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National Association of Real Estate Brokers (NAREB) – A professional trade association of African American real estate brokers. Members are called “Realtists”. See also Realtist.
National Association of Realtors® (NAR) – A professional real estate trade association which is the country’s largest and most influential real estate professional organization. Members are referred to as “Realtors” or “Realtor Associates”. NAR functions through affiliate state organizations often referred to as “boards”. The most prominent activity of most local boards in NC is the operation of multiple listing services in which brokers who are members of the local board may participate. See also Realtor®
National Historic Preservation Act – Federal legislation protecting and providing some assistance for historic properties.
Natural Monument – Those monuments, which are a product of nature.
Navigable Water – A body of water suitable for the usual purpose of navigation by vessels or boats. Ownership of land under navigable water is the State of North Carolina in trust for all of its citizens.
Negative amortization - The situation occurs when a borrower's monthly payment is not large enough to cover both the principal and interest of a loan. As a result, the outstanding balance of the loan actually grows larger with each payment rather than smaller. Most fixed-rate loans are not subject to negative amortization, but many adjustable-rate mortgages are susceptible
Negligence – The failure to exercise that degree of reasonable care required under the circumstances existing at a given time; the failure to exercise that degree of care that would be expected of a reasonably prudent person under the same or similar conditions.
Negligent Misrepresentation – The unintentional misrepresentation of a material fact by a party where that party “should reasonable have known” the truth of the matter that was misrepresented.
Negligent Omission – The unintentional failure to disclose a material fact by a party where that party “should reasonably have known” of the fact that was not disclosed.
Negotiable Promissory Note – An unconditional promise to pay on demand, or at a fixed or determinable future time, a sum of money “to order” or “bearer”. A negotiable note is assignable by the lender. A non-negotiable note, in contrast, is payable only to a named person.
Net Lease – A lease where, in addition to the rental stipulated, the lessee assumes payment of property charges such as taxes, insurance, and maintenance.
Net Listing – A brokerage fee arrangement in a listing contract whereby the seller will receive a fixed price for his property and the broker will receive any amount realized (i.e. the “net”) in excess of that price.
Net Operating Income (NOI) – In an operating budget, the income projected for an income producing property after deducing projected vacancy/rent collection losses and operating expenses from projected gross (maximum possible) income. In an income/expense statement, the income from a property after deducting operating expenses from gross income actually received.
Net worth - The value of ones assets minus their liabilities.
Non-assumption clause - Loan provision that prohibits the transfer of a mortgage to another borrower without lender approval
Non-conforming use – A use of land that predates zoning, but is not in accordance with the uses prescribed for the area by the later zoning ordinance. Because it was there first, it may be continued, subject to certain limitations.
Non-exclusive listing - A real estate listing to which no one agent or broker has claim.
Non-financial asset - An asset with a physical value such as land, property, or some type of object.
Non-freehold – Any interest (estate) in real estate which is less than a “freehold” interest. Also called a leasehold estate.
Non-recurring closing costs - Costs that are one-time only fees for such items as an appraisal, loan points, credit report, title insurance and a home inspection
North Carolina Association of Realtors - The North Carolina Association of REALTORS® is a non-profit trade association founded in 1921 and incorporated on Sept. 14, 1935. From an initial membership of 135, NCAR today has a membership of more than 40,000 real estate professionals representing 66 local associations statewide. The NC Association of REALTORS® is the largest and oldest state association in North Carolina.
North Carolina Planned Community Act – A law enacted in 1998 effective January 1, 1999 that significantly expands the authority of homeowner associations and makes the enforcement of covenants and restrictions significantly easier in developments that fit the definition of a “planned community” by allocating authority to make and enforce annual and special assessments to the homeowner association.
North Carolina Real Estate Commission – See Real Estate Commission
North Carolina Real Estate License Law – See Real Estate License Law
North Carolina Residential Rental Agreements Act – See Residential Rental Agreements Act
North Carolina Tenant Security Deposit Act – See Tenant Security Deposit Act
North Carolina Time Share Act – See Time Share Act.
Notarization – A certification by an authorized notary public to the effect that the signatures on a document are authentic. See also Acknowledgment.
Note - Legal document that requires a borrower to repay a mortgage at a certain interest rate over a specified period of time
Novation – The substitution of a new contract for the former one. All obligations under the old contract are discharged and replaced by the terms of the new one.
Nuisance – The unreasonable use of private property in a manner that is hazardous or offensive to the property or health of neighboring owners or the public in general.
O
Obsolescence – As applied to real estate, it is the loss or impairment of value due to becoming outmoded and/or less useful as a result of social or economic changes. See also Economic Obsolescence and Functional Obsolescence.
Offer – A promise by one party to another party to perform a specified act provided that the other party promises to perform some specified act in return. An offer may be either an “offer to purchase” or an “offer to sell”.
Offer To Purchase - A written contract setting out the terms under which the buyer agrees to buy. Upon acceptance by the seller, it forms a legally-binding contract subject to the terms and conditions stated in the document.
Offeree – The person receiving an offer; the person to whom the offer is extended.
Offeror – The person making the offer.
Oil and Gas Lease – A lease transferring the right to extract oil or gas from the real property of the lessor.
Omission – The willful or negligent failure to disclose a material fact to another party. See also Willful Omission and Negligent Omission.
Open End Mortgage – A mortgage with an additional arrangement allowing the borrower to secure funds up to a certain amount in addition to the original amount borrowed.
Open house - Marketing tool in which a listing agent opens a house for public viewing
Open listing - A property given to a number of brokers to market at the same time. A general listing given to a broker by an owner to sell his property. Such listing is not exclusive and may be given to a number of brokers at the same time. The owner is not precluded from selling the property during the term of the listing, and, if the owner procures a purchaser, he is under no obligation to pay any commission. Only the broker who produces a purchaser is entitled to receive compensation for effecting a sale under this type of listing. A sale by one broker terminates all other such listings.
Open Mortgage - A mortgage which can be prepaid at any time, without penalty.
Operating Budget – A detailed statement of projected income and expenses for a specified period of time.
Operating Expenses – All expenses or costs of operating a piece of property except for debt service, capital expenditures, and depreciation.
Opinion of Title – An attorney’s report on the status of title to real property based on his examination of the land records and other relevant public records.
Option – A privilege sold by a property owner (optionor) to another (optionee) going to the optionee, in return for the payment of a consideration, a right to buy or not to buy a property within a specified period of time at a specific price. Also called an option to purchase or an option contrat.
Option Agreement - A document stipulating that, in exchange for a deposit, a specified individual is to be given the first chance of buying a property at or within a specified period of time. If the option holder does not buy at or within the specified period, he or she loses the deposit and the agreement is canceled.
Option to Renew – In landlord tenant law, the right given to tenants in some leases to renew the tenancy for an additional term.
Ordinance – A law passed by the governing body of a county or city acting under authority granted by the state legislature.
Ordinary Gain/Loss – For income tax purposes, any gain/loss that is not a capital gain/loss.
Original Titles – Titles not derived from a prior owner, but arising by operation of law independently of any prior owner as a result of occupancy by an adverse possessor for a specified length of time.
Origination Fee – A one time fee charged to a borrower by a lender for making a mortgage loan. This fee usually is computed as a percentage of the loan amount. Also called loan origination fee.
Over-improvement – An improvement that is not the highest and best use for the site on which it is placed by reason of excess in size or cost.
Overlay Zoning District – In zoning practices, a district or zone that superimposes a certain zoning use over the existing traditional zoning map. A historic preservation zone, for example, might be superimposed over existing traditional zones.
Override Clause – An override or extender clause is a provision in a listing contract that protects the real estate broker in the event that the property owner and a prospective purchaser postpone the ultimate purchase in order to avoid paying a brokerage commission. It provides that, if the property is sold within a certain period of time after expiration date of the listing contract to a prospect that the broker found during the listing period, commission is payable. Also called Extender Clause.
Owner financing - A transaction in which the seller of a property agrees to finance all or part of the purchase.
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Package Insurance Policy – A generic term describing an insurance policy that insures against a number of perils, such as a homeowner’s policy.
Package Mortgage – A mortgage or deed of trust on both real and personal property.
Panic Peddling – See Blockbusting.
Parcel - An officially described piece of land A part or portion of land or an estate; synonymous with the term “lot”.
Parol – Oral, as distinguished from written.
Parol Evidence Rule – An evidentiary rule that states that earlier informal and tentative agreements and negotiations are no longer valid or binding once there is a final and complete written contract between the parties, nor can the terms or content of any such earlier negotiations or agreements be introduced into evidence.
Participation Mortgage – (a) A mortgage whereby the lender receives a portion of the income from the property or a partial equity interest in the property; (b) A mortgage loan made by two or more lenders.
Partition – A division of land among those who own it in undivided shares, such as tenants in common. A partition may be by a voluntary exchange of deeds or it may be ordered in a judicial proceeding.
Partition Deed – A deed executed by concurrent owners of property in order to convert their ownership into ownership in severalty.
Partnership – An association, regulated by the Uniform Partnership Act an the Revised Uniform Limited Partnership Act, of two or more persons to conduct business for a profit. There are three types of partnerships; general, limited and limited liability.
Party Wall – A wall that is erected upon and over a line separating two adjoining properties which the owners of the respective parcels have a common right to use.
Party Wall Agreement – A contract between adjoining property owners calling for the construction and joint use of a wall between two buildings used for the support of both.
Patent Ambiguity – A condition that exists in an attempted description of real estate in a deed, contract, or other document affecting title that is so absolutely uncertain that there is not way of determining where the property is. A document containing a patently ambiguous description is void. Compare Latent Ambiguity.
Patent Defect – An obvious property defect that should be discovered by a reasonably diligent inspection of the property. Compare Latent Defect.
Payment Cap – A limit on the amount the monthly payment on an adjustable rate mortgage can be increased when the interest rate is adjusted upward.
Penalty - A sum of money paid to a lender for the privilege of prepaying a mortgage in part or in full.
Percentage Lease – A lease of commercial property in which the rent is computed as a percentage of the receipts, either gross or net, from the business conducted by the lessee, sometimes with a guaranteed minimum rental.
Percolation Test – The old, now obsolete, term used to describe a soil suitability test to determine if soil will absorb and drain water sufficiently for use of a septic tank.
Periodic Tenancy – See Estate from Year to Year.
Personal Property – Movable property that is not real property. The term “personal property” includes tangible property such as money, goods, chattels, and also intangible property such as debts and claims (choses in action).
Personal Representative – A person appointed to wind up the affairs of a decedent; if appointed by the Court, an administrator, or, if named by a will, an executor or executrix.
Pest Inspection Report – See Wood Destroying Insect Inspection Report
Physical Deterioration – Impairment of condition; one of the causes of depreciation, resulting from wear and tear, disintegration, use in service, action of the elements, and other causes.
P.I. (Principal & Interest) - Principal and interest due on a mortgage.
P.I.T. (Principal, Interest, & Taxes) - Principal, interest and taxes due on a mortgage.
P.I.T.I. - The owner's typical monthly payment, which includes principal, interest, (property) taxes and (mortgage) insurance. Most lenders collect a portion of annual tax and insurance bills each month, then pay them when they're due.
Plaintiff – The complaining party in a legal action or lawsuit.
Planned Community – Real estate with respect to which any person by virtue of that person’s ownership of a lot, is expressly obligated by a declaration to pay real property taxes, insurance premiums, or other expenses to maintain, improve r benefit other lots or other real estate described in the declaration, but specifically excluding condominiums.
Planned Unit Development – A “PUD” is a special use permitted under a zoning ordinance that allows a developer to deviate from construction on standard lots and develop tracts with varying land uses and densities. A PUD often involves cluster housing with areas of open space.
Plat – A map of a division of land into blocks and lots.
Plat Book – A public record in the office of the Register of Deeds of various recorded plans of subdivisions of land into blocks and lots.
Point - A point is 1 percent of the loan amount. For example, two points on a $100,000 loan would be $2,000. You can pay points to get your lender to give you a lower interest rate. Or, you can refuse to pay points and keep the interest rate offered. Often the increase in payment is quite small, so weigh the pluses and minuses carefully before you decide. Points are also called loan discount fees. Also called a Discount Point.
Police Power – The authority of states, often delegated to local governments, to place restraints on the personal freedoms and property rights of individuals to promote public health, safety, morals, or general welfare. The best example of the exercise of such power is zoning ordinances.
Power of Attorney – An instrument authorizing a person to act as the attorney in fact of the person granting it; it may be a general power or may be limited to performance of a specific act or acts.
Power of Sale – A method of foreclosure of a mortgage or deed of trust in default. After proper notice and a hearing before a clerk of court, the mortgaged property is sold at a public sale.
Prepayment Option - The right to prepay specified amounts of the principal balance. Penalty interest may be incurred on prepayment options.
Pre-Qualifying a buyer - The process of making a non-binding preliminary determination of a prospective buyer's qualifications with respect to a mortgage loan. Pre-qualification may be performed by a lender or a real estate agent.
Present Value – The present worth of money to be received at some future time.
Prima Facie – From Latin meaning “first view”. In law, prima facie evidence of fact is sufficient to establish the fact unless rebutted.
Primary Mortgage Market – The market in which mortgage loans are originated. This market consists of lenders (such as savings and loan associations, mortgage companies, and banks) that make mortgage loans directly to borrowers.
Prime Contractor – See General Contractor.
Principal - The amount you still owe the lender at any time, not including interest. The amount of money actually borrowed. (a) one who appoints or hires an agent to act for and in his stead; (b) A capital sum loaned with interest; the amount of a loan.
Private mortgage insurance (PMI) - If your down payment is less than 20 percent of the property's cost, most lenders will require you to obtain private mortgage insurance, which protects your lender if you default on the loan. Cost: $45 to $75 a month. Be sure you can cancel the private mortgage insurance policy when you've paid your loan to less than 80 percent of your home's value.
Probate sale - A real estate sale triggered by the death of the owner, with proceeds to be divided among heirs or creditors
Property - Property is commonly thought of as a thing which belongs to someone and over which a person has total control. But, legally, it is more properly defined as a collection of legal rights over a thing.
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Qualified Buyer - A purchaser who has been pre-approved for financing. The process of determining whether or not a buyer of real estate applying for a mortgage loan is qualified under the qualification standards for that loan. Qualification of a buyer-borrower is performed by the lender.
Qualifying ratios - Lenders compute qualifying ratios to determine how much a potential buyer can borrow.
Queen Anne style - A Victorian-era style of architecture that originated in San Francisco.
Quiet Enjoyment - The right of an owner of an interest in land, whether an owner or a tenant, to protection against disturbance or interference with his possession of the land. If a grantee's or lessee’s possession is disturbed by one who has superior title to that of a grantor or lessor, the grantee or lessee may sue his grantor or lessor and recover for breach of the covenant of quiet enjoyment in the deed or lease by which the grantee or lessee took his interest.
Quiet Title - A court action brought to establish title and to remove a cloud on the title.
Quit-claim deed - Document that releases a party from any interest in a piece of real estate. A deed given when the grantee already has, or claims, complete or partial title to the premises; a deed that transfers any interest the grantor may have in real property, but in which the grantor makes no guarantee as to the quality of the title he transfers.
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Racial Steering – An illegal practice under the Federal Fair Housing Act of 1968 and the State Fair Housing Act by which patterns of racial segregation are preserved and encouraged by steering members of racial and ethnic groups to areas occupied primarily by members of their own racial or ethnic group.
Ranch House (Rancher) - A description of a one-storey house, developed from the old, western-style homes.
Rate (interest) - The return the lender receives for loaning you the money for the mortgage.
Rate Cap – A limit on the amount of adjustment that can be made in the interest (note) rate on an adjustable rate mortgage at each rate adjustment date.
Ready, Willing, and Able – A self-explanatory phrase referring to a prospective purchaser of real estate who is prepared to purchase a property on terms acceptable to the seller and is in a position, financially and otherwise, to complete the transaction.
Real Estate - Term for land and all fixtures to land, including buildings and other improvements.
Real estate agent - A person licensed to negotiate and transact the sale of real estate.
Real Estate Board - A non-profit organization representing local real estate brokers/agents, salespeople, which provides services to its members and maintains and operates a MLS® system in the community.
Real Estate Commission – The North Carolina state agency charged with the responsibility of administering and enforcing the Real Estate License Law (which includes the Time Share Act).
Real Estate Investment Trusts (REITS) – A legal entity formed by a group of investors who desire to pool their resources for the purpose of real estate investment.
Real Estate License Law – The law enacted by the General Assembly that governs the licensing of real estate brokers, establishes standards of conduct for such licensees, and provides for disciplinary action against licensees who violate its provision. The enforcing agency is the North Carolina Real Estate Commission .
Real Estate Settlement Procedures Act (RESPA) – Consumer protection legislation enacted by Congress requiring lenders to provide borrowers with specified information in residential real estate loan transactions. RESPA also prohibits certain practices in residential real estate closings.
Real Property – Lands, tenements, and hereditaments; the earth’s surface, the air above, the ground below and all improvements and appurtenances to the land; the rights, interests, and benefits (sometimes referred to as the “bundle of rights”) inherent in the ownership of real property. Synonymous with the terms real estate and realty.
Realtist – A term used to designate a member of the National Association of Real Estate Brokers.
Realtor® - A real estate agent, broker or an associate who holds active membership in a local real estate board that is affiliated with the National Association of Realtors.
Reconciliation – The final step in the appraisal process; the process by which an appraiser reconciles the estimates of value derived through the sales comparison, cost, and income approaches to select a single conclusion of value.
Recording – The filing or registering of documents affecting title to real estate (and certain other documents) in the proper books in the office of the Register of Deeds of the applicable county so that a public record will be made.
Record Title – The ownership of real estate as shown by the instruments recorded in the office of the Register of Deeds along with records in certain other public offices.
Redemption – The right that an owner-mortgagor, or one claiming under him, has after defaulting on the mortgage payments to recover back his title to the mortgaged property by paying the mortgage debt, plus interest and any costs accrued, prior to a valid foreclosure. The payment discharges the mortgage and places the title back as it was at the time the mortgage was executed.
Referral - A recommendation, a suggestion to a client of the value of the services of a person or firm. (i.e. a real estate agent may refer a purchaser to a particular banker or lawyer.)
Residence - The dwelling in which a person lives, may also refer to the country or state where a person lives.
Residential Property - Real estate that is occupied by the owner.
Restrictive Covenant – A privately imposed limitation on the use of real property that is imposed by a landowner or developer and set forth in a deed or in a separately recorded declaration. Such covenants constitute an appurtenance to the real property and “run with the land”.
Retaliatory Eviction – Under common law theory, a landlord can evict a tenant for any legal reason, including no reason at all. The doctrine of retaliatory eviction modifies this rule as a matter of public policy by holding that a landlord cannot evict a tenant in retaliation for the tenant’s assertion of some legal right (e.g., reporting a building code violation) or engagement in a protected activity. N.C. Gen. Stat. §42-37 adopts this doctrine for residential tenancies.
Revenue Stamps – Obsolete term, as stamps are no longer used.
Reverse Annuity Mortgage(RAM) - A type of mortgage where the equity in the home serves as security for periodic payments made by the lender to the borrower. Mortgage is generally paid out upon the sale of the property.
Reversion – The residual of an estate left to a grantor, to commence possession after the termination of some particular estate granted out by him; the return of land to the grantor and his heirs after the grant is over. In appraising, the anticipated net profit a property owner will receive upon the future sale of his property.
Rezoning - The amendment of the classification of a property under use and building by-laws or ordinances. A property may rezoned from industrial to residential to allow a warehouse to be converted into condominiums.
Right of first refusal - A provision in an agreement that requires the owner of a property to give another party the first opportunity to purchase or lease the property before he or she offers it for sale or lease to others.
Right of Survivorship – The right of surviving co-tenants to automatically acquire the interest of a deceased co-tenant where two or more were joint or concurrent owners of certain interests in real estate; the most important and distinguishing feature of tenancy by the entirety (spousal ownership) in North Carolina; also present in a joint tenancy, but subject to destruction by a transfer of any individual co-owner’s interest.
Right of Way – A right whereby the owner of land has given to another the right to pass over his land, to construct a roadway or use as a roadway, a specific part of his land without actually transferring ownership of the land. A right-of-way also may be a right of one to construct over the land of the owner telephone, telegraph, or electric power lines, or to place underground water mains, gas mains, sewer mains and the like in the lands of the owner.
Riparian Owner – One who owns lands bordering upon a river or water course. A riparian owner has peculiar “riparian rights” to water that is on, under, or adjacent to his land.
Riparian Rights – Rights to use water enjoyed by riparian owners.
Risk of Loss – The allocation of loss between seller and purchaser due to damage or destruction of property during the interim period between the signing of a valid real estate sale contract and the closing date. Risk of loss can be specified by contractual agreement. Where the contract is silent, one must refer to the Uniform Vendor and Purchaser Risk Act or the common law.
Roll-over Mortgage - A mortgage loan where the interest rate is established for a specific term. At the end of this term the mortgage is said to "roll over" and the borrower and lender may agree to extend to loan. If satisfactory terms cannot be agreed upon, the lender is entitled to be repaid in full. In this case, the borrower may seek alternative financing.
Rural - A term to describe something which is not of an urban center.
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Sale Agreement (Purchase Agreement) - Also known as "Agreement of Purchase and Sale". The contract that sets out the terms and conditions agreed to by the buyer and the seller in the sale of land.
Second Mortgage - This is usually at a higher interest rate and represents the difference between the price of the house and first mortgage plus the down payment. This may be obtained from banks and finance companies or through lawyers or notaries.
Seller's Agent - The Seller's Agent represents the seller -- either as a Listing Agent under the listing agreement with the seller or by cooperating as a Sub-Agent, typically through the MLS® system. In dealing with prospective buyers -- customers-- the Seller's Agent can provide a variety of information and services to assist the buyer in his/her decision-making. The Seller's Agent does not represent the buyer.
Senior Mortgage – A mortgage on real property that is higher in priority that any other mortgage; usually the same as the “first mortgage.”
Servient Estate – A parcel of land that is burdened by an easement for the benefit of another parcel of land (the dominant estate).
Setback – The distance from a curb or other established line within which no buildings may be erected. A “setback ordinance” prohibits erection of buildings or structures beyond defined setback lines.
Settlement (or Closing) - The settlement or closing is the conclusion of your real estate transaction. It includes the delivery of your security instrument, signing of your legal documents and the disbursement of the funds necessary to the sale of your home or loan transaction (refinance).
Settlement Costs - Also known as closing costs, these costs are for services that must be performed before your loan can be initiated. Examples include title fees, recording fees, appraisal fee, credit report fee, pest inspection, attorney's fees, taxes, and surveying fees.
Severalty Ownership – Sole ownership where real property is owned by one person only.
Severance Damage – The impairment in value caused by separation; commonly, the damage resulting from the taking of a fraction of the whole property, reflected in a lowered utility and value in the land remaining.
Sexual Harassment – The unsolicited overt requests or demands for sexual acts when (i) submission to such conduct is made a term of the execution or continuation of the lease agreement, or (ii) submission to or rejection of such conduct by an individual is used to determine whether rights under the lease are accorded.
Shared Appreciation Loan – A mortgage loan plan that requires the borrower to pay to the lender a share of the appreciated value of the property after a certain period of time. In return, the borrower obtains a lower interest rate.
Sheriff’s Deed – A deed given by a sheriff conveying title to real property pursuant to an execution sale to satisfy a judgment against a judgment debtor who is a property owner.
Short Sale - (From Wikopedia) In real estate, a short sale is a sale of real estate in which the proceeds from the sale fall short of the balance owed on a loan secured by the property sold. In a short sale, the bank or mortgage lender agrees to discount a loan balance due to an economic or financial hardship on the part of the mortgagor. This negotiation is all done through communication with a bank's loss mitigation or workout department. The home owner/debtor sells the mortgaged property for less than the outstanding balance of the loan, and turns over the proceeds of the sale to the lender, sometimes (but not always) in full satisfaction of the debt. In such instances, the lender would have the right to approve or disapprove of a proposed sale. Many Short Sales leave a deficiency balance for which the Mortgagor / Borrower is still liable. In 99% of all cases it is not a settlement-in-full. A deficiency balance will remain as a potential liability for the Mortgagor / Borrower. The bank's opportunity of pursuit of a deficiency judgment will vary from state to state Extenuating circumstances influence whether or not banks will discount a loan balance. These circumstances are usually related to the current real estate market and the borrower's financial situation. An important thing to know about a short sale is that it has to be handled by a real professional who knows how to work these deals. Most REALTORS® don't handle short sales. A short sale typically is executed to prevent a home foreclosure, but the decision to proceed with a short sale is predicated on the most economic way for the bank to recover the amount owed on the property. Often a bank will allow a short sale if they believe that it will result in a smaller financial loss than foreclosing as there are carrying costs that are associated with a foreclosure. A bank will typically determine the amount of equity (or lack of), by determining the probable selling price from a Broker Price Opinion BPO or through a valuation of an appraisal. For the home owner, advantages include avoidance of a foreclosure on their credit history and partial control of the monetary deficiency. A short sale is typically faster and less expensive than a foreclosure. In short, a short sale is nothing more than negotiating with lien holders a payoff for less than what they are owed, or rather a sale of a debt, generally on a piece of real estate, short of the full debt amount. It does not extinguish the remaining balance unless settlement is clearly indicated on the acceptance of offer. Short sales are common in standard business transactions in recognition that creditors are not doing debtors a favor but, rather, engaging in a business transaction when extending credit. When it makes no business sense or is economically not feasible to retain an asset, businesses default on their loans (called bonds). It is not uncommon for business bonds to trade on the after-market for a small fraction of their face value in realization of the likelihood of these future defaults.
Simple Interest – Interest computed based on the remaining principal balance of a loan. Previously earned but unpaid interest is not included in the computation . Most mortgage loans are simple interest loans.
Small Claim Action – The procedure by which a complaint for summary ejectment is brought and by which most tenants are evicted.
Special Agent – An agent who is authorized to perform a specified act or series of specified acts in accordance with detailed instructions. A real estate sales agent is usually a special agent.
Special Assessment – A legal charge against real estate by a public authority to pay the cost of public improvements, such as for the opening, grading, and guttering of streets, the construction of sidewalks and sewers, the installation of street lighting, and the like.
Special Use Permit – A zoning procedure that allows a property owner to make a certain use of the property if certain stated conditions are met. It is sometimes called a conditional use permit.
Special Warranty Deed – A deed in which the grantor warrants and guarantees to his grantee that the title he conveys is free from defects or encumbrances that have arisen since the grantor acquired title; a warranty only against defects or encumbrances that have occurred “by, through, or under the grantor.”
Subjacent Support – The right of a land owner to have his land supported from below when another owns or has the right to mine the land’s subsurface. See also Lateral Support.
Subject – With regard to appraisal, the property being appraised (for which an estimate of value is sought).
Subject to Mortgage – A term or phrase referring to the taking of title to mortgaged property by a grantee – purchaser, wherein he is not responsible to the holder of the promissory note for the payment of any portion of the amount due. In the event of foreclosure, the most that he can lose is his equity in the property. The original maker of the note (i.e. the seller grantor) is not released from his responsibility.
Subdivision - A housing development that is created by dividing a tract of land into individual lots for sale or lease.
Sublease – An agreement whereby a person who has leased land from the owner rents out all or a portion of the premises for a period ending prior to the expiration of the original lease
Sub-lessee – A tenant who rents property from the original tenant (sub-lessor) under a sublease, or separate rental agreement apart from the original lease between the sub-lessor and the land lord.
Sub-lessor – The lessee under the original lease with a property owner who sublets (subleases) to another party, known as the sub-lessee, under a document separate from the original lease.
Subordinated Ground Lease – A ground lease in which the lessor has agreed to subordinate his title in the land to a mortgage or deed of trust subsequently executed by the ground lease.
Subordination Clause – A clause in a mortgage or lease stating that one who has a prior claim or interest agrees that his claim or interest shall be secondary or subordinate to a subsequent claim, encumbrance, or interest.
Subsurface Rights – A landowner’s right of ownership to minerals and water beneath he surface of land. The rights tothese materials can be conveyed separately without conveying full ownership fo the land.
Surety – One who guarantees the performance of another.
Surrender – A voluntary termination of a lease by agreement of the landlord and tenant prior to the normal expiration date.
Survey - A measurement of land, prepared by a licensed surveyor, showing a property's boundaries, elevations, improvements, and relationship to surrounding tracts.
Survivorship – The distinguishing feature of a tenancy by the entirety, by which, on the death of one spouse, the surviving spouse automatically acquires full ownership by operation of law.
Syndication – A group of investors who combine to pursue a specific goal of investment in real estate.