The Real Estate Dictionary

Archive for the ‘Real Estate Dictionary’ Category

B HORIZON – The horizon (layer of soil) beneath the top layer. The composition of the B horizon is changed by the action of percolating water.

B.T.U. – See: British Thermal Unit.

BACK POINTS – Points paid to a mortgage broker by a lender which exceed the points paid by the borrower.

BACK TITLE LETTER – In states where attorneys examine title for title insurance purposes, this letter is given by a title insurance company to an attorney, giving to said attorney the condition of title as of a certain date. The attorney then begins his examination as of that date. Also called a starter or back title certificate. See also: Starter.

BACKFILL – To replace ground removed by excavation for construction. Used to brace a structure (especially a foundation or footings).

BACKUP OFFER – A secondary offer to buy property, used in case the first (primary) offer fails. A backup offer is especially useful when the primary offer contains difficult contingencies.

BACKWATER – Water in a stream or river which, because of a dam or other obstruction, is stopped in its course or flows back toward its source.

BACKWATER VALVE – A valve set in a lateral sewer line which automatically prevents sewage from flowing back to its source (a building).

BALANCE – An appraisal term meaning that value of real property is best sustained when opposite influences (e.g. supply and demand) are equal.

BALANCE DUE DATE – See: Installment Note, Balance Due Date.

BALANCE SHEET – A statement of the assets and liabilities of a company to determine its net worth (equity).

BALANCED EXCHANGE – A tax free exchange of properties under Section 1031 of the Internal Revenue code. To be tax free the taxpayer must invest all of the profit from the relinquished property into the replacement property. See also: Boot.

BALCONY – (1) A balustrade, railed, elevated platform projecting from the face of a building. (2) An upper floor seating area in a theater.

BALLOON – (1) The final payment of a balloon note (see which). (2) A landlocked parcel of land.

BALLOON FRAME CONSTRUCTION – A term describing the framing used in a two story wood construction where the studs extend from the sill (ground level) to the ceiling of the second floor. See: Platform Frame Construction; Post and Beam Frame Construction.

BALLOON MORTGAGE – A mortgage that has a final payment larger than the other payments. For example, a thirty year loan due in five years would have a payment that would amortize it (pay it off) over thirty years. However, the loan would be due in five years, making the final payment (the balloon payment) greater than the previous payments.

BALLOON NOTE – A note calling for periodic payments which are insufficient to fully amortize the face amount of the note prior to maturity, so that a principal sum known as a “balloon” is due at maturity.

BALLOON PAYMENT – The final payment (balance due) of a balloon note.

BALTIMORE RULE – An appraisal method for setting a value on a corner lot. The lot is appraised as an inside lot for its front footage on both streets. The two values are then added to find the value of the corner lot. For example: Lot 1 fronts 100′ on street A and 100′ on street B. The value of a 100′ inside lot on street A is added to the value of a 100′ inside lot on street B to find the value of lot 1. Also called the Bernard Rule.

BALUSTER – The supporting posts of a handrail in a staircase.

BALUSTRADE – A row of balusters supporting a handrail.

BANK – (1) The elevated land on each side of a river or stream which keeps the water in its natural channel. (2) See: Commercial Bank.

BANKRUPT – One who is adjudicated a bankrupt by a court having proper jurisdiction. The bankruptcy may be voluntary (petitioned by the bankrupt) or involuntary (petitioned by the creditors of the bankrupt).

BANKRUPTCY – Proceedings under federal bankruptcy statutes to relieve a debtor (bankrupt) from insurmountable debt. The bankrupt’s property is distributed by the court to the creditors as full satisfaction of the debts. In accordance with certain priorities and exemptions. Voluntary bankruptcy is petitioned by the debtor; involuntary by the creditors.

BARGAIN AND SALE DEED – A contract or deed which conveys a “use” in the buyer under the Statute of Uses. Although the deed may also convey legal title, there are no warranties by the seller that title is good unless specified. See also: Grant Deed; Quit Claim Deed; Warranty Deed.

BARGE COUPLE – Either of the two rafters supporting the part of a gable roof which extends beyond the supporting wall.

BARGE COURSE – Tiling on a gable roof projecting beyond the supporting wall.

BARGE-BOARD – A board (often carved or ornamented) which hangs from the projecting edge of a sloping roof. Also called a vergeboard.

BARN – A farm building used to store hay, grain, farm equipment, and to house livestock.

BARREL – A unit of solid or liquid measure, varying with each trade. For example: A barrel of water if 31 1/2 gallons, oil 42 gallons.

BASE – The lowest part of a construction member. That which bears the load. See also: Base Title.

BASE AND MERIDIAN – See: Base Line; Meridian.

BASE LINE – (1) A survey line used in the government survey to establish township lines. The base line runs East and West through a principal meridian (line running North and South). (2) A horizontal elevation line used as the centerline in a survey for a highway route.

BASE MAP – A map having background information, such as state, county, or city boundaries, upon which more detailed data is plotted.

BASE MOLDING – Molding installed along the top of the baseboard.

BASE PROPERTY – Private property owned by a cattle owner, required before a permit will be issued to allow the cattle to graze on public land.

BASE RENT – A specific amount used as a minimum rent in a lease which uses a percentage or overage for additional rent.

BASE SHOE MOLDING – Molding installed along the bottom of a baseboard (junction with floor). Also called carpet molding or carpet strip.

BASE TITLE – The result of an examination of title for the internal use of a title insurance company. Usually covers a large area and is done in anticipation of future sales or subdividing of the area.

BASE YEAR – The year upon which a direct expense escalation of rent is based. See also: Escalation Clause (3).

BASEBOARD – Generally, any board or molding covering an interior wall where it meets the floor.

BASEBOARD HEATING – A system of perimeter heating in which the baseboard is replaced by the heating units. May also be panels rather than baseboard units.

BASEMENT – Generally, the story of a building below ground level.

BASIC CAPACITY – In connection with highway use, the greatest number of cars per hour which can pass a given point under ideal driving conditions will give the basic capacity of a lane or road.

BASIC CROPS – Crops usually subject to government price supports and considered the basis of our agricultural economy, such as wheat, corn, oats, rice, and similar crops.

BASIS – The purchase price of a property, including all expenses related to the purchase.

BASIS FOR DEPRECIATION – The value of property for purposes of depreciation. For example: A purchased asset The basis is cost, whether fully paid for or not. The method for determining the basis is different for gift, inheritance, etc.

BASIS POINT – A finance term meaning a yield of 1/100th of 1%.

BATHROOM – A room containing a toilet, sink, and bathtub or bathtub-shower combination. In appraisal for federally insured mortgages, a toilet and sink (no bathtub or shower) equal a half bathroom; a toilet, sink and stall shower equal a three quarter bathroom.

BATT – A strip of insulation fitting closely between the studs of a wall.

BATTEN – A narrow strip (usually of wood), used to cover seams between siding boards.

BATTER – The slope of a structure, such as a wall or bank; expressed in terms of the vertical rise per horizontal distance, such as 3 inches (vertical) per 10 feet (horizontal).

BATTURE LAND – The land between a river bank and the water’s edge when the water level is lower than normal.

BAUHAUS – (1919-1933) A school of design (most noted for its architecture) founded by Walter Gropius in Germany.

BAY – (1) The opening between two columns, walls, etc., which forms a room-like space. May be industrial space, parking space, barn space, or other use. (2) A bending or curving of the shoreline so as to form a partially enclosed body of water.

BAY WINDOW – A window which projects in a curve out from a wall, giving a bay- like effect to the interior.

BEACH – That portion of the shore between ordinary low and high water marks. Commonly used to describe any sandy area adjacent to a body of water.

BEAM – A vertical or horizontal member of a structure; may be of wood, steel, concrete, or other strong material, and, unless decorative only, is a load-bearing part of the structure.

BEAMED CEILING – A ceiling having one or more of its beams exposed. See: Beam.

BEARER – One holding commercial paper.

BEARER INSTRUMENTS – Checks, notes, drafts, bonds, etc., payable to whomever has possession of the instruments: i.e. the bearer.

BEARING – (1) Relative position or direction of one object to another or to a compass point. (2) Supporting a load, such as a bearing wall.

BEARING VALUE – In construction, the ability of soil to bear the weight of the structure to be built.

BEARING WALL – A wall which supports the weight of a part of a structure in addition to its own weight.

BED A TREE – Preparing a path (bed) on which a tree is to fall so that it will not be damaged.

BEDROCK – Solid rock beneath the soil, as distinguished from rocks or boulders.

BEDROOM COMMUNITY – An area primarily residential. The people living there commute to work.

BEFORE AND AFTER METHOD – An appraisal method used in both condemnation and modernization. In condemnation the method is used in a partial taking. The value of the total land owned by A, for example, is $1.00 per sq. ft. After a partial taking, the remaining land of A is worth $.75 per sq. ft. A should receive $1.00 per sq. ft. for the property taken plus $.25 per sq. ft. for the remaining parcel. In the event the remaining property is worth $1.25 after the taking (increased value), the payment to A could be less than the value of the property taken. In modernization, an appraiser may take the value of property before and after remodeling to determine if the value increased more than modernization costs.

BELT HIGHWAY – A limited access highway carrying traffic around an urban area, with entrances and exits to principal streets. Also called a by- pass.

BELVEDERE – See: Gazebo.

BENCH MARK – Surveying mark made in some object which is permanently fixed in the ground, showing the height of that point in relation to sea level. Used in topographic surveys and tidal observations.

BENEFICIAL ESTATE – An estate, the right to possession of which has been postponed, such as a devise under a will. More commonly, an estate, the legal ownership of which has not yet vested, as under a land contract. An equitable estate.

BENEFICIAL INTEREST – The equitable, rather than legal ownership of property, such as under a land contract.

BENEFICIAL USE – The doctrine, applicable in some areas, pertains to water rights, giving priority to those who would use the water most beneficially.

BENEFICIARY – (1) One for whose benefit a trust is created. (2) In states in which deeds of trust are commonly used instead of mortgages, the lender (mortgagee) is called the beneficiary.

BENEFICIARY’S DEMAND – Written instructions by a beneficiary under a deed of trust stating and demanding the amount necessary for issuance of a reconveyance, whether a full or partial amount.

BENEFICIARY’S STATEMENT – A statement by a lender under a deed of trust, setting forth the pertinent information necessary to assume said deed of trust, such as the unpaid balance, monthly payment, and interest rate.

BENEFIT OF THE BARGAIN – A rule of damages under which a defrauded purchaser may recover the difference between the actual and misrepresented value of the property purchased, even though greater than the actual loss suffered.

BENEFITS – A term used in eminent domain, referring to the increase in value to land not taken, which is produced by the taking. See also: General Benefits; Special Benefits.

BENEVOLENT ASSOCIATIONS – Non-profit groups having a philanthropic or charitable purpose.

BENT – A transverse frame of a building or bridge, designed to support horizontal or vertical loads.

BEQUEATH – To give personal property by will.

BEQUEST – Traditionally, a gift of personal property in a will. Modernly, a gift of personal or real property. See also: Devise.

BERM – (1) A bench, ledge, or other resting place part way up a hill or slope. (2) A mound used to control drainage by diverting all or part of the flow.

BERNARD RULE – See: Baltimore Rule.

BETTERMENT – An improvement to a structure which is not a repair, restoration, or enlargement. For example: the addition of aluminum siding over a frame wall; paving a street adjoining the structure; adding a fireplace or some similar improvement which increases the value of the property.

BETWEEN SIDEWALLS – See: Balloon Frame Construction; Platform Frame Construction.

BEVELED SIDING – See: Clapboard.

BI – A prefix meaning both “every two” or “twice in”. Biannual, for example, is twice in one year. Biennial is once every two years.

BI-LEVEL – Two levels. Commonly refers to construction of a house. Also called “split” level.

BIANNUAL – Twice per year. Semiannual.

BID – (1) An offer, usually in competition with others, such as at auction. A builder may bid for the right to do construction (especially for a government contract). (2) Used in some states to describe an offer to purchase real estate.

BIENNIAL – Every two years.

BILATERAL (RECIPROCAL) CONTRACT – A contract formed by an exchange of promises. Performance of the contract takes place at a later time. The standard real estate sale’s agreement or lease is a bilateral contract. See also: Unilateral Contract.

BILL DISCOUNTED – A promissory note from which the interest is deducted in advance.

BILL OF SALE – An instrument by which one transfers personal property.

BILLBOARD – A Structure annexed to land for the purpose of posting advertising.

BINDER – (1) A report issued by a title insurance company setting forth the condition of title to certain property as of a certain date, and also setting forth conditions which, if satisfied, will cause a policy of title insurance to be issued. Also called a commitment. See also: Preliminary Title Report. (2) A policy of title insurance (used primarily by investors) calling for a reduced rate for a future policy if the property is sold within a specified period.

BIRD DOGGING – Obtaining the initial lead regarding property, buyers, investors, potential home improvement customers, etc. The lead is then followed up by one empowered to make the deal.

BIRTH RATE – The number of births in a given area during a given period of time, based on per thousand population.

BIWEEKLY ACCELERATED MORTGAGE – A mortgage repaid by biweekly payments. A biweekly payment is equal to one-half the regular monthly payment. This reduced payment is then paid biweekly or 26 times per year. Under this accelerated plan, the borrower pays off more principal than a borrower making monthly payments. Example: A $100,000.00, 30 year loan at 12% interest would have a monthly payment of $1,028.62. Making biweekly payments of $514.31 pays off the 30 year loan in 19 years and 2 weeks and saves $115,975.18 in interest.

BLACK ACRE – Fictitious name used by legal writers to describe a specific property without a more complete description.

BLACKTOP – A black paving surface composed of a coal or asphalt material.

BLANKET DEED OF TRUST – See: Blanket Mortgage.

BLANKET INSURANCE POLICY – A policy covering more than one property. Commonly used by builders of a tract.

BLANKET MORTGAGE – (1) A mortgage covering more than one property of the mortgagor, such as a mortgage covering all the lots of a builder in a subdivision. (2) A mortgage covering all real property of the mortgagor, both present and future. When used in this meaning, it is also called a “general mortgage”.

BLENDED RATE – An interest rate used in refinancing that is higher than the original loan but less than the current market rate.

BLIGHT – To wither and decay. Applied both to diseased plants and to neighborhoods where normal real estate maintenance has stopped.

BLIGHTED AREA – A term popular in urban renewal, referring to a run-down area.

BLIND AD – An ad (usually in a newspaper or magazine) which does not identify the party placing the ad. Often used in an ad for a job, asking that a resume be sent to a post office box.

BLIND CORNER – A corner where building or vegetation (trees, shrubs, etc.) extends to the property line and so obstructs the vision of motorists to right angle traffic.

BLIND NAILING – Nailing so that the nails are sunk into the wall and covered with putty so the nail heads do not show.

BLOCK – (1) In a city, a square or rectangular area enclosed by streets. (2) In some states, a part of a subdivision legal description, such as Lot 1, Block 1, Tract 1. (3) A pulley in a frame. (4) An auctioneer’s platform.

BLOCK BUSTING – An illegal method of obtaining houses at below fair market value by telling the inhabitants that people of a different race or religion, moving into the area, will cause property values to fall.

BLUE LAWS – Actually, laws adopted in some New England colonies regarding religious and personal conduct. Later came to mean any laws regarding the conducting of business on Sunday. Do not confuse with Blue Sky Laws.

BLUE SKY LAWS – Laws to regulate the sale of securities to avoid investment in fraudulent companies or high risk investments without disclosure of the risks to the investor.

BLUEPRINT – A plan of a building in such detail as to enable workmen to construct it from the print. The name comes from the photographic process which produces the plan in white on a blue background.

BOARD – (1) A term which, in the lumber trade, refers to a piece of lumber less than 2 inches thick, and 8 or more inches wide. (2) A group of persons authorized by law to exercise management and control, either of a public function, such as a board of supervisors, board of health, etc., or a private corporation, as a board of directors.

BOARD AND BATTEN – A siding constructed of wide boards (usually one foot wide) placed 1/2 inch apart; the seams are covered by 3 inch wide battens.

BOARD OF ALDERMEN – The governing body of a municipal corporation. Equivalent to a city council.

BOARD OF EQUALIZATION – State board charged with the duty to bring equitable uniformity to the various local property tax assessments.

BOARDFOOT – A unit of measurement for lumber. One boardfoot equals 144 cubic inches or 12″ X 12″ X 1″.

BOARDING HOUSE – A house where one can rent a room and receive board (meals), the cost of which is included in the rent. Not common today.

BOATEL – A name given to a hotel or motel adjacent to a marina and catering to boat travelers.

BOILER PLATE – The form language (generally printed) which is contained in deeds, deeds of trust, CC&R’s, and other documents and contracts. The specifics for each instance are then filled in.

BOILER PLATING – Using form language for a contract, CC&R’s (restrictions), etc.

BOLE – A tree trunk.

BOMA – See: Building Owners And Managers Association.

BONA FIDE – A legal term which refers to any actions, situations, or persons that are honest, in good faith, and without fraud.

BONA FIDE PURCHASER – A purchaser in good faith, for valuable consideration, without notice or knowledge of adverse claims of others. Sometimes abbreviated to B.F.P.

BOND – (1) An insurance agreement by which one is insured against loss by acts or defaults of a third party. In construction, a performance bond insures that the builder will finish his project. The insured could be a lender, purchaser, or other interested party. (2) A method of financing long term debt, issued by a government or private corporation, which bears interest and has priority over stock in terms of security.

BOND FOR DEED – See: Land Contract.

BOND FOR TITLE – See: Land Contract.

BONUS CLAUSE – See: “No Bonus” Clause.

BOOK COST – The actual cost as carried in the account ledger.

BOOK DEPRECIATION – Depreciation reserved (on the books) by an owner for future replacement or retirement of an asset.

BOOK VALUE – The value of a property as a capital asset (cost plus additions to value, less depreciation).

BOOM – (1) A barrier forming an enclosure for logs or timber. (2) A beam of a crane or derrick , used for guiding whatever it lifts.

BOOT – Something given in addition to. Generally used in exchange to refer to something given other than the major properties to be exchanged, in order to equalize value.

BORING TEST – Study of soil by boring holes and removing samples.

BOROUGH – A part of a city, having authority over certain local matters. The best known boroughs are the five boroughs of New York City.

BORROW – Material such as sand or gravel used for grading, which is brought from another location.

BORROW BANK – The place from which borrow material is taken.

BORROW PIT – The pit left after the removal of borrow material. The pit is sometimes filled as a lake and even stocked by some states for fishing.

BORROWER – 1. The party receiving funds that must be repaid, usually with interest. 2. One who uses anything belonging to another with the agreement to return it.

BOTTOM LAND – Low land along a river formed by alluvial deposits. Also low lying ground such as a valley or dale.

BOULEVARD – A wide street, usually having a median or promenade, and lined with trees.

BOUNDARY – A separation, natural or artificial, which marks the division of two contiguous properties.

BOUNDS – Boundaries.

BOURN – A brook. Also called a bourne or burn.

BOURNE – See: Bourn.

BOWSTRING TRUSS – A structural truss with a top member which curves at each end to meet the bottom member, thus resembling a bow.

BRACED FRAMING – Framing reinforced with post and braces, forming a frame more rigid than balloon framing.

BRADLEY FOUNTAIN – See: Bradley Sink.

BRADLEY SINK – A circular lavatory, usually found in industrial buildings, capable of use by several persons at the same time by utilization of a center column containing multiple water jets operated by foot pedals. Also called a Bradley Fountain.

BREACH OF CONTRACT – Failure to perform a contract, in whole or part, without legal excuse.

BREACH OF COVENANT – The failure to do or to refrain from doing that which was covenanted. See also: Covenant; Condition; Restriction.

BREACH OF WARRANTY – In real property, the failure of the seller to pass title as either expressed or implied (by law) in the conveyancing document. See also: Warranty Deed; Grant Deed; Quitclaim Deed.

BREAK EVEN POINT – In income property, where there is neither a positive nor a negative cash flow.

BREAKDOWN METHOD – Estimating accrued depreciation by using all three reasons (physical deterioration, functional obsolescence, economic obsolescence) for loss in value.

BREAST-HEIGHT – The height at which the diameter of a tree is measured. A height of 4 1/2 feet above the ground level. The abbreviation D.B.H. (diameter-breast-height) is usually used.

BREATHER ROOF – A storage tank roof which rises or lowers depending on the level of the stored gas or liquid.

BREEZEWAY – (1) In construction of a house with no garage, a canopy which extends from the house over the driveway as a protection from the weather for an automobile and for those people going between the house and the automobile. (2) A covering over a porch or patio, connecting two sections of a house or a house and garage. Open on two sides, allowing air circulation (breeze).

BRICK – A building material made from clay, which is molded and heated. The effect of the heat on the iron in the clay gives a red color. Addition of lime or magnesia produces a yellow color.

BRIDGE – A structure over a waterway, highway, or other obstruction, to facilitate passage and for the benefit of travelers.

BRIDGE FINANCING – A form of interim loan, generally made between a short term loan and a permanent (long term) loan, when the borrower needs to have more time before taking the long term financing.

BRIDGING – Floor joist bracing, usually of wood or metal.

BRIDLE PATH (ROAD) – Technically a private road designated as a bridle road without specific use. More modernly, a road designated for equestrian use.

BRITISH THERMAL UNIT (B.T.U.) – Unit of heat required to raise one pound of water one degree Fahrenheit. Used to express the capacity of heating and cooling systems.

BROKER, REAL ESTATE – One who is licensed by the state to carry on the business of dealing in real estate. A broker may receive a commission for his or her part in bringing together a buyer and seller, landlord and tenant, or parties to an exchange.

BROKERAGE – The act of bringing together principals (buyer-seller; landlord- tenant; etc.) for a fee or commission, rather than acting as a principal.

BROKERAGE COMMISSION – See: Commission.

BROOM CLEAN – A term used to describe the condition of a building, delivered to a buyer or tenant. As the term indicates, the floors are swept and free of debris.

BUCKED – A tree, cut into logs.

BUDGET – As the word is applied to condominiums and planned developments, the common expenses shared by the unit owners. This will determine the amount each unit will be charged (usually monthly) for expenses of the common area (taxes, insurance, maintenance, etc.).

BUFFER STRIP (BUFFER ZONE) – A parcel of land separating two other parcels or areas, such as a strip of land between an industrial and residential area.

BUILD TO SUIT – A method of leasing property whereby the lessor builds to suit the tenant (according to the tenant’s specifications). The cost of construction is figured into the rental amount of the lease, which is usually for a long term.

BUILDER – One whose occupation is the construction of structures (buildings).

BUILDER BOND – See: Performance Bond.

BUILDING – A structure built to shelter people, animals, or goods. May be a residence, business, or meeting place, such as a church.

BUILDING AND LOAN ASSOCIATION – An organization for the purpose of accumulating a fund by subscription and savings of its members, to assist them with loans for building or purchasing real estate.

BUILDING CODE – A comprehensive set of laws which control the construction of buildings, including design, materials used, construction, use, repair, remodeling, and other similar factors.

BUILDING CONTRACT – A contract setting forth the terms under which construction is to be undertaken. Price may be set, or based on the builder’s cost plus a profit.

BUILDING LINE – A line beyond which there can be no construction. Set by law, the purpose of such a line is to keep buildings from being built too close to the street, both for safety and aesthetic reasons.

BUILDING ORIENTATION – See: Orientation.

BUILDING OWNERS AND MANAGERS ASSOCIATION (BOMA) – An association of owners and managers of commercial (mainly office) buildings. The association shares information on management techniques as well as setting standards for things such as floor measurement of office buildings.

BUILDING PAPER – An insulation. A waterproof, heavy paper used in the construction of a roof or wall.

BUILDING PERMIT – A permit given by a local government to construct a building, or make improvements.

BUILDING RESIDUAL TECHNIQUE – An appraisal technique by which building value is determined by first determining the net return attributable to the land only, and deducting it from the total return to the property (may be estimated). The residual amount is capitalized to find the building value. Best used when land value is easy to estimate and building value difficult to estimate. See: Land Residual Technique; Property Residual Technique.

BUILDING RESTRICTIONS – Prohibition by a governmental body (zoning restriction) or a private party (a former owner) against construction of certain structures on a property.

BUILDING SITE – See: Site (2).

BUILT-IN’S – Commonly stoves, ovens, dishwashers, and other appliances, framed into the building construction and not movable.

BUILT-UP ROOF – A level roof composed of layers of roofing materials (tars and waterproof paper), covered with fine gravel.

BULK SALE – A transfer in bulk, not in the ordinary course of business, of all or substantially all of the inventory and fixtures of a business.

BULK SALES ACT – Laws to protect creditors against secret sale of all or substantially all of the merchant’s goods. Requires certain notice before sale, and sets forth methods of voiding improper sales. See also: Uniform Commercial Code.

BULK ZONING – See: Area Zoning.

BULKHEAD – (1) A partition in a ship. (2) A retaining wall to hold back water and thereby extend the shoreline.

BULKHEAD LINE – A line established in navigable waters beyond which no solid fill can be used. The Army Corps of Engineers establishes the bulkhead line and also the pier line, beyond which no pier can be constructed.

BUNDLE OF RIGHTS – A theory comparing property rights to a bundle of sticks. Each of the usual property rights (possession, alienation, etc.) is represented by a stick and is, therefore, considered separately.

BURN – See: Bourn.

BUS – A copper bar through which electrical current flows.

BUS DUCT – A metal clad enclosure containing a bus.

BUSINESS – Unqualified, the word has no definite meaning, but has come to be understood to be any activity by which people earn money.

BUSINESS CYCLE – The economic cycle of prosperity, followed by a decline, and then a return to prosperity.

BUSINESS OPPORTUNITY – The sale of a business (may or may not include the sale of real estate). Some states require a real estate license for these sales even when real estate is not involved. The Uniform Commercial Code, state statutes, and special laws for alcoholic beverage licenses (when applicable) should be studied by the business opportunities broker.

BUTT JOINT – The meeting end to end (butting) of two members to form a connection (joint).

BUTT LOG – The log immediately above the stump of a tree.

BUTT LOT – See: Key Lot 2.

BUTTE – A steep hill, usually standing alone.

BUTTERFLY ROOF – A roof formed by two gable roofs concave to a center ridge. The roof resembles the shape of a butterfly’s wings.

BUTTRESS – A support for a wall. A prop. If the buttress projects from the wall and supports by lateral pressure, it is called a “flying buttress”.

BUTTS AND BOUNDS – See: Metes and Bounds.

BUY-SELL OFFER – An offer by one owner of a business or real estate to buy out the interest of another owner of the same business or real estate (a partner or other shareholder), or to sell the offeror’s interest at the same price or proportionate price if unequal ownership. Example: A and B each own a 1/2 interest in lot 1. A offers to buy B’s interest for $10,000, or to sell A’s interest to B for $10,000. Theoretically, very fair, since B has the option to buy or sell. However, B’s interest may be worth $12,000, but B is financially unable to buy A’s interest (also worth $12,000).

BUYDOWN – A payment to the lender from the seller, buyer, third party, or some combination of these, causing the lender to reduce the interest rate during the early years of a loan. The buydown is usually for the first 1 to 5 years of the loan. See also: Certificate Backed Mortgage.

BUYDOWN ACCOUNT – The account holding funds to be used to pay additional amounts during the buydown period. See: Buydown.

BUYER – AGENCY AGREEMENT – An agreement by a real estate broker to represent a buyer of property. A broker’s agreement to represent a seller is commonly called a listing agreement. See: Agency.

BUYER’S MARKET – A market condition favoring the buyer. In real estate, when more homes are for sale than there are interested buyers.

BUYERS BROKER – A real estate agent representing the interests of the buyer. Rules of confidentially between buyer and agent are stricter than if the agent represented both buyer and seller.

BX CABLE – The main conduits coming into a home. Electrical wiring run through metal conduits.

BY-LAWS – Rules and regulations, adopted by an association or corporation, which govern its activities.

BY-PASS – A road designed to avoid or pass by a high density area, such as a business section of a city, in order to ease traffic congestion. Also called a belt highway.

C HORIZON – The horizon (layer) of the Earth below the A and B horizons. Called the substratum, it is usually not affected by rain, change of temperature, or other surface conditions.

C.A.E.(CERTIFIED ASSESSMENT EVALUATOR) – An assessor who, through the completion of required courses, experience, and examination, has earned this designation by the International Association of Assessing Officers.

CABINET WORK – Any interior carpentry which will be seen and must be finished with skill and care. One who does this work is called a cabinet maker or, more commonly, a finish carpenter.

CADASTRE – Inventory of real property in a community for tax and assessment purposes.

CAISSON – A watertight chamber in which men work underwater, or in an open excavation where loose soil or sand cave in on the workers. It may also be filled with concrete after it is used, and become a support.

CAL-VET LOANS – Real estate loans available to armed forces veterans from California, at low interest rates.

CALIFORNIA RANCH ARCHITECTURE – A sprawling, one story, ranch-style building, lending itself to interior flexibility in floor plan design.

CALL – In metes and bounds description, the angle and distance of a given line or arc. Each call is usually preceeded by the word “then” or “thence”. Example:N 22% E 100′ (1st call), thence N 80% E 100′ (2nd call). (2) To demand payment due to default. Also used when a loan payment is not large enough to amortize the loan. Example: A mortgage payment requiring 20 years to pay in full but for a term of 5 years would be referred to as a 20-year amortization with a 5- year call.

CALL DATE – Originally a term used when a bond is redeemed prior to maturity, it is now also used in describing mortgages. [See Call(2)].

CALL LOAN – A loan payable upon demand.

CALL OPTION – A clause in a note and mortgage allowing the lender to demand full payment of the loan before the full term.

CAMBER – A slight bending or arching to a convex angle. Used to prevent beams, girders, flooring, ship decks, timbers, and similar load- bearing members, from taking a concave shape.

CAMINO – A Spanish word meaning highway.

CAMPANILE – A free standing bell tower.

CANAL – (1) A man made waterway used to connect bodies of water for navigation. (2) An irrigation waterway.

CANCELLATION CLAUSE – A clause in a lease or other contract, setting forth the conditions under which each party may cancel or terminate the agreement. The conditions may be as simple as giving notice or complex and require payment by the party desiring to cancel.

CANDLE – A measure of light, being the luminous intensity of a 7/8 inch sperm candle burning at 120 grains per hour. An international candle is based on the burning of platinum.

CANDLE HOUR – A measure of light, equal to one candle burning for one hour.

CANDLE POWER – The intensity of a light, expressed in candles.

CANTILEVER – A structural support which itself is supported at one end only and bears its load through its material strength and rigidity.

CANTILEVER BRIDGE – A bridge formed by two cantilevered members extending toward each other and connecting each other or a suspended span.

CAP – (1) A maximum amount of charge. Example: An Adjustable Rate Mortgage with a 5% rate cap could not adjust the interest rate by more than 5%. (2) A fitting used to seal, such as by a plumber to seal (cap) a pipe end. (3) A cornice, lintel, or top of a structure member such as a column.

CAP (PAYMENT) – See: Payment cap.

CAP RATE (APPRAISAL) – See: Capitalization Rate.

CAPACITY – One’s ability to carry on normal business transactions. Lack of capacity may be natural (unsound mind) or simply by law (a minor). Restrictions may be full or partial.

CAPE COD HOUSE – An adaption of the New England cottage. May be one or two stories with sloping roof, usually with dormer windows, cornices, and of frame painted white.

CAPITA – Literally, heads. Commonly, persons individually. See also: Per Capita.

CAPITAL – Money used to create income, either as investment in a business or income property.

CAPITAL ASSETS – Assets of a permanent nature used to produce income, such as machinery, buildings, equipment, land, etc. Must be distinguished from inventory. A machine which makes pencils, for example, would be a capital asset to pencil manufacturer, but inventory to the company whose business is to sell such machines.

CAPITAL EXPENDITURES – Money spent on improvements such as land, buildings, machinery, and similar major expenditures which are not inventory.

CAPITAL GAIN – Gain realized from the sale of a capital asset. The difference between the purchase and sale price less allowable deductions, plus depreciation.

CAPITAL IMPROVEMENT – See: Capital Expenditure.

CAPITAL LOSS – Loss from the sale of a capital asset. The difference between the purchase and sale price plus allowable deductions, less depreciation.

CAPITAL STOCK – A general term referring to the stock a corporation may issue, the amount actually subscribed by shareholders, the value of the company, liability to the shareholders, etc.

CAPITALIZATION – Determining a present value of income property by taking the annual net income (either known or estimated) and discounting by using a rate of return commonly acceptable to buyers of similar properties. For example: Net income of a property is $10,000 per year. Capitalizing at a rate of 10%, the property would be worth $100,000.

CAPITALIZATION APPROACH – See: Income Approach.

CAPITALIZATION RATE – The percentage (acceptable to an average buyer) used to determine the value of income property through capitalization.

CAPITALIZE – To determine the present money value of future income, whether estimated or fixed.

CAPITALIZED VALUE – The value of the property after use of the capitalization approach of appraisal.

CAPRICIOUS VALUE – In appraisal, a value based on whim or emotion and not reflective of the fair market value.

CAPTURE RATE – The comparison of the rate of sales or leases of real estate developments in a given market area.

CAR – California Association of Realtors.

CAR FLOAT BRIDGE – The connection (bridge) used to transfer railroad cars to or from land and a barge. The bridge must be vertically mobil to adjust to changing water levels.

CARAVAN – An inspection of newly listed properties, either by the entire sales staff of an office or by sales personnel from more than one office in conjunction with a multiple listing group. Generally conducted on a regular basis.

CARPORT – A roof supported by pillars or cantilevered which shelters a car. May either extend from a structure (usually a house) or be constructed separately (often to accommodate several cars).

CARRYBACK LOAN – See: Purchase Money Mortgage (1).

CARRYING CHARGES – The costs involved in keeping a property which is intended to produce income (either by sale or rent) but has not yet done so.

CARRYOVER BASIS – The tax basis in a tax deferred exchange which is transferred (carried over) from the property given up to the property acquired.

CASE – (1) An external framework of a structure. (2) A court action.

CASE LAW – See: Common Law.

CASEMENT WINDOW – A window hinged at its sides, allowing it to swing open vertically.

CASH – (1) Money or (2) its equivalent (checks, bank notes, etc.). Ready money.

CASH ACCOUNTING – See: Accrual Accounting.

CASH ASSETS – Money which is available to meet the requirements of operating a business.

CASH DISCOUNT – A discount from a billed amount if paid within a certain period.

CASH EQUIVALENCY ANALYSIS – An appraisal technique by which the price of comparable properties selling at different financing terms are adjusted to find market value. The theory is that terms less advantageous to the seller will cause a higher sale price; cash being most advantageous to the seller.

CASH FLOW – In investment property, the actual cash the investor will receive after deduction of operation expenses and debt service (loan payment) from his gross income.

CASH FLOW RATE – See: Cash-On-Cash.

CASH ON HAND STATEMENT – A statement of cash on hand which the buyer intends to apply to closing costs, impounds, and down payment. Also shows the source of the money (savings, gift, etc.).

CASH OUT – To take the entire amount of a seller’s equity in cash rather than to retain some interest in the property, such as a purchase money mortgage or deed of trust. Also loosely used when paying off anyone having an interest in property, thereby ending the interest.

CASH RENT – A term used in farm rental to distinguish between money rent and rent paid by giving a portion of the crop to the owner (share crop).

CASH RESERVES – An amount of money sometimes required by a lender to be held in reserve in addition to the down payment and closing costs.

CASH SALE – A sale for full payment in cash, as opposed to a credit sale. A payment by check is considered cash. May be qualified, as “cash to new loan”, “cash to existing loan”, etc.

CASH-ON-CASH – The amount of cash received compared to the amount of cash invested. Also called the Equity Dividend Rate, Cash Flow Rate or Equity Capitalization Rate.

CASH-OUT REFINANCE – A new mortgage loan that pays off any existing debts on the property and still gives the borrower cash.

CASHIER’S CHECK – A check drawn by a bank on itself rather than on an account of a depositor. A cashier’s check is generally acceptable to close a sale without waiting for the check to clear.

CASING – The exterior surface or covering of a building such as aluminum siding, a roof, etc.

CATTLE GUARD – A grill or grating placed in the ground over which cattle will not cross.

CATWALK – A narrow, elevated walkway along a wall, girders, or over a stage or other area where it may be necessary for a person to go for operation or repair.

CAUSEWAY – A raised roadbed over lowlands. See also: Levee.

CAVAEDIUM – An atrium, courtyard.

CAVEAT – “Let Him Beware” – A formal notice to a court or officer, given by an interested party, asking that the court suspend proceedings until deciding on the merits of the caveat.

CAVEAT EMPTOR – “Let the buyer beware”. Legal maxim stating that the buyer takes the risk regarding quality or condition of the item purchased, unless protected by warranty or there is misrepresentation. Modernly, consumer protection laws have placed more responsibility for disclosure on the seller and broker.

CAVITY WALL – Refers to a brick or stone wall which is actually built as two separate walls, joined only at the top and ends, and so “hollow”. Also called a hollow wall.

CC&R’S (COVENANTS, CONDITIONS, AND RESTRICTIONS) – A term used in some areas to describe the restrictive limitations which may be placed on property. In other areas, simply called restrictions.

CEILING – (1) The overhead interior lining of a room, building, etc. (2) A maximum amount.

CELLAR – A storage room or group of rooms, usually under a building, which are used for storage.

CEMENT – A mineral powder which, when mixed with water and allowed to set will dry hard and can be used in construction as floors, walls, etc.

CEMENT BLOCK – A building block, composed of cement, and usually hollow. See also: Cinder Block.

CEMETERY – Large parcels of land used for burying deceased persons. May be public or private, the private usually being of a specific religious denomination.

CENTRAL ASSESSMENT – An assessment of property under one ownership but located in more than one assessment district. Used for railroads and public utilities to stabilize the assessment value.

CENTRAL BUSINESS DISTRICT – An area of a city where most of the major businesses are located. The “downtown” area.

CENTRAL CITY – (1) The downtown area of a major city. (2) A city which is central to a metropolitan area containing many cities. The name of the central city is used for the whole area. For example: Los Angeles metropolitan area.

CERCLA (COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION, AND LIABILITY ACT) – See which.

CERTIFICATE – A writing, either from a court or other public body, giving assurances of existing conditions or facts, and giving rights or creating obligations.

CERTIFICATE BACKED MORTGAGE – A variation of the buydown. The seller purchases a savings certificate (usually with the proceeds of the sale) from the lender. The lender sets the buyer’s interest rate below market (generally 2 percent above the certificate rate). Should the seller withdraw the certificate funds, the buyer’s rate goes to market rate.

CERTIFICATE OF DEPOSIT (C.D.) – A specific sum of money deposited into a savings institution for a specified time period, and bearing a higher rate of interest than a passbook account if left to maturity. Does not have withdrawal privileges as does a passbook account. Also called a time certificate of deposit (T.C.D.)

CERTIFICATE OF DEPOSIT INDEX – One of the many indices that may be used for interest rate changes in an adjustable rate mortgage.

CERTIFICATE OF ELIGIBILITY – A certificate obtained by a veteran from a Veteran’s Administration office which states that the veteran is eligible for a V.A. insured loan. There is a list of requirements (when and how long the veteran served, type of discharge, etc.) which also may be obtained from the V.A. office.

CERTIFICATE OF OCCUPANCY – A certificate issued by a local building department to a builder or renovator, stating that the building is in proper condition to be occupied.

CERTIFICATE OF PURCHASE – See: Certificate of Sale.

CERTIFICATE OF REASONABLE VALUE – A certificate giving the estimate of value on which to base a loan guaranteed by the Veterans Administration.

CERTIFICATE OF REDEMPTION – Evidence of redeeming (buying back) a property by the owner after losing it through a judicial sale. The time limit for redemption is set by statute.

CERTIFICATE OF SALE – Certificate issued to the buyer at a judicial sale (such as a tax sale), which will entitle the buyer to a deed upon confirmation of the sale by the court or if the land is not redeemed within a specified time.

CERTIFICATE OF TITLE – In areas where attorneys examine abstracts or chains of title, a written opinion, executed by the examining attorney, stating that title is vested as stated in the abstract.

CERTIFICATE OF VETERAN STATUS – The evidence of eligibility given to a veteran by the VA. The certificate gives the veteran status to obtain certain loans with less money down.

CERTIFIED CHECK – A personal check drawn by an individual which is certified (guaranteed) to be good. The bank holds the funds to pay the certified check and will not pay any other checks drawn on the account if such payment would impede payment of the certified check. The bank also will not honor a stop payment of a certified check.

CERTIFIED COMMERCIAL INVESTMENT MEMBER (CCIM) – A designation conferred by the Commercial Investment Real Estate Institute, an affiliate of the NATIONAL ASSOCIATION OF REALTORS. The designation recognizes expertise in many different areas including commercial real estate sales, leasing, property management, appraisal, development, lending and investment counseling.

CERTIFIED COPY – A true copy, attested to be true by the office holding the original.

CERTIFIED MORTGAGE BANKER (CMB) – A designation conferred by the Mortgage Bankers Association of America (MBA) to employees of its member companies after experience, educational and testing requirements have been met.

CERTIFIED PROPERTY MANAGER (CPM) – A professional awarded to real estate managers by the Institute of designation Real-Estate Management,an affiliate of the National Association of Realtors. Address: Institute of Real Estate Management 430 North Michigan Avenue Chicago, IL 60611

CERTIFIED PUBLIC ACCOUNTANT (CPA) – A designation awarded to accountants by the American Institute of Certified Public Accountants (AICPA) after completing the required education and passing a national exam. Only CPA’s may audit HUD programs unless registered before 1970.

CERTIFIED REAL ESTATE BROKERAGE MANAGER (CRB) – A designation conferred by the Real Estate Brokerage Managers Council upon a brokerage owner or manager who is an expert in the field.

CERTIFIED RESIDENDIAL SPECIALIST (CRS) – A designation conferred by The Council of Residential Specialists upon those who have successfully completed the required courses and are experts in residential real estate transactions.

CERTIORARI – An appellate review of the complete record of a lower court action, rather then simply a review of an appeal for judicial error.

CESSPOOL – A pit or pool which holds raw sewage.

CESTUI QUE TRUST – One having an equitable interest in property, legal title being vested in a trustee.

CESTUI QUE VIE – The person whose life is used to determine the length of an estate based on a life in being.

CHAIN – See: Chain Of Title; Chains And Links.

CHAIN OF TITLE – The chronological order of conveyancing of a parcel of land, from the original owner (usually the government) to the present owner.

CHAIN STORE – A store belonging to a series of similar stores under central ownership and management, and striving for uniformity in design, inventory, and service.

CHAINS AND LINKS – Measurements. In real estate measurements (surveying) a chain is 66′ long or 100 links, each link being 7.92″. The measurement may change when used in fields other than surveying.

CHANGE – The principle that no physical or economic condition remains the same.

CHANGE FREQUENCY – The time between adjustments of interest and payment on a adjustable rate mortgage.

CHANGE OF NAME – When there is a name change of a party appearing on a document (deed, etc.), it may be reflected in several ways, such as (1) Mary Smith, a married woman, W.A.T.A. (who acquired title as) Mary Jones, an unmarried woman. (2) Mary Smith AKA (also known as) Mary Jones. (3) Mary Smith, formerly Mary Jones. (4) Mary Smith, alias Mary Jones. Each may be applicable in different circumstances (how and why the name was changed).

CHANGE ORDER – In construction, a written instruction to alter the original construction plan.

CHANNEL – (1) An open or closed duct or conduit. (2) A gutter, furrow, or groove. (3) The deepest part of a natural waterway through which the main current flows, and which affords the best passageway for ships.

CHANNELIZATION – The term used to describe traffic direction. Traffic is “channeled” by use of one way streets, signs directing turns, island barriers, etc.

CHAPEL – (1) A place of worship apart from a church, such as a hospital chapel, college chapel, etc. Generally for a small group. (2) A portion of a church secondary and subordinate to the main alter.

CHARGE-OFF – The unpaid balance of a loan that a lender writes off as a bad debt.

CHATTEL – Personal property.

CHATTEL MORTGAGE – A lien on personal property. Also called a security interest or financing statement.

CHATTEL REAL – All estates in real property less than fee estates, such as a lease.

CHECK ROW – A method of planting rows of plants on intersecting lines, forming a “checkerboard” effect. Used for corn, tomatoes, and other vegetables.

CHECK VALVE – A valve to prevent backup of material being carried through a pipe or other conduit.

CHILD CARE STATEMENT – A statement by a working husband and wife showing the amount paid for child care and to whom paid.

CHIMNEY – Any passage through which smoke from a fire passes. Most commonly the passage, constructed of brick, from a fireplace to above the roof of a building.

CHIMNEY BACK – The back wall or lining of a fireplace or furnace chimney.

CHIMNEY FLASHING – See: Flashing.

CHIMNEY POT – An earthenware or metal pipe or deflector, projecting from the top of the chimney to increase draft and reduce and disperse smoke.

CHOSE IN ACTION – A right to an action for recovery of a debt or to possession of anything held by another. The right to possession rather than possession.

CHOSE IN POSSESSION – Something in possession, rather than the right to possession.

CHURCH – A public place of worship, usually Christian worship. See also: Synagogue; Temple.

CID – See: Common Interest Development.

CIENAGA – A Spanish word meaning a swamp or marsh, formed by hillside springs.

CINDER BLOCK – A building block composed of cinders (ashes) and cement, which does not have the weight or strength of a cement block.

CIRCLEHEAD WINDOW – A semicircular window, usually above a door, which has no moving parts and is used as a decoration as well as to admit light.

CIRCUIT BREAKER – An electrical device which has taken the place of the fuse in most buildings. The circuit is broken (electricity shut-off) when there is an overload. The circuit breaker can be reset rather than replaced as a fuse must be.

CIRCULATION PATTERN – The regular traffic pattern, as from a residential area to a business district and back.

CIRCUMFERENTIAL HIGHWAY – A highway which arcs around the central business district of a city. Also called a belt highway or by-pass.

CISTERN – A tank used for storing rain water for use in areas where there is no water brought to the property by plumbing.

CITY – Technically, a municipal corporation having voting by represen-tatives to operate its functions, rather than direct voting, as in a town. Commonly, any large incorporated town is called a city.

CITY PLAN – See; Master Plan .

CIVIL ACTION – Any action which is not a criminal action.

CIVIL LAW – (1) Roman Law. The legal system derived from the Romans which is prevalent in most of the non-English speaking countries, and, to some degree, in Louisiana. Differs from Common Law of England, from which United States Law is derived. (2) Any laws which are not criminal laws.

CIVIL RIGHTS ACT OF 1964 – An act passed to strengthen the Civil Rights Act of 1866. The act, among other things, prohibits discrimination in housing.

CLAIM – An assertion of some right or demand.

CLAPBOARD – Narrow boards used as siding for frame houses, and having one edge thicker than the other. The boards run horizontally with the thicker edge overlapping the thinner edge.

CLARIFIER – Underground system of tanks with filters or chemical agents designed to remove or neutralize harmful wastes from water before emptying said water into a sewer or septic tank.

CLASS ACTION – An action brought on behalf of a group of people having a similar claim. Has become increasingly popular in the consumer movement, and is a strong weapon against unfair pricing when the price of overcharging in one instance would be too minor to bring suit.

CLASSIFIED LOAN – A substandard loan which a bank should not have made.

CLASSIFIED PROPERTY TAX – Property tax which varies in rate depending on the use (zoning classification) of the property.

CLEAN ROOM – A room specially designed to have a controlled atmosphere, for health reasons or experimentation accuracy, such as a germ free room or a dust free room.

CLEAN WATER ACT – A federal act, first adopted in 1977, to stop pollution of waterways and protect wildlife and recreational areas.

CLEAR HEADWAY – The height of the lowest overhead framing member (usually the top of the door frame) as measured from the floor.

CLEAR LUMBER – High quality lumber “clear” of most defects, particularly knots.

CLEAR SPAN – An interior area which does not use columns or posts to hold up the roof, thereby creating a large, open area with maximum visibility and use of the floor space.

CLEAR TITLE – See: Free and Clear.

CLEARANCE – (1) The removal of structures from an area for urban renewal. (2) The maximum height of a vehicle which may safely pass under a bridge or through a tunnel.

CLERESTORY – A wall or portion of a wall to which the roof attaches at a higher level than the other walls or portions of a wall of a building. Generally found in church construction and contains windows.

CLERESTORY WINDOW – Window in a clerestory.

CLIENT – Traditionally one who employs an attorney. Has loosely been used to refer to the principal of a real estate agent, insurance agent, stock broker, etc.

CLOSE CORPORATION – (1) A corporation not allowing its shareholders to vote for directors or officers. (2) A corporation owned by a small group of shareholders and not having publicly traded stock. Commonly, and incorrectly, called a closed corporation.

CLOSED CORPORATION – See: Close Corporation.

CLOSED END MORTGAGE – A mortgage that does not allow the borrower to increase the amount borrowed over the term of the mortgage. See also: Open End Mortgage.

CLOSED END MUTUAL FUND – A fund (sometimes dealing in real estate or mortgages) which is not accepting new investors. The shares in the fund are bought and sold, either at a premium, par, or a discount, based on the success of the fund. The shares are not sold and redeemed through the fund but on the open market. The same technique is used with closed end trusts.

CLOSED MORTGAGE – See: Lock-in.

CLOSING – (1) In real estate sales, the final procedure in which documents are executed and/or recorded, and the sale (or loan) is completed. (2) A selling term meaning the point at which the client or customer is asked to agree to the sale or purchase and sign the contract. (3) The final call in a metes and bounds legal description which “closes” the boundaries of the property.

CLOSING COSTS – Expenses incidental to a sale of real estate, such as loan fees, title fees, appraisal fees, etc.

CLOSING STATEMENT – The statement which lists the financial settlement between buyer and seller, and also the costs each must pay. A separate statement for buyer and seller is sometimes prepared.

CLOUD – See: Cloud on Title.

CLOUD ON TITLE – An invalid encumbrance on real property, which, if valid, would affect the rights of the owner. For example: A sells lot 1, tract 1, to B. The deed is mistakenly drawn to read lot 2, tract 1. A cloud is created on lot 2 by the recording of the erroneous deed. The cloud may be removed by quitclaim deed, or, if necessary, by court action.

CLOVERLEAF – An intersection using loop shaped ramps and grade separation to accomplish the intersecting of traffic without signal lights or stop signs. When viewed from above, the shape of the intersection resembles a cloverleaf.

CLOVERLEAFING – A method of real estate canvassing by looping around a specific property (one listed or sold) in the shape of a cloverleaf, in order to obtain listings or buyers.

CLUSTER HOUSING – Building houses close together with little yard space and a large common area, rather than each house having a large yard. The density is usually greater in the cluster project.

CLUSTER ZONING – Zoning allowing the construction of buildings closer together than normal (clustered) and then requiring the balance of the property to be kept as open space.

CLUSTERING – See: Cluster Housing.

CMB – See: Certified Mortgage Banker.

CMO – See Collateralized Mortgage Obligation.

CO-ADMINISTRATOR – One who shares the duties of administrator with one or more other administrators.

CO-EXECUTOR – One who shares the duties of executor with one or more other executors.

CO-MAKER – A surety (see which) under a loan. The co-maker is equally responsible for repayment as the borrower (maker).

CO-MORTGAGOR – One who signs a mortgage with another as borrower. The term is often applied to one who intends to guaranty the loan even though co-mortgagors have equal liability.

CO-OP – See: Cooperative apartment.

CO-ORDINATES – A general term encompassing a number of methods to determine the position of intersecting lines, planes, points, etc.

CO-OWNERSHIP – Ownership by two or more persons or entities. See also: Equitable Ownership; Legal Owner.

CO-SIGNATORY – See: Co-maker.

CO-TRUSTEE – One who shares the duties of trustee with one or more other trustees.

COAST – The seashore or land near it.

COASTAL COMMISSION – A commission set up to control construction in coastal areas.

CODE – A comprehensive set of laws drawn up to cover completely a given subject. Covers diverse subjects, such as the criminal code, and the building code.

CODE OF ETHICS – See: Ethics.

CODICIL – An addition to a will, which modifies the will by adding to it, subtracting from it, or clarifying it.

COFFERDAM – See: Caisson.

COFI (COST OF FUNDS INDEX) – One of the many indexes used to determine rate changes for an adjustable rate mortgage. COFI is considered a good index for the borrower.

COGNOVIT NOTE – A note in which a debtor confesses judgement in the event of nonpayment and waives all defenses.

COIGN, COIGNE – A cornerstone, usually differing in size (and sometimes material) from the rest of the wall, also spelled quoin.

COINSURANCE – A sharing of the risk of an insurance policy by more than one insurer. Usually one insurer is liable up to a certain amount; the other liable over that amount.

COINSURANCE CLAUSE – A requirement by an insurer that the property owner carry insurance equal to a specified percentage of the value of the property.

COLD CANVASS – Soliciting door to door or by phone without any previous contact. A good method for a salesperson to begin to establish a farm area. See: Farm (3).

COLLAPSIBLE CORPORATION – A corporation which is sold instead of its product, in order to create a capital gain rather than ordinary income for tax purposes. For example: A and B (persons) are real estate developers who want to build an office building to sell. They form a corporation which builds the building. Then, rather than selling the building, A and B sell the corporation, claiming capital gain on the stock profit. Federal tax laws regulate such transactions.

COLLAR TIE – See: Tie Beam.

COLLATERAL – By or at the side, additional or auxiliary. Mistakenly used to mean collateral security.

COLLATERAL ASSIGNMENT – An assignment of property as collateral security, and not with the intent to transfer ownership from assignor to assignee.

COLLATERAL HEIR – One not in a direct line of descent of inheritance. Example: A nephew, not a son.

COLLATERAL NOTE – A promissory note secured by specific property.

COLLATERAL SECURITY – Most commonly used to mean some security in addition to the personal obligation of the borrower.

COLLATERALIZED MORTGAGE OBLIGATION – A mortgage-backed security. CMOs are similar to mortgage-backed securities except that CMOs offer the option of short or long maturity. The future cash flows from a group of mortgages are split into varying length classes to satisfy the needs of investors who seek different maturity lengths. (See: Mortgage-Backed Securities).

COLLUSION – An agreement of two or more people to do something unlawful. Generally, an agreement between people who represent different interests and “sell out” these interests for personal gain.

COLONIAL ARCHITECTURE – Two story houses with windows divided into small panes, usually with shutters. The main facade is detailed and symmetrical, generally with a center entrance. Architecture following the style of New England colonial houses.

COLONNADE – Columns, regularly spaced, which support an architrave. See also: Peristyle; Portico.

COLOR OF TITLE – That which gives the appearance of good title, but actually contains some defect. For example: A conveyance given without the grantor having good title.

COLUMN – A large vertical support member of a structure. A pillar, usually cylindrical.

COLUMN FOOTINGS – The support bases for load-bearing columns. Generally composed of reinforced concrete.

COLUMN LOTS – Small lots for the placement of columns to support a structure, such as a billboard or other structure which has its largest parts not touching the ground.

COLUMN STEEL – Steel used inside a column for reinforcement.

COMBED PLYWOOD – An interior paneling, grooved as if by a comb.

COMBINATION ADVANCE REVERSE MORTGAGE – Under this arrangement, the borrower receives a lump sum. This is most commonly used to pay off an existing mortgage, make repairs on the property, or pay consumer debt. The balance of the loan is made in periodic (monthly) payments. See also: Reverse Mortgage.

COMBINATION DOOR – An outer door using interchangeable panels of glass and screen, depending on the weather.

COMBINATION SEWER – A sewer that is both a sanitary and storm sewer.

COMBINATION WINDOW – A window using interchangeable panels of glass and screen, depending on the weather.

COMMENSURATE PROPERTY – See: Base Property.

COMMERCIAL ACRE – See: Net Acre.

COMMERCIAL BANK – An institution for savings, loans, checking accounts, and other services not all of which are found in savings and loan institutions. Banks are generally more active in construction loans rather than long term real estate financing

COMMERCIAL BROKER – A licensed real estate broker specializing in improved commercial property or offices.

COMMERCIAL INESTMENT REAL ESTATE INSTITUTE – An affiliate of the NATIONAL ASSOCIATION OF REALTORS which strives to improve the level of competency of those engaged in Commercial-Investment real estate, and which confers the designation of Certified Commercial Investment Member (CCIM).

COMMERCIAL PAPER – Negotiable instruments used in the course of business, such as promissory notes, which are bought and sold (usually at a discount).

COMMERCIAL PROPERTY – Property which is zoned “commercial” (for business use). Property such as stores, restaurants, etc., falling between residential and industrial.

COMMINGLING – To mix funds held in trust with other funds. For example: A broker or builder mixes deposits (should be in a trust account) with his funds by putting the deposits in his general account. Although commingling is in itself a violation for which a broker may lose his license, it does not mean that, by commingling, the broker or builder intended to misappropriate the funds. See also: Conversion (2).

COMMISSION – An amount, usually as a percentage, paid to an agent (real estate broker) as compensation for his services. The amount to a real estate broker is generally a percentage of the sale price or total rental.

COMMISSION POINT – See: Point (2).

COMMITMENT – (1) Title insurance term for the preliminary report issued before the actual policy. Said report shows the condition of title and the steps necessary to complete the transfer of title as contemplated by the buyer and seller. (2) A written promise to make or insure a loan for a specified amount and on specified terms.

COMMITMENT FEE – A fee paid for a loan commitment. See: Commit-ment (2).

COMMITMENT LETTER – See: Commitment (2).

COMMON AREA – The area owned in common by the owners of condominiums or planned unit development homes in a subdivision.

COMMON AREA ASSESSMENTS – The levies (assessments) charged to owners of condominiums or planned unit developments for the cost of common area maintenance and home owner association costs.

COMMON BRICK – A brick having no special surface treatment, making each brick different in color. Used to describe a surface of bricks which are artificially treated so that each is different in color.

COMMON ELEMENTS – See: Common Area.

COMMON INTEREST DEVELOPMENT – A general term used to describe any type of clustered buildings with shared land ownership, such as condominiums and planned developments. CID’s, as they are called, must have individual ownership or exclusive right to occupy, combined with shared ownership.

COMMON LAW – The body of laws, originated and developed in England, which was adopted by most states and still prevails if not superseded by statute. Also referred to as case law.

COMMON LAW MORTGAGE – Any mortgage which contains the elements of a mortgage according to the Common Law.

COMMON OF ESTOVERS – See: Estovers.

COMMON STOCK – A share of ownership in a corporation.

COMMON WALL – See: Party Wall.

COMMUNITY APARTMENT – A form of common interest development under which title to the entire development is shared, with an exclusive right to occupy each unit given to the various title holders.

COMMUNITY ASSOCIATION – See: Home Owner’s Association.

COMMUNITY HOME IMPROVEMENT MORTGAGE – A loan for low to moderate income buyers to borrow more than the usual 80% loan to value when a portion of the funds will be used to improve or make repairs on the property. The theory is that improvement of individual properties will benefit the whole community.

COMMUNITY PROPERTY – Property owned in common by a husband and wife, which is not separate property. A classification of property peculiar to certain states.

COMMUNITY REINVESTMENT ACT – Federal legislation of 1977 (and subsequent amendments) for the purpose of encouraging banks and thrifts (savings and loans) to make more loans in their local areas. The act created the National Consumer Cooperative Bank to make loans to local banks and thrifts for community investment (loans) and also to guarantee certain loans made in the local community.

COMMUNITY SECOND MORTGAGE – A junior mortgage subsidized by a state or local government agency or nonprofit organization enabling low to moderate income buyers to purchase a home with less of a down payment. The mortgage will have a below market interest rate and the principal may not have to be repaid if the buyer stays in the home for a certain period. The details of this type of loan vary by location.

COMMUNITY SHOPPING CENTER – An intermediate size shopping center. May contain a small department store and coordinated small shops. Larger than a neighborhood center and smaller than a regional center.

COMPACTION – The pressing together and joining of sedimentary layers of ground by the pressure of the weight of overlying layers. A report showing the density of the soil and its make-up is required in some areas before permits for construction will be issued.

COMPARABLES – Properties used as comparisons to determine the value of a specific property.

COMPARATIVE ANALYSIS – See: Market Value Approach.

COMPARATIVE MARKET ANALYSIS – See: Market Data Approach.

COMPARATIVE METHOD – A method of estimating replacement construction cost by comparing the property to be built with the cost per square foot or cost per cubic foot of a similar building.

COMPARISON METHOD – See: Market Data Approach.

COMPENSATING BALANCE – Funds deposited into a bank, savings and loan association, or other lending institution, to induce the lender to make a specific loan or establish a line of credit. The deposit may be made by the party desiring the loan, or a third party.

COMPENSATION – A payment to make amends for the abridgement of rights or an injury. In condemnation, the payment for the taking of a person’s property without the owner’s consent.

COMPENSATORY DAMAGES – Damages to cover a loss or injury and nothing more. See also: Exemplary Damages.

COMPETENT – Legally fit. Having the necessary age, ability, and authority to accomplish any given acts or duties.

COMPETITION – The appraisal principle that states that excess profits generate competition.

COMPETITIVE MARKET ANALYSIS (CMA) – See: Market Data Approach.

COMPLETION BOND – A bond protecting against failure to complete construction.

COMPONENT CONSTRUCTION – Also called modular construction or prefabrication. See also: Prefabrication.

COMPONENT DEPRECIATION – Allocating separate effective lives to components of a building and depreciating each separately.

COMPONENT PANEL – A modular (prefabricated) wall, fully finished, which is installed as a part of a building.

COMPOSITE RATE – A rate reflecting both the income flow of a building (or other depreciating asset) and the recapture of invested capital.

COMPOSITION – (1) A mixture of gravel and stones embedded in a heavy tar roof shingle, and called a “composition” roof. (2) A creditor’s composition, (see which).

COMPOUND AMOUNT OF AN ANNUITY – The total amount at the end of a given period, including investment and reinvestment of the annuity payments.

COMPOUND AMOUNT OF AN INVESTED SUM – The total amount at the end of a given period, including the reinvestment of all interest plus the original amount invested.

COMPOUND INTEREST – Interest paid on accumulated interest as well as on the principal.

COMPOUND SLOPE – A slope composed of two or more separate slopes with different grade angles.

COMPREHENSIVE COMMUNITY PLAN – See: Master Plan.

COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION, AND LIABILITY ACT – The federal legislation which established the Superfund to hasten the cleanup of contaminated property. The strength of the act is that there is strict liability, joint and several liability, and liability is retroactive. See also: Joint and Several Liability; Strict Liability; Superfund.

COMPS – See: Comparables.

COMPUTER LISTING – A system of processing listings through a computer so that anyone belonging to the service may learn of the listing through a telephone call directly into the computer. The listings are coded by area, number of bedrooms, and other features of the property.

CONCAVE – Having an angle or curvature less than 180 degrees.

CONCEALED HEATING – See: Radiant Heating.

CONCESSION – A granting of a right, by government or privately, usually for use of land or area in a building to carry on a business.

CONCRETE – A cement mixture containing sand and gravel which is combined by mixing with water, poured to a desired shape, and hardens as it dries. See also: Poststressed Concrete; Prestressed Concrete; Reinforced Concrete.

CONCRETE (PLAIN) – A concrete which has not been prestressed, poststressed, or reinforced in any way except possibly to hinder shrinkage or expansion caused by temperature changes.

CONCRETE CONSTRUCTION – See: Architectural Concrete Construc-tion; Reinforced Concrete Construction.

CONCRETE SLAB FOUNDATION – A poured foundation consisting of concrete beams at the perimeter and center of a reinforced slab, which gives the slab support. See: Floating Slab; Monolithic Slab; Rebar.

CONCRETE TILT-UP – An inexpensive method of constructing walls by pouring concrete into forms flat on the ground, allowing to harden, then raising the forms by a crane or block and tackle to a vertical position, thereby forming the wall.

CONCRETION – A mineral mixture which forms, generally in rock of a different composition, various size grains or modules.

CONCURRENT EXCHANGE – An exchange of properties under section 1031 of the Internal Revenue Service Code that close (transfer) simultaneously.

CONDEMNATION – (1) The taking of private property for public use. Consent of the owner is not required but fair compensation must be paid. See also: Eminent Domain. (2) Declaring property unfit, usually for violations of health and/or safety codes.

CONDEMNATION VALUE – Market value paid upon condemnation.

CONDEMNEE – The owner of property taken by condemnation (eminent domain).

CONDEMNER – The party taking property by condemnation (eminent domain).

CONDENSATION – The forming of water on a barrier from warm air meeting cooler air, as in air conditioning units.

CONDENSATION DUCT – A duct which carries away the water given off by condensation from an air conditioning unit.

CONDITION – In real property law, some limiting restriction to a grant or conveyance of property, stating that upon the happening or not happening of a stated event, the estate shall be changed in some manner.

CONDITION PRECEDENT – A condition to be performed before an agreement becomes effective or some right vests or accrues.

CONDITION SUBSEQUENT – A condition following an agreement, the happening of which changes the estate.

CONDITIONAL COMMITMENT – A loan commitment given before a borrower (buyer) is obtained, and subject to approval of the buyer by the lender.

CONDITIONAL OFFER – An offer conditioned upon some event, such as the buyer being approved for a loan, an appraisal above a certain amount or a favorable termite report.

CONDITIONAL SALE OF REAL PROPERTY – See: Land Contract.

CONDITIONAL SALES CONTRACT – A sale in which the title to property or goods remains with the seller until the purchaser has fulfilled the terms of the contract, usually payment in full. See also: Land Contract.

CONDITIONAL USE PERMIT – Approval by the government body that controls zoning of a use not permitted by the zoning. The procedure is less complicated than applying for a change of zoning.

CONDOMINIUM – A structure of two or more units, the interior space of which are individually owned; the balance of the property (both land and building) is owned in common by the owners of the individual units. The size of each unit is measured from the interior surfaces (exclusive of paint or other finishes) of the exterior walls, floors, and ceiling. The balance of the property is called the common area.

CONDOMINIUM CONVERSION – The changing of rental property (two or more units) to condominium ownership. Physical changes, as well as paperwork, may be necessary to conform to building and safety codes.

CONDOMINIUM MAP (PLAN) – A recorded map showing the condominium units and common area. The map includes both horizontal and vertical measurements of the units. It is important that the map agree with the declaration of restrictions (recorded at the same time).

CONDOMINIUM OWNER’S ASSOCIATION – See: Home Owner’s Association(2).

CONDUCTION – Transmission of electricity or heat through a conductor.

CONDUCTOR – A material (usually metal) which can transmit electrical current or heat.

CONDUIT – A natural channel for the flow of water, or artificial channel, such as a pipe, used for conveying and protecting water, wires, or other materials.See Which: Real Estate Mortgage Investment Conduit.

CONDUIT SYSTEM – A system of metal casings (conduits) containing wiring and conductors.

CONDUIT, ELECTRICAL – A metal pipe, usually flexible, through which electrical wiring is installed.

CONFESSION OF JUDGMENT – The written, voluntary, submission of a debtor to a judgment by a creditor for a specified amount.

CONFIGURATION – Outline of a shape.

CONFIRMATION DEED – See: Rerecording.

CONFIRMATION OF SALE – See: Order Confirming Sale.

CONFORMING LOAN – A mortgage loan that follows the requirements for sale in the secondary market to FHLMC or FNMA.

CONFORMITY, PRINCIPLE OF – An appraisal term stating that general uniformity of structures in an area produces highest value.

CONGRUOUS – Suitable or appropriate. In appraisal, a property which conforms to the area.

CONSANGUINITY – Blood relationship, rather than legal relationship (through marriage).See also: Affinity.

CONSENT JUDGMENT – A written agreement between plaintiff and defendant to have a judgment entered and recorded. Although the court does no actual finding for one party or the other, the judgment, once approved by the court, is binding on both parties.

CONSEQUENTIAL DAMAGES – Damages created by a change in other property. An owner’s right to compensation varies with state statutes. See also: Lateral Support: Inverse Condemnation.

CONSERVATION – (1) Care and preservation of natural resources. (2) Preservation, though zoning, of improved areas to maintain the quality of the area.

CONSERVATOR – A guardian, court appointed.

CONSIDERATION – Anything which is, legally, of value, and induces one to enter into a contract.

CONSOLIDATION – (1) The coming together, either through merger or partial ownership, of two or more companies. (2) The solidification of loose material or liquid, usually under pressure.

CONSTANT – See: Loan Constant.

CONSTANT PAYMENT LOAN – See: Interest Included Note.

CONSTRUCTION COST – The total cost of building, including overhead and profits as well as land, labor, and materials.

CONSTRUCTION LOAN – Short term financing of real estate construction. Generally followed by long term financing called a “take out” loan, issued upon completion of improvements.

CONSTRUCTIVE EVICTION – (1) Regarding a landlord and tenant relationship, constructive eviction is any act by the landlord which substantially interferes with the tenant’s use and enjoyment of the leased property, but is not actual eviction. (2) The inability of the buyer to obtain possession because of a superior title of a third party. This constitutes a breach of the covenant of quiet enjoyment warranted by the seller.

CONSTRUCTIVE MORTGAGE – See: Equitable Mortgage.

CONSTRUCTIVE NOTICE – Notice given by publishing in a newspaper, recording, or other method which legally notifies the parties involved, but may not actually notify them.

CONSTRUCTIVE RECEIPT – The controlling by the taxpayer of funds from the sale of the relinquished property under a 1031 exchange rather than direct reinvestment into the replacement property. This will cause the taxpayer to lose the tax free status.

CONSTRUCTIVE TRUST – A trust created by operation of law to change an inequitable situation. If one acquires title to property through fraud, the court will hold that the legal owner holds in trust for those who really should have ownership. Also called an involuntary trust.

CONSUMER LENDING – Loans made for personal property, such as automobiles, appliances, etc.

CONSUMER PRICE INDEX – See: Cost of Living Index.

CONSUMER REPORTING BUREAU – See: Credit Bureau.

CONTEMPORARY ARCHITECTURE – A general term encompassing any number of modern designs which do not conform to any traditional architectural styles.

CONTIGUOUS – Near or close to, whether actually touching or not. Generally refers to actual touching or bordering on.

CONTINGENCY – Commonly, the dependence upon a stated event which must occur before a contract is binding. For example: The sale of a house, contingent upon the buyer obtaining financing.

CONTINGENT BENEFICIARY – One who, under the terms of a will or trust, may or may not share in the estate upon the happening of an uncertain event. Example: A leaves property to B when B reaches 30, stipulating that if B dies before 30, property goes to C. C is the contingent beneficiary.

CONTINGENT FEES – Fees to be paid only in the event of a future occurrence. A broker’s commission is paid only if the property is sold or leased (unless otherwise agreed upon). Attorneys (especially in negligence cases) may be paid based on winning the suit and collecting damages.

CONTINGENT INTEREST – An interest subject to the occurrence of a specified but uncertain event.

CONTINGENT REMAINDER – A remainder interest uncertain as to the persons in interest or the occurrence of an event. Example: A grants to B for life, then to the children of C. At the time of the grant C has no children but may have when B dies.

CONTOUR FURROWS – Furrows plowed laterally across a slope to control water running down the slope.

CONTOUR LINE – (1) A line showing the shape (outline) of a parcel of land or body of water. (2) A line on a topographical map connecting all portions of the property which have the same elevation.

CONTOUR MAP – A map which uses lines (most always curved) to outline the configuration and elevation of surface areas.

CONTRACT – A legally enforceable promise or agreement consisting of offer, acceptance and consideration or a legally acceptable consideration substitute.

CONTRACT FOR DEED – See: Land Contract.

CONTRACT OF SALE – In some areas of the country, synonymous with land contract. In other areas synonymous with purchase agreement.

CONTRACT RATE – The interest rate on a specific note as opposed to the market rate.

CONTRACT RENT – Rent paid under a lease. The actual rent as opposed to the market rental value of the property.

CONTRACTOR – See: General Contractor; Subcontractor.

CONTRACTOR’S OVERHEAD – Expenses over and above labor and materials, such as return on money invested, carrying costs of land, office expense, interest on loans, etc.

CONTRACTOR’S PROFIT – Price at which property is sold, less costs of land, labor and materials, and overhead.

CONTRACTUAL LIEN – A voluntary lien such as a mortgage or deed of trust.

CONTRIBUTION – (1) The right of one who pays a common liability to recover from the others who share the liability. Example: A, B and C own property. A pays the property tax. A may recover from B and C that portion which B and C should have paid. (2) Decreasing the gifts in a will to pay creditors of the estate or those entitled to a portion of the estate who have been omitted. See also: Abatement.

CONTROL – Referring to traffic, the term is used to indicate a traffic light or stop sign at an intersection, which slows (controls) traffic. A retail site, such as a gas station or fast food restaurant, prefers a corner location with control.

CONTROLLED ACCESS HIGHWAY – See: Limited Access Highway.

CONTROLS – In government projects such as urban renewal, the limits on use, density, and other limits which would be contained in zoning laws in a private venture.

CONVECTION – In heating, the motion created by the gravitational pull on air or water at different temperatures, and therefore, different densities.

CONVENTIONAL LOAN – A mortgage or deed of trust not obtained under a government insured program, (such as F.H.A. or V.A.).

CONVENTIONAL MORTGAGE – See: Conventional Loan.

CONVERSION – (1) A legal term referring to the “legal” changing from real to personal property (or vice versa), although there is no actual change in the property. (2) A taking of something for one’s own use which was originally in his possession only to hold for the owner. (3) The changing of an apartment to a condominium.

CONVERTIBILITY CLAUSE – The provision in a convertible adjustable rate mortgage giving the borrower the option of changing to a fixed rate at specified times during the term of the mortgage.

CONVERTIBLE ADJUSTABLE RATE MORTGAGE – An adjustable rate mortgage that gives the borrower the option to change to a fixed rate at specified times during the term of the loan.

CONVERTIBLE MORTGAGE – A mortgage which enables the lender to take (convert to) an equity (ownership) position in the collateral security (real estate) as opposed to that of a lienholder.

CONVEX – Having an angle or curvature greater than 180 degrees.

CONVEY – To transfer title to property. See also: Conveyance.

CONVEYANCE – Transfer of title to land. Includes most instruments by which an interest in real estate is created, mortgaged, or assigned.

CONVEYANCE TAX – See: Transfer Tax.

COOP – A structure to shelter chickens.

COOPERATING BROKER – The broker who finds the buyer and so shares in the commission with the listing broker.

COOPERATION CLAUSE – A clause in the purchase agreements of both the relinquished and replacement properties in a 1031 exchange stating that the parties agree to do what is required (cooperate) by the IRS rules.

COOPERATIVE – See: Stock Cooperative.

COOPERATIVE APARTMENT – Also called a stock cooperative or a co-op. A structure of two or more units in which the right to occupy a unit is obtained by the purchase of stock in the corporation which owns the building. Difficult to obtain financing because there is not individual ownership of each unit. A forerunner of the condominium.

COPING – The top or “cap” of a wall, usually convex to permit the runoff of water.

COPSE – A small wooded area. A thicket of trees or bushes.

CORBEL – A timber or stone, set in and projecting from a wall, and used to support a load.

CORD – A measure, usually associated with cut wood. 128 cubic feet of cut wood, or a pile 4′ high, 4′ wide, and 8′ long.

CORNER – Most commonly, the acute angle formed by intersecting streets or walls.

CORNER BEAD – A reinforcement placed in corners before plastering. Commonly a strip of iron with metal lath.

CORNER BOARDS – The boards (trim) covering the outside corners of a frame building.

CORNER BRACES – Braces nailed diagonally to the studs as a reinforcement at corners.

CORNER INFLUENCE – In appraisal, the effect on the value of a property because it is on a corner or near a corner.

CORNER LOT – A lot contiguous to two intersecting streets, and, for purposes of value, having access to both streets.

CORNICE – The “crowning” member of a wall. The top molding or facade, generally of a decorative nature.

CORPORATE RESOLUTION – An action taken by vote of the directors of a corporation. A title insurance company may require a corporate resolution before insuring a sale or loan made by a corporation.

CORPORATION – A general term encompassing any group of people “incorporating” by following certain statutory procedures. Most common type of corporation is a private one formed to carry on a business.

CORPOREAL – Concerning material objects or property, rather than non-material things, such as ideas. A machine would be corporeal; the patent for it would be incorporeal.

CORPOREAL PROPERTY – That property which can be touched. For example: A window (glass) is corporeal. The view through the window is incorporeal.

CORPUS – A body; of people, laws, etc.

CORRECTION DEED – See: Rerecording.

CORRECTION LINES – See: Standard Parallels.

CORRELATION – The use of different appraisal methods to reach an estimate of value of a property. The methods must be weighed as to relative value in each specific appraisal.

CORRIDOR – (1) A hallway or passageway. (2) A strip of land used as a passageway, such as an inland country’s outlet to the sea, or between heavily populated areas.

COSIGNER – See: Co-Maker.

COST – Technically, the original amount paid for anything. The term is generally used as a synonym for value or the total amount invested, including expenses after the original purchase.

COST APPROACH – An appraisal method, estimating the replacement cost of a structure, less depreciation, plus land value.

COST ESTIMATING – (1) In construction, the expenditure of building based on a detailed cost of materials to be used. (2) In appraisal the term is general, referring to replacement cost, but not limited to a specific method of arriving at said cost.

COST OF FUNDS INDEX (COFI) – See: COFI.

COST OF LIVING ESCALATION – See: Escalation Clause (2).

COST OF LIVING INDEX – A government indicator of the increase or decrease of living costs for the average person on a monthly basis. See also: Escalation Clause (2).

COST OF OCCUPANCY – Cost (usually monthly) of a business to occupy its property exclusive of any costs of doing business.

COST OF REMODELING – Expense of alterations to raise the value of a property, rather than to make repairs.

COST OF REPAIRS – Expenses to maintain the value of a property by restoring the worn- out or broken parts of the structure.

COST RECOVERY – See: Depreciation (2).

COST-PLUS CONTRACT – A building contract setting the builder’s profit at a set percentage of actual cost of labor and materials.

COTENANCY – A general term covering both joint tenancy and tenancy in common.

COTTAGE – Originally, a house with no surrounding land belonging to it. Modernly, a small house, perhaps used as a summer home.

COULOMB – A measure of electricity equal to a one second electrical charge in a current having a constant flow of one ampere.

COUNSELOR (COUNSELLOR) – (1) A lawyer. (2) One designated as a real estate counselor by the American Society of Real Estate Counselors. The designation indicates an extremely high standard of knowledge and experience on the part of the conferee.

COUNSELOR OF REAL ESTATE (CRE) – A designation conferred by the Counselors of Real Estate, an affiliated association of the NATIONAL ASSOCIATION OF REALTORS. The designation is not just for those in the real estate business but includes lawyers, accountants, financial firms, government employees and educators.

COUNSELORS OF REAL ESTATE – An association affiliated with the NATIONAL ASSOCIATION OF REALTORS. Its members provide counseling in various aspects of real estate. The association offers publications and courses in counseling and confers the designation of Counselor of Real Estate.

COUNTER FLASHING – Flashing (tar substance) used on chimneys at the roofline to prevent entry of moisture, and cover the metal sheet flashing.

COUNTER OFFER – An offer (instead of acceptance) in response to an offer. For example: A offers to buy B’s house for X dollars. B, in response, offers to sell to A at a higher price. B’s offer to A is a counter offer.

COUNTER-LETTER – In civil law (Louisiana), when a deed is given to a lender as security, an agreement to reconvey (counter-letter) upon payment of a certain amount is given by the lender.

COUNTY – A political division within a state, usually encompassing one or more cities or towns. There are exceptions such as New York City which contains more than one county. Louisiana uses the word parrish instead of county; New York uses both borough and county, as in Kings County (the borough of Brooklyn).

COUNTY MORTGAGE – A mortgage placed on property by the county to secure aid given to indigent persons. Generally paid upon sale of the property. Also called an indigent mortgage.

COUNTY RECORDS – Public recorded documents by which notice is given of changes of title, liens, and other matters affecting real estate.

COUNTY ROAD – (1) A road lying entirely in one county. (2) Any road or portion of a road under the jurisdiction and maintenance of the county. (3) Loosely, any road not a federal or state road.

COURSE – (1) The path or direction of a river. (2) Something designed so that it must be used by following a certain direction, such as a golf course or race course. (3) A continuous row or layer of wood, bricks, masonry, etc.

COURSES AND DISTANCES – Terminology used in surveying, meaning metes and bounds. See also: Metes and Bounds.

COURT – (1) A totally uncovered space, wholly or partly surrounded by walls or buildings. (2) A blind alley, short street, or short cul de sac. (3) A courtroom.

COURTESY TO BROKERS – Willingness of a seller to pay a commission to any broker supplying a suitable buyer; or the willingness of a listing broker to share the commission with any broker supplying a suitable buyer.

COVE – (1) An arched, rather than square angle, meeting of a ceiling and wall. (2) An inlet or small bay.

COVE MOLDING – A small, concave faced molding, used to cover a narrow gap or angle.

COVENANT – Generally, almost any written agreement. Most commonly in real estate, assurances set forth (expressed) in a deed by the grantor or implied by law. Example: Covenant against encumbrances, covenant of right to convey, etc.

COVENANT NOT TO COMPETE – A promise (covenant) usually by a seller of a business, not to operate a competitive business after the sale. The more specific the restriction (time limit, distance, etc.), the more easily it is enforceable.

COVENANT OF QUIET ENJOYMENT – Usually inserted in leases or conveyances whereby lessor or grantor promises that the tenant or grantee shall enjoy possession of the premises in peace and without disturbance caused by defective title.

COVENANTS RUNNING WITH THE LAND – See: Running With The Land.

COVENANTS, CONDITIONS, AND RESTRICTIONS – See: CC&R’s.

CPA – See: Certified Public Accountant.

CPM – See: Certified Property Manager.

CRA – See: Community Reinvestment Act.

CRADLE – (1) A framework or support, built to shield or protect its contents. (2) The path prepared to catch a falling tree to prevent damage to the tree.

CRAMDOWN – A term used in chapter 13 (wage earner restructuring debt) bankruptcy. A secured loan is reduced when the loan balance exceeds the reasonable value of the collateral security. The amount above that value becomes unsecured. Used mainly for personal property loans but now starting to be used for mortgage loans. A portion of the mortgage, if it exceeds the value of the property, can become an unsecured loan.

CRAWL SPACE – A space between the ground and the first floor of a structure (usually a house). Repair of utilities under the house may be made by a person crawling through the shallow space.

CRB – See: Certified Real Estate Brokerage Manager.

CREATIVE FINANCING – A general term which encompasses any method of financing property going beyond traditional real estate lending.

CREDIT – (1) The financial worthiness of a borrower. The history of whether this borrower has met financial obligations on time in the past. (2) An accounting term designating money received or receivable, as opposed to debit which is money payed or payable.

CREDIT BUREAU – A company that compiles information on a person’s credit history. Also called a Consumer Reporting Bureau.

CREDIT BUREAU SCORE – A number representing the credit worthiness of a potential borrower.

CREDIT ENHANCEMENT – The requirement of additional collateral security, such as mortgage insurance, to protect a lender against loss.

CREDIT HISTORY – The past and present debts of a potential borrower. It is used to see if the person pays obligations as agreed and whether any past defaults have led to judgments or bankruptcy.

CREDIT LIFE INSURANCE – See: Mortgage Life Insurance.

CREDIT LINE REVERSE MORTGAGE – A maximum amount is established as a line of credit. The borrower can write checks up to this amount. This loan allows repayment and reborrowing during the life of the loan, but does not require repayment until the loan ends. This occurs either at the borrower’s sale of the property or the borrower’s death. See also: Reverse Mortgage.

CREDIT REPORT – A report on the past ability of a loan applicant to pay installment payments. Several national and local companies make such reports.

CREDIT REPOSITORY – See: Credit bureau.

CREDITOR – One who is owed money.

CREDITOR’S COMPOSITION – An agreement by creditors to take a portion of a debt as satisfaction for the total due. Generally done to avoid a debtor having to declare bankruptcy.

CREDITOR’S POSITION – (1) The portion of the value of property which is mortgaged, rather than the equity. (2) The portion of the value of property upon which a first mortgage could be obtained.

CREEK – (1) An inlet, going deeper into land than a cove. (2) A stream which empties into a river or bay.

CRICKET – A small, convex roof, placed on a larger roof or surface, to promote drainage in areas of the surface which have barriers to said drainage.

CROFT – An obsolete term referring to a small farm or area to be farmed.

CROP – A specific harvest in a single growing season, such as the corn crop, apple crop, etc.

CROP ROTATION – The planting of crops such as peas and beans (leguminous plants), which add nitrogen to the soil, on an alternating basis with crops such as corn, wheat, etc., which take nitrogen from the soil.

CROPLAND – (1) Any land suited for farming (the growing of crops). (2) Land upon which crops are actually grown or growing.

CROSS CONNECTING ROAD – A road connecting two parallel roads, usually at a right angle.

CROSS SECTION – The surface exposed by cutting at a right angle to an axis (usually the longer axis) of an object.

CROSS-BRIDGING – Strengthening a structure by bracing cross members between the joists, thereby spreading the weight over a larger area.

CROWN MOLDING – A large molding used on a cornice or to cover a wide gap or angle.

CRS – See: Certified Residential Specialist.

CRUISE – A surveying report showing the amount and type of timber in a given area or stand.

CRV – See: Certificate of Reasonable Value.

CUBIC CONTENT – The number of cubic feet in a building, measured from the exterior surfaces of the exterior walls and roof, and the interior surface of an unfinished floor or six inches below the finished surface of the floor.

CUBIC FEET PER MINUTE – An air flow measure used to grade the efficiency of ventilating fans.

CUBIC FOOT – See: Cubic Measure.

CUBIC FOOT COST – The cost of construction of a structure, divided by the number of cubic feet of the structure. See: Cubic Content.

CUBIC FOOT METHOD – See: Comparative Method.

CUBIC FOOT PER SECOND – A flow of water of one cubic foot per second. Used as a measurement term in determining the flow of a river or stream.

CUBIC INCH – See: Cubic Measure.

CUBIC MEASURE – A system of measuring volume or space by using cubic units. One cubic inch is 1 inch long by 1 inch wide by 1 inch high; 1728 cubic inches equals 1 cubic foot; 27 cubic feet equals 1 cubic yard.

CUBIC YARD – See: Cubic Measure.

CUL DE SAC – A street or ally open at one end only. Modernly, a street in a subdivision, open at one end, and having a large, rounded, closed end to facilitate U turns.

CULTURA – A parcel of land which can be cultivated.

CULTURAL FEATURES – A term denoting man made changes to land.

CULVERT – A waterway or drainage ditch which crosses under a road.

CUPOLA – (1) A structure, usually domelike, atop a roof. (2) A type of foundry furnace for melting iron.

CURABLE DEPRECIATION – Repairs which an owner of real estate should make to retain a high value, but which have not been made.

CURABLE FUNCTIONAL OBSOLESCENCE – See: Functional Obso-lescence.

CURABLE PHYSICAL DETERIORATION – See: Physical Deterioration.

CURB CUTS – The part of a curb which lowers to street level to form the apron of a driveway.

CURB LINE – The line between the right of way for automobiles (road) and the right of way for pedestrians (sidewalk).

CURRENT ASSETS – An accounting term meaning cash or those things which can be readily converted to cash, such as short term accounts receivable.

CURRENT LIABILITIES – Short term debts.

CURTAIL SCHEDULE – The schedule of partial principal payments (both amounts and due dates) to reduce and retire an indebtedness.

CURTAIN WALL – An outside wall which lends no structural support to a building, but acts merely to enclose.

CURTESY – A common law interest of a husband in the property of his deceased wife. Abolished in most states.

CURTILAGE – The grounds and secondary buildings surrounding a house which are commonly used in connection with the everyday use of the house.

CURVILINEAR – Having boundaries of curved lines; may refer to architecture, streets, etc.

CUSTODIAN – (1) One who is entrusted with the care and keeping of real or personal property. See also: Custody. (2) A janitor.

CUSTODY – The care and keeping of property (real or personal). For example: An escrow agent has custody of documents and funds until closing.

CUSTOM BUILDER – One who builds for a specific owner, designing the building to suit said owner’s need, rather than building and then looking for a buyer.

CUSTOMER – A buyer of goods or services.

CUT-OVER LAND – Land from which the original growth has been cut away by logging.

CUTS – In construction, the excavation of land into a terrace or terraces, to control flooding, locate a highway, building, or affect the grade for some other purpose.

CY PRES – As nearly as possible. A doctrine used to carry out the intent of the donor when a specific charitable gift fails. Example: Land is left in a will to the X Blood Bank. When the will is probated, X Blood Bank no longer exists. The land is given to the Red Cross.

CYCLICAL MOVEMENT – A term in economics describing the business cycle of the national economy, from good to bad to good again.