE:"A percentage of the appraised value, as determined by law, upon which the tax rate will be levied to determine the property tax." ASSIGNMENT OF CONTRACT:One party in a contract substitutes another party in his place. The original party retains secondary liability for the performance of the contract. It does not require the agreement of the other original party in the contract. ASSIGNMENT OF LEASE:"A contract that substitutes a new tenant in the lease. The assignee becomes liable for the remaining term of the lease. Unless prohibited by the lease contract, this can be done without the approval of the lessor, but the original lessee retains secondary liability." ASSOCIATE BROKER:A person with a broker's license who works under the supervision of an employing principal broker. ATTACHMENT:The legal process when real or personal property is seized by the court and held as security for satisfaction of a judgment. ATTORNEY IN FACT:A person who has been given power to sign in behalf of another. ATTORNEY'S OPINION:"A lawyer's examination and evaluation of the history of title. It includes a brief summary of all recorded instruments which affect the title, including records of taxes, special assessments, judgments, mortgages and trust deeds." BALLOON MORTGAGE:A loan with a balloon payment at the end of its term. It could be a partially amortized or a straight loan or note. BALLOON PAYMENTS:"Required payments larger than the regular payment. These payments are often made at the end of the loan, retiring the loan early; but payments can be made at other times during the term of the loan." BARGAIN AND SALE DEED:"This deed makes no guarantees as to the condition of the title, but unlike the Quit Claim Deed, the grantor implies some actual interest in the property." BASELINE:An east-west line that intersects the meridian and creates a point from which land can be measured under the Government or rectangular survey method. BENEFICIARY:The lender under a Trust Deed & Note. BEQUEST OR LEGACY:A gift of personal property given in a will. BILATERAL CONTRACT:"A contract wherein a promise is exchanged for a promise, thus making the contract binding on both parties." BILL OF SALE:Evidence of transfer of ownership of personal property. BLANKET MORTGAGE:A loan that uses two or more parcels of real property as security. BLIND AD:An advertisement which fails to indicate that the advertiser is a real estate brokerage or sales agents or brokers selling their own property. They are generally considered illegal. BLOCKBUSTING:The illegal practice of inducing panic selling in a neighborhood by starting rumors involving minorities moving in. BOARD OF ADJUSTMENT:The body to which one would appeal in order to obtain a variance to do something contrary to the current zoning law BOARD OF EQUALIZATION:The body of appeal if you think your property tax appraisal is too high. BOOT:Personal property or money needed to make up a difference in value when exchanging real property. BRANCH OFFICE:Any remote operation of the main real estate office that will be in operation more than 12 months and must be registered with the Real Estate Division. BRIDGE LOAN:"A short term loan to help the buyers have up-front funds to get into their new home, when the sale on the old one is going to close later than the closing to purchase the new one. Also called a swing or gap loan." BUFFER ZONE:An area established by the zoning and planning commission to separate commercial and industrial areas from residential. Its purpose may be safety or economics. BUILDING CODES:Rules set by government to establish minimum standards of construction. BUNDLE OF RIGHTS:"All rights and interests that can be legally held in real property. They are separated into Possession, Use & Control, Quiet Enjoyment and Disposition." BUSINESS PLAN:A written overview that reveals the basic philosophy and strategy for an investment property. CAPITAL GAIN:"The taxable profit derived from the sale of a capital asset, such as real property." CAPITALIZATION RATE OR CAP RATE:The ratio created when the net operating income is divided by the value of the property. It is also called the rate of return. CAPITILIZATION APPROACH:"An appraisal approach based on the cash flow the property produces. It addresses the question, ""How much will a potential investor pay for the cash flow?"" Also called the income approach." CAVEAT EMPTOR:"The philosophy that says ""Let the buyer beware.""" CC~R:The abbreviation given to restrictions and requirements created in the Uniform Declaration of Restrictions for condominiums. CERTIFICATE OF ELIGIBILITY:Endorsement from the Veterans Administration indicating the right of a veteran to obtain a VA loan and the amount of his/her eligibility. CERTIFICATE OF REASONABLE VALUE:The document required for a VA loan that validates the price of property being used as security for the VA loan (VA appraisal). CERTIFICATE OF SALE:The document given to the individual who successfully bids and purchases a property at a Sheriff's Sale. It does not convey title to the property. CHAIN OF TITLE:A historical record of land ownership and liens or encumbrances against the property. Also known as an abstract of title. CHATTEL:"A synonym for personal property. It comes from the word ""cattle.""" CHATTEL MORTGAGE:A loan secured by personal property. CLOSING:When the loan funds are received from the lender(s) and the applicable documents are recorded. This comes after the settlement. CLOUD ON THE TITLE:A term that refers to any kind of lien or encumbrance against the title. CODICIL:An addition or change to an existing will. COLLATERAL:A term that refers to security used for a loan. It may be real or personal property. COLOR OF TITLE:"To all outward public appearance, or from a document that seems to be valid, the possessor of the property would seem to have ownership." COMMINGLING:A broker puts personal funds in excess of $500 into the real estate trust account. COMMISSION:"One entity of the Division of Real Estate composed of five people, one of whom is a chairman." COMMUNICATION:The process of notifying the offeror that the offer has been accepted. COMMUNITY PROPERTY:"A form of ownership between husband and wife where each has an equal interest in property obtained during their marriage. The only way either can hold separate property is to obtain it before marriage, after the marriage is ended, or during the marriage by gift or inheritance." COMPARISON APPROACH:An appraisal approach that contrasts the subject property with other properties that have recently sold. Adjustments are made to account for variations between the subject property and the others. Also known as market data approach. COMPETENCY OR CAPACITY:The ability to understand the terms of a contract and to make a rational decision as to whether or not to enter into it. COMPETITION:"An appraisal principle: When a particular use of property is bringing a high return, others enter into the same business or purchase property for the same purpose." COMPOUND INTEREST:Interest is paid on earned interest as well as on the principal. It is used in savings accounts. CONDEMNATION:A legal action initiated by the government to purchase land from a private individual under eminent domain. CONDOMINIUM:One owns the air space of one's own unit and an undivided interest in the common area. CONDOMINIUM OWNERSHIP ACT:The act which governs ownership and related issues when one owns airspace and undivided interest in the common area. CONFORMITY:"An appraisal principle that states that because all homes in a particular area are harmonious in design and value, their value is sustained and tends to increase over time." CONSIDERATION:The process wherein each party to a contract makes a sacrifice and each party receives a benefit. It is an essential element of any contract. CONSTRUCTION LOAN:An open ended loan funded in installments as various portions of the work are completed. CONSTRUCTIVE DELIVERY:The process of transferring a deed from the grantor to the grantee by recording the deed at the county recorder's office. CONSTRUCTIVE EVICTION:"When the landlord violates the terms of the lease by not keeping the property livable or habitable, the tenant can legally vacate the property and not be held liable for further rent payments." CONSTRUCTIVE FRAUD:"A party misrepresents innocently, with no evil intention, but that misrepresentation could have been avoided with reasonable care." CONTINGENCY CLAUSE:"Sometimes known as a ""subject to"" clause, it requires completion of certain acts before the contract is fully binding." CONTRACT:An agreement between two or more parties to do or not to do certain things. It may be oral or in writing. CONTRACT FOR DEED:"A document wherein the lender (usually the seller) retains title to the property until the debt is paid. Also known as a Uniform Real Estate Contract, installment sales contract, or land contract." CONTRIBUTION:The appraisal principle which states that an improvement to a property will add its cost to the value. COOPERATIVE:"A form of ownership in multiple unit housing where the owner purchases shares of stock in the entire development, then obtains exclusive use of a unit by means of a proprietary lease." CORPORATION:A legal person. It cannot die or go to jail. CORPOREAL:"Something that is physical or tangible, such as land or buildings." CORRELATION:An appraiser should use as many of the approaches to appraising as possible. This technique synthesizes the results into a single estimate of value. It is sometimes called reconciliation. COST APPROACH:An approach to appraisal which considers the price of resources necessary to build the same or a similar property. It is the only approach which places a separate value on the land. COST OR COST BASIS:What you paid for the product or property when you bought it. COST PLUS:"A contract where payment is for material and labor, with a profit factor added." COST RECOVERY:"An income tax deduction allowed on investment property, to treat the improvements as though they will waste away in a certain number of years. It cannot be applied to raw land or a personal residence. Also known as depreciation." COUNTER OFFER:"A response to an offer wherein the offeree changes one or more of the terms of the contract, becomes the offeror, and sends the offer back to the original offeror." COVENANT AGAINST ENCUMBRANCES:This covenant in a deed assures the grantee that the title has no liens or encumbrances except those that have been revealed by the grantor. COVENANT OF FURTHER ASSURANCE:"In the event someone makes a claim against the property, the grantor takes responsibility to defend the title against the claimant. This includes producing proper documents to substantiate the ownership of the grantee, and going to court, if necessary." COVENANT OF QUIET ENJOYMENT:"In a deed, the guaranteed right of an owner or lessee legally in possession of property to uninterrupted use without interference from any third party claiming superior title." COVENANT OF SEIZIN:This covenant in a deed guarantees the grantor holds title to the property and has the right to convey it to a grantee. COVENANT OF WARRANTY FOREVER:"If the grantor were to lose in defense of the title, this covenant guarantees payment for the defense of the title and for damages caused the grantee, including buying the property back from the grantee if necessary." COVENANTS, CONDITIONS ~ RESTRICTIONS:"The restrictions and requirements created in the Uniform Declaration of Restrictions for condominiums, often abbreviated as CC and Rs." CREDIT:"An amount of money that will reduce what the buyer has to bring to closing, or increase the amount the seller gets at closing." CUBIC FOOT METHOD:"Under the Cost Replacement Approach, this method determines the cost per unit of volume and multiplies that by the number of units of volume. It is most often used when appraising warehouses." CYCLE OF CHANGE:This appraisal principle involves activity which goes from growth or integration to equilibrium to disintegration and perhaps to growth again. Also known as the neighborhood cycle. DAMAGES:A money adjustment ordered by the court for actual losses suffered. DEBIT:"An amount of money that will increase what the buyer brings to closing, or will reduce what the seller gets at closing." DEBT SERVICE:Loan payments of principle and interest. DEDUCTIONS:Items that the IRS allows to be subtracted from your gross taxable income in order to determine your taxable income. DEED:"The document that serves as evidence of ownership of real property, as well as the document of conveyance." DEED IN LIEU OF FORECLOSURE:"The defaulting borrower conveys title to the property to the lender. In return, the lender forgives the loan on the property." DEFEASANCE CLAUSE:A clause in most loans written in favor of the borrower. It requires the lender to reconvey all interest in the property after the loan has been paid off. DEFERRED MAINTENANCE:"When physical deterioration is repairable, but hasn't yet been taken care of." DEFICIENCY JUDGMENT:A judgment obtained when a foreclosure sale fails to completely pay off a debt. DELIVERY:Any process of the grantor conveying the deed to the grantee. DEPRECIATION:An income tax deduction. It allows the owner of investment property to treat the improvements as though they will waste away in a certain number of years. It cannot be applied to raw land or a personal residence. Also known as cost recovery. DESCENT:"The laws by which the court determines ownership of property of a person who has died intestate, but who has heirs." DESIGNATED AGENCY:The principal (buyer or seller) who is hiring an agent specificies exactly which person(s) will act as agent or subagent and exercise fiduciary care in representing the principal's best interest. DETERMINABLE FEE ESTATE:"A fee simple estate which has conditions attached, the violation of which could cause the grantee to lose title. If written in the deed with the words ""so long as,"" it automatically reverts back to the grantor or his heirs if the conditions are violated. Also known as defeasible fee, or qualified fee estate." DEVISE:A gift of real property given in a will. DEVISOR/DEVISEE:The individuals who give and receive gifts of real property in a will. DIRECTOR OF R. E. DIVISION:One of the entities in the Real Estate Division. A full-time position responsible for submitting a budget for the Division's operation. DISCOUNT POINTS:Money paid when a loan is initially obtained which is considered prepaid interest and permanently lowers the interest rate. DISCOUNT RATE:"The rate charged by the Federal Reserve to member banks for money they borrow. It, along with reserve requirements, is one of the ways the Federal Reserve controls the economy." DISCOUNTED LOAN OR NOTE:Selling a loan to the secondary money market for less than its face value. This increases the yield (profit) on the loan. DIVISION OF WATER RIGHTS:"In Utah, the office to which one applies for water rights. This Division falls under the State Engineer's Office." DOCUMENT RECEIPT:A confirmation by the buyer and seller that they received a copy with all signatures. DOMINANT TENEMENT:The name given to a property that encumbers a neighboring property with an easement. DOUBLE COMMISSION:"The seller pays a commission to the listing agent, as per their contract, and also a commission to the selling agent." DOUBLE CONTRACT:The buyer and seller enter into a second sales contract in order to deceive the lender and enable the buyer to finance the purchase. DUAL AGENT:When the agent is representing both principals in a transaction with their informed consent. Also known as a limited agent. DUE-ON-SALE CLAUSE:"A clause that allows the lender to call the loan due and payable immediately if the property is sold or the loan is assumed. Also known as alienation, or non-assumption. " DURESS:The use of force to obtain agreement. It can be physical or emotional. EARNEST MONEY DEPOSIT:The deposit buyers make when submitting an offer to purchase real property. It shows they're serious in the offer and will serve as liquidated damages if they default on the contract. EASEMENT:"A nonpossessory interest which one person has in land owned by another, allowing limited use or enjoyment of the owner's land. It may be referred to as a physical use or condition." EASEMENT APPURTENANT:"An easement which attaches to the land and/or the deed, and passes from owner to owner with the deed." EASEMENT BY IMPLICATION:"An unexpressed, but legally binding understanding regarding a right of way between the parties, created by their actions." EASEMENT BY NECESSITY:"Created by a court of law in situations where justice and need, not convenience, dictate the appropriateness of the easement. An example would be the case of landlocked property." EASEMENT BY PRESCRIPTION:"An easement created by adverse use. The use must be adverse, hostile, open, notorious and continuous. This type of easement can be prevented by giving permission to the user, or by ordering the user to discontinue the use before the statutory period passes." EASEMENT IN GROSS:"An easement which is personal in nature and does not pass with the deed or the land. It runs with the persons who agreed to it for the term of their lives, or with the need for which it was created, such as a utility easement." ECONOMIC LIFE:The period of time during which improvements give a return on investment. It is generally considered to be shorter than physical life. ECONOMIC OBSOLESCENCE:A form of depreciation caused by forces outside the property boundaries. They may be political or social factors. It is considered to be incurable. Also known as external obsolescence. EFFECTIVE AGE:"An age placed on property for appraisal purposes, based on the condition of the property. It may be more or less that the actual chronological, or physical, age." EGRESS:Leaving a property by traveling across the servient tenement property. EMBLEMENTS:Crops nurtured in the year of the transfer or sale of the property. They are considered personal property. EMINENT DOMAIN:"The right of the government to take title, at fair market value, to land owned by a private individual." ENCROACHMENT:"The unauthorized intrusion of a building, tree, or other improvements onto a neighbor's property." ENCUMBRANCE:"Anything that burdens the title to real property so as to restrict, limit, or otherwise affect an owner's rights." ENFORCEABILITY:The deciding factor as to whether a contract dispute could be taken into the court to be settled. ENVIRONMENTAL PROTECTION AGENCY:"The government entity which deals with the impact of commercial, industrial and residential development on the environment." EQUAL CREDIT OPPORTUNITY ACT OF 1974:"Federal act which prohibits discrimination in financing, based on race, age, sex, or marital status." EQUITABLE PERIOD OF REDEMPTION:"In foreclosure, the period of time during which the borrower can reinstate the loan before the foreclosure sales takes place. It is sometimes referred to as equity of redemption." EQUITABLE TITLE:The legal interest held in a property by the buyer between the signing of the purchase contract and the conveying of the deed to the grantee. EQUITY:The market value of a property minus the debts secured by the property. ESCALATION CLAUSE:A clause written into a loan or lease that allows for payments to be increased at specified times by stated amounts. ESCHEAT:"This occurs when one dies without a will, and having no heirs." ESCROW:A neutral depository where a third party is used to hold money or documents. ESCROW ACCOUNT:A trust account established to set aside funds for future needs relating to a parcel of real property. Those needs typically include such things as property tax and hazard insurance. Also called reserve or impound account. ESTATE FOR YEARS:A lease which contains a termination date. Its term can be for any agreed-upon period of time. (It can be more or less than one year.) Also known as tenancy for years. ESTOPPEL CERTIFICATE:A document provided by a lender that reveals all the terms of a loan as requested by the borrower or ordered by the court. ESTOVERS:"The right of a tenant to use natural resources on leased land, such as timber, water, etc. when required as necessities." EXCEPTIONS AND RESERVATIONS CLAUSE:"In a deed, it indicates rights in the real property which will not be conveyed to the grantee. Also known as habendum, to have and to hold, and subject to clause." EXCLUSIVE AGENCY LISTING:"One broker is named as the exclusive agent of the seller, but the seller reserves the right to locate and sell to a buyer without paying a commission." EXCLUSIVE RIGHT-TO-SELL LISTING:"One principal broker is designated to represent the seller and receive a commission when the buyer is found, regardless of who finds the buyer." EXECUTE:To put a contract into effect by signing it. EXECUTED CONTRACT:A contract with all of the terms completed by all parties. EXECUTIVE DIRECTOR, DEPT. OF COMMERCE:The person who appoints the Director of the Utah Division of Real Estate. EXECUTOR:The title of a person named in a will to carry out the terms of the will after the death of the testator. EXECUTORY CONTRACT:"A contract that is not fully performed, but which is not in default." EXPRESS AGENCY:"Agency created through words, written or oral, between the principal and the agent." EXTENDED COVERAGE TITLE INSURANCE:"Covers claims both on and off the records. It includes a site visit to give protection against unrecorded liens and encumbrances, such as mechanic's liens, as well as defects in the land itself, such as unrecorded easements, encroachments, and information based on incorrect surveys. It can be obtained by private individuals." EXTERNAL OBSOLESCENCE:A form of depreciation caused by forces outside the property boundaries. They may be political or social factors. It is considered to be incurable. Also known as economic obsolescence. FAIR MARKET VALUE:"What a willing buyer is willing to pay, and a willing seller is willing to accept, with neither of them under duress and the property has been on the market for sufficient time to verify its value." FAMILIAL STATUS:One of the protected classes under Fair Housing referring to families with children under 18. FEDERAL CONSUMER CREDIT PROTECTION ACT:An act created in Congress to protect consumers from being deceived about the costs of borrowing money. It requires full disclosure of the cost of borrowing money and regulates advertising of credit. Also known as Regulation Z and Truth in Lending. FEDERAL FAIR HOUSING ACT OF 1866:This body of law stated there could be no discrimination based on race in the sale or lease of real estate and that all people were to be treated the same as white people. FEDERAL FAIR HOUSING ACT OF 1968:"Extended the Federal Fair Housing Act of 1866 by adding the prohibition of discrimination according to color, sex, religion, and natural or national origin. It specifically stated that no discrimination should take place relative to sale or rental of real estate, or real estate brokerage services." FEDERAL FAIR HOUSING AMENDMENT OF 1988:Added two new protected classes to Fair Housing: handicapped and familial status. FEDERAL RESERVE BANK:The bankers' bank; it regulates the money supply by establishing discount rates (cost of money to lending institutions) and setting a reserve requirement (how much cash lenders must keep on hand). FEE ESTATE:The highest or most complete form of ownership that can be held under the law. The ownership rights go on forever. Also known as fee simple and fee simple absolute. FEE SIMPLE:The highest or most complete form of ownership that can be held under the law. The ownership rights go on forever. Also known as fee estate and fee simple absolute. FEE SIMPLE ABSOLUTE:The highest or most complete form of ownership that can be held under the law. The ownership rights go on forever. Also known as fee simple and fee estate. FHA LOAN:"A government sponsored loan program with a low down payment, insured by the borrower's payment of the Mortgage Insurance Premium (MIP). " FHLMC (FREDDIE MAC):Federal Home Loan Mortgage Corporation; serves as a secondary money market to purchase existing loans. FIDUCIARY:"The word which describes the responsibility of an agent toward the principal, involving trust, loyalty, confidence, care and diligence. It can also be used to describe the agent him/herself." FIXED COST:A contract where the price is established up front and there is no allowance for overruns. FIXTURE:That which is attached without losing its identity. It is always real property. FLAT LEASE:"The lessee makes periodic, equal rent payments." FNMA (FANNIE MAE):"Federal National Mortgage Association, a major secondary money market player. It is privately owned, but Federally regulated." FORECLOSURE:The legal process a lender uses to recover the investment from a defaulting borrower where the loan was secured by the property. FORFEITURE:"In a default situation when the lender can repossess the property, this is the effect to the borrower." FORMAL WILL:"Most valid form of a will, usually prepared by an attorney. It is the least likely form of a will to be challenged." FRAUD:An act intended to deceive or misrepresent in order to gain some unfair or dishonest advantage over another and induce someone to give up something of value. FREEHOLD ESTATE:An interest in property in which some form of ownership is held. FULLY AMORTIZED LOAN:"A loan that requires payments of both principal and interest. When the last payment is made, the loan is retired." FULLY DISCLOSED PRINCIPAL:"The ""other party"" knows there is a principal, knows who it is, and that there is an agent." FUNCTIONAL OBSOLESCENCE:"The item in question is working fine, but is not what people want in their homes any more." GENERAL AGENT:An agent hired by contract to use the agent's expertise to fulfill the objectives of the principal. GENERAL OR FULL WARRANTY DEED:A deed that contains all five covenants and covers the period of time from the date of transfer back to the date of the patent. GENERAL PARTNER:"A partner who has full authority to make decisions, act for the partnership, and has full liability for the business dealings of the partnership." GENERAL PARTNERSHIP:A partnership composed only of general partners. GIFT DEED:A transfer of ownership made for love and affection. Creditors of the donor could still use the property for payment of the grantor's debts if it can be shown that the donor was insolvent and transferred the property to evade creditors. GNMA (GINNIE MAE):Government National Mortgage Association. A Federal corporation that operates in the secondary market. GOOD CONSIDERATION:"Consideration given in the form of love, friendship, loyalty, etc." GOVERNMENT SURVEY METHOD:"A method of land description that uses base and meridian lines, townships and sections. Also known as the rectangular survey method." GRADUATED LEASE:"A lease where the rent will increase periodically in amounts specified in the lease, as contained in the escalation clause." GRADUATED PAYMENT MORTGAGE:"Payments begin below the normal, fully amortized payment and are then increased for a set period of years. Some lead to negative amortization." GRANT DEED:A type of deed used in some states which contains limited warranties. The grantor usually also provides title insurance. GRANTEE:One who receives property or property rights from a grantor. GRANTOR:One who conveys property or property rights to a grantee. GROSS LEASE:"The tenant pays a set amount of rent. From this rent, the lessor is required to pay some or all of the operating expenses." GROSS OPERATING INCOME (GOI):The total income received from an investment property after subtracting vacancies and lost rents. GROSS RENT MULTIPLIER:"A ""quick and dirty"" estimate of value based only on a relationship between the value of the property and the gross rents. It is referred to as the GRM." GROSS SCHEDULED INCOME (GSI):What an investor would receive if there were no vacancies or lost rents. GROUND LEASE:"The landlord leases the land to the tenant, and the tenant builds improvements on the leased land." GROWING EQUITY MORTGAGE:"A loan where payments increase each year, thereby allowing the loan to be paid off many years sooner, with a substantial savings of interest dollars." HABENDUM CLAUSE:"In a deed, it indicates rights in the real property which will not be conveyed to the grantee. Also known as exceptions and reservations, to have and to hold, and subject to clause." HABITABILITY CLAUSE:"If not actually written in the lease, there is an unwritten or implied warrant of this in every lease, which says the property is livable." HAZARD OR HOMEOWNERS' INSURANCE:"An insurance policy which indemnifies real property against loss resulting from physical damage to the property such as fire, vandalism, etc." HIGHEST AND BEST USE:The appraisal principle that states that value should be based on the utilization of the property that will bring the greatest return to the owner. That use must be legal and feasible. HOLDER OF LIFE ESTATE:The grantee of a life estate who has the property for the duration of the grantee's own life. HOLDOVER TENANT:"The lessee had an estate for years that has now terminated. The lessor accepted a rent check, so now the tenant is on periodic tenancy basis." HOLOGRAPHIC WILL:"A handwritten will, which must be dated, written entirely in the handwriting of the testator, and does not need witnesses in order to be valid. It can pass both real and personal property." HUD 1 SETTLEMENT STATEMENT:The required form to be used when closing a real estate transaction. HYPOTHECATION:Using property as collateral or security for a debt without giving up possession of the property. IMPLIED AGENCY:"Agency that is created by the actions of the parties, rather than through an express agreement. Also called ostensible agency." IMPOUND ACCOUNT:A trust account established to set aside funds for future needs relating to a parcel of real property. Those needs typically include such things as property tax and hazard insurance. Also called reserve or escrow account. IMPROVEMENTS:"A term that refers to any additions to the land made by man. It includes buildings, roads and utilities and landscaping." INCOME APPROACH:"An appraisal approach based on the cash flow the property produces. It addresses the question, ""How much will a potential investor pay for the cash flow?"" Also called the capitalization approach." INCORPOREAL RIGHTS:"Intangible or nonpossessory rights in real property, such as easements, licenses, mining claims, etc." INCURABLE DEPRECIATION:Physical deterioration that cannot be repaired in a cost-effective manner. INDEX LEASE:"Rent payments are periodically adjusted based on an economic indicator, such as the consumer price index." INGRESS:Entering by traveling across the servient tenement property. INJUNCTION:Legal action taken to enforce the restrictive covenants in the Uniform Declaration of Restrictions or to prevent a neighbor from encroaching. INTEREST RATE:"Money paid during the term of a loan that is profit to the lender. It represents the return, or yield, on the lender's investment." INTERMEDIATE THEORY:"A combination of Title Theory and Lien Theory that allows the lender to sell the property in case of default, but does not allow it to keep any equity." INTESTATE:The condition of a person who dies and leaves no will. INVERSE CONDEMNATION:The legal process by that private individuals sue to have their property taken by eminent domain. INVESTMENT PROPERTY:"Property that is generating a cash flow, such as a strip mall or a residential rental property." JOINT TENANCY:"A form of concurrent ownership where all owners have equal rights of possession, equal interest, took title at the same time, there is one deed, and each owner has full rights of survivorship." JOINT VENTURE:"A ""temporary"" partnership between individuals and/or companies to accomplish a particular project or business activity." JUDGMENT:The decision given by a court after a case has been heard. JUNIOR LIENS:Any loans or encumbrances which come after the one which was recorded first against the property. LATERAL SUPPORT:"The duty to give support to a neighbor's property, such as building a retaining wall." LEASE:A contract for a less-than-freehold estate or right in real property. Rent is paid for the right of possession in someone else's property. LEASE WITH OPTION TO PURCHASE:A lease contract that allows the lessee the right to purchase the property. Sometimes a portion of the rent will apply to the down payment if the right is exercised. LEGAL NONCONFORMING USE:The right of an individual to continue a use of land contrary to current zoning regulations because the use existed prior to the establishment of the current zoning category. LEGAL PURPOSE:The essential element of a contract that protects the public. LESS THAN FREEHOLD:An estate or legal interest in real property that is not an ownership interest. LETTER FORM REPORT:"An appraisal report that provides a short, written statement giving the basic essentials of the appraisal." LEVERAGE:Using as much of other people's money and as little of your own as possible in order to buy property. LICENSE INTEREST:"A limited, revocable interest in property. It grants a privilege, not a right, and is often an oral agreement granting a short term use of real property." LICENSE RENEWAL:Two years after the month in which a licensee receives a real estate license this action is necessary to continue practicing real estate. LIEN:A money encumbrance that is secured against real property. LIEN THEORY:"A legal doctrine or theory of mortgage law, used in most states, which gives lenders an interest in the property, and allows them to force the owner to sell the property to pay the debt in the event of default." LIEN WAIVER:"When the mechanic is paid, signing this terminates the right to later place a lien." LIEN WAIVER:"When the owner of the property pays the general contractor for the work done, this form should be given by the mechanic who did the work." LIFE ESTATE:A form of freehold estate wherein holders act as though they own the property so long as they live. LIFE ESTATE PUR AUTRE VIE:A life estate based on the life of a person other than the holder of the life estate. LIMITED AGENT:When the agent is representing both principals in a transaction with their informed consent. Also known as a dual agent. LIMITED PARTNER:Partners who have no authority to make decisions or act for the partnership. They are financially liable only for the amount of their investment. LIMITED PARTNERSHIP:"A partnership with at least one general partner and one limited partner. Beyond that, there can be as many general or limited partners as desired." LIQUIDATED DAMAGES:"In anticipation of a particular default, clauses are sometimes written into a contract to specify the default and its penalty." LIS PENDENS:"This gives constructive notice that an action affecting a particular parcel of property has been filed in court. The property can be sold, leased, or otherwise disposed of, but all transactions are subject to the outcome of the court action." LISTING:"An agency agreement between a seller and a principal broker. The owner authorizes the broker to place the property on the market and seek a ready, willing, and able buyer and agrees to pay consideration if the broker is successful." LITTORAL RIGHTS:"Rights of an owner of property bordering a lake, river, ocean or body of water subject to tides." LOAN TO VALUE RATIO OR L-T-V-R:"The amount of debt secured by the property compared to the worth of the property, expressed as a percentage. It must be a total of all liens." LOT, BLOCK, AND PLAT:"A method of land description used for subdivisions, identifying the location of a particular parcel in the subdivision or tract." MANAGEMENT CONTRACT:An employment contract between a property manager and an owner of investment property. MARKET DATA APPROACH:An appraisal approach that contrasts the subject property with other properties that have recently sold. Adjustments are made to account for variations between the subject property and the others. Also known as the comparison approach. MARKETABLE RECORD TITLE ACT:The law that allows the simplification and stabilization of title searches by allowing old liens and encumbrances to be removed after the statutory period. MARKETABLE RECORD TITLE ACT:The law that allows the simplification and stabilization of title searches by allowing old liens and encumbrances to be removed after the statutory period. (40 years in Utah) MECHANIC'S LIEN:A lien placed by a person who has integrated labor or materials into a property and has not been paid. MEDIATION:A non-binding process of meeting with a disinterested third party to try to resolve a dispute between the two principals in the transaction or contract. MERGER:"The joining of two contiguous properties so as to extinguish a lesser right. For instance, this process can terminate an easement on land locked property." MERIDIAN:A north-south line that intersects a baseline and creates a point from which land can be measured under the Government or rectangular survey method. METES AND BOUNDS:A method of land description that uses measurements and monuments and utilizes angles. MILE:"5,280 linear feet" MINERAL RIGHTS:Subsurface rights of an owner of real property which extend downward to the center of the earth. These rights are real property. MONUMENT:A fixed surveyor's marker for a metes and bounds description. It can be natural or man made and marks the corners of the property. MORTGAGE:"A document used to secure a loan. It is a judicial agreement, meaning if non-payment takes place, the holder of the promissory note can take it to court and the court will order the sheriff to foreclose." MORTGAGEE:The lender who receives a mortgage as security for a loan or debt. MORTGAGOR:A borrower who hypothecates property as security for a loan through the use of a promissory note and a mortgage. MUTUAL AGREEMENT:The essential element of a contract achieved through the offer and acceptance process. NARRATIVE REPORT:The longest form of appraisal report which uses a variety of supporting documentation. NATURAL PERSON:An individual. The opposite of a legal person. NEGATIVE (PASSIVE) INTENTIONAL FRAUD:"When a person covertly hides facts, thus leading the other contracting party to believe certain things which are not true." NEGATIVE OR REVERSE AMORTIZATION:A loan that requires payments of no principal and only part of the interest. The unpaid interest is added to the principal. This technique is used on some graduated payment mortgages. NEIGHBORHOOD CYCLE:An appraisal principle involves activity which goes from growth or integration to equilibrium to disintegration and perhaps to growth again. Also known as the cycle of change. NET LEASE:"Tenants pay the landlord rent; and, in addition, also pay their portion of the operating expenses (such as utilities)." NET LISTING:A listing wherein the seller identifies an acceptable amount for the property and everything above that figure will be commission to the agent. NET OPERATING INCOME (NOI):The profit that remains after the operating expenses have been subtracted from the gross effective income. NON-ASSUMPTION CLAUSE:"A clause that allows the lender to call the loan due and payable immediately if the property is sold, or the loan is assumed. Also known as due-on-sale, or alienation. " NON-DISTURBANCE CLAUSE:A clause in a mortgage which protects the rights of the lessee if the property should be foreclosed by the lender upon the owner's default. NON-HOMOGENEOUS:A term that means no two parcels of land are exactly alike. NON-INVESTMENT PROPERTY:"A property that has no cash flow; for example, your home or a vacant lot." NON-RECOURSE LOAN:"The terms of the loan stipulate that even if the lender receives less than the balance owed as a result of a foreclosure action, the debt is satisfied and the lender may not go after the borrower's personal assets." NON-RESIDENT LICENSE:A real estate licensee from another state acquires this kind of a license to enable him/her to practice real estate in Utah. NOTICE OF DEFAULT:The action filed to initiate foreclosure under a Trust Deed and Note. NOTICE OF INTEREST:"Holders of junior liens against a property would file this. If the senior lien holder foreclosed, they would be notified and could protect their interest." NOTICE TO QUIT:The first step a lessor must take against a tenant before filing an Unlawful Detainer with the courts. NOVATION:"The substitution of a new party or a new obligation in a contract. This process requires the agreement of all original parties in the contract, but once it has been agreed to, the original obligatee is released from liability." NUNCUPATIVE WILL:"Oral will, written down by someone and witnessed by two non beneficiaries. It can only convey personal property." OPEN END MORTGAGE:"A loan which can be increased up to an agreed upon maximum, similar to the way a credit card works. It is often used for construction loans and home equity loans." OPEN LISTING:"A listing agreement that can be given to as many principal brokers, on the same property, as the seller desires. It is a non-exclusive listing." OPERATING BUDGET:A projection of the financial operation of an investment property. OPTION :"A contract wherein a seller agrees to sell property for a set amount at specified terms, if the buyer chooses to exercise that right to purchase during the contracted period of time. In return for the seller taking the property off the market, the buyer pays valuable, non-refundable consideration." OPTIONEE:One who receives an option; a potential buyer who may or may not purchase by the end of the term of the option. OPTIONOR:One who gives an option; the potential seller. ORIGINATION FEE:A fee (profit) charged by the lender to initiate a loan. OSTENSIBLE AGENCY:"Agency that is created through the actions of the parties, rather than through an express agreement. Also called implied agency." PACKAGE MORTGAGE:A loan that uses both real and personal property as security. PAR:The interest rate charged on a loan when there are no discount points involved. PAROL EVIDENCE RULE:Prevents the admission into court of oral agreements reached prior or subsequent to the written contract and which contradict the terms in the written contract. PARTIALLY AMORTIZED LOAN:"A loan requiring payments of both principal and interest, but when the final payment is made, a balloon payment is required to retire the loan." PARTIALLY DISCLOSED PRINCIPAL:"The ""other party"" knows who the agent is, knows there is a principal, but is not told who the principal is." PARTICIPATION LOAN:A loan where the lender becomes an investor or owner in the project for which the money is being loaned. PARTITION SUIT:A court process where property owned concurrently can be divided into distinct portions so each co-owner may hold his or her portion in severalty. The court may order the property sold. PARTY WALL:"A common wall between two properties, usually involving a zero lot line." PATENT OR PUBLIC GRANT :The instrument issued when the property is first conveyed from public or government ownership to a private individual. PERCENTAGE LEASE:"A lease used in commercial leasing. The tenant pays a percent of the net or gross income derived from the use of the property, or the tenant may be paying a flat rate plus a stated percent of the gross or net income." PERIODIC TENANCY (MONTH-TO-MONTH):"A lease which automatically renews itself. The period for legal notice is established by statute in each state, or can be agreed upon as one of the terms of the lease (15 days in Utah)." PERSONAL PROPERTY:"The opposite of real property, it is moveable and destructible. Synonyms are chattel and personalty." PERSONALTY:"A synonym for personal property. The opposite of ""realty.""" PHYSICAL DETERIORATION:A type of depreciation that occurs when something wears out and will no longer perform the function or give the service that was originally intended. PHYSICAL LIFE:"The time span during which an improvement is still standing, though it no longer has economic life." PLAIN LANGUAGE POLICY:"Title insurance covering the borrower, that will cover mechanic's liens." PLEDGE:The borrower gives up possession of the property being used as collateral for the loan (the way a pawn shop works). PLOTTAGE:Combining two or more parcels of land with a resulting increase in total value. POINT OF BEGINNING:"In the Metes and Bounds method, this is the corner at which the boundary description starts." POLICE POWER:"The right of government, such as in zoning, to exercise control over private property without their consent and without compensation." POSITIVE INTENTIONAL FRAUD:When a person deliberately and overtly deceives or misrepresents facts pertinent to a contract. POWER OF ATTORNEY:"What an attorney-in-fact holds which authorizes actions in behalf of another person, including signature authority." POWER OF SALE (BARE, NAKED, LEGAL TITLE):The authority (conveyed from the trustor to the trustee at the time the Trust Deed and Note are signed) to sell the property in the event of default. PREPAYMENT PENALTY:This clause in a loan penalizes the borrower for paying off the loan earlier than agreed. PREPAYMENT PRIVILEGE:"This clause in a loan allows the borrower to pay the loan off early. Extra principal can be paid monthly, the loan refinanced, balloon payments made, or the whole balance paid off." PRICE:"The amount of money being asked for a product or property, or the amount it sells for." PRIMARY MONEY OR MORTGAGE MARKET:"Those who originate loans of any type, regardless of the priority of the loan, are in this financial market." PRIME RATE:The interest rate that is charged a lender's most favored clients and is established by the major banks or lenders of America. PRINCIPAL:The agent works for this person. This person is also sometimes referred to as a client. PRINCIPAL BROKER:The broker who manages the offices and is responsible for supervising the activities of the licensed and unlicensed staff. PRINCIPLE OF SUBSTITUTION:The appraisal principle which states that no prudent buyer will pay more than he has to to get what he wants. This is the basic principle of the Market Data or Comparison approach to appraisal. PRIOR APPROPRIATION:"The legal doctrine used in Utah for distribution of water based on the ""first come first served"" idea. Also known as statutory appropriation." PROCURING CAUSE DOCTRINE:A doctrine governing who gets the selling portion of the commission. It says the agent who set up an uninterrupted chain of events that led to the closing earned the commission. PROMISSORY NOTE:"The document given as evidence of the loan. It contains all information relative to the money: payment, term, interest rate, etc." PROPERTY MANAGEMENT:This activity occurs when a licensee takes charge of investment property for the owner. PROPERTY MANAGER:One who represents the interests the owner of an investment property. This person must have a real estate license. PROPERTY MGMT. TRUST ACCOUNT:Must be opened when a real estate brokerage is handling more than six property management accounts. PROPERTY TAX:"The tax levied by government against real estate, sometimes known as real estate taxes." PROPRIETARY LEASE:"Sometimes called an ""owner's"" lease. It is held by a person who owns shares in a stock cooperative. They own personal property that entitles them to this type of lease." PRORATION:"The process of computing the buyer's and seller's portion of an obligation owed by both, such as property tax." PUFFING:"Sales talk, or exaggerated statements that reflect an obvious overstatement by the agent and are not considered misrepresentation or fraud." PURCHASE MONEY MORTGAGE:The seller is the lender and may be lending all or only part of the purchase price. QUALIFIED FEE ESTATE:"A fee simple estate which has conditions attached, the violation of which could cause the grantee to lose title. Also known as defeasible fee, or determinable fee estate." QUANTITY SURVEY METHOD:"The appraiser determines the cost of the materials; labor; management fees, and profit. These are used to determine the value of improvements when using the cost approach in appraisal." QUIET ENJOYMENT:"One of the rights in the ""Bundle of Rights."" The right of an owner or lessee to uninterrupted legal use of the property without interference or disturbance caused by defective title." QUIET TITLE ACTION:A court action to determine the actual ownership of real property. This type of proceeding would be conducted to transfer title to an adverse possessor. QUIT CLAIM DEED:"A deed that conveys all interest in a property which the grantor may or may not have, and gives no warranties as to the condition of title. Its primary use is to remove clouds from the title." RANGE:"A vertical column of townships, counted east and west from the meridian in the Government or Rectangular Survey Method." RATE OF RETURN:The ratio created when the net operating income is divided by the value of the property. It is also called the capitalization rate or cap rate. REAL ESTATE PURCHASE CONTRACT:"A form that must be filled out by all licensees when writing an offer to buy real property. When accepted, it becomes the sales agreement." REAL ESTATE RECOVERY FUND ACT:The purpose of this act is to protect the public from dishonest licensees. REAL ESTATE TRUST ACCOUNT:A special bank account where money is deposited when it is being held for other people involved in a real estate transaction. REAL PROPERTY:"Land and appurtenances, air space to infinity, and the subsurface to the center of the earth." REAPPRAISAL LEASE:A lease wherein the rent is determined by a periodic re-evaluation of the property's value. RECIPROCITY:When states agree to recognize each others' education requirements for real estate licensing. RECONCILIATION:An appraiser should use as many of the approaches to appraising as possible. This technique synthesizes the results into a single estimate of value. It is sometimes called correlation. RECONVEYANCE OF DEED:The document a lender uses to return all interest in the property after the debt has been satisfied under a Trust Deed and Note. This is in accordance with the defeasance clause. RECORDING:"A form of delivery of a deed, also known as constructive delivery or notice." RECTANGULAR SURVEY METHOD:"A method of land description that uses base and meridian lines, townships and sections. Also known as the Government Survey Method." REDLINING:The discriminatory practice of refusing to make loans in certain neighborhoods. REFINANCE:"Obtaining a new loan, often at a lower interest rate, out of which the old loan is paid off." REGULATION Z:An act created in Congress to protect consumers from being deceived about the costs of borrowing money. It requires full disclosure of the cost of borrowing money and regulates advertising of credit. Also known as Truth in Lending and the Federal Consumer Credit Protection Act. REIT (REAL ESTATE INVESTMENT TRUST):"Its purpose is to avoid double taxation. It must have at least 100 members, and return at least 90% of the profits to the investors." RELEASE CLAUSE:"When a blanket loan has been given, this clause will allow part of the property to be removed as security for the loan when certain requirements have been met, sometimes called a partial release clause." RELEASE OF LIEN:"If a mechanic had previously placed a claim against the property where the work was done, when payment is made, this form must be filed within ten days." REMAINDERMAN:The person who will receive the life estate when the current holder of the life estate dies. There can be more than one of these. REPC FOR RESIDENTIAL CONSTRUCTION:"Similar to the Real Estate Purchase Contract, but this one is to be used solely when the property being purchased is a new home to be constructed or for which no Certificate of Occupancy has been issued." RESCISSION:"As a remedy for fraud, or by agreement of the parties, all parties return to their original positions prior to the executing of the contract. It is also known as a ""contract to end a contract.""" RESERVE ACCOUNT:A trust account established to set aside funds for future needs relating to a parcel of real property. Those needs typically include such things as property tax and hazard insurance. Also called impound or escrow account. REVERSE ANNUITY MORTGAGE:When the mortgagee makes regular monthly payments to the mortgagor. The payments create the loan. It is used for elderly people who's homes are paid off or nearly so. The debt is not repaid until they either sell the house or die. RIGHT OF FIRST REFUSAL:"A right given to a prospective purchaser to be able to meet the price and terms at which the owner is willing to sell the property to another party. Unlike an option, the seller is under no obligation to withdraw the property from the market." RIPARIAN:"Water law that says the owner of the land has a reasonable right to water on, under, or adjacent to the real property." RIPARIAN RIGHTS:"An approach to the distribution and use of water that states the owner of real property has a reasonable right to use any water that is on, under, or adjacent to the property. The guideline for boundaries when water borders land." ROOFTOP LEASE:This lease is used when the tenant only wants to rent space on the the top of the building. RULE OF DISCLOSURE:"An agent's responsibility to reveal all material facts to a principal, including mistakes and misrepresentations. Indeed it might be said concerning the fiduciary relationship, what the agent knows, the principal knows." RULE OF OBEDIENCE:An agent's responsibility to follow all instructions of the principal. SAFETY CLAUSE:A clause in a listing contract that protects the listing broker from the seller's attempt to sell the property after the expiration of the listing to avoid paying a commission. SALE AND LEASEBACK:An owner sells a property and then leases it back from the new owner. This could be for a long or short term. SALES AGENT:A real estate licensee who does not have a broker's license and must work under the supervision of an employing principal broker. SATISFACTION OF MORTGAGE:"The document used by the lender to reconvey all interest in a property used as collateral, as required by the defeasance clause under a mortgage." SEASONED LOAN:A loan with a payment history. This feature of a loan is preferred by the secondary money market. SECONDARY MONEY OR MORTGAGE MARKET:Individuals or financial institutions who purchase existing loans. SECTION:An area of land one mile square in the Government or Rectangular Survey Method. It contains 640 acres. SEGREGATING:The opposite of commingling funds in the trust account. SELLER DISCLOSURES:The property's title and physical condition information required by the REPC to be given to the buyer by the seller. SENIOR LIEN:Refers to first mortgages or trust deeds or the debt first recorded against the real property. SERVICE PROPERTY:Property such as government buildings or churches which are used for public purposes and are non-profit. SERVIENT TENEMENT:"The name given to a property encumbered by an easement appurtenant, such as a land lock situation." SETTLEMENT:"The date specified in the purchase contract when buyer and seller deliver any monies required, as cleared funds, to the settlement agent and sign the documents applicable to the transaction." SEVERALTY:A form of ownership wherein an individual owns the property in sole ownership. SEVERANCE:A process by which real property becomes personal property. SHARED EQUITY MORTGAGE:"The lender not only collects interest on the loan, but when the property is sold, the lender will receive a portion of the profits from the increase in the property's value since the time it was purchased." SHERIFF'S DEED:The document given to the person who bid and bought property at a Sheriff's Sale. This document is not given until the statutory period of redemption has passed. SHERIFF'S SALE:The name of the event wherein a property is sold in foreclosure under a mortgage. SHERMAN ANTITRUST ACT:A law designed to encourage competition and free enterprise by outlawing price fixing. SHORT FORM OR CHECKLIST REPORT:An appraisal report that uses a standardized form wherein the appraiser checks boxes and fills in blanks. It is often required by lending institutions. SIMPLE INTEREST:The type of interest that is computed on the unpaid principal balance. SITUS:Personal preference for one location over another that affects the value of the property. SPECIAL AGENT:An agent hired by contract to carry out specifically stated activities. Also known as a specific agent. SPECIAL ASSESSMENT:"A tax customarily imposed against only those parcels of property that will benefit from a proposed public improvement such as sidewalks, sewer, street lights, parks, etc." SPECIAL PURPOSE PROPERTY:"Property that doesn't fit one of the standard zoning classifications (residential, commercial, agricultural, etc.) is put in this general category." SPECIAL WARRANTY DEED:"This type of deed contains only two covenants: the covenant of seizin and the covenant against encumbrances. Furthermore, it only warrants the period of time that the grantor actually owned the property." SPECIFIC AGENT:An agent hired by contract to carry out specifically stated activities. Also known as a special agent. SPECIFIC PERFORMANCE:A legal remedy requiring a party to perform as agreed in the contract. SPOT ZONING:The process involved when the zoning and planning commission changes the zoning of a single lot to be different from others surrounding it. SQUARE FOOT METHOD:"In this Cost Approach Method, the appraiser multiplies the value per unit of area times the number of units of area." STANDARD COVERAGE TITLE INSURANCE:"Title insurance which protects against losses arising from both recorded title claims, omissions and errors in public records, and from inadequate title search procedures. It does not protect from undisclosed and unrecorded claims against the title such as unrecorded mechanic's liens." STATE APPROVED FORMS:"The Division of Real Estate and the State Attorney General's office allow licensees to fill out these forms. They include the Real Estate Purchase Contract, its Addenda, the Real Estate Purchase Contract for Residential Construction, the All Inclusive Trust Deed and its Note, and the Uniform Real Estate Contract." STATUTE OF FRAUDS:The requirement that certain contracts must be in writing in order to be enforceable in court. STATUTORY APPROPRIATION:"The legal doctrine used in Utah for distribution of water based on the ""first come first served"" idea. Also known as prior appropriation." STATUTORY DEDICATION:"When the developer is allowed (or required) by the city, county, or state to convey the streets, sidewalks, gutters, etc. to the government." STATUTORY PERIOD OF REDEMPTION:The period of time following a foreclosure sale wherein the mortgagor has the right of paying off all debts against the property and regaining ownership of the property sold in foreclosure. STEERING:The act of directing buyers to or away from certain geographical areas for the purpose of discriminating. STRAIGHT NOTE:"A loan that requires payments of interest only, sometimes called a term loan. Usually the entire principal is paid off in one balloon payment at the end of the loan." SUBAGENT:"Anyone who is assisting the agent (principal broker) in the agent's responsibilities. For instance, a sales agent or associate broker in the office, or principal broker with a co-broker agreement." SUBDIVISION:"Land divided into lots which may or may not include improvements, such as water, utilities, curbs, gutters, and streets; but does not include buildings." SUBJECT TO CLAUSE:"In a deed, it indicates rights in the real property which will not be conveyed to the grantee. Also known as habendum, to have and to hold, and exceptions and reservations clause." SUBLEASE:"A lease given by the original lessee. The lessee remains fully liable to the lessor. The lessee pays rent to the lessor or landlord, and collects rent from the sublettee." SUBORDINATION CLAUSE:"The clause in a loan that can alter the priority of a loan, making it junior to other liens. " SUBROGATION:"The substitution of liability or rights, as in a title insurance policy." SUPPLY AND DEMAND:"The principle of economics, as well as appraisal, which states that when there is an overabundance of a particular product, the price will go down; conversely, when there is a limited amount of that product, the price will go up." SURVIVORSHIP:The surviving owner(s) automatically receives ownership of the deceased person's share. It takes precedence over a will. TACKING:"In adverse possession, this process allows consecutive periods of adverse possession by multiple adverse possessors to be added together to make up the required number of years." TAKE-OUT LOAN:"Once construction is completed and an appraisal obtained, this is a term referring to the permanent, long-term financing for the property." TAX CREDIT:Items which the IRS allows you to subtract from the dollar amount of tax due. It provides a dollar for dollar benefit. There are very few of these allowed. TAX DEFERRED EXCHANGE:An exchange of like for like properties. Tax on any capital gains is paid at a later date. Tax is paid on boot or debt reduction. TENANCY AT SUFFERANCE:"The lease has expired and the lessee now possesses the property illegally, having been given proper notice to vacate. It is similar to trespassing except that the lessee, at one time, held a legal lease." TENANCY AT WILL:A lease which requires little or no notice of termination. It is used in special circumstances wherein both the lessor and lessee agree that the lease may be terminated by either party. It is of uncertain duration. TENANCY BY THE ENTIRETY:"A form of ownership that can only be held by husband and wife, similar to joint tenancy, except that one party cannot sell or encumber without the approval of the spouse." TENANCY FOR YEARS:A lease which contains a termination date. Its term can be for any agreed-upon period of time. (It can be more or less than one year.) Also known as estate for years. TENANCY IN COMMON:"A form of ownership where owners have full rights of possession, but each owner can have a different percent of ownership. Upon the death of one, that interest goes to the heirs." TENDER:Another term for the process of making or presenting an offer. TESTATOR:The title of a person who makes a will. THIRD PARTY DELIVERY:"Delivery of the deed is accomplished by a disinterested party who has written, acknowledged instructions from the grantor. Also called a deed in escrow." TIER:"The horizontal row of townships, counted north and south from the baseline in the Governmental or Rectangular Survey method." TIME IS OF THE ESSENCE:The clause in a contract that means all dates are firm and non-performance by the date specified may create a voidable contract. TIMESHARE AND CAMP RESORT ACT:The act that governs developers who offer property for use with mobile types of housing or where you will periodically use the property for a limited amount of time. TITLE:An abstract term denoting ownership; not a document. TITLE INSURANCE:"Since an attorney's opinion does not offer the buyer financial protection if the title proves unsound, this can be purchased, giving varying degrees of financial protection relative to the condition of title of real property." TITLE THEORY:A legal doctrine or theory of mortgage law used in a few states that allows the lender to take property as collateral for the debt by holding ownership of the property until the debt is paid. TO AND THROUGH DOCTRINE:An approach which says the agent who first showed the property to the buyer earns the selling portion of the commission. TO HAVE AND TO HOLD CLAUSE:"In a deed, it indicates rights in the real property which will not be conveyed to the grantee. Also known as habendum, exceptions and reservations, and subject to clause." TOWNSHIP:The largest land area used in the rectangular or government survey system. It is six miles square. TRADE FIXTURE:That which is considered legally attached to a business. It is always personal property. TRUST DEED (OR DEED OF TRUST):"The document that provides for a non-judicial foreclosure process. It is used to secure a promissory note, by which a borrower hypothecates property as collateral for a debt or loan." TRUSTEE:"Since the courts are not being used in the case of a Trust Deed and Note, this person acts as an escrow agent to insure that the terms of the loan are carried out, and to initiate foreclosure if they are not." TRUSTEE'S DEED:The document that is given to the individual who successfully bids at a foreclosure sale and purchases the foreclosed property. It conveys fee simple title immediately after the sale. TRUSTEE'S SALE:The event where property is sold in foreclosure under a Trust Deed and Note. TRUSTOR:"The legal term given to one who hypothecates property as collateral for a loan, using a promissory note and trust deed." TRUTH IN LENDING:An act created in Congress to protect consumers from being deceived about the costs of borrowing money. It requires full disclosure of the cost of borrowing money and regulates advertising of credit. Also known as Regulation Z and the Federal Consumer Credit Protection Act. UNDISCLOSED PRINCIPAL:"The ""other party"" thinks that the agent is the principal and sees no evidence of an agency relationship. It is usually illegal." UNDUE INFLUENCE:"Taking advantage of another person because you hold a unique position of trust, such as a doctor/patient, attorney/client, real estate agent/client relationship." UNIFORM COMMERCIAL CODE:"The body of law that regulates the transfer or sale of personal property, such as when one is selling a business." UNIFORM DECLARATION OF RESTRICTIONS:The document that is used when a subdivider or developer records a group of restricitive covenants on all of the lots in a subdivision. UNIFORM REAL ESTATE CONTRACT:"A document wherein the lender (usually the seller) retains title to the property until the debt is paid. Also known as an installment sales contract, contract for deed, or land contract." UNIFORM RESIDENTIAL LANDLORD AND TENANT ACT:Federal legislation aimed at creating proper legal relationships between landlords or owners and tenants. UNILATERAL CONTRACT:"A contract wherein a promise is exchanged for a performance. Only one of the parties is initially bound, as when a reward is offered; for example, finding a lost animal." UNIT-IN-PLACE METHOD:"An appraisal method for determining the cost of improvements which takes a general approach. It is sometimes referred to as a sub-contractor approach and considers the cost of components, such as the concrete work, the framing, etc. or such items as extra light fixtures, kitchen or bathroom fixtures, etc." UNIVERSAL AGENT:An agent hired to do all things for and in behalf of the principal. UNLAWFUL DETAINER:The legal process a landlord brings against the tenant to evict when there is legal cause. URBAN RENEWAL:The procedure of condemning private propertys as a blighted area and having it torn down and rebuilt. USURY:"Interest rates above the legal rate, or statutory limit." UTAH EXEMPTION ACT:The law that provides protection for a portion of equity when a homeowner experiences foreclosure or bankruptcy. UTAH UNIFORM LAND SALES PRACTICES ACT:The body of law that governs subdivisions that fall under the regulation of the State of Utah. VA LOAN:A government loan that is guaranteed and does not require a down payment. VALID CONTRACT:A contract that contains all the essential elements of a contract and therefore is binding on all parties. VALUABLE CONSIDERATION:"Consideration in the form of money, services, promises, or real or personal property." VALUE:"The power of a product, service, or property to command other goods or money in exchange. It is the present worth of future benefits arising out of ownership." VARIANCE:The right of an individual to do something that violates current zoning regulations because the zoning and planning commission or Board of Adjustment granted that right. VENDEE:One who buys or offers to buy. VENDOR:One who sells or offers to sell. VERTICAL LEASE:A lease for either air rights or subsurface rights (such as oil). VOID CONTRACT:A contract that lacks one or more of the essential elements of a contract and therefore is not binding on any of the parties. VOIDABLE CONTRACT:A contract wherein one of the parties can challenge one or more of the essential elements of the contract and therefore has the right to affirm or disaffirm the contract. VOLUNTARY DEDICATION:"When a private individual gives land as a gift for public use, such as land for a park, church, hospital, etc." WALK-THROUGH INSPECTION:An optional visit by the buyer to check and approve the condition of the property and any repairs that have been made. WASTE:When the owner of the property commits destructive acts on the property or fails to keep up with maintenance requirements. WATER RIGHTS:The authority under the law to have ownership of water. They are considered real property. WATER SHARES:"A right to use water on real property, granted to the owner by a canal company with water certificates. They are considered personal property." WATER SHARES:"A right to use water on real property, granted to the owner by a canal company with water certificates. They are considered personal property." WRAPAROUND LOAN:A loan that encompasses one or more existing loans. WRIT OF EXECUTION:A court order directing an officer of the court to sell property of the defendant in order to satisfy a judgment. WRIT OF RESTITUTION:"In an Unlawful Detainer Action, the order the judge gives for the sheriff to evict a tenant and restore the premises to the lessor." ZONING:"A right of state governments to regulate the height, bulk and use of private property in order to protect the health, morals, welfare, and safety of the public; usually delegated to the local level."