Category: Definition page

Warranty Deed

A warranty deed is a legal real estate document where the seller guarantees that...

Triplex

A triplex consists of three individual dwelling units combined into one building...

Triple Net Lease

Triple net lease (also commonly known as NNN) is normally a commercial lease whe...

Townhouse

A townhouse, also called a townhome, is a multi-floor home that shares at least ...

Tenant Screening

Tenant screening is a process carried out by landlords to assess an applicant be...

Student Housing

Student housing is a form of off-campus accommodation for university or college...

Single Family Home

The legal definition of a single-family home is – a structure maintained a...

Occupancy

Occupancy is defined as the act of taking possession. In real estate terms, it i...

Lessor

A lessor is essentially someone who is the owner of the property that grants a l...

Lease Agreement

A lease agreement is a legal, binding contract between a landlord and a tenant, ...

Landlord Insurance

Landlord insurance is a policy that is purchased for rental properties. It provi...

Duplex

A duplex is a type of multifamily property that allows for two separate resident...

Condominium

A condominium, also known as a condo, residential complex in which there are sep...

Common Area Maintenance

Common area maintenance, also known as CAM, are the costs associated with overhe...

Capital Improvement

The IRS defines a capital improvement as a change made to property you own that ...

Appraised Value

An appraised value is an evaluation of a property’s value by a professiona...

Apartment

An apartment is a single housing unit that is part of one (or several) residenti...

Amenities

Amenities are any features of a building or space that provide comfort and conve...

Private Mortgage Insurance

Private mortgage insurance, also called PMI, is a type of insurance that is ofte...

FICO Score

A FICO score is a credit score created by the Fair Isaac Corporation (FICO). Thi...

Cash Out Refinance

Whenever you refinance, you’re starting over with a new mortgage and new t...

Good Faith Estimate

A Good Faith Estimate, also known as a GFE, is a document that a lender must gi...

Functional Obsolescence

Functional obsolescence is when a home doesn’t meet market expectations on a f...

FSBO

For sale by owner or FSBO homes are sold by the homeowner without the help of a ...

FHA

The Federal Housing Administration or FHA, is a government agency that promotes ...

Fair Market Value

Fair market value also known as FMV, in real estate is the price that a property...

Encroachment

Encroachment in real estate occurs when one property owner violates their neighb...

Economic Obsolescence

Economic obsolescence is the loss of value of a real estate property that is cau...

Dual Agency

Dual agency occurs when a single real estate agent works on behalf of both the h...

Depreciation

Depreciation is the decrease in the value of your property over time. It is a pr...

HUD

HUD is an acronym for the Department of Housing and Urban Development, a governm...

CMA

A comparative market analysis or CMA, is a tool that real estate agents use to e...

Comparables

Comparables are used in real estate to find the fair value of a home. They assis...

Common Areas

Common areas are elements of a property available for use by all tenants. Common...

Mortgage Commitment Letter

A mortgage commitment letter is a formal document from your lender stating that ...

Buydown

A buydown is a mortgage financing technique that allows homebuyers to obtain a l...

Built-Ins

Built-ins are any items that do not leave the property but remain a part of the ...

Breach Of Contract

When the parties sign a real estate contract, they agree to all of the terms con...

Bill Of Sale

A bill of sale is commonly used when selling or buying something of value. It is...

Balloon Mortgage

A balloon mortgage is a home loan that has an initial period of low or no monthl...

Assumable Mortgage

An assumable mortgage provides a buyer the opportunity to purchase a home by tak...

Assessment

An assessment occurs when an asset’s value needs to be determined for tax ...

Abstract Of Title

Abstract of title is a document that summarizes everything that has happened wit...

Pre-Approval

A pre-approval is a preliminary evaluation by a lender to determine whether a bo...

Multiple Listing Service

A Multiple Listing Service, also called MLS, is a database that allows real esta...

Mortgage Pre-Approval Letter

A mortgage pre-approval letter is a document from a lender indicating that you h...

Home Sale Contingency

A home sale contingency is a clause frequently included in a real estate sales c...

Equity

Equity is the investment a homeowner has in their home. To calculate equity, tak...

Escrow Holder

An escrow account is important because specific instructions must be followed in...

Closing Costs

Closing costs are an assortment of fees, including fees charged by: a lender, th...

Covenants, Conditions & Restrictions (CC&...

Covenants, conditions & restrictions or CC&Rs are the rules and regulati...

Listing Agent

A listing agent also known as a seller’s agent, is a licensed real estate prof...

ARM

An adjustable-rate mortgage or ARM, is a home loan with a variable interest rate...

Tax Shelter

A tax shelter is a place to legally store assets so that current or future tax l...

Start-Up Expenses

Start-up expenses are the costs you incur to get your rental business up and run...

Passive Loss Rules (PAL)

Passive Activity Loss Rules, or PAL, are a set of IRS rules stating that passive...

Cost Segregation

Cost Segregation is a tax strategy that allows real estate owners to utilize acc...

Bonus Depreciation

Bonus depreciation allows an investor to deduct the full cost of capital improve...

Straight-Line Depreciation

Straight-line depreciation is the depreciation of real property in equal amounts...

Recovery Period

The recovery period of an asset is the length of time over which the Internal Re...

Depreciation Recapture

Depreciation recapture is a process that allows the IRS to collect taxes on the ...

Tax Cuts And Jobs Act (TCJA)

On Dec. 22, 2017, former President Donald Trump signed a massive tax bill known ...

Probate Sale

A probate sale happens when a homeowner dies without writing a will or leaving a...

Land Lease

Traditionally, when you purchase a home, you own the home and the land the prope...

Inspection Contingency

An inspection contingency, also called a ‘due diligence contingency’ gives t...

iBuyer

An iBuyer is a company that uses technology to make an offer on your home instan...

Hard Money Loan

A hard money loan is a type of loan that is secured by real property. These loan...

FHA 203k Rehab Loan

An FHA 203(k) loan is a type of government-insured mortgage that allows the borr...

Conventional Sale

A conventional sale is when the property is owned outright or the owner owes les...

Backup Offer

When a buyer is interested in purchasing a property that is already under contra...

As-Is

If you’re in the market for a house, you’ll probably come across a few listi...

Appraisal Contingency

A contingency is a condition that needs to be met before an offer can proceed. I...

Operating Expenses

Operating expenses include all of the costs associated with operating the proper...

USDA Loan

The U.S. Department of Agriculture (USDA) home loans program offers mortgages to...

Staging

Staging refers to preparing your property to sell so it appeals to the most pot...

Net Operating Income (NOI)

Net Operating Income, or NOI for short, is a formula used to quickly calculate p...

Listing Agreement

A listing agreement is an employment contract between a property owner and a rea...

Earnest Money

Earnest money is a deposit made to a seller before closing on a house to show yo...

Curb Appeal

Curb appeal is a subjective appreciation for a physical asset in its simplest fo...

Construction Loan

A construction loan is usually a short-term loan that provides funds to cover th...

Amortization

Amortization is the schedule of your periodic mortgage loan payments. An amortiz...

Appreciation

In real estate, the term appreciation refers to the increase in the value of a p...

Bi-weekly Mortgage

A bi-weekly mortgage payment is a mortgage option where, instead of 12 monthly p...

Clear Title

A clear title, also known as a “clean title,” is a property title that is fr...

Equal Credit Opportunity Act (ECOA)

The Equal Credit Opportunity Act (ECOA) is federal civil rights law that prevent...

Seller’s Disclosure

When an owner sells a property, they are typically required to disclose informat...

Refinance

When you refinance, you’re essentially trading in your current mortgage for a ...

Purchase Agreement

A real estate purchase agreement is a legally binding document that governs the ...

PITI

PITI is an acronym that stands for principal, interest, taxes and insurance R...

Home Equity Line Of Credit (HELOC)

A home equity line of credit, or HELOC, is a second mortgage that gives you acce...

NHD Report

NHD Report stands for Natural Hazard Disclosure Report. The natural hazard discl...

Debt-To-Income Ratio

Debt-to-income ratio or DTI a percentage that tells lenders how much money you s...

ROI

ROI stands for Return On Investment. Return on investment (ROI) is a measurement...

Days On Market (DOM)

DOM is a common real estate abbreviation for ‘Days On Market’. The term days...

Blind Offer

A blind offer is an offer by a buyer to buy a property that has not been seen in...

Appraisal

An appraisal is the estimation of a home’s current market value. The valuation...

Eviction

Eviction is the process by which a landlord can legally remove a tenant from the...

Vacancy Rate

The vacancy rate is the percentage of all available units in a rental property t...

Sublease

Subletting occurs when your lease-signing tenant rents out their spot in your pr...

Rent Control

Rent control is a government program that is intended to keep living costs affor...

Proration

In real estate terms, proration is defined as the act of dividing real estate ex...

Guarantor

The definition of a guarantor is a person who guarantees something for someone e...

Short Sale

A short sale occurs when a financially distressed homeowner sells their home for...

Transfer Tax

A transfer tax is a charge on the transfer of ownership or title to property fro...

Transfer Of Ownership

Transfer of ownership is the means by which the ownership of a property is trans...

VA Mortgage

A VA loan is a mortgage loan that is available through a program established by ...

Title

When you purchase a home, one of the documents that you will receive and be requ...

Rate Lock

In real estate terms, rate lock refers to a mortgage. It is an agreement between...

Quitclaim Deed

A quitclaim deed releases a person’s interest in a property – public...

Per Diem

Per diem is latin for per day. In real estate terms, a per diem penalty is usual...

Mortgage

A mortgage refers to a loan used to purchase or maintain a home, land, or other ...

Loan-To-Value

Loan-to-value ratio is a measure that compares the amount of your mortgage to th...

Lien

A lien is a claim or legal right against a property that can be used as collater...

HOA

HOA stands for Homeowners Association. It is a self-governing organization for a...

Home Inspection

A home inspection is an examination of the condition of a real estate property, ...

Foreclosure

Foreclosure is a legal process that begins when a borrower fails to make their m...

Fixed-Rate Mortgage

A fixed-rate mortgage is essentially A home loan with A fixed interest rate for ...

FHA Loan

An FHA loan is a government-backed mortgage loan that requires a lower minimum d...

Escrow

Escrow is the use of a third party, which holds an asset or funds before they ar...

Down Payment

A down payment is a sum of money paid upfront in a financial transaction, for ex...

Deed

A deed is a legal document that once signed, transfers ownership of an asset to ...

Addendum

An addendum is defined as an attachment to a contract that modifies the terms an...