The dollar amount shown on a document by words or numbers. Example: A mortgage has a face value of $10,000, amortization term of 30 years, and 8% face interest rate. It will be amortized in 13 years to $8,000 by annual payments.

A federal law that allows individuals to examine and correct credit information about them that is used by credit reporting services.

A federal law that prohibits discrimination in housing based on a person's race, color, religion, sex, handicap, familial status, and national origin

The amount that a property would command if it were currently available for lease. Contrast with Contract rent. See Economic rent, Rent control, Section 8 housing.

The amount of money that would be paid for a property offered on the open market for a reasonable period of time with both buyer and seller knowing all the uses to which the property could be put and with neither party being under any pressure to buy or sell.

A federal law that prohibits discrimination against any person due to race, color, religion, sex, handicap, familial status, or national origin in the sale, rental, leasing, financing and advertising of housing or in the prevention of real estate brokerage services

In modern estates, the terms “fee" and "fee simple” mean substantially the same thing.

A Title that is absolute and unqualified and is the best one can have giving complete ownership and control of real property without any conditions or limitations..

An estate in fee subject to the occurrence of a condition happening subsequently or afterwards, upon which the estate may be terminated. See Fee simple determinable.

A fee that may terminate upon the occurrence of a specific event that may or may not ever occur or the time of which is uncertain..

The greatest interest that one can have in real property which is unqualified, of indefinite duration, freely transferable and inheritable..

See Fee simple determinable

An estate in which the holder has a fee simple title, subject to return to the grantor if a specified condition occurs. See Fee simple determinable.

A freehold estate of inheritance limited so as to descend to a particular class of heirs of the person to whom it is granted.

An estate or a limited estate in which transfer of the property is restricted in that the property must pass to the descendants of the owner and which was originally used to insure the passing of land in a direct ancestral line..

A real property ownership system in which ownership rests with a sovereign who may grant lesser interests in return for service or loyalty and which is in contrast to allodial tenure.

Grants of land.

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

A recorded generic mortgage or trust deed that is not related to one specific transaction but is used as a reference mortgage or trust deed to avoid lengthy mortgages or trust deeds for each title transfer.

The duties or responsibilities that an agent owes to his or her principal or client of loyalty, obedience, disclosure of material facts, accountability for funds, confidentiality and to exercise the highest skill level to the principal and not to gain any personal advantage over the principal by even the slightest misrepresentation, concealment, duress or pressure..

1. The ability of a proposed land use or change of land use to justify itself from an economic point of view. 2. One of but not the only test of the highest and best use of land because it does not necessarily make it the best use of the land. Example: A proposed small office building will cost $1 million to build, including direct costs and indirect costs. It is expected to generate $150,000 in annual net operating income. Building investors require a 12% rate of return on the $1 million investment, or $120,000, so this project is financially feasible.

The organizations such as commercial banks, savings and loan associations, credit unions, savings banks and insurance companies that deal in money or claims to money and serve the function of channeling money from those who wish to lend to those who wish to borrow.

(FIRREA) A federal law passed in 1989 in response to the savings and loan crisis of the 1980s that restructured the regulatory and deposit insurance program for dealing with S&Ls and changed the rules under which federally-regulated S&Ls operate. See Federal Housing Finance Board, Office of Thrift Supervision, Resolution Trust Corporation. Example: The FIRREA was intended to address the major problem of failing S&Ls due to mounting nonperforming loans held in portfolio, as well as to make reforms that would prevent the problem from retuning. Often referred to as the “S&L bailout.” the law represents a large expenditure of federal funds to pay off depositors at failed associations. The law also created the Resolution Trust Corporation. which is charged with managing and liquidating the assets of associations seized by the government. The Federal Savings and Loan Insurance Corporation was abolished by the law. and its insurance and regulatory responsibilities were brought under the Federal Deposit Insurance Corporation, which also insures commercial banks.

The financial institutions such as commercial banks, savings and loan associations, mutual savings banks and life insurance companies that act as an intermediary or go-between for savers and borrowers by selling its own obligations for money and, in turn, lending the accumulated funds to borrowers in the form of real estate loans.

The use of another party's, which is typically a lending instution's, money to buy something which in real estate is property. The following are examples of financing:

• Obtaining a mortgage loan on a purchase
• Assumptions of a mortgage from a seller
• Arranging for the seller to take a loan as part of the purchase price
• Arranging an installment sale

The amounts used to pay the costs of acquiring real estate such as interest on all loans, ground rent for leased land. Loan principal payments reduce the debt, so technically they are not expenses. Contrast Operating expenses. Example: Florence owns both units of a duplex, each financed with a separate mortgage. She lives in one unit and rents the other. From the $2,000 monthly rent received from her tenant, Florence has to pay, financing expenses (interest on both mortgages) and operating expenses.

The systematic five-step procedure followed by major institutional lenders when analyzing a proposed loan: 1. Application filed by a borrower; 2. Analysis of borrower and property by lender; 3. Processing of loan documentation; 4. Closing (funding) the loan; and 5. Servicing through collection and recordkeeping..

An instrument filed in order to give public notice of a security interest and which protects the interest of any secured parties in the collateral. See Security interest and Secured party

A monetary payment which is prohibited or limited in most states to a party who locates suitable property or a purchaser who is other than a licensed broker. Example: Broker Abel has a listing on a particular property. Baker knows several people interested in such property. Abel arranges with Baker to provide a finder's fee should one of the prospects identified by Baker purchase the property

1. An unqualified written promise as to under what specified terms and conditions a lender will lend money. 2. A commitment assumed by the FHA to insure a mortgage of a specified mortgagor;

A legal document that is pledged as collateral for a loan that was recored first giving it first priority and will be superior to all other liens or claims against the property except for taxes and bonded indebtedness. See Mortgage..

See Right of first refusal..

See First mortgage.

The tangible property such as buildings, furniture and fixtures and equipment that are used in a business operation that is not for sale and is shown on the financial statement of the company.

The regular recurring costs required in owning a property or business such as taxes and fire insurance

A mortgage secured by real property featuring periodic principal and interest payments that are constant over the term of the loan. All fixed payment mortgages are Fixed rate loans but some may have variable payments such as a Graduated payment loans.

A mortgage secured by real property featuring a constant interest rate for the term of the loan. See Adjustable rate loan. Example: A fixed-rate mortgage is originated with an interest of 10% for a term of 30 years. the rate will remain at 10% until loan is retired or the due-on-sale clause is exercised at resale of the property.

The movable items such as toilets and built in store showcases that are attached to land or its improvements which become appurtenances and which under normal circumstances cannot be removed without a prior agreement because the affixing converts them to real property.

1. A one-level apartment. 2. A level payment (flat) mortgage or (flat) lease requirement. Example: A 2-room flat is an apartment having 2 rooms. Example: A flat lease is one that requires level payments each month or other specified period.

A real estate broker who charges a fixed or flat fee for brokerage services instead of a commission based on a percentage of the sales price of the property. See Discount broker. Example: Kramden., a flat fee looker, charges $5,000 to arrange the sale of a home, no matter what price is agreed upon by the buyer and seller. If a sale is not consummated within the listing contract, no fee is paid..

A lease in which the rent is a fixed (flat) sum paid periodically throughout the entire lease term..

A loan in which the repayment schedule is based on the borrower's financial position to pay so payments are usually lower in the earlier years and increase as the borrower's ability to repay increases.

An interest rate that is not fixed over the term of a loan, bond, or other fixed-income security, but is allowed to vary according to the change in a specified index. See adjustable Mortgage. Example: Financial Securities Company created a floating mutual fund based on a portfolio of adjustable-rate mortgages yield on the fund varies from year to year depending on the in rates charged on the ARMS in portfolio.

A plan drawn to scale indicating wall-to-wall dimensions, room sizes and exposures and the placements of windows, doors, partitions, etc.

An accounting method used primarily by the Federal Reserve to describe the sources and uses of the nation's funds in a given period of time.

(FSBO) A term referring to properties on the market that are not listed with a real estate broker because the owner desires to sell the property his or her self without paying a commission. Example: The Mathers are attempting to find a buyer for their home by placing an ad in the paper and putting up a sign in the yard. Such activities indicate the existence of a FSBO..

Definition goes hereA tolerant action by a creditor against a borrower who has not received payment once the debt has become due.

A clause is often inserted in a construction contract to protect the contractor from unavoidable delays or of failure to perform the contractual obligations in a timely manner due to a force(s) beyond control such as weather, labor disputes or strikes or other unavoidable events.

The act of selling property under a compulsion as to time and frequently the result of legal proceedings ordering the sale.

The loss of money or something of value resulting from the failure to perform.

See Uniform Residential Appraisal. Report (URAR).

A building containing four dwelling units in comparison to a duplex with two. Many FHA loan programs are available for 1-to-4-unit housing.

An appraisal rule for computing value based on the depth factors of lots primarily in retail environments.

An ownership interest of some but not all real estate rights. Examples include, leasehold, easement and hunting rights.

A real estate sale that is clear fee simple estate that is unclouded by any encumbrances such as liens, mortgages, etc

An estate such as a fee simple or life estate of a duration that runs forever and its end cannot be determined.

An important property valuation concept used mainly in retail or commercial situations due to the belief that the more frontage certain businesses have is an advantage and whereby a property is identified by its number of linear front feet facing the most important street or road surrounding the property and with imaginary parallel lines one foot apart extending the full depth of the lot resulting in a 75-foot frontage.

Pronounced “fizzbo.” See For Sale By Owner

A requirement to reveal all material facts pertinent to a transaction. Example: Under fill disclosure, a broker is required to give the buyer all known material facts about the physical, financial, and economic condition of the subject property..

The rate of interest stated in the debt. See Nominal interest rate

A note that is fully repaid at maturity by periodic reduction of the principal..

In adjustable rate mortgages this is the rate at the time of the loan application which is agreed upon termed indexed to which the gross margin stated in the note has been added.

A loss of value due to adverse factors from inside the property lines such as defects in the plan or design which affect how well the property can be used, function or perform which affects its value and marketability.

A loan concept whereby the lender provides the cash for for the seller to be paid. Example: When a loan is approved, the lender issues a commitment to make the loan at certain specified terms. At closing, the lender funds the loan by forwarding sufficient cash..

The cash or other resource having value which may be sold in order to buy another asset.

(FF&E) A term frequently found in the ownership of a hotel or motel that wears out much more rapidly than other the components so an owner or prospective buyer needs to establish the condition, cost, and frequency of replacement of the FF&E. Example: In measuring the profitability of a hotel, a real estate appraiser subtracted 3% of total revenues to provide for the eventual replacement of FF&E. The useful life of FF&E in a hotel was estimated at 7 years..