General Glossary of Real Estate Terms PDF

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Real Estate Dictionary 1031 Exchange The Internal Revenue Code Section that allows a taxpayer to sell an investment property and purchase another investment property in its place without paying capital gains on the proceeds...

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Real Estate Dictionary 1031 Exchange The Internal Revenue Code Section that allows a taxpayer to sell an investment property and purchase another investment property in its place without paying capital gains on the proceeds from the sale. Also called Like-Kind Exchange or Tax-Deferred Exchange. A Abandonment Non-payment of taxes. Absolute Auction An auction where the property is sold to the highest qualified bidder; there is no minimum bid or reserve or right of confirmation. Also called Without Reserve. Abstract of Title A brief, chronological summary of the recorded documents affecting title to a particular parcel of real property. Acceleration Clause A contract clause that gives the lender the right to declare all outstanding payments immediately due upon a default by the borrower. Acceptance When a party agrees to the terms of an offer to enter into a contract, thereby creating a binding contract. Accession The acquisition of title to land by its addition to real estate already owned, through human actions or natural processes. Accounting In an agency relationship, the agent's fiduciary duty to the principal to strictly account for all monies received. Accretion A gradual addition to dry land by the forces of nature, as when the tide deposits waterborne sediment onto shoreline property. Accrued An accumulation. Accrued Expense Item on a settlement statement for which the cost has been incurred, but the expense has not yet been paid. Such expenses are considered to be paid in arrears. Acknowledgment Recognition of validity; a document signer's declaration to an authorized official (usually a notary public) that he is signing voluntarily. Acre A measure of land area that is equal to 43,560 square feet. One square mile contains 640 acres. Actionable Fraud Fraud that meets certain criteria, so that a victim can successfully sue. The victim must prove the defendant concealed material facts or made false statements (intentionally or negligently) with the intent to induce the victim to enter a transaction, and the victim was harmed by relying on misrepresentations. Actual Eviction The legal process of forcing someone off of a property or preventing someone from re-entering the property. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Actual Fraud An intentional misrepresentation or concealment of a material fact; when a person actively conceals material information or makes statements that he knows are false or misleading. Actual Notice Personal knowledge of a fact, rather than knowledge imputed or inferred by law. Ad Valorem Latin phrase meaning “according to value,” used to refer to taxes assessed on the value of property. Adequate Consideration Consideration that is comparable in value to the consideration the other party to the contract is giving. Adjustable Rate Mortgage (ARM) A type of loan structure that permits the lender to periodically change or vary the interest rate charged, based on a standard index. Administrator A person appointed by the probate court to manage and distribute the estate of a deceased person when no executor is named in the will or there is no will. Adverse Possession The open, notorious, hostile, adverse, exclusive, and continuous possession of another person's property for a statutory number of years, after which time the adverse possessor may seek to obtain title to the property. Advertisement A public notification in any type of media featuring property for sale or rent or marketing brokerage services; must follow guidelines of federal, state, and local fair housing laws. Affidavit of Title A statement, sworn in front of a notary public or other authorized official, by the seller or grantor of property that identifies the grantor, identifies the grantor’s marital status, and certifies that the grantor has no new judgments, liens, divorces, unrecorded deeds, or other potential title defects since the title examination was completed. It also certifies that the grantor is indeed in possession of the property. Affiliated Business Arrangement (AfBA) A situation where a person in a position to refer settlement services—or an associate of that person—has either an affiliate relationship with or a direct or beneficial ownership interest of more than 1% in a provider of settlement services and who then refers business to that provider or in some way influences the selection of that provider. Agency A relationship of trust created when one person (the principal) gives another person (the agent) the right to represent the principal in dealings with third parties. Agency Coupled with an Interest A situation in which the agent has a personal interest in the subject of the agency, as when one co-owner has been authorized by the others to sell their property. Agent A licensed broker who represents another (the principal) in a real estate transaction; a person authorized to represent the principal in dealings with third parties (clients or customers). Aggregate Rent The total rent for the full term of the lease. Air Rights The right to undisturbed use and control of the airspace over a parcel of land (within reasonable limits for air travel); may be transferred separately from the land. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Alienation The transfer of ownership or an interest in property from one person to another, by any means. Alienation Clause A mortgage clause allowing the lender to demand the full and immediate payment of the mortgage because the owner transferred or pledged to transfer ownership of the property. Also called Due on Sale Clause. Allodial System The system of land ownership that allows anyone to own land. Alluvion Solid material deposited along a shore by accretion. Also called Alluvium. Amenity A tangible or intangible feature that enhances or adds value to real estate. Amenity Purchaser A person who values a property based on its ability to fulfill their specific business needs or use, unlike investors who value a property based primarily on its investment return. American Land Title Association (ALTA) A national association of title companies, abstractors, and attorneys. Members agree to promote uniformity, quality, and professional standards in title insurance policies. Policies issued by ALTA members follow specific guidelines. Americans with Disabilities Act (ADA) A wide-ranging federal civil rights law, signed in 1990, that prohibits, under certain circumstances, discrimination based on disability. Amortization Occurs when a loan balance decreases because of periodic installments paid on the principal and interest. Amortized Loan A financial debt that is paid off over a period of time by a series of periodic payments. A loan can be fully amortized or partially amortized requiring a balloon payment to satisfy the debt at the end of the term. Amperage Amount of electricity going through electric wires, measured in amperes (amps). Anchor Tenant Major department or chain store strategically located at shopping centers to give maximum exposure to smaller satellite stores. A center may have several anchor tenants. Also called Magnet Store. Annexation Attaching personal property to land so that it becomes a fixture and the law views it as part of the real property. Annexation, Actual The process of physically attaching personal property to land, causing it to be a fixture. Annexation, Constructive Personal property associated with real property in such a way that the law treats it as a fixture, even though it is not physically attached to the real property. Annexer A person who owns an item as personal property and brings it onto real property, making it a part of the real property. Annual Percentage Rate (APR) Relationship between the total cost of borrowing and the amount financed, represented as a percentage. Also called Effective Rate of Interest. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Anticipation An economic principle that says value is created by the expectation of future benefits, such as profit on resale, pleasure, tax shelter, production, income, etc. Anticipation is the foundation of the income approach. Anticipatory Repudiation When one party to a contract informs the other before the set time of performance that he or she doesn’t intend to perform as agreed. The other party may immediately file a lawsuit for breach of contract without making a tender offer. Also called Anticipatory Breach. Antitrust An area of federal law concerned with maintaining competition in private markets by prohibiting unlawful restraint on trade. Appraisal A professional estimate or opinion of the value of a piece of property (parcel of land), as of a certain date, that's supported by objective data. Appraisal Foundation Nonprofit organization recognized as the authority for professional appraisal standards. Appraisal Management Company (AMC) An entity that, for compensation, acts as a third party intermediary by contracting with independent real estate appraisers to perform appraisals for lenders. Appraiser A person who estimates the value of property, especially an expert qualified to do so by education and experience. Appreciation The increase in value of an asset over time. Appropriative Rights Water rights allocated by government permit, according to an appropriation system. It is not necessary to own property beside the body of water in order to apply for an appropriation permit. Appurtenance A right that goes along with ownership of real property; usually transferred with the property but may be sold separately. Arbitration An alternative to a court proceeding where the parties agree to submit facts and evidence to an impartial third party for a decision. Area Variance Entitles landowners to use land in a way that is typically not allowed by the dimensional or physical requirements of the zoning law. Arm’s Length Transaction A transaction that occurred under typical conditions in the marketplace, with each party acting in their own best interest. Arrears 1. Owing payment on things for which one has the use of but has not yet paid for, such as property taxes or mortgage interest that is paid in arrears. 2. Not on time; late in making payments or completing work. As of Right Zoning A property owner’s right to use or develop the property if the proposed use accords with the zoning by-laws. Asbestos A fibrous material that was once common in many building materials because of its insulating and heat-resistant properties; can cause breathing issues and illness when particles are inhaled. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Ascending Bid An auction method where the bidding starts low and the auctioneer asks for more, allowing buyers to bid more until the item is sold to the highest bidder. As-Is Clause A statement in a contract that indicates the property is being sold without warranty in its present condition at the time of the contract. Assemblage The act of combining two or more parcels of land into one larger parcel. Assessed Value The value placed on a property by a taxing authority for the purpose of taxation. Asset An item of economic value owned by an individual, especially those that can be converted to cash. Asset Class A grouping of investments that have similar characteristics and are subject to the same laws and regulations. Assignment The transfer of rights or interests under a contract to another party. Assignment of Mortgage A situation in which the lender (mortgagee) transfers its rights under the agreement to another party (assignee), who receives the right to enforce the agreement's terms against the borrower (mortgagor). Assistance Animal An animal that provides emotional or physical support to an individual with a disability, lessening the effects of the disability. Also called Emotional Support Animal. Association Fees Monthly dues collected by homeowners associations from property owners to pay for common area expenses such as utilities, management, building maintenance, hazard and liability insurance, and amenities. Assumable Loan A financing arrangement in which a borrower transfers their outstanding loan and its terms to a subsequent buyer; requires the approval of the lender. Assumption When one party takes over the payments and primary liability for the loan of another party; usually lender approval is needed. A release is needed; without one, the original party remains secondarily liable for the loan. Attachment Lien A lien acquired on property by a creditor in order to prevent property transfer pending the outcome of litigation. Attestation The act of witnessing a person’s signing of an instrument by a notary public. Attorney-In-Fact A person specifically designated in an instrument (e.g., power of attorney) to act on behalf of another, but not necessarily authorized to practice law. Attorney's Opinion of Title A statement issued by an attorney after analyzing an abstract as to the quality of the title. Attornment An act in which tenants acknowledge their obligations to a new landlord. Auctioneer A person licensed or authorized to conduct a public auction of item(s) belonging to someone else. In some states, auctioneers selling real property must be licensed as real estate brokers, whereas in others they must be licensed auctioneers. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Automated Clearinghouse (ACH) A settlement system used for financial transactions by U.S. commercial lenders; a nationwide network to exchange paperless payments among financial institutions and government agencies. Automated Underwriting A computerized evaluation of a borrower’s creditworthiness, based on statistical models. Avulsion A natural process in which land is removed from one person’s property and deposited onto another’s. Avulsion happens very suddenly, as in a flash flood. B Backup Offer An offer made and accepted, after another offer has been accepted, that is contingent on the failure of the first contract. Bad Title Title with defects making it unmarketable. Bait and Switch A deceptive sales technique that involves advertising to a consumer a particular product, service, or rate, then persuading the consumer to accept something else. Most states have consumer protection laws that make this tactic illegal. Balance (Four Factors of Production) The right mix of capital, entrepreneurship/management, labor, and land that results in the best return on investment from land (remember: C-E-L-L). Balance Sheet A financial statement (such as a property management report) that lists assets, liabilities, and ownership equity at a specific moment in time. Balloon Framing A technique of framing where the long vertical pieces (studs) are installed in a continuous piece from foundation to roofline. Balloon Payment A lump-sum payment made at the end of a loan term to pay off the remaining balance of principal and interest that was not covered by payments during the loan term. Bankruptcy A court process that cancels some debt and provides some relief for creditors. Chapter 7, sometimes called straight bankruptcy, is a liquidation proceeding; Chapter 13, sometimes called a reorganization proceeding, is filed by individuals who want to pay off their debts over a period of three to five years. Bargain and Sale Deed A type of deed that implies that the grantor owns the property and has the right to convey it, but there are no warranties that go with it. Base Rent The minimum amount of rent indicated in a lease. Base Year A period for determining a property’s actual operating expenses, typically over the first year of a lease term, which is used as the point of reference against which increases in subsequent years are compared and then passed on to the tenant. Baseline The principle east-west line (i.e., a parallel) upon which all rectangular surveys in a defined area are based. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Basic Sector The segment of a local economy that is made up of businesses and industries that bring income into the local economy by selling goods or services to consumers outside the community. Basis Point One hundredth of one percent, used chiefly to express differences in interest rates. Beam A long piece of timber or metal that spans an opening or part of a building and provides support to a roof or floor above it. Beams are installed horizontally. Benchmark A bronze disk permanently placed and precisely identified by government survey teams. Beneficiary One who receives a benefit; in real estate, the lender in a trust deed. Bilateral Contract A contract in which both parties make a binding promise to the other. Bill of Sale A document used to transfer ownership of personal property from one person to another. Binder A non-binding document used to communicate the terms of a buyer’s offer to purchase property; serves as a blueprint for creating a purchase agreement. Biweekly Payment Plan A fixed-rate mortgage set up like a standard 30-year conventional loan, but payments are made every two weeks instead of every month. Blanket Mortgage A mortgage loan that covers more than one parcel of real estate, usually used to finance entire subdivision developments rather than an individual unit or lot. Blind Advertisement A real estate advertisement used by a licensee regarding the sale or lease of real estate or of licensed activities that does not include the broker's name or business name. Prohibited in most states. Blockbusting The illegal practice of inducing owners to sell their homes (often at a deflated price) by suggesting the ethnic or racial composition of the neighborhood is changing, with the implication that property values will decline as a result. Also called Panic Selling or Panic Peddling. Blue Sky Laws State laws regulating the sale of securities; intended to protect consumers from fraud. Blueprint A detailed diagram, usually created by an architect, which is used to evaluate design, determine feasibility, and guide the construction of a structure. Boilerplate Standardized language used in contracts for the sake of efficiency and completeness. Book Value The value of an asset, such as real estate or equipment, as indicated in the company’s financial records (may differ from market value). Boot Extra, non-like-kind property that can be a part of a like-kind exchange to make up for pricing disparity between like-kind properties. Bounds Refers to boundaries; used with the word “metes” in the metes and bounds method of land description. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Boycott A concerted refusal by two or more people to deal with a particular person or company. Breach Violation of an obligation, duty, or law. Breach of Contract An unexcused failure to perform according to the terms of a contract. Breach of Trust The failure by someone entrusted with care or property of others to discharge the duties imposed on them under the terms of an agreement or other obligation; may be malicious or due to negligence or carelessness. Breakdown Method Estimating physical depreciation by estimating all items of depreciation individually and then adding the individual estimates together and deducting the sum from the estimated reproduction or replacement cost. Bridge Mortgage A mortgage loan that occurs between the termination of one mortgage and the commencement of another. When the next mortgage is taken out, the bridge is repaid. British Thermal Unit (BTU) The amount of heat needed to raise the temperature of one pound of water by one degree Fahrenheit; used to measure the capacity of furnaces and air- conditioning units. Broker A real estate licensee with several years of experience who has received advanced training and passed a broker exam. Broker Price Opinion (BPO) The estimated value of a property as determined by a real estate licensee or other qualified individual, often done at the request of a lender for non-federally related property transactions. Broker Protection Clause A provision in an agency agreement that entitles the broker to a commission if the property is sold during a certain time period after the agency agreement expires. Also called Carryover Provision or Extender Clause. Brokerage A firm with real estate licensees who may be retained by consumers to negotiate the purchase, sale, and lease of real property Broker-Dealer A person or organization that engages in the business of trading securities, such as stocks and bonds, for its own account or on behalf of its customers. Brownfield A former industrial or commercial site where future use is affected by real or perceived environmental contamination. Budget Mortgage A mortgage agreement where payments include principal and interest on the loan, plus 1/12 of the year's ad valorem property taxes and hazard insurance premiums. Buffer Zone A means by which planners use space to separate two adjoining districts which have incompatible uses. A buffer zone consists of uses that are compatible with uses in each adjoining district. Building Code A set of regulations, written by city or county officials with the help of construction professionals, that governs design and construction standards and requires builders to use particular methods and materials. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Building Department An agency responsible for issuing building permits and seeing that building codes are followed and that construction and renovations are performed by licensed professionals. Building Efficiency The ratio of usable square footage to rentable square footage. Building Inspection A process whereby local government officials ensure compliance with state and local building codes. Building Permit An official document from a local government or other authority that allows a construction or remodeling project to proceed. Bump Clause A provision in a purchase agreement that allows the seller to keep the property on the market while the prospective buyer's purchase is contingent on the sale of the buyer’s property. Bundle of Rights All real property rights that are conferred with ownership, including the right of possession, right of quiet enjoyment, right of disposition, right of exclusion, and right of control. Also called Bundle of Sticks. Buyer Agency Agreement An employment contract between a buyer and a broker that grants the broker the right to represent the buyer in the purchase of property and stipulates the terms under which the broker will be compensated. Also called Buyer Broker Agreement. Buyer’s Agent A real estate licensee who represents the interests of the buyer of a property. Buyer’s Choice A type of auction for multiple parcels where the winning bidder gets to select which of the parcels they want. Buyer’s Market A situation in the housing market where there are many homes available for sale, but few people looking to buy. Buyer’s Premium A compensation structure in which the winning buyer at an auction pays the auctioneer/auction company, generally a percentage of the high bid in addition to the bid amount. Bylaws Homeowners association rules and regulations that govern property owners' activities, including rules for elections and voting, and frequency of board of directors’ or shareholders’ meetings. C Cancellation Termination of a contract without undoing acts that have been performed under it; can be done without going to court. CAN-SPAM Act A federal law enacted to limit unsolicited commercial email and text messages, requiring senders to provide an opt-out option. Cap The maximum increase in the interest rate, or the maximum interest rate, that a lender can charge on an adjustable-rate mortgage. Capital Expense A cost incurred to improve a property with the expectation of long-term benefits; an investment in the business of the property. Also called Reserves for Replacement. Capital Gain Profit made from an investment. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Capitalization Used in the income approach to value. To capitalize income means to convert future income into present (current) value. Capitalization Rate The rate of return considered to be a reasonable return on investment given the risk. Carbon Monoxide A colorless, odorless gas that is a natural byproduct of fuel combustion and is dangerous when inhaled. Cash Flow A measure of the money being transferred into and out of an investment, calculated as net operating income minus debt service. Cash to Close The amount of money a buyer must bring to settlement to close the transaction after all credits and debits have been reconciled. Cash-on-Cash Return The yield of an investment expressed as a percentage by dividing the investment’s cash flow by the total amount expended to acquire the property. Caveat Emptor A Latin phrase meaning “Let the buyer beware;” implies that a purchaser is expected to examine property carefully instead of relying on seller disclosures. CC&Rs A declaration of covenants, conditions, and restrictions; usually recorded by a developer to create private restrictions for a subdivision or condominium community. Cease and Desist Order An administrative agency directive to stop an offending activity. Ceiling The maximum increase or decrease in the periodic payment allowable over the life of an adjustable-rate mortgage. Also called Lifetime Cap. Ceiling Height The height in feet from the floor to the steel girders. Also called Feet Under Steel. Certificate of Eligibility (COE) A document issued by the Department of Veterans Affairs to establish status and amount of a veteran’s eligibility to qualify for a loan guarantee. Certificate of Occupancy A document issued to builders after all inspections have been made and the property is deemed fit for livability by meeting the appropriate standards for health and safety. Certificate of Permanent Location A document recorded in the county in which a manufactured home has been permanently affixed to real property with common ownership between the land and the home. Certificate of Purchase A document that is given to the winning bidder of a real estate tax or foreclosure sale. Once the sale is confirmed, a deed will be issued to convey title. Certificate of Title 1. A document prepared by an attorney, title company, or title abstractor stating their opinion of the status of the title to a piece of property after performing a title search and reviewing the public records. Also called Opinion of Title. 2. A document proving ownership of a vehicle. Chain of Title The chronological succession of changes in ownership of a piece of property from one owner to the next, as disclosed in the public record. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Change A principle of value that says all factors that influence real estate—physical, economic, governmental, social (P-E-G-S)—are constantly changing and, thus, property value itself is subject to constant change as well. Chant The way in which an auctioneer verbally communicates to engage and inform prospective bidders, indicating the current bid and the desired bid. Charrette An intense work effort in which a team of design professionals across multiple disciplines works with community stakeholder participants within a highly focused, compressed timeframe to develop a plan. Chattel A piece of personal property. Chattel Mortgage A loan that uses only personal property as security. Chlorofluorocarbons (CFCs) Nonflammable chemicals once used in refrigeration systems and linked to depletion of the ozone layer. City Planning The effort on the part of the city to coordinate, direct, and control the type of development taking place so as to ensure maximum benefits to the populace. Civil Rights Fundamental rights guaranteed to all persons by the law, primarily in reference to constitutional and statutory protections against discrimination based on protected class status. Civil Rights Act of 1866 A federal law prohibiting discrimination based on race and color against all native-born Americans in all property transactions (personal, commercial, residential), without exception. Clearspan Open distance between inside faces of support members. Client A person being represented by a licensee. Also called Principal. Closing The transfer of real property ownership from seller to buyer, according to terms and conditions in a purchase agreement or escrow instructions; the final stage in a real estate transaction. Also called Settlement. Closing Costs The expenses incurred and paid at the time of settlement in the transferring of property. Closing Disclosure A standardized document that presents a final, detailed accounting for a real estate transaction, listing each party’s debits and credits and the amount each will receive or be required to pay at closing; required for all RESPA-related transactions. Also called Settlement Statement. Cloud on the Title A claim, encumbrance, or defect that could place the title to real property in question, reducing its marketability. Cluster Zoning A method that allows developers to provide a varied selection of lot sizes and housing choices within a single area. Code of Ethics A set of principles and standards based on core values by which a group of professionals are expected to conduct themselves. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Co–Insurance A common clause or provision in building insurance policies under which the insured agrees to maintain insurance on their property in an amount equal to at least 80% of the replacement cost. If the property is not insured to that amount and a loss is incurred, the insurance company will make the insured share in the loss on a pro–rata basis. Cold Calling The practice of making unsolicited phone calls to possible customers with whom there is no prior relationship or inquiry. Collateral Property pledged as security for a debt. Collusion Secret agreement or cooperation among people, especially for deceitful or fraudulent purposes. Combined Loan-to-Value (CLTV) The relationship between the unpaid principal balances of all mortgage loans and the appraised value or sales price, whichever is lower, of the property. Commercial Banks The largest financial intermediaries directly involved in the financing of real estate. Their primary real estate activity involves short–term loans. Commercial Property Property zoned and used for business purposes, such as warehouses, restaurants, and office buildings (as distinguished from residential, industrial, or agricultural property). Commercial residential property has five or more units. Commingling Illegally mixing personal or business funds with money held in trust on behalf of a third party. Commission Compensation paid to a broker for services in a real estate transaction; usually a percentage of the sales price. Commission is negotiable and should be clearly spelled out in a written brokerage agreement. Commission Association Manager Provides a large range of services for communities, typically tailoring those services to the needs of an individual community. Common Area Maintenance (CAM) All costs incurred in maintaining the common areas of a commercial property, including parking lot sweeping and repair, snow removal, common utilities, landscaping, and other maintenance tasks. CAM costs are usually prorated among all tenants. Common Areas The land and improvements in a condominium or cooperative that all residents use and own as tenants in common, such as the parking lot, hallways, and recreational facilities. Common Interest Ownership A situation where individual ownership (fee simple) and group ownership (tenants in common) are present in the same community subject to an owners association. Common Law Law that has developed over many years through court decisions and other precedents. Community Property In some states, property acquired during marriage that is owned jointly by the married couple. Comparables Recently sold properties with similar characteristics (size, room count, design, utility, etc.) that are in close proximity to the property being valued. Also called Comps. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Comparative Unit Method A method for determining the replacement cost of a building based on the cost of recently built comparable buildings. Compensation Valuable consideration given by one person or entity to another person or entity in exchange for the performance of some activity or service. Compensatory Damages An award of damages intended to compensate a plaintiff for harm caused by the defendant’s act or failure to act, including personal injuries, property damage, and financial loss. Competency The ability to do something successfully or efficiently. Competent Parties Those who are legally capable of entering into contracts. Competition The act or process of trying to obtain or win something that others are also trying to obtain or win. Competitive Market Analysis (CMA) A method of determining the probable selling price of a property by comparing it to similar properties that have sold, are presently for sale, or did not sell in a given area. Also called Comparative Market Analysis. Complaint A formal allegation, generally in writing, accusing someone of misdeeds, usually to formally begin a legal or administrative action. Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) A federal law enacted by Congress in 1980 to provide broad authority to respond directly to releases or threatened releases of hazardous substances that may endanger public health or the environment. Also called Superfund. Comprehensive Loss Underwriting Exchange (C.L.U.E.)® Report A report available from Lexis/Nexis® that tracks insurance claim history on real property and automobiles. Comprehensive Plan A long-term plan (e.g., 20 or 30 years) prepared by a local planning board that identifies the goals, objectives, principles, guidelines, policies, standards, and strategies for the growth and development of a community, including its housing needs. Also called Master Plan. Concealment Failing to disclose or intentionally hiding information that is material to a decision by a party. Conciliation A mediation between two parties to settle a dispute and/or seek voluntary compliance in an attempt to avoid a legal court case. Condemnation The legal proceeding of taking private property for public use, through the government’s power of eminent domain. Condemnation is the action; eminent domain is the right. Also called Appropriation. Condition Provision in a deed or other document that makes the parties’ rights and obligations dependent on the occurrence or non-occurrence of some event. Conditional Approval A lender's agreement to fund a loan, provided certain contingencies are met. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Conditional Use A land use that does not comply with the general zoning rules for the zone in which it is located, but is permitted because it benefits the public, such as allowing a hospital in a residential neighborhood.. Also called Special Exception or Special Use. Condominium A property developed for co-ownership, with each co-owner having a separate interest in an individual unit, combined with an undivided interest in the common areas of the property and air space consisting of the area between the walls, floor, and ceiling. Condominium Declaration The document that developers must file in the public record when they develop or convert existing property to a condominium; specifies common and private spaces lists easements, and describes the land, bylaws, and house rules. Confidentiality A duty that requires an agent to protect the client’s confidential information (this duty lasts even after the agency relationship has terminated). Conforming Loan A loan that meets the qualifying standards of Fannie Mae or Freddie Mac, and thus can be sold on the secondary market. Conformity The principle of value that says a particular property achieves its maximum value when surrounded by properties similar in style, function, and utility. Also called Homogeneity. Consent Decree A binding agreement reached before judgment in a court case by which the accused party consents to change its behavior without admitting wrongdoing. Consideration Anything of value—such as money, goods, services, or promises—that is given to induce another person to enter into a contract. Also called Valuable Consideration. Construction Loan A temporary loan used to finance the construction of improvements and buildings on land. Constructive Eviction Occurs when a landlord does not physically or legally evict a tenant but takes actions that interfere with the tenant's use and enjoyment of the premises; may provide legal cause for a tenant's release from the lease. Constructive Fraud Concealment of a material fact; when a person carelessly fails to disclose material information or makes statements that they should realize are false or misleading. Constructive Notice Knowledge of a fact imputed to a person by law because they could have or should have known it, even if they did not actually know it; this includes notice given by recording a document in the public record or by taking physical possession of property. Consumer A person or entity seeking or receiving licensed activities. Consumer Financial Protection Bureau (CFPB) An independent government agency within the Federal Reserve System, established under Title X of the Dodd-Frank Act, with rulemaking and enforcement authority regarding many consumer financial laws. Consumer Price Index (CPI) An index published monthly by the United States Bureau of Labor Standards (BLS) considered by many to be the basic indicator of inflation in the U.S. Contemporaneous Offers Competing offers submitted by the same buyer agent on behalf of competing buyers for the same property; requires disclosure to the buyer clients. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Contingency A provision in a contract, deed, law, regulation, guideline, etc. that makes the parties’ rights and obligations depend on the occurrence (or nonoccurrence) of a specified event. Also called Condition, Escape Clause, Subject to Clause, or Kick-Out Clause. Continuation A title search performed just prior to settlement to bring a preliminary title report up to date and ensure that no intervening rights to the property have arisen. Also called Bring- Down or Continuance. Contract An agreement between two or more parties to do, or not do, something; a legally enforceable promise, with the law providing remedies for breach. Contract for Deed An installment contract in which the seller passes possession but retains title to the property until the total or a substantial portion of the purchase price is paid. The two parties are the vendor (seller) and the vendee (buyer). Also called Land Contract, Agreement for Sale, or Installment Sales Contract. Contract Rent What tenants are actually paying in rent, as stated in the terms of the lease. Contractual Capacity The legal ability to enter into a contract. Contribution The economic principle that a specific item or feature of a property is worth only as much as it increases the value of that parcel of real estate. Conventional Loan A loan made by an institutional lender or a private party with real estate as security for the loan that the government neither guarantees nor insures. Conversion The illegal use of another’s funds or other property for one’s own personal or business purposes. Conveyance The act of transferring an interest in property from one person to another. Cooperating Agent An agent who works with a listing agent to sell property in a real estate transaction, usually through participation in a multiple listing service. This agent could represent either the buyer or the seller, but a cooperating broker is generally the buyer's agent. Also called Cooperating Broker. Cooperative A type of property ownership under which residents have the right to occupy a unit by purchasing stock shares in the corporation that owns the property. These individuals own stock shares, not real estate. Co-Ownership Any form of ownership in which two or more people share title to a piece of property, holding undivided interests. Also called Co-Tenancy or Concurrent Ownership. Corporation A legal entity organized according to strict regulations, in which individuals purchase ownership shares; regarded by the law as an artificial person, separate from the individual shareholders; centralized management is provided via a board of directors. Correction Deed A deed used to correct minor mistakes in an earlier deed, such as misspelled names or errors in the legal description of the property. Also called Deed of Correction or Deed of Confirmation. Correction Line In the government survey system, lines that are established at 24-mile intervals (or at every four township lines) north and south of a baseline, re-establishing the six- mile width between the range lines to account for the curvature of the earth. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Corrective Maintenance Repairing or restoring broken or failed equipment to a specified condition. Cosmetic Maintenance Maintenance that increases a property's aesthetic appeal. Cost The dollars needed to develop, produce, or build something. Cost Approach An appraisal method in which an opinion of the value of real property is derived by estimating the expense of constructing a replacement or reproduction of the building, deducting an amount for depreciation, and adding the value of the land or site. Cost Manuals Books, electronic media, and online sources that give estimated construction costs for various types of buildings in different areas of the country. Cost of Money The interest rate that people or businesses must pay to use another’s money for their own purposes. Costing Service Books, electronic media, and online sources that give estimated construction costs for various types of buildings in different areas of the country. Counteroffer A response to an offer to enter into a contract, changing some of the terms of the original offer. A counteroffer is a rejection of the original offer (not a form of acceptance). Counterofferee A person who receives a counteroffer or to whom a counteroffer is made. Counterofferor A person who makes a counteroffer. Covenant A contract, promise, or a guarantee (express or implied) in a document such as a deed or lease. Covenant A contract, promise, or a guarantee (express or implied) in a document such as a deed or lease. Covenant Against Encumbrances The assurance that no encumbrances other than those specified in the deed exist. Covenant of Further Assurance A promise that the grantor will perform further acts reasonably necessary to correct any defects in the title or in the deed instrument. Covenant of Quiet Enjoyment A guarantee that a buyer has the right to exclusive, undisturbed possession of an estate, and will not be disturbed by the previous owner or anyone else claiming an interest in the property. Covenant of Seisin An assurance that the grantor has the exact estate in the quantity and quality which is being conveyed, i.e., “I own, and I have the right to sell it.” Crawl Space Unfinished space below the first floor of a house, less than a full story in height, usually containing plumbing and other functional elements. Credit A sum of money that is to be received. Credit History Record of debt repayment, detailing how a borrower has paid debts and obligations in the past, used to predict whether the borrower is likely to pay debts in the future. Credit Report A listing of a borrower's credit history, including the amount of debt, record of repayment, job info, address info, etc. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Credit Reporting Agencies Agencies that gather debt service information to calculate an individual’s credit score. The largest credit bureaus are Experian™, Equifax® and TransUnion® and although they use similar information, they calculate their scores differently so that each individual may have three separate and slightly different scores. Also known as credit bureaus. Credit Score A three-digit number in the range of 300 to 850 used by lenders to estimate a borrower’s creditworthiness. These are calculated by credit reporting agencies based on several factors including payment history, length of credit history, amount owed, recent inquiries, recent credit activity, types of accounts. Credit Scoring A method in which numerical values are assigned to different aspects of a borrower’s loan application and used by lenders to gauge creditworthiness and assess credit risk. Cubic Feet Length × Width x Depth = Cubic Feet. Divide cubic feet by 27 to find cubic yards. Culpable Negligence Occurs if a licensee operates in a reckless, careless, and excessively negligent manner. Culpable negligence is for which one can be held legally accountable. Curable Depreciation Depreciation is considered curable if the cost of the repair is less than what the repair adds to the value of property. Curtesy Rights The interest held by a married person in the real property owned by a spouse; refers to a husband’s interest in their wife’s property (not recognized in all states). Customer A party to a transaction with whom a real estate licensee does not have a fiduciary duty or relationship, but with whom a licensee must be honest and fair. D Dangling Commission Compensation that licensees may accept from a broker with whom they are no longer associated, assuming they were licensed with that broker at the time the commission was earned and the right to any commission under such circumstances is spelled out in the licensee’s agreement with the broker. Database Contact information for prospects, collected and maintained in an organized manner. Days on Market (DOM) The time period between listing a property and either selling or removing it from the market. DD-214 A Certificate of Release or Discharge from Active Duty issued by the Department of Defense. The DD-214 identifies the character of service and reason for discharge (honorable, dishonorable, etc.). Debit A sum of money that is owed. Debt The amount of money owed on a note or other promise to pay. Debt Service The amount of money paid at regular intervals toward reducing the principal and interest owed on a debt. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Debt-to-Income Ratio The relationship of a borrower's total monthly debt to gross monthly income, expressed as a percentage (Total Debt ÷ Income = Ratio %). Debt obligations include housing and long-term debts with more than 10 payments remaining. Also called Total Debt Service Ratio or Back-End Ratio. Decree Court order. Dedication The donation of real property by a private owner to the public. Deed A written instrument transferring the grantor's ownership of, or interest in, real property. Deed in Lieu of Foreclosure A document that transfers the title of a property from the property owner to the lender, in exchange for relief from the mortgage debt. Deed of Release A deed given by lien holders, remaindermen, or mortgagees to relinquish their claims on the property. Deed of Trust A security instrument In financed real estate transactions that transfers the legal title of a property to a third party—such as a bank, escrow company, or title company—to hold until the borrower repays the debt to the lender. Also called Trust Deed. Deed Restriction Limitations placed in a deed by a grantor that restrict the way in which the land may be used, improved, or maintained. Default Failure to fulfill an obligation, duty, or promise, as when a borrower fails to make payments, a tenant fails to pay rent, or a party fails to perform a contract. A mortgage, note, or other document will define what constitutes default. Defeasance Clause A clause used to defeat or cancel a certain right upon the occurrence of a specific event. Defeasible Fee Estate A type of freehold estate conveying ownership interest that comes with a condition. Also called Fee Simple Defeasible Estate or Qualified Fee Estate. Defect in Title Any lien, claim or encumbrance, on a particular piece of real estate that has been properly recorded in the public records. Recorded defects impair clear title and may result in the title being unmarketable. Deficiency Judgment A personal judgment against a borrower if the lender/creditor does not receive the amount of the lien plus the costs associated with foreclosure at a foreclosure sale. Deficiency Statement A statement in a home inspection report that describes a deficiency, explains its implications, and advises the client about what to do. Delivery and Acceptance A requirement for the legal transfer of property through a deed. Delivery refers to the grantor’s intention to transfer the property’s title and signing a deed; acceptance refers to the grantee’s receiving the deed while the grantor is alive. Demand The need or desire for a specific good or service. Demographics Socioeconomic data regarding employment, education, marriage rates, birth and death rates, and family dynamics. Department of Housing and Urban Development (HUD) An agency of the federal government that oversees many federal housing programs. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Deposit A sum of money placed or kept in a bank account. Depreciation A loss in property value for any reason—physical deterioration, functional obsolescence, or external obsolescence. Also, a loss in value as an accounting procedure for use as a tax deduction for income tax purposes. Also called Cost Recovery. Deregulation A process whereby restrictions imposed by a ruling authority are gradually relaxed. Derogatory Credit Credit history showing previous problems in meeting financial obligations. Descending Bid An auction method in which the auctioneer begins with a high asking number, and gradually lowers the asking price until the first person speaks, thereby winning the auction. Also called Dutch Auction. Descent An operation of law in which real property is transferred to an heir after the death of the owner who leaves no will (intestate). Designated Agency A contractual relationship between a broker and a client available in some states in which one or more licensees associated with the broker are appointed to represent the client in an in-house transaction. Also called Split Agency. Designated Agent A licensee appointed by a broker as the legal agent of a client. Also called Split Agent. Desk Copy A payment agreement through which a real estate licensee pays their employingbroker; an alternative to a commission split. Devise To transfer real property by will; real property transferred in a will. Direct Capitalization Rate A rate of return, stated as a percent, used to derive a value opinion from the anticipated net operating income a property could generate. It is used for direct capitalization in the income approach. Also called Cap Rate or Rate. Disability A physical or mental impairment that substantially limits or curtails one or more major life activities. Discharge of Mortgage The lender’s release of all further obligations on the part of a borrower; required once a borrower’s loan is paid off. The lender issues the discharge of contract, and the borrower should record this document. Also called Release of Lien or Satisfaction of Mortgage. Disclosure Revelation of material facts or defects. Discount Point A form of pre-paid interest that is charged by a lender to increase the yield on a lower-than-market interest rate loan; one point equals 1% of the loan amount. Important: while discount points cost 1% of the loan amount, they don’t buy down a full 1% of the interest rate. A typical 1% discount point may only buy down 0.25% or so of the interest rate. Discount Rate The interest rate charged by Federal Reserve Banks on loans to member commercial banks. Discrimination Treating people differently because of their race, religion, sex, national origin, age, or some other characteristic of a protected class, in violation of civil rights laws. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Disintermediation When depositors bypass traditional depository institutions and invest directly in the stock market, mutual funds, artwork, etc., thereby reducing the mortgage money supply and causing interest rates to rise. Disparate Impact When a law that isn’t discriminatory on the face of it has The disproportionate effect impact on one or more protected classes. Also called Disparate Effect. Disparate Intent An intentional decision to treat some people differently from others in a similar situation. Also called Disparate Treatment. Disposal Rule A provision of the federal Fair and Accurate Credit Transaction Act that requires businesses to take reasonable measures to dispose of sensitive consumer information. Distress Code A pre-defined signal, word, or phrase used by someone in a vulnerable or unsafe situation to communicate to others that they are in danger. Doctrine of Emblements A rule that allows a tenant farmer to re-enter the land to harvest crops that were planted by the tenant farmer even after the land has been sold to a new owner. Doctrine of Part Performance A legal doctrine that allows a court to enforce an oral agreement that should have been in writing, when one party has taken irrevocable steps to perform their side of the bargain, and failure to enforce the contract would result in an unjust benefit for the other party. DOM (Days on Market) The period between when a property is listed and when it goes under contract. Dominant Tenant A person with easement rights on another's property; either the owner of a dominant tenement or someone who has an easement in gross. Dominant Tenement Property that receives the benefit of an appurtenant easement. Also called Dominant Estate. Double Net Lease A lease in which the tenant pays two of the expenses associated with property ownership, in addition to paying the rent. Also called Net-Net. Dower Rights The interest held by a married person in the real property owned by a spouse; generally refers to a wife’s interest in her deceased husband’s property (not recognized in all states). Down Payment The amount of money a buyer pays to obtain a property, in addition to the money that the buyer borrows. Dual Agency An agency relationship in which a licensee represents both buyer and seller (or both landlord and tenant) in the same transaction. Usually requires advance informed written consent from both parties. Dual Agent A licensee who represents both the buyer and the seller (or both landlord and tenant) in a single real estate transaction. Due Diligence Investigation to discover facts or liabilities about a property prior to its purchase. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Due on Sale Clause A clause, included in many mortgages, permitting the lender to require the borrower to repay the outstanding balance when the property is sold. Prevents loan assumption. Duress The use of force or improper actions, against a person or property, in order to induce a party to enter into a contract. E Early Termination Clause A clause, term, or condition in a contract that allows a party to that contract to avoid having to perform the contract. Also called Escape Clause. Earned Increment An increase in value of real property due to some effort of the owner such as remodeling or other property improvements. Earnest Money Money offered as an indication of good faith regarding the future performance of a purchase agreement. Easement A nonpossessory interest and an encumbrance on property that grants the right to use another person’s real property for a particular purpose. Easement Appurtenant The right acquired by the owner of one parcel of land to use another's adjacent land for a specific purpose. There must be two tracts of land; one becomes the dominant tenement (it benefits from the easement), and the other becomes the servient tenement. Easement by Condemnation An easement created through the government’s power of eminent domain when necessary to benefit the public. Easement by Implication An easement that occurs because of necessity, such as the conveyance of a land–locked property. Easement by Prescription An easement created by open, notorious, hostile, and uninterrupted use of another person’s land for a specific period of time determined by state law. Prescriptive use does not have to be exclusive (the owner may be using the property, too), and the user does not acquire title to the property. Also called Prescriptive Easement. Easement for Light and Air A negative easement that prohibits the servient tenant from doing something that would obstruct the view or prevent light or air from reaching the dominant tenement. Also called View Easement. Easement in Gross An easement that benefits a person or company, rather than benefiting another parcel of land, such as a utility company easement to access the property to repair or replace utility equipment. Economic Base The main business or industry in an area that supports and sustains the community. Economic Base Analysis A study of an area’s current business and employment situation, conducted to determine the likelihood of continued stability, growth, or decline. Economic Life The time during which a building can be used for its intended purpose and generate more income than is paid out for operating expenses. Also called Useful Life. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Economic Obsolescence A loss in value due to factors outside the subject property, such as changes in competition or surrounding land use. Also called External Obsolescence. Economic Rent The amount of rental which a building would receive, if set by the market, as opposed to contract rent set by the lease. Effective Age The age of a structure based on the actual wear and tear that the building shows from physical, functional, or external obsolescence; not necessarily the structure's actual age. Effective Date The date for which value was established when doing an appraisal. Effective Demand When prospective buyers have enough disposable income to satisfy their purchase needs or desires. Also called Purchase Ability. Effective Gross Income An investment property’s potential gross rental income plus other income, less vacancy and collection losses. Efflorescence A white powdery deposit on the surface of foundation walls or floor slabs, created when water penetrates the wall or floor, combines with salts within the masonry, and brings those salts to the surface. EIFS (Exterior Installation and Finish Systems) A stucco-like material that was subject of a class action lawsuit due to moisture penetration issues. Elevation Vertical measurement above or below a fixed reference point, most commonly sea level. Emblement An annual crop that is planted and cultivated by a tenant farmer and is always the personal property of the tenant farmer. Also called Fructus Industriales. Eminent Domain The government’s constitutional power to take private property for public use, as long as the owner is paid just compensation. (Condemnation is the action; eminent domain is the right.) Employee Someone who works under the control of, and at the direction of, a business or manager and is compensated for their time. Employing Broker A broker under whom affiliated licensees are contracted to work. Employment Agreement (Independent Contractor Agreement) A written contract between a self-employed real estate licensee and a broker under whose license the licensee will work. Enabling Law Legislation in which a governmental body grants another entity the authority or power to take certain actions. Encapsulation The process of applying a sealant to asbestos-containing material, which penetrates the material’s surface, preventing the release of the dangerous fibers into the air. Encroachment A physical object intruding onto neighboring property, often due to a mistake regarding the boundary. Encumbrance Any claim, lien, charge, or liability that attaches to, or burdens, real property. ENERGY STAR A program, managed by the U.S. Environmental Protection Agency, that sets standards for energy-efficient consumer products and homes. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Enforceable Contract A contract that would be upheld by the courts; the requirements are capacity, mutual consent, lawful objective, consideration, and, for real estate contracts, in writing. Entitlement The maximum dollar amount of guaranty that applies to an eligible veteran on a VA-guaranteed loan. Environmental Impact Statement (EIS) A study required by the National Environmental Policy Act for all federal and federally-related projects that details a development project's impact on energy use, sewage systems, drainage, water facilities, schools, and other environmental, economic, and social elements. Environmental Protection Agency (EPA) The federal agency tasked with creating and enforcing environmental protection standards, helping others with environmental pollution problems, and providing research on environmental issues. Environmental Site Assessment (ESA) A report prepared for a real estate transaction that identifies potential or existing environmental contamination liabilities. An ESA can have up to four phases: I-Investigation; II-Testing; III-Remediation; IV-Management. Equal Credit Opportunity Act (ECOA) A federal law that requires all lenders to make credit available with fairness and without discrimination based on race, color, religion, national origin, age, sex, marital status, or receipt of income from public assistance programs. Equitable Lien A lien created when justice and fairness would require a court of equity to declare such a lien exists or when the conduct of the parties would imply that a lien was intended. Equitable Right of Redemption The right of a debtor to redeem the property from foreclosure proceedings prior to confirmation of sale. Equitable Title Any present right to acquire legal title to property. Equity An owner’s unencumbered interest in property; the difference between the value of the property and the liens, such as a mortgage, against it. Erosion A gradual loss of soil due to the action of wind, water, or other forces. Errors and Omissions (E&O) Insurance A type of liability insurance that helps cover the expenses of a lawsuit if a client claims a real estate licensee was at fault. Escalation Clause A lease clause that provides for an increase in rent to reflect increases in expenses paid by the landlord, such as real estate taxes, operating costs, and cost of living expenses. Also called Escalator. Escape Clause A clause, term, or condition in a contract that allows a party to that contract to avoid having to perform the contract. Escheat The reversion of property to the state (or, in some states, the county) after a person dies without leaving a valid will or having any heirs. Escrow A neutral third party that holds things of value on behalf of the parties to a transaction until the specified conditions have all been met. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Escrow Account 1. A separate account maintained by a broker for the deposit of clients’ money (i.e., good faith deposits). Also called Trust Account. 2. An account a lender maintains to hold a borrower’s monthly payments for property insurance and property tax until those bills are due. Also called Reserve Account or Impound Account. Escrow Closing A settlement procedure conducted by a disinterested third party, often an escrow agent, where the buyer and seller are not present. Escrow Company A neutral third party who safeguards funds on behalf of a buyer or seller until a transaction is ready to close. Escrow Reserves An account maintained by a lender for the deposit of borrowers’ extra 1/12 monthly deposits to cover next year’s insurance and tax payments. Established Business Relationship (EBR) A relationship that may allow a telemarketer or seller to call a consumer for up to 18 months after the consumer's last business transaction or payment or up to three months after the consumer makes an inquiry or submits an application— even if the consumer’s number is on the National Do Not Call Registry. Estate A possessory interest in real property; may be either a freehold estate or a leasehold estate. Estate at Sufferance Possession of property by a tenant who once had a valid lease but stays on after the lease expires without the property owner’s permission. Also called Tenancy at Sufferance. Estate at Will Possession of property by a tenant with the owner’s permission, but with no definite lease term and no rent being paid or rent not paid on a regular basis; e.g., a property owner lets a holdover tenant remain on the premises without paying rent until a new tenant is found. Also called Tenancy at Will. Estate for Years A leasehold estate set to last for a definite period (e.g., one week, three years), after which it automatically terminates. Also called Term Tenancy. Estate from Period to Period A leasehold that is automatically renewed for the same term as in the original lease, requiring notice to terminate. Also called Periodic Tenancy, Estate from Period to Period, or Month-to-Month Rental. Estate in Fee The maximum possible estate one can possess in real property. Also called Fee Simple or Fee Simple Absolute. Estoppel A legal doctrine that prevents a person from asserting rights or facts that are inconsistent with their earlier actions or statements when they failed to object (or attempt to “stop”) another person’s actions. Estoppel Certificate A document, often used in real estate and mortgage activities, that establishes certain facts that may later not be contradicted, disputed, or recanted. Ethics The fundamental principles of honesty and integrity that guide a person’s behavior. Eviction The process of forcing someone off property or preventing someone from re-entering property; can be classified as actual, constructive, retaliatory, or self-help. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Evidence of Title Evidence of title to real estate is provided through a title report or issuance of title insurance. Excess Land Land that is not needed to support the highest and best use of a property and adds no value to the property. Exclusive Agency Buyer Agency Agreement An employment contract between a buyer and broker in which the broker earns a commission when the buyer purchases property unless the property was specifically exempted. Exclusive Agency Listing An employment contract between a seller and a broker that entitles the broker to a commission if anyone other than the seller finds a buyer for the property during the listing term. Exclusive Buyer Agency Agreement An employment contract between a buyer and a broker that grants only one broker the right to represent the buyer in the purchase of property and entitles the broker to the negotiated fee even if the buyer purchases property through another broker; depending on the language of the contract, the broker may also be entitled to compensation if the buyer finds the property and purchases it directly from the owner. Exclusive Right to Rent Agreement An employment contract between a landlord and a broker giving the brokerage exclusive rights, for a specified period of time, to locate a tenant to rent the landlord’s property. If the property is rented during this time, the broker is paid a commission. Exclusive Right to Sell Listing An employment contract between a seller and a broker that entitles the broker to a commission if anyone, including the seller, finds a buyer for the property during the term of their agency relationship. Executed Contract A contract in which both parties have fully performed their contractual obligations. Executor A person appointed in a will to carry out the provisions of the will. Sometimes called Executrix if female. Executory Contract A contract in which one or both parties have not yet completed performance of their contractual obligations. Expired Listing A listing that did not sell during its listing period. Express Agency An agency relationship in which the principal clearly communicates the authority to the agent, in spoken words or in writing. Express Authority Actual consent to represent intentionally given by agreement—either oral or written—by a principal to an agent. Express Contract An agreement that’s been expressed in words, either spoken or written. Extended Coverage A title insurance policy that includes standard coverage and additional protections, including defects that may be discovered only through actual inspection; usually required by lenders (mortgagees). External Obsolescence When something outside of a property and outside of the control of a property owner makes it less desirable. Also called Economic Obsolescence. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z F Facilitator A licensee who assists in the successful completion of a real estate transaction but has no agency relationship with and, therefore, no fiduciary obligation to either party. Fair Credit Reporting Act The federal law promoting the accuracy, fairness, and privacy of consumer information contained in the files of consumer reporting agencies. Fair Housing Act Common name for Title VIII of the Civil Rights Act of 1968 and its amendments that prohibits discrimination by governments and private parties in the sale or lease of residential real property. Fair Market Value The price negotiated for a parcel of real estate in a competitive market where both buyer and seller are free to act and under no undue pressure. Familial Status A protected group under the federal Fair Housing Act, making it illegal to discriminate because they are the parent or guardian of a child under 18 years of age. Farm Area A focused area, such as a neighborhood, that a real estate licensee continues to prospect (multiple contacts over time increase the likelihood of success). Federal Deposit Insurance Corporation (FDIC) A federal agency established to insure the deposits in member commercial banks. It determines the maximum insurance amount per account. Federal Fair Housing Act of 1968 An act prohibiting discrimination in the sale or rental of housing on the basis of race, color, religion or national origin sex, handicap, and familial status. Federal Home Loan Bank System (FHLB) A government-sponsored enterprise, created by Congress but privately funded, that supports mortgage lending and related community investment for its member banks and financial institutions. Federal Home Loan Mortgage Corporation (FHLMC) Commonly known as “Freddie Mac,” a government-sponsored entity regulated by the Federal Housing Finance Agency that operates in the secondary mortgage market to purchase mortgage loans from lenders. Federal Housing Administration (FHA) A federal agency established in 1943 to increase home ownership by providing an insurance program to safeguard the lender against the risk of non-payment. Currently part of HUD. Federal National Mortgage Association (FNMA) Commonly known as “Fannie Mae,” a government-sponsored entity regulated by the Federal Housing Finance Agency; the largest buyer of existing mortgages in the secondary mortgage market. Federal Reserve System (FRS) A federal agency which oversees and regulates monetary policy, which in turn affects interest rates and the availability of credit. All federally chartered commercial banks must be members. Fee Appraiser An independent valuation professional hired by a client to value a particular property for a fee. Fee Simple Determinable Estate A type of defeasible fee that terminates automatically if certain conditions occur. The grantor (or grantor’s heirs) has a possibility of reverter (reclaiming ownership and possession). Also called Determinable Fee Estate. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Fee Simple Estate The greatest estate (ownership) one can have in real property because it is freely transferable and inheritable, and of indefinite duration, with no conditions on the title. Also called Fee Estate, Fee Simple Absolute Estate, or Estate in Fee. Fee Simple Estate Subject to a Condition Precedent A condition in which the grantor retains title to the estate until a specific condition occurs. Fee Simple Estate Subject to a Condition Subsequent A type of defeasible fee that may be terminated by the grantor through legal action if conditions stated in the deed are not met; the grantor (or grantor’s heirs) has the right of re-entry. Also called Fee on Condition. FHA-Insured Loan A home financing option available to qualified borrowers through which the Federal Housing Administration insures approved lenders against loss from borrower default. FICO Fair Isaac Corporation (FICO), provides a three-digit number calculated from information on a credit report and nothing else. It summarizes the credit report into a number lenders use to consider the level of risk in providing a loan to a borrower. Fictitious Name A business name that is different from its owner’s legal name. Also called Trade Name or Doing Business As (DBA) Name. Fiduciary A person in a position of trust, held by law to high standards of good faith and loyalty. Fiduciary Deed A deed used to transfer property when the grantor is a fiduciary such as a trustee, guardian, conservator, or executor acting in their official capacity. A fiduciary deed usually only warranties that the fiduciary is acting in their appointed capacity and within their allotted authority. Also called Judicial Deed or Bargain and Sale Deed. Finance Charge The cost of consumer credit as a dollar amount, including any charge imposed directly or indirectly by the creditor as an incident to or a condition of the extension of credit. Financing Contingency A clause in a purchase agreement that states the contract is contingent on the buyer obtaining approval for a loan on specified terms. First Lien Claim with highest priority against property; also known as a superior to the rights of subsequent lenders. (Recorded first) First Mortgage A mortgage on real estate in which the lender's rights are superior to the rights of subsequent lenders. (Recorded first) First Substantive Contact An event triggering agency disclosure, for example, prior to entering into a listing agreement, or when showing a property, or at an open house when a buyer displays serious interest. Fixed Expenses Ongoing operating expenses that do not vary based on occupancy levels of the property (e.g., taxes, insurance). Fixed Fee Commission agreement by which a fixed dollar amount is paid for the performance of specific real estate services; payment usually requires the successful completion of the transaction. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Fixed-Rate Loan A loan for which the interest rate remains constant for the duration of the loan. Fixture An item of personal property that has been attached to or closely associated with real property in such a way that it has legally become part of the real property. Flat Fee A specific fee paid out once or in specific increments. Flipping Purchasing a property and quickly reselling it for a profit. Floodplain Land areas adjacent to rivers and streams that are subject to recurring flooding. Floor Area Ratio The maximum size of a building permitted on a development site according to zoning requirements. The floor area ratio (FAR) is typically stated as a percentage, such as 25%, 30%, etc. Floor Duty An assignment to take calls from consumers who call the brokerage for assistance or who walk into the brokerage looking for help. Floor Load Capacity The weight (pounds per square foot) or load that the floor of a structure can handle. Footer The support for the foundation of a building. Footers are installed below the frost line and are wider than the foundations that they support. For Sale by Owner (FSBO) A property offered for sale directly by the seller, who is not represented by a listing agent. Forbearance Agreement When the lender agrees to temporarily reduce, postpone, or suspend a borrower’s mortgage payment and not proceed with foreclosure as long as the borrower brings the loan current within the specified time. Forced-Air System A type of heating system consisting of furnaces, blowers, ducts, and registers. Forcible Entry and Detainer Action A summary legal action to regain possession of real property; especially, a lawsuit filed by a landlord to evict a defaulting tenant and regain possession of property. Also called Unlawful Detainer Action. Foreclosure The process used by a lienholder to force a property to be sold so that the proceeds of the sale can be applied toward debt satisfaction. Foreclosure Action A lawsuit filed by a creditor to begin foreclosure proceedings. Foreign Investment in Real Property Tax Act of 1980 (FIRPTA) A federal law that imposes income tax on foreign persons selling or otherwise disposing of their interest in real property. Foundation The basic structure on which the rest of the building will sit. A foundation can be concrete slab, pier and beams, crawl space, or basement. Framing The basic load-bearing skeleton of the house to which interior walls, exterior walls, and roof are attached. Fraud An intentional or negligent misrepresentation or concealment of a material fact; making statements that a person knows, or should realize, are false or misleading. Also called Fraudulent Dealing. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Freehold Estate A possessory interest in real property of uncertain (and often unlimited) duration; an ownership estate in real property; either a fee simple or life estate. The holder of a freehold estate has title. Friable A characteristic of asbestos in which it can crumble easily or become powdery when manipulated by hand, releasing particles into the air. Frontage The dimension across the access side of a parcel of land. The access could be a road, railroad tracks, or a body of water. In lot size dimensions, frontage is the first number listed. Also called Front Foot. Fructus Industriales Plants planted and cultivated by people (“fruits of industry”), generally considered personal property. Fructus Naturales Naturally occurring plants (“fruits of nature”) generally considered part of real property. Also called Natural Attachments. Fully Amortized Loan A loan in which regular payments of principal and interest are applied until the loan is paid off when the last scheduled payment is made. Functional Obsolescence Something inherent in the design of a structure that makes it less desirable. G Gender Identity Actual or perceived appearance, expression, identity, or behavior of a person as being male or female, whether or not that appearance, expression, identity, or behavior is different from that traditionally associated with the person’s designated sex at birth. General Agent A person authorized to handle a variety of activities for the principal in one area or in specified areas on a continuing basis, for example, a real estate broker who is a property manager. General Liability Insurance Insurance that protects against bodily injury and property damage claims. General Lien A lien against all property of a debtor, instead of a particular piece of property. General Partnership An association organized by two or more persons engaged in a business for the purpose of joint profit. General partners assume unlimited joint and several personal liability; as such, a general partner may be personally liable for the actions of other general partners. General Warranty Deed A deed in which the grantor warrants the title against any and all defects that might have arisen before or during their period of ownership. Also called Standard Warranty Deed or Simple Warranty Deed. Genuine Assent Consent given freely to create a binding contract. Geographic Information System (GIS) A computer-based system for gathering, analyzing, and displaying geographic data, typically on a map. Good Consideration Love and affection (as opposed to monetary consideration). ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Good Faith The general presumption that the parties in a contract or other business transaction will deal with each other honestly and fairly, adhering to the terms of any contract and acting without any intent to defraud, deceive, or otherwise take advantage of the other party. Good Title Title that is free from encumbrances such as liens, pending litigation, and other such defects. Government National Mortgage Association (GNMA) Commonly known as “Ginnie Mae,” an agency of the Department of Housing and Urban Development (HUD) that operates in the secondary mortgage market. It is involved with special government financing programs, e.g., FHA-insured and VA-guaranteed loans. Government Survey System Legal description for land referencing principal meridians and baselines designated throughout the country. Also called Rectangular Survey System. Government-Sponsored Enterprise (GSE) A quasi-governmental, privately held agency established by Congress to improve credit flow in some areas of the country’s economy. A GSE provides financial services to the public for various things, particularly mortgages, through capital market liquidity. Graduated Lease A lease under which rental increases are made at scheduled intervals for specific amounts. Graduated Payment Buydown A temporary buydown plan where payment subsidies, usually from a seller or developer, in the early years of the loan keep payments low, but payments increase each year until they're sufficient to fully amortize the loan. Graduated Payment Mortgage (GPM) A financing technique for residential real estate in which monthly payments start at a lower rate and increase periodically over the life of the mortgage; an example is the FHA 245 loan. Grandfather Clause An exemption from the application of a new law due to previously existing circumstances; a nonconforming use. Grant Transferring real estate by means of a deed. Grantee Person receiving a grant of real property. Granting Clause A deed clause stating a grantor's intent to transfer an interest in real property. Grantor A person who conveys their interest in real property. Gratuitous Agency An agency relationship where a real estate licensee is not compensated for their services, but still owes the principal all legal obligations due to every client. Can occur with implied agency. Gross Income The actual income received from property before the deduction for any expenses. Gross Income Multiplier A conversion factor derived from the sales price of comparable rental properties divided by their gross rent and any other miscellaneous income. This factor is multiplied by the estimated gross income of the subject to estimate its value. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Gross Lease A lease for which the tenant pays a fixed amount to the property owner and the property owner is responsible for paying all associated expenses (taxes, insurance, maintenance); most common for residential leases. Gross Living Area Residential space that is finished, heated, and above grade. Garages, finished basements, and storage areas do not count in GLA. Also called Livable Area. Gross Rent The amount a property owner receives from a tenant for leasing a property before the owner deducts any operating expenses. Gross Rent Multiplier (GRM) A conversion factor derived from the sales prices of comparable rental properties divided by their gross income received from lease payments. This factor is multiplied by the estimated gross rent of the subject property to arrive at an opinion of value. Ground Lease (Land Lease) A lease under which the tenant leases only the land from the owner, but the tenant owns the building during the lease term. Group Home A residential property where a small number of unrelated people in need of care, support, or supervision can live together. Growing Equity Mortgage A fixed-rate mortgage with payments that increase by a predetermined amount, with the increased payment amount applied to principal reduction. Guardian’s Deed A deed authorized by a guardian, which is a person assigned by the court to handle the affairs of an incapacitated person. H Habendum Clause A clause in a deed, usually beginning with “to have and to hold,” that describes the type of estate granted. Half Timbering A construction method in which the external walls have exposed wood framing constructed of timber frames, with other materials such as plaster or brick filling the space between them. Have The part of the auctioneer’s chant that indicates the current bid. ("I have 50, who'll give me 60?") Heat Pump A combination heating and cooling system consisting of compressors, refrigerants, blowers, and ducts. Heterogeneity A characteristic of real property; each piece of land, each building, and each house is a unique piece of real estate. Also called Uniqueness. Highest and Best Use The most profitable, legally permitted, feasible, and physically possible use of a piece of property. Holder in Due Course One who acquires a negotiable instrument in good faith and for consideration, and thus has certain rights above the original payee. Holdover Tenant A lessee who remains in possession of property after the lease has expired; a tenant who refuses to surrender possession of property at the tenancy’s end. Home Acquisition Debt A loan that a taxpayer takes out to buy, build, or substantially improve a qualified home. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Home Energy Rating System (HERS) A measurement of a home’s energy efficiency used primarily in the United States; in the HERS Index, the higher the score, the less energy efficient the home is. Home Equity Debt A loan that does not qualify as home acquisition debt but is secured by a qualified home. Home Equity Line of Credit (HELOC) Available money that a homeowner can borrow, secured by a second mortgage on the principal residence. The homeowner can access HELOC funds at any time up to a predetermined borrowing limit and use them for non-housing expenditures. Home Equity Loan A loan taken by a homeowner that is secured by a mortgage on their principal residence. Home Inspection An unbiased, systematic, noninvasive, visual inspection of the physical structure and systems of a home. Home Inspection Report A written report that a home inspector issues after a home inspection detailing issues found. Home Warranty A contract between a homeowner and a home warranty company that provides coverage for the covers repair or replacement of named components of the home for a specified period of time, such as one year. Homeowners Association (HOA) A nonprofit association composed of homeowners in a subdivision, responsible for enforcing the subdivision's CC&Rs and managing other community affairs. Homestead A statutory or legal life estate recognized in some states that protects the interests in real estate belonging to a deceased person for the use of a surviving spouse and minor children. Horizontal Property Acts A generic name given to state laws that create the legal framework that allows a condominium form of ownership. These acts make it possible for lenders to provide mortgages on condominiums, for tax authorities to assess property taxes, etc. Hot Water or Steam System A type of heating system consisting of boilers, pipes, and radiators. Housing Expense Ratio The relationship of a borrower's total monthly housing expense to gross monthly income, expressed as a percentage (Total Housing Expense ÷ Income = Ratio%). Also called Income-to-Payment Ratio or Front-End Ratio. HVAC Heating, ventilation, and air conditioning. Hypothecation The act of pledging property to be the security for a loan without giving up possession of it, as with a mortgage. I Illegal Flipping A scheme in which property is purchased at a low price, appraised at an inflated value without justification, and resold at the higher price. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Illegal Per Se Something deemed unlawful on the face of the evidence, without need to consider context or intent; generally made so by a statute, constitution, or case law. Illiquidity The difficulty of converting an asset to cash. Immobility A physical characteristic of real estate referring to the fact that it cannot be moved from one place to another. Implicit Bias The attitudes or stereotypes that affect our understanding, actions, and decisions in an unconscious way, making them difficult to control. Implied Agency An agency relationship created through the behavior (actions or words) of one or both parties. Implied Contract An agreement that hasn’t been put into words but is implied by actions of one or both parties. Implied Warranty of Habitability The lessor’s implicit promise that the premises comply with building codes and health and safety regulations and are otherwise safe for occupancy. Improvement A substantial, manufactured addition to real property, such as a building. Imputed Knowledge The legal concept that information communicated to the agent has been communicated to the principal, i.e., notice to the agent is notice to the client. Incentive Zoning A system by which developers receive zoning incentives on the condition that they provide specific physical, social, or cultural benefits to the community. Incidental Authority The authority to do everything reasonably necessary to carry out the principal’s express orders. Income Approach An appraisal method in which an opinion of the value of real property is derived by analyzing the amount of revenue the property generates or could generate. Income Approach An appraisal method that estimates the value of real estate by analyzing the amount of revenue, or income, the property currently generates, or could generate. Also called Capitalization Approach. Income Statement A report that details the income (e.g., in a property management report, the rent and any other income) and expenses associated with an investment over a specific period of time. Also called Profit and Loss Statement. Increasing and Decreasing Returns Economic principle stating the addition of more factors of production will add higher amounts to new income up to a certain point, which is the point where the maximum value of the asset has been reached; any further addition of factors of production will do nothing to increase the value. Incurable Depreciation Elements of a structure which are neither physically possible nor economically feasible to correct. Independent Contractor A term often erroneously applied to real estate licensees who are actually self-employed individuals under the supervision of their brokers (statutory non- employees, in IRS terms). Indestructibility A characteristic of real estate; land can’t be destroyed. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Index A statistical report that is generally a reliable indicator of the approximate change in the cost of money; often used to adjust the interest rate of adjustable rate mortgages. Index Lease A lease in which the amount of the rent is tied to some common index indicator, such as the Consumer Price Index or the Wholesale Price Index. As the agreed-upon index increases, the rent goes up by the same percentage of change. Index Method A method for determining the cost of a building by taking its original cost and multiplying that number by an index factor based on how long ago the building was constructed. Index Mortgage A fixed-rate mortgage with payments that increase by a predetermined amount, with the increased payment amount applied to principal reduction. Inflation An increase in the cost of goods or services. Inheritable An interest in land that can be passed to a relative upon the death of the owner. In-House Transaction A situation in which a single brokerage represents both the buyer and seller in the same real estate transaction. Injunction A court-ordered prohibition against a particular act, as opposed to a judgment for money. Also called Injunctive Relief. Injunctive Relief A court-ordered prohibition against a specific act or conduct, as opposed to a judgment for money. Also called Injunction. Inquiry Notice When circumstances should have alerted someone to a possible problem prompting further investigation, a person may be held to have had notice of the problem even if they do not have actual knowledge of it. Inspection Contingency A purchase contract clause giving a buyer the right to have the home inspected during a specified period of time and to terminate the agreement should the inspection turn up issues the buyer and seller are unable to negotiate. Inspection Period The period specified in the purchase agreement during which the buyer has the opportunity to conduct an inspection. Insulation A material that is used to slow the flow of heat, moisture, shock, or sound. Insurable Title Title to property that a title insurance company has agreed to insure against defects that could affect its ownership or value of the property. Insurance Value The amount for which an owner can insure a property; usually only the replacement cost of the structure, disregarding any value for the land. Interest 1. A right or share in something, such as a parcel of real estate. 2. A charge a borrower pays to a lender for the use of the lender’s money. Interest Rate The cost of using money expressed as a percent per period. Intermediation The flow of deposits into lending institutions that creates a mortgage money supply. Interstate Land Sales Full Disclosure Act A federal law that protects consumers from fraud and abusive marketing practices in the sale and lease of land through interstate commerce. ColibriRealEstate.com Revision – Jan. 2023 Copyright ©2023, Colibri Real Estate  A B C D E F G H I J K L M N O P Q R S T U V W X Y Z Intestate The state of dying without making a will, causing the decedent’s estate to pass on according to the state laws of descent and distribution. Invalid Without legal force. Inventory The number of available homes on the market listed as active or pending. Investment Value The value of a property to a particular investor based on that investor's specific investment expectation and criteria. Involuntary Alienation When title to property is transferred during the owner's lifetime without the owner’s consent. Involuntary Lien A lien that arises by operation of law, without the consent of the property owner. Irrevocable Not capable of being changed or terminated. IRS Form 1099-S A report indicating the seller’s proceeds from the sale or transfer of real estate that a settlement officer submits to the Internal Revenue Service. IRV Formula A simple calculation for finding the net operating income (I), the capitalization rate (R), or the value (V) of an investment property. When any two factors are known, the third can be determined. Also called Capitalization Rate Formula. J Joint Tenancy A form of co-ownership in which the co-owners have equal undivided interests and the right of survivorshi