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March 2011

Is it time to buy? Time to sell? With affordable housing prices, and historically low interest... read more

Taxes...how do property taxes work here?

How do taxes work?Are the current taxes relevant to what I will pay? There are discounts for... read more

Real Estate Update March 2010

Check this link. 

http://www.nytimes.com/2010/03/08/business/08short.html?pagewanted=all

... read more

Foreclosed Properties, Interesting

People often ask about foreclosures.

Foreclosures can be cheap. Or seem cheap.

Seldom... read more

Glossary

ABSORPTION RATE   Back to top
The ratio of the number of properties in an area that have been sold against the number available. Used to show the volatility of a market.

ABSTRACTION METHOD   Back to top
This method of estimating the value of property uses similar properties available in the same market to extract the value of a parcel of land.

ACCELERATION CLAUSE   Back to top
A provision in a mortgage that gives the lender the right to demand immediate payment of the outstanding loan balance under certain circumstances. Usually when the borrower defaults on the loan.

ACCESSORY BUILDING   Back to top
A building separate from the main structure on a property. Often used for a specific purpose, such as a workshop, storage shed or garage.

ACCRETION   Back to top
The natural growth of a piece of land resulting from forces of nature

ACRE   Back to top
43,560 square feet. A measurement of area.

ACTUAL AGE   Back to top
The amount of time that has passed since a building or other structure was built. See also: EFFECTIVE AGE

ADJUSTMENT DATE   Back to top
The date the interest rate changes on an adjustable rate mortgage.

AD VAL OREM TAX   Back to top
Taxes assessed based on the value of the land and improvements

ADDENDUM   Back to top
A supplement to any document that contains additional information pertinent to the subject. Appraisers use an addendum to further explain items for which there was inadequate space on the standard appraisal form.

ADJUSTABLE-RATE MORTGAGE (ARM)   Back to top
A type of mortgage where the interest rate varies based on a particular index, normally the prime lending rate.

ADJUSTED BASIS   Back to top
The value of an asset (property or otherwise) that includes the original price plus the value of any improvement, and less any applicable depreciation.

ADJUSTED SALES PRICE   Back to top
An opinion of a property's sales price, after adjustments have been made to account for differences between it and another comparable property.

AESTHETIC VALUE   Back to top
The additional value a property enjoys based on subjective criteria such as look or appeal.

AFFIRMATION   Back to top
A declaration that a certain set of facts are truthful.

AFFORDABILITY ANALYSIS   Back to top
A calculation used to determine an individual's likelihood of being able to meet the obligations of a mortgage for a particular property. Takes into account the down payment, closing costs and on-going mortgage payments.

AGENT   Back to top
A person who has been appointed to act on behalf of another for a particular transaction.

AMENITY   Back to top
Any feature of a property that increases its value or desirability. These might include natural amenities such as location or proximity to mountains, or man-made amenities like swimming pools, parks or other recreation.

AMERICAN SOCIETY OF APPRAISERS   Back to top
An organization of appraisal professionals and others interested in the appraisal profession.

AMORTIZATION   Back to top
The repayment of a loan through regular periodic payment.

AMORTIZATION SCHEDULE   Back to top
The breakdown of individual payments throughout the life of an amortized loan, showing both principal contribution and debt service (interest) fees.

AMORTIZATION TERM   Back to top
The length of time over which an amortized loan is repaid. Mortgages are commonly amortized over 15 or 30 years.

AMPERAGE   Back to top
A measure of electric current describing the magnitude.

ANNUAL PERCENTAGE RATE (APR)   Back to top
The rate of annual interest charged on a loan.

ANNUITY   Back to top
A sum of money paid at regular intervals, often annually.

APPLICATION   Back to top
A form used to apply for a mortgage loan that details a potential borrower's income, debt, savings and other information used to determine credit worthiness.

APPRAISAL   Back to top
A ''defensible'' and carefully documented opinion of value. Most commonly derived using recent sales of comparable properties by a licensed, professional appraiser.

APPRAISAL FOUNDATION   Back to top
A not-for-profit educational organization established by the appraisal profession in the United States in 1987. It is dedicated to the advancement of professional valuation and responsible for establishing, improving, and promoting the Uniform Standards of Professional Appraisal Practice (USPAP).

APPRAISAL INSTITUTE   Back to top
A world-wide organization dedicated to real estate appraisal education, publication and advocacy.

APPRAISAL PRINCIPLES   Back to top
The basic building blocks of the property valuation process, including property inspection, market analysis and basic economics.

APPRAISAL REPORT   Back to top
The end result of the appraisal process usually consists of one major standardized form such as, the Uniform Residential Appraisal Report form 1004, as well as all supporting documentation and additional detail information. The purpose of the report is to convey the opinion of value of the subject property and support that opinion with corroborating information.

APPRAISAL STANDARDS BOARD (ASB)   Back to top
An independent board of the APPRAISAL FOUNDATION, which writes, amends, and interprets USPAP. The ASB is composed of up to seven appraisers appointed by the Foundation's Board of Trustees. The ASB holds public meetings throughout the year to interpret and amend USPAP.

APPRAISED VALUE   Back to top
An opinion of the fair market value of a property as developed by a licensed, certified appraiser following accepted appraisal principals.

APPRAISER   Back to top
An educated, certified professional with extensive knowledge of real estate markets, values and practices. The appraiser is often the only independent voice in any real estate transaction with no vested interest in the ultimate value or sales price of the property.

APPRECIATION   Back to top
The natural rise in property value due to market forces.

ARMS LENGTH TRANSACTION   Back to top
Any transaction in which the two parties are unconnected and have no overt common interests. Such a transaction most often reflects the true market value of a property.

ASSESSED VALUE   Back to top
The value of a property according to jurisdictional tax assessment.

ASSESSMENT   Back to top
The function of assigning a value to a property for the purpose of levying taxes.

ASSESSMENT RATIO   Back to top
The comparative relationship of a property's assessed value to its market value.

ASSESSOR   Back to top
The jurisdictional official who performs the assessment and assigns the value of a property.

ASSET   Back to top
Any item of value which a person owns.

ASSIGNMENT   Back to top
Transfer of ownership of a mortgage usually when the loan is sold to another company.

ASSUMABLE MORTGAGE   Back to top
A mortgage that can be taken over by the buyer when a home is sold.

ASSUMPTION   Back to top
When a buyer takes over, or "assumes" the sellers mortgage.

ATTACHED HOUSING   Back to top
Any number of houses or other dwellings which are physically attached to one another, but are occupied by a number of different people. The individual houses may or may not be owned by separate people as well.

BACKFILL   Back to top
The slope of the ground around a house.

BALL COCK VALVE   Back to top
The valve inside a toilet tank that controls the filling of the tank.

BALLOON MORTGAGE   Back to top
A mortgage loan in which the monthly payments are not large enough to repay the loan by the end of the term. So at the end of the term, the remaining balance comes due in a single large payment.

BALLOON PAYMENT   Back to top
The final large payment at the end of a balloon mortgage term.

BANKRUPTCY   Back to top
When a person or business is unable to pay their debts and seeks protection of the state against creditors. Bankruptcies remain on credit records for up to ten years and can prevent a person from being able to get a loan.

BEAM   Back to top
A structural supporting member.

BILL OF SALE   Back to top
A physical receipt indicating the sale of property.

BIWEEKLY MORTGAGE   Back to top
A mortgage where you make "half payments" every two weeks, rather than one payment per month. This results in making the equivalent of 13 monthly payments per year, rather than 12, significantly reducing the time it takes to pay off a thirty year mortgage.

BLIGHTED AREA   Back to top
Any region of a city or town that has fallen into disrepair or otherwise has become undesirable.

BONA FIDE   Back to top
Any genuine offer, made without intent to defraud or deceive.

BRIDGE FINANCING   Back to top
An interim loan made to facilitate the purchase of a new home before the buyer's current residence sells and its equity is available to fund the new purchase.

BRIDGING   Back to top
Structural members used between beams to strengthen the structure.

BROKER   Back to top
An individual who facilitates the purchase of property by bringing together a buyer and a seller.

BTU   Back to top
British Thermal Unit. A unit of measurement used to describe heating or cooling capacity.

BUFFER ZONE   Back to top
A segment of land between two disparate municipal zones which acts as a shield to keep one zone from encroaching upon the other. Often used to separate residential districts from commercial areas.

BUILDING CODE   Back to top
Regulations that ensure the safety and material compliance of new construction within a municipality. Building codes are localized to ensure they are adequate to meet the risk of common hazards.

BUILDING LINE OR SETBACK   Back to top
The statutory distance between buildings and the property line, imposed by municipalities, home associations, or other agreements.

BUILT-INS   Back to top
Specific items of personal property which are installed in a real estate improvement such that they become part of the building. Built-in microwave ovens and dishwashers are common examples.

BUNGALOW   Back to top
A one-story, home-style dating from the early twentieth century. Often characterized by a low-pitched roof.

BUY DOWN   Back to top
Extra money paid in a lump sum to reduce the interest rate of a fixed rate mortgage for a period of time. The extra money may be paid by the borrower, in order to have a lower payment at the beginning of the mortgage. Or paid by the seller, or lender, as incentive to buy the property or take on the mortgage.

BX CABLE   Back to top
Electrical cable shrouded in a galvanized steel outer cover.

CALL OPTION   Back to top
A clause in a mortgage which allows the lender to demand payment of the outstanding balance at a specific time.

CAP   Back to top
Associated with Adjustable Rate Mortgages. A limit on how high monthly payments or how much interest rates may change within a certain time period or the life of the mortgage.

CAPE COD COLONIAL   Back to top
A single-story house style made popular in New England. Often characterized by a steep roof with gables.

CAPITAL   Back to top
Accumulated goods and money which is most often used to generate additional income.

CAPITAL EXPENDITURE   Back to top
An outlay of funds designed to improve the income-producing capabilities of an asset or to extend its economic life.

CASH-OUT REFINANCE   Back to top
Refinancing a mortgage at a higher amount than the current balance in order to transform a portion of the equity into cash.

CAULKING   Back to top
A pliable material used to seal cracks or openings such as around windows.

CAVEAT EMPTOR   Back to top
Literally translated: ''Let the buyer beware.'' A common business tenet whereby the buyer is responsible for verifying any and all claims by the seller of property.

CERTIFICATE OF DEPOSIT   Back to top
A document showing that the bearer has a certain amount of money, at a particular amount interest, on deposit with a financial institution.

CERTIFICATE OF DEPOSIT INDEX   Back to top
An index based on the interest rate of six month CD's. Used to set interest rates on some Adjustable Rate Mortgages.

CERTIFICATE OF ELIGIBILITY   Back to top
A document issued by the Veterans Administration that certifies eligibility for a VA loan.

CERTIFICATE OF OCCUPANCY   Back to top
Issued by an appropriate jurisdictional entity, this document certifies that a building complies with all building codes and is safe for use or habitation.

CERTIFICATE OF REASONABLE VALUE (CRV)   Back to top
Usually based on an independent appraisal, a CRV for a particular property establishes the maximum amount which can be secured by a VA mortgage.

CERTIFICATE OF TITLE   Back to top
A document designating the legal owner of a parcel of real estate. Usually provided by a title or abstract company.

CERTIFIED GENERAL APPRAISER   Back to top
Generally, any professional who has met the local or state requirements, and passed the appropriate certification exam, and is capable of appraising any type of property.

CERTIFIED RESIDENTIAL APPRAISER   Back to top
A sub-classification of appraiser who is only licensed to appraise residential property, usually up to four units.

CHAIN OF TITLE   Back to top
The complete history of ownership of a piece of property.

CHATTEL   Back to top
Any personal property which is not attached to or an integral part of a property. Chattel is not commonly taken into consideration when appraising the value of real property.

CIRCUIT BREAKERS   Back to top
Electrical devices which automatically open electrical circuits if they are overloaded.

CLEAR TITLE   Back to top
Ownership of property that is not encumbered by any counter-claim or lien.

CLOSING   Back to top
A torturous process designed to induce cramping in a home buyer's hands by requiring signature on countless pieces of documentation that nobody has ever read. Or, the process whereby the sale of a property is consummated with the buyer completing all applicable documentation, including signing the mortgage obligation and paying all appropriate costs associated with the sale (CLOSING COSTS).

CLOSING COSTS   Back to top
All appropriate costs generated by the sale of property which the parties must pay to complete the transaction. Costs may include appraisal fees, origination fees, title insurance, taxes and any points negotiated in the deal.

CLOSING STATEMENT   Back to top
The document detailing the final financial arrangement between a buyer and seller and the costs paid by each.

CO-BORROWER   Back to top
A second person sharing obligation on the loan and title on the property.

COLLATERAL   Back to top
An asset which is placed at risk to secure the repayment of a loan.

COLLECTION   Back to top
The process a lender takes to pursue a borrower who is delinquent on his payments in order to bring the mortgage current again. Includes documentation that may be used in foreclosure.

CO-MAKER   Back to top
A second party who signs a loan, along with the borrower, and becomes liable for the debt should the borrower default.

COMMON LAW   Back to top
As opposed to statute law. Laws that have been established by custom, usage and courts over many years.

COMMISSION   Back to top
A percentage of the sales price or a fixed fee negotiated by an agent to compensate for the effort expended to sell or purchase property.

COMMON AREA ASSESSMENTS   Back to top
Fees which are charged to the tenets or owners of properties to cover the costs of maintaining areas shared with other tenets or owners. Commonly found in condominium, PUD or office spaces.

COMMON AREAS   Back to top
Any areas, such as entryways, foyers, pools, recreational facilities or the like, which are shared by the tenets or owners of property near by. Commonly found in condominium, PUD or office spaces.

COMMUNITY PROPERTY   Back to top
In many jurisdictions, any property which has been acquired by a married couple. The ownership of the property is considered equal unless stipulated otherwise by both parties.

COMPARABLES   Back to top
An abbreviated term used by appraisers to describe properties which are similar in size, condition, location and amenities to a subject property whose value is being determined. The Uniform Standards of Professional Appraisal Practice (USPAP) establish clear guidelines for determining a comparable property.

COMPOUND INTEREST   Back to top
Interest paid on the principal amount, as well as any accumulated interest.

CONCESSIONS   Back to top
Additional value granted by a buyer or seller to entice another party to complete a deal.

CONDEMNATION   Back to top
The official process by which a property is deemed to be uninhabitable or unusable due to internal damage or other external conditions.

CONDENSATION   Back to top
The transition of water vapor to liquid. Typically forms in areas of high humidity.

CONDOMINIUM   Back to top
A development where individual units are owned, but common areas and amenities are shared equally by all owners.

CONDOMINIUM CONVERSION   Back to top
Commonly, the conversion of a rental property such as an apartment complex into a CONDOMINIUM-style complex where each unit is owned rather than leased.

CONDUIT   Back to top
The pipe through which electric wiring is run.

CONSTRUCTION LOAN   Back to top
A loan made to a builder or home owner that finances the initial construction of a property, but is replaced by a traditional mortgage one the property is completed.

CONTIGUOUS   Back to top
Connected to or touching along an unbroken boundary.

CONTINGENCY   Back to top
Something that must occur before something else happens. Often used in real estate sales when a buyer must sell a current home before purchasing a new one. Or, when a buyer makes an offer that requires a complete home inspection before it becomes official.

CONTRACT   Back to top
A legally binding agreement, oral or written, between two parties.

CONVENTIONAL MORTGAGE   Back to top
A traditional, real estate financing mechanism that is not backed by any government or other agency (FHA, VA, etc.).

CONVERTIBLE ARM   Back to top
A mortgage that begins as and adjustable, that allows the borrower to convert the loan to a fixed rate within a specific timeframe.

COOPERATIVE (CO-OP)   Back to top
A form of ownership where each resident of a multiunit property owns a share in a cooperative corporation that owns the building. With each resident having rights to a specific unit within the building.

CORPORATE RELOCATION   Back to top
A situation where a person's employer pays all or some of the expenses associated with moving from one location to another, usually over a substantial distance. Relocation expenses often include the amounts, such as brokerage fees, incurred in the selling and buying of the employee's primary residence.

COST OF FUNDS INDEX (COFI)   Back to top
An index of financial institutions costs used to set interest rates for some Adjustable Rate Mortgages.

COVENANT   Back to top
A stipulation in any mortgage that, if not met, can be cause for the lender to foreclose.

CREDIT   Back to top
A loan of money for the purchase of property, real or personal. Credit is either secured by an asset, such as a home, or unsecured.

CREDIT HISTORY   Back to top
A record of debt payments, past and present. Used by mortgage lenders in determining credit worthiness of individuals.

CREDITOR   Back to top
A person to whom money is owed.

CREDIT REPORT   Back to top
A detailed report of an individuals credit, employment and residence history prepared by a credit bureau. Used by lenders to determine credit worthiness of individuals.

CREDIT REPOSITORY   Back to top
Large companies that gather and store financial and credit information about individuals who apply for credit.

CUL-DE-SAC   Back to top
A dead-end street. One with only one entrance/exit.

DATE OF APPRAISAL   Back to top
The specific point in time as of which an appraiser designates the value of a home. Often stipulated as the date of inspection.

DEBT   Back to top
An obligation to repay some amount owed. This may or may not be monetary.

DEBT EQUITY RATIO   Back to top
The ratio of the amount a mortgagor still owes on a property to the amount of equity they have in the home. Equity is calculated at the fair-market value of the home, less any outstanding mortgage debt.

DEED   Back to top
A document indicating the ownership of a property.

DEED-IN-LIEU (OF FORECLOSURE)   Back to top
A document given by a borrower to a lender, transferring title of the property. Often used to avoid credit-damaging foreclosure procedures.

DEED OF TRUST   Back to top
A document which transfers title in a property to a trustee, whose obligations and powers are stipulated. Often used in mortgage transactions.

DEED OF RECONVEYANCE   Back to top
A document which transfers ownership of a property from a Trustee back to a borrower who has fulfilled the obligations of a mortgage.

DEED OF RELEASE   Back to top
A document which dismisses a lien or other claim on a property.

DEED OF SURRENDER   Back to top
A document used to surrender any claim a person has to a property.

DEFAULT   Back to top
The condition in which a borrower has failed to meet the obligations of a loan or mortgage.

DELINQUENCY   Back to top
The state in which a borrow has failed to meet payment obligations on time.

DEPOSIT   Back to top
Cash given along with an offer to purchase property, Also called EARNEST MONEY.

DEPRECIATION   Back to top
The natural decline in property value due to market forces or depletion of resources.

DETACHED SINGLE-FAMILY HOME   Back to top
A single building improvement intended to serve as a home for one family.

DISCOUNT POINTS   Back to top
Points paid in addition to the loan origination fee to get a lower interest rate. One point is equal to one percent of the loan amount.

DISTRESSED PROPERTY   Back to top
A mortgaged property which has been foreclosed on.

DOWNSPOUT   Back to top
The pipe that water moves th

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