GA Real Estate 5 Glossary

One authorized to transact all of the principal's affairs within the context of a broad commercial or other kind of endeavor. Property manager.

A lien that attaches to all property owned by an individual. Real and personal.

Contains covenants in which the grantor formally guarantees that good and marketable title is being conveyed. Highest deed - 5 covenants.

Commonly known as "Ginnie Mae," this agency of HUD operates in the secondary mortgage market. It is involved with special government financing programs.

This lease provides for periodic step increases in the rental payments

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; FHA 245.

Purchaser or donee receiving title to property.

Owner making conveyance of title or interest in property.

The actual income received from property before the deduction for any expenses

A method of appraising income-producing property based on a multiple of the annual gross income; also called a gross rent multiplier.

A method of appraising single family or duplexes based on the monthly gross income.

That part of a deed beginning with the words, "To have and to hold", followed by the granting clause and reaffirming the extent of ownership that the grantor is transferring. The habendum clause defines or limits the extent of ownership in the estate granted as, for example, a fee simple, life estata or easement: "To have and to hold unto said Sally Smith, grantee, a life estate in the following property"

The legal use of a parcel of land, which when capitalized, will generate the greatest net present value of income. The first thing an appraiser should determine.

An agency of the federal government which oversees many federal housing programs

process of pledging something (house) as security, but retaining possession of it.

Incapable of being moved; fixed in location, such as land.

contract formed through the acts or conduct of the parties. involved.(Ostensible)

A traditional means of appraising property based on the assumption that value is equal to the present worth of future rights to income.

This economic principle states that 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.

Elements of a structure which are neither physically possible nor economically feasible to correct.

The rental is tied to some commonly agreed to price index such as the Consumer Price Index or the Wholesale Price Index.

1) the sum paid for the use of money (2) the degree of rights in the ownership of land.

Dying without a will.

A form of concurrent ownership, which occurs when two or more persons own a single estate in land, with right of survivorship. Must have equal shares, right to partition

The charge upon the land of a debtor, resulting from the decree of a court, entered in the judgment docket. Lawsuit

An encumbrance, second in priority, to a previously recorded lien or to a lien to which the encumbrance has been subordinated.

The seller accepts a down payment on a parcel of land but title to the property does not pass until the last principal payment has been received. This is referred to as an installment sales contract or a contract for a deed.

A defect which cannot be discovered by ordinary inspection.

The interest that the tenant has created by a lease.

A written description of a parcel of land which locates it precisely and will hold up in court. (Does not include address.)

Estates in possession generally referred to as leaseholds. Considered to exist for a definite period of time, or successive periods, of time until terminated by notice; also know as non-freehold estates.

Tenant.

Landlord.

Using borrowed capital to finance the purchase of real estate or other assets. (No money down)

A personal privilege to go upon the land of another; not considered an interest in land. Permission only to use.

A legally recognized right to enforce a claim or charge on the property of another for payment of some debt, duty or obligation.

The mortgage merely creates a lien right on the mortgagee with the mortgagor retaining the title.

An interest which only lasts for the term of a life, or lives, of one or more persons. Death terminates

A life estate in one person with another person serving as the measuring life.

The holder of a life estate.

An entity with one or more general partners and one or more passive investors, called limited partners

An agreed-to sum, which will be paid if the contract is breached.

A notice filed for he purpose of serving constructive notice that title, or some matter involving particular real property, is in litigation.

An employment agreement between an owner and broker defining the duties and rights of both parties. (Unilateral contract)

The relationship between the amount borrowed and the appraised value of the property. (Purchase price 100,000-Loan 80,000-LTV 80%)

A method of land description frequently used after land has been subdivided into building lots; also referred to as the recorded plat method. (Must have a plat map to find the property)

The duty owed by an agent, to avoid conflicts of interest or any activity which is detrimental to a principal.

An employment contract between the owner of real estate and a property management firm that agrees to oversee the management of the property

economic function of bringing buyers and sellers together through the price mechanism.

A means of estimating value by comparing similar properties. Used when there is an active market and where comparables can be identified. Also called comparable sales approach.

The price at which a willing buyer and a willing seller will agree upon, where neither is under any undue pressure, and both are negotiating at arms length with complete knowledge of the market.

One which is free from reasonable doubts or objections, and which the courts would compel a purchaser to accept under the terms of a sales contract.

A program for the future development of a community which serves as the guideline for capital expenditures.

A method of land description which involves identifying distances and directions and makes use of both the physical boundaries and measurements of the land.

A mill is equal to one-tenth of one cent and is used to state the property tax rate. (.001)

A tax rate stated in tenths of a cent. For example, a millage rate of 150 mills on property assessed at $100,000 would result in a property tax of$1,500 ($100,000 x .150).

An infant; one who has not attained majority in a state and does not have legal capacity to be bound by most contracts. (Voidable contracts)

An innocent or negligent mis-statement of a material fact, detrimentally relied upon by the other party.

A lease which has a term of one month but renewable for successive months at the option of both parties.

Physical evidence of a point- of- beginning established by surveyors for use in locating parcels of land.

A legal document used to secure the performance of an obligation, in which the borrower or mortgagor agrees to pledge property to secure the debt represented by the promissory note. (A contract).

The broker agrees to sell the property in order to achieve a net price to the owner, and anything which is received above the net price is the broker's commission. A net listing is prohibited by the licensing law in many states.

A pre-existing use of land which does not conform to the zoning ordinance but which may legally remain.

A signed instrument acknowledging the existence of a debt and the promise to pay.

Occurs when the person in a contract, to whom the duty was owed, expressly agrees to substitute the delegate, or new obligor, for a consideration, and agrees to discharge the old obligor from the obligations under the contract. For example, loan assumptions

Invalid and unenforceable.

A loss in value due to reduced desirability and usefulness of a structure because its design and construction have become obsolete. A loss due to a structure’s becoming old fashion, not in keeping with today’s standards or needs, with consequential loss of income

The necessary elements of mutual assent; for example, an agreement of one party to buy and another party to sell.

An agreement between an owner and many brokers. If a broker produces a ready willing, and able buyer, a commission is due. However, the owner still has the right to sell his/her property and is not obligated to pay a commission to anyone.

A loan containing a clause which allows the mortgagor to borrow additional money without rewriting the mortgage.

A right which is given for consideration to a party (optionee) by a property owner (optionor) to purchase or lease property within a specified time, at a specified price and terms. An option is irrevocable by the optionee and will not be extinguished by death or insanity of either party

The holder of the option. Buyer

The seller of the option.

A statute enacted by the legislative branch of a local government

A policy insuring the owner of real estate against certain defects of title

Individual ownership.