A financial arrangement where at the time of sale, the seller gets cash and retains occupancy by concurrently agreeing to lease the property back from the buyer and becomes the lessee. The buyer gets a fixed return on his or her investment plus gets a known tenant and becomes the lessor.

A sale and leaseback transaction in which the lessee has the option to buy back his or her original property after a specified period of time.

One of the three appraisal methods where an estimate of value is obtained by comparing the property being appraised with actual recently-sold comparable properties. Previously known as the Market data approach and the Market comparison approach. See Income approach and Cost approach.

A contract by which a buyer and a seller agree to the terms to the sale of real property.

In brokerage, an agent's commissions, advertising costs and costs incurred in the sale are examples of common expenses.

A person who holds a salesperson license and is employed by a real estate broker.

In computing depreciation for tax purposes, the reasonably anticipated fair market value of the property at the end of its useful life after being fully depreciated which must be considered with all methods of depreciation except for the declining balance method.

A leasehold interest that exists when subleasing property that is between the primary lease and the operating lease when the holder of a sublease in turn sublets to another, his or her position is that of being sandwiched between the original lessee and the second sub-lessee.

(S&L) A state or federally chartered thrift institution that specializes in making residential mortgages.

A fund managed by the FDIC that insures deposits in savings and loans which is the successor to the former FSLIC. See Federal Savings and Loan Insurance Corporation.

A type of bank which receives savings in the form of the deposits in mortgages and other securities allowed by law and which are mutual institutions and usually are governed by a self-perpetuating board of trustees.

1. A mortgage loan made to secure a loan to make home improvements or some other related purpose.

2. A mortgage loan given by a buyer to generate enough capital to make the down payment required under the first mortgage loan.

A mortgage or trust deed that is securing a loan that is in addition to the first mortgage on the property, which makes it a second mortgage, and where others could be added which would make them a third, fourth, fifth or sixth mortgage or trust deed, but they are still referred to as a second mortgage.

A market for the purchase and sale of existing mortgages, designed to provide greater liquidity for mortgages; also called the secondary money market. Mortgages are first originated in the primary mortgage market.

The funds given as collateral by a tenant so that at the termination of the lease the leased property can be restored to its original condition if necessary.

A Uniform Commercial Code term which replaces such terms as chattel mortgage, pledge, trust receipt, chattel trust, equipment trust, conditional sale, inventory lien, etc. that is used to designate the interest of a creditor in the property of a debtor in all types of credit transactions

Entity that has legal possession, (ownership) of any interests, benefits or rights inherent to the real or personal property. The person(s) or company that owns a property, or debt instrument and wants to sell it.

A financing arrangement whereby the owner acts as the lender for the buyer until he or she can qualify and obtain financing from an instutional lender.

The economic market condition that exists when a seller is in a more commanding position as to price and terms because of a limited number of properties being available and the demand from users and potential users exceeds the supply.

A licensee who actually gets a buyer into contract for a property. Do not confuse a selling agent with the seller's agent who is normally the listing agent.

The property owned by a husband or wife in his or her own right outside of the community interest including property acquired by the spouse (a) before marriage, (b) by gift or inheritance, (c) from rents and profits on separate property or (d) with the proceeds from other separate property.

A counterclaim or cross-demand charged by a defendant against the claim of a plaintiff in an action seeking money damages.

The distance from curb or other established line on which nothing may be erected.

A law that requires improvements not be built on property within a specified distance from the property line, street or curb.

The process at the closing of a sale of real estate negotiated by a real estate broker whereby the broker accounts to his or her principal for the earnest money deposit and deducts commission and advances by use of a form of settlement statement. See Closing.

The ownership of real property by one party or person.

See Sole ownership.

The act of (literally) cutting or removing something from the land that is attached such as removing shrubs from a property or the taking of a part of a parcel of land for another use.

The loss in value caused by cutting or removing something from the land such as the damage resulting from the taking of a fraction of a whole property that lowers its utility and the remaining value in the land due to the fractional taking.

The interest computed only on the principal amount of a loan. See Compound interest.

the issuance of owner's and lender's policies of title insurance at the same time. Such issuance often carries a discount to the premium payer.

A situation in which a licensee/agent represents either the buyer or the setter in a real estate transaction - but never both.

A dwelling designed for occupancy by one household only.

See Indirect costs.

A property owned by only one party or person. Also known as Severalty ownership.

A mortgage that provides for only interest payments and where the entire principal falls due in one payment at the maturity of the loan.

A statement in a deed or other sales contract that confirms the fact that the purchaser actually gave something of value for the property.

The commonly-used identifying term for various statutes which require that a legal action be begun within a prescribed time after acquiring the right to seek legal relief.

A term pointing to the laws created by the enactment of legislation as opposed to law created by court decisions.

The giving of private land for public use under a procedure established by statute.

A lien, such as a real estate tax lien, granted to a party by a statute or operation of law.

The time period granted to a delinquent borrower to pay up and cure his loan deficiencies before his property can be permanently taken away.

The legal right under state law granted for a limited period of time for a mortgagor to redeem or buy back the title to his or her real property after a foreclosure sale has taken place by paying the full amount of the debt plus any costs involved to the lender.

A short-term warranty deed outlined by state statutes which to protect the buyer warrants by inference that the conveyor is the undisputed owner and has the right to convey the property and will defend the title against all claims if necessary and if the conveyor fails to do so the new owner can defend the claim and sue the former owner. See Warranty deed.

The illegal practice of channeling home seekers to particular areas, either to maintain the homogeneity of an area or to change the character of an area, which limits their home choices.

A lease that increases the rental rate at specified times during the lease term. Also know as a Graduated lease.

A classification of specific property holding a negative reputation, which varies significantly from state to state, as a result of an event that occurred on or near it such as murder, death, illness, personal tragedy or gang-related activity. Most states have very strict rules regarding what can and cannot be disclosed about stigmatized property.

In accounting, a method of decreasing the value of an asset for tax purposes by which the cost of improvements are reduced at a constant rate and in equal amounts throughout the estimated useful life of the improvement. See Depreciation.

The action taken by a court upon determining that sufficient time has elapsed and the mortgagor has not paid that which is past due, which terminates all rights and interests of the mortgagor in the real property and which orders a forced sale of the property to pay the mortgage creditors.

A party being held responsible to an injured party without any excuses.

The relationship under which a person becomes an agent and the powers of an agent have been conferred not directly by the principal but by his or her agent and who has been as authorized to do so by the principal. A once common relationship under a Multiple Listing Service (MLS) it is now rarely practiced due to dual agency issues. See Dual agency.

A person upon whom the powers of an agent have been conferred not directly by the principal but by his or her agent and who has been as authorized to do so by the principal.

An area of land regulated by state law that is divided into parcels or lots that are suitable for building and having the eventual goal of sale, lease or financing..

The municipal ordinances that establish subdivision and development requirements.

The property under consideration and being appraised.

See Subject to mortgage.

To execute a lease by a lessee to a third party that conveys his or her estate to a “sub” estate for part or all of the lessee's remaining term.

The leasing of a premise by a lessee to a third party for part or all of the lessee's remaining term. See Assignment.

An agreement by the holder of an encumbrance against real property to permit his or her claim to take an inferior position to other encumbrances against the property often such as with construction loans.

A clause in a first trust deed that permits it to be subordinated to subsequent liens such as construction loan liens and sometimes in a junior or a second lien permitting it to hold priority over prior liens.

A loan that is offered at a rate above prime to individuals who do not qualify for prime rate loans. Subprime loans tend to have a rate that is 0.1% to 0.6% higher than the prime rate. Although the additional percentage may seem small, for mortgages and other large loans, this translates to thousands of dollars worth of additional interest payments.

The replacing or substituting of one person with another in regard to a legal right or obligation such as in place of the creditor to whose rights he or she succeeds in relation to the debt. The doctrine is used when one person agrees to stand to guarantee another person's performance of a contract or the payment of an insurance contract claim.

The housing for low- and moderate-income families in which rentals are paid in part by the government or in which the government pays a portion of the developer's loan interest costs so that he or she can charge lower rentals.

In real estate, a grant by government that eases the financial burden of holding, using or improving real property. 1. A direct subsidy is a subsidy which is of direct, visible benefit to the recipient, such as a cash grant. 2. An indirect subsidy is a subsidy whose benefit is felt indirectly, such as tariffs or farm price supports which may affect the land values in a particular area.

The funds provided typically by a builder or seller to temporarily reduce a borrower's monthly principal and interest payments.

The ownership rights a parcel of real estate has to the water, minerals, gas, oil that is beneath the surface.

A development of real estate in areas surrounding the central area of a city.

The legal act or right of acquiring property by descent or also succeeding to an asset by will or inheritance.

A party who follows or comes after such as a buyer of a business who becomes the seller's successor.

The liability that a buyer of a business might have for nonpayment of sales taxes by the seller.

The interest that an owner has when a tenant holds over without the owner's consent after the expiration of a lease. See Estate at sufferance.

A means by which conveyed real estate can be identified in a deed so that it will legally hold up in court.

A law suit initiated by a landlord to evict a tenant from leased premises after the tenant has breached the terms of the lease or has retained possession after the lease has expired.

A legal action intended to establish, settle or remove a cloud on the title of a particular property.

The ownership rights in a parcel of land that are limited to the surface of the property and do not include the air rights above it or the subsurface minerals below it.

A short-term loan enabling the purchaser of a property to purchase another property before receiving the cash equity from the property he or she is selling.