Real Estate
Glossary
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R VALUE:
A method of measuring the insulation capabilities of
materials.
RADON:
A radioactive gas which may cause health problems for
occupants of some buildings.
RANCH HOUSE:
A description of a one-storey house, developed
from the old, western-style homes.
RANGE LINES:
From Government Surveying Method, lines which
run parallel to the principal meridian six mile apart to create "ranges"
of land.
RATE CAP:
A limit of how much an
interest rate can change in a variable of adjustable rate
mortgage either in a given period or over the life of the loan.
RATE COMMITMENT:
A written promise by a lender to lend money
to a borrower at a stated rate of interest -- usually time limited.
RATE LOCK-IN:
See "rate commitment". A written agreement in
which the lender guarantees the borrower a specified interest rate,
provided the loan closes within a set period of time.
RATIFIED SALES CONTRACT:
A firm and binding agreement for the
purchase and sale of land.
RAW LAND:
Property that has not been developed or improved.
READY, WILLING, AND ABLE:
A term of art meaning in a position
to complete a contract. In order to enforce a contract against another
party, you must be ready, willing and able to complete the contract
yourself.
REAL ESTATE:
Term for land and all
fixtures to land, including buildings and other improvements.
REAL ESTATE AGENT:
A trained professional involved in the
purchase, sale and marketing of real property. The "listing agent" acts
for the vendor, the "selling agent" for the successful purchaser.
REAL ESTATE BROKER:
A real estate professional who is
licensed to run a real estate firm, to hold trust funds, etc.
REAL ESTATE COMMISSION:
1. The fee paid to the real estate
agents after a transaction.
2. An agency that enforces real estate
license laws.
REAL ESTATE EDUCATORS ASSOCIATION:
An organization of
post-secondary teachers of real estate courses.
REAL ESTATE MARKET:
A term for the pool of potential buyers
and sellers of property at a given time.
REAL ESTATE SALES PROFESSIONAL:
See "real estate agent" or
"real estate broker".
REAL ESTATE SETTLEMENT PROCEDURES ACT (RESPA):
Statute
requiring lenders to provide advance notice to borrowers of fees and
charges to be paid at closing.
REAL PROPERTY:
Also known as "real estate". Land, property,
plus improvements to land.
REALTOR:
Professional designation for a member of the
National Association of REALTORS or its affiliated local groups. Must be a
real estate broker.
REALTOR'S ASSOCIATE:
Professional designation of a licensed
real estate agent or salesperson who is a member of the National
Association of Realtors but who has not been licensed as a broker.
REALTY:
See "real estate".
REAPPRAISAL LEASE:
A rental
agreement in which the periodic payment is adjustable according to
scheduled re-appraisals of the rental value of the premises.
REASSESSMENT:
A change in the estimated value of a property
for realty, municipal or ad valorem tax purposes.
REBATE:
Any refund of all or a portion of money paid.
RECAST PAYMENT:
Adjustment of the periodic payment on an
adjustable or variable rate mortgage to ensure that the
mortgage will be paid out by maturity date.
RECASTING:
Adjusting the terms of a loan agreement in light
of new developments (i.e. lower rates, possible default).
RESCISSION OF CONTRACT:
The act of declaring a contract null
and void and taking the necessary actions to return the parties to the
position they were in prior to entering the contract.
RECITAL:
An unsworn statement of fact included in a document.
In many jurisdictions, recitals in registered documents are deemed true
and unassailable if unchallenged after a certain period of time.
RECONVEYANCE:
The return of title to property to its original
owner. May occur as a result of the pay-out of a mortgage or at the end of
a limited estate.
RECORDING:
The act of entering title instruments in the
public records, thus giving notice to any interested parties of the
existence of the instrument.
RECORDING FEES:
The fees paid to have an instrument recorded
in the public record.
RECOURSE:
The right of a lender to pursue a borrower
personally for moneys owed.
RECOVERY FUND:
A pool of money made up of contributions from
licensed brokers used to compensate members of the public with claims
against brokers.
RECTANGULAR SURVEY:
See "government rectangular survey method".
REDEEM:
To bring mortgage payments up-to-date after the
lender has begun default proceedings. Once a borrower (or other lien
holder) redeems, the mortgage is back in good standing and the
relationship continues as before the default.
REDEMPTION PERIOD:
The length of time during which the
borrower may redeem a mortgage.
REDEVELOP:
To remove existing improvements and buildings on a
parcel of property and replace them with new, more useful and profitable
improvements.
REDLINING:
An illegal practice, refusing to lend money to
owners of property in certain neighborhoods or to owners on the basis of
their race, color, religion, creed, age, gender, etc.
REDUCTION CERTIFICATE:
A mortgage statement setting out the
amount owing on the loan as of a given date. May be used for discharges or
assumptions.
REEVALUATION LEASE:
See "reappraisal lease".
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.)
REFINANCE:
To replace an existing and perhaps mature mortgage
with a new mortgage on the same property. New mortgage may have different
terms than the old one.
REGENCY HOUSE:
A two-storey or three-storey house in a
traditional English style of the Regency Period, symmetrical in
construction with a hip roof. May have a small, eight-sided window above
the front door.
REGISTRAR:
The person who has the task of collecting,
recording, and maintaining instruments related to title of land. May also
have responsibility of ruling on the acceptability of documents submitted
for registration and for making decisions as to how to correct title
defects.
REGISTRATION:
The submission for recording in the public
records of instruments relating to title in land. Each jurisdiction may
have specific requirements as to documents which will be accepted for
registration; once registered, documents will be given a registration
number and recorded on the title abstract index for the property to which
the apply.
REGULATION Z:
A federal rule which requires lenders to
provide borrowers with full disclosure of the terms of a loan.
REHABILITATE:
To restore, refurbish, bring back to original
condition.
REHABILITATION TAX CREDIT:
A tax provision allowing a tax
credit of up to 20% for the refurbishing of historic properties.
RE-ISSUE RATE:
A reduction in the fee for title insurance on
a property which was previously title insured.
RELEASE CLAUSE:
A term of a mortgage which allows the
borrower to pay out the loan and have the mortgage removed from title.
RELEASE OF LIEN:
A document which, once registered, removes
certain kinds of claims from title to property.
RELICTION:
The gradual migration of a body of water such that
additional dry land is left behind.
RELOCATION CLAUSE:
A term in a lease which allows the
landlord to move the tenant to a new unit, within the same building or
elsewhere.
RELOCATION NETWORK:
An organization of real estate
professionals in a number of different areas specifically designed to
allow information to be shared to allow easier movement of clients from
one area to another.
RELOCATION SERVICE:
A firm that specializes in helping
employees who are transferred by their employer to a new area take care of
the move.
REMAINDER:
An interest in property that only arises once
another interest ends.
REMODEL:
To refurbish, redesign, redecorate.
RENEWAL OPTION:
A right which arises out of a term in a
contract and takes effect at or near the termination date of a contract;
the party who enjoys the right may choose to continue the agreement on
terms as set out in the option clause or to treat the contract as at an
end upon the termination date.
RENOVATE:
Similar to remodel, with an emphasis on upgrading
the existing property.
RENT:
1. Verb -- to lease premises from the owner or a
representative of the owner.
2. Noun -- the periodic payments made by
a tenant to the landlord for the right to occupy the premises.
RENT CONTROL:
Government initiative to control raises in the
amount charged for the lease by tenants of residential premises.
RENT-FREE PERIOD:
An inducement to enter a lease, a specified
number of months at the beginning of the lease in which the tenant is not
required to pay the periodic rental payments.
RENTABLE AREA:
See "net leasable area".
RENTAL RATE:
The amount charged for the occupation of a
property.
REPAYMENT PLAN:
A schedule arranged between a lender and
borrower to set out how a debt is to be paid out.
REPLACEMENT COST:
An insurance term, the total cost of
erecting a new home or building which adequately takes the place of the
existing one.
REPORT:
A document sent by a lawyer to a bank certifying that
title to the subject property is clear and marketable.
REPORTING LETTER:
A letter sent by a lawyer to a client after
a transaction is completed (or when sent during the process of the
transaction, called "interim reporting letter") in which the lawyer
certifies title to the property and informs the client of all other
matters relating to the transaction.
REPRODUCTION COST:
The cost of making an exact duplicate of a
property.
REQUIRED CASH:
Collective term for the total sum of money
required to complete a transaction, including purchase price, taxes, legal
fees, mortgage fees, etc.
RESCIND:
To treat a contract as being at an end, to withdraw
one's offer or acceptance of an agreement.
RESCISSION:
The act of treating a contract as being at an end
as a result of the failure, breach or misconduct of another party.
RESERVE FUND:
A pool of money held for use for future
contingencies, usually in the management of a building, condominium
corporation or cooperative unit.
RESERVE PRICE:
The amount set prior to an auction which must
be met in the bidding for a particular item before the item will be sold.
Also known as "reserve bid".
RESIDENCE:
The dwelling in which a person lives, may also
refer to the country or state where a person lives.
RESIDENTIAL BROKER:
A real estate professional who deals in
dwelling properties.
RESIDENTIAL PROPERTY:
Real estate that is occupied by the
owner.
RESIDENTIAL SERVICE CONTRACT:
A warranty or insurance
contract which covers services such as electrical, plumbing etc. in a
resale home.
REISSUE RATE:
See "re-insurance
rate".
RESTORE:
To refurbish a building or other asset to its
original condition.
RESTRAINT ON ALIENATION:
Any limit on the ability of an owner
to sell or transfer property.
RESTRICTION:
Any limit or control on the owner's ability to
use the property. May be contained in a deed and be binding on the land
and future owners of it.
RESTRICTIVE COVENANT:
See "restriction".
RETIRE (A DEBT):
To fulfill one's obligations under a loan or
mortgage so that the lender has no further claims against the borrower.
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.
REVERSE LEVERAGE:
A term for the situation where the income
from ownership of property is lower than the rate of interest paid to
finance the ownership.
REVERSION:
The return of a property to the original grantor
upon the occurrence of an event specified in the grant.
REVERSIONARY INTEREST:
The legal right to a property of a
person under a reversion clause.
REVERSIONARY VALUE:
The value of the property at the time of
reversion.
REVOCATION:
Taking back, recalling. One might revoke a power
of attorney or a consent given.
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.
RIDER:
A document which contains additional or amending
clauses to a contract.
RIGHT OF FIRST REFUSAL:
The ability to make an offer for a
property before the owner puts it up for sale on the open market.
RIGHT OF REDEMPTION:
See "equity of
redemption".
RIGHT OF SURVIVORSHIP:
The legal term for the right of a
surviving joint tenant to take title to a property alone upon the death of
the other joint tenant.
RIGHT TO RESCISSION:
Being legally entitled to treat a
contract as being at an end.
RIGHT-OF-WAY:
A form of easement, the legal entitlement to
pass over a portion of the land of another.
RIPARIAN OWNER:
A person who has title to land bordering on a
body of water.
RIPARIAN RIGHTS:
The rights of an owner of land bordering a
body of water to use or control that body of water or a part thereof.
ROD:
160 feet measured in a line, a unit of measurement.
ROLLOVER LOAN:
A loan where the amortization period is
much longer than the term and the borrower is allowed to refinance at the
end of the term at the interest rate then applicable.
ROOT DEED:
The first conveyance in a chain of title. If a
jurisdiction has legislation which cures any title defects that are older
than a certain number of years, the root deed will be the first deed
beyond that period.
ROOT OF TITLE:
Any defect in ownership of property which
throws into question the very basic issue of who actually owns the
property. An unresolved problem going to the root of title is grounds for
rescission of the Agreement of Purchase and Sale no matter when it is
discovered before closing.
ROW HOUSE:
A dwelling that is attached to its neighbors by
way of common walls.
RULE OF 72'S:
To calculate the number of years it will take
to double money while earning compound interest, divide the interest rate
into 72. Money invested at 10 percent compound interest will take 7.2
years to double.
RUN WITH THE LAND:
A legal term which suggests that a rule,
restriction, right or obligation forms part of the land itself and is
transferred to each new owner along with the land.
RURAL:
A term to describe something which is not of an urban
center.