Our Glossary is designed to educate the public in respect to buying and selling Real Estate. If for any reason you do not find a term that you are looking for, we will be happy to email a definition to you and add it to our site. We are constantly growing our reference sections and encourage the public's participation. define this
 

RE Abbreviations • Acronym Designations and What They Stand For

RE Abbreviations • Acronyms in Advertising and What They Stand For

RE Descriptions • North Shore MLS Appearance

Architectural Styles • Typical Suffolk County Homes

Real Estate & Mortgage Terms • Defined

Designation & Association Acronyms:

ABR - Accredited Buyer Representative is a designation from the Real Estate Buyer's Agent Council that trains experienced REALTORS® in specifically representing the real estate consumer. The ABR designation is awarded to real estate practitioners who complete a comprehensive two-day REBAC course in buyer representation, achieve a passing grade on the written examination, demonstrate practical experience by completing and closing five real estate transactions in which the candidate functioned as a buyer's representative and who maintain a membership in good standing with the National Association of REALTORS® and the Real Estate BUYER'S AGENT Council.

ABRM - Accredited Buyer Representative Manager is geared to real estate firm brokers, owners and managers that have or wish to incorporate buyer representation into their daily practice, designees have taken and passed both the ABR® and ABRM course and provided documentation of past management experience. The ABRM designation is awarded real estate practitioners who complete a comprehensive two-day REBAC ABR® course in buyer representation and passing or challenging the written examination, complete the comprehensive one-day REBAC ABRM course in buyer representation, successfully passing the written examination, certification that the broker/owner/manager has overseen a minimum of 25 real estate transactions that involved a buyer agent or had more than 2 years of experience in the oversight of buyer representatives and be a member in good standing with the National Association of REALTORS® and the Real Estate Buyer's Agent Council.

ALC - Accredited Land Consultant are the recognized experts in land brokerage transactions of five specialized types: (1) farms and ranches; (2) undeveloped tracts of land; (3) transitional and development land; (4) subdivision and wholesaling of lots; and (5) site selection and assemblage of land parcels. Acquire valuable skills through educational offerings leading to the ALC designation. The ALC designation is awarded to a petitioner that is a member in good standing of the Realtors Land Institute, has 3 or more years of experience as a REALTOR®, successfully complete five RLI Land University core courses and one RLI Land University elective course in Investment Analysis, Subdivision Development, Agricultural Land, Transitional Land, Tax Ideas with Exchanging and Creative Real Estate, Tax Ideas and Strategies for Selling Real Estate, Site Selection, and Land Planning and Design.

AMO - Accredited Management Organization is a professional designation provided by the Institute of Real Estate Management (IREM) to companies, not individuals, who engage in property management with residential, commercial and industrial properties.

BA - Broker Associate is a real estate person holding a broker license that chooses to associate or affiliate with another sponsoring broker rather than opening their own brokerage office. They want the added knowledge and status of a broker, but do not desire to operate an independent office.

REPA - Real Estate Professional Assistants provide administrative and support roles and are educated in the day-to-day business practices of a brokerage. They support agents and brokers in many aspects of their work, from providing clerical support and marketing assistance, to tracking due dates and transaction processes.

RSPS - The RSPS is a new certification offered by NAR Resort for resort & second-home REALTORS around the world. REALTORS specializing in resort and second-home markets and interested in demonstrating their knowledge and expertise should pursue the RSPS certification. The RSPS core certification requirements include the NAR Resort & Second-Home Market Course and the RLI Tax-Deferred (1031) Exchange Course. RSPS applicants will also choose from nine different elective choices including courses from the NAR Education Matrix and the NAR Resort Symposium held every 18 months.

SIOR - Society of Industrial and Office REALTORS®. Individuals certified with the SIOR designation are top producers in industrial and office real estate brokerage, representing more than 800 offices in over 350 cities worldwide. The Society's mandatory recertification requirement assures clients of the designee's excellence in the fast changing commercial brokerage field. This designation may be earned after successfully completing a comprehensive membership entrance examination; or hold a CCIM or RICS designation; or complete thirty credit hours of approved commercial real estate coursework based on various criteria and completing the Society's ethics and professional standards module (a half-day seminar).

SRES - Seniors Real Estate Specialist is a professional designation provided by the Seniors Advantage Real Estate Council for Realtors wanting to meet the special needs and concerns of maturing Americans when buying or selling residential or investment properties.

Advertising Acronyms:
 

AGP - Above Ground Pool

ATT - Attached

BR - Bedroom

BSMT - Basement

BTH - Bathroom

CAC - Central Air Conditioning

CH - Center Hall

CO, C/O - Certificate of Occupancy

CVAC - Central Vaccuum

DA -Dining Area

DET - Detached

DR - Dining Room

EH - Entry Hall

EIK - Eat in Kitchen

FDR - Formal Dining Room

FLR - Formal Living Room

FP, FPL, FPLC - Fireplace

Appearance:
these definitions vary and apply mostly to the North Shore Eastern Suffolk County

New - New

Diamond - Top Condition

Mint - Maintained

Good - Needs Work

OK - Needs Work







Architectural Styles:

Beach Bungalow - a small structure usually having a single story with no heat.

Cape Cod - square or rectangular one-story structures with gabled roofs, dormers & unornamented fronts.

Colonial - feature a rectangular, symmetric design, second-floor bedrooms and gabled roofs.

Condominium - an attached home, you own the interior of that unit.

Contemporary - identifiable by their odd-sized windows, asymmetrical design, open living spaces & lack of ornamentation.

Co-op - an attached home, you own the right to occupy the interior of that unit.

Cottage - a small house with a single story

Duplex - a house containing two legally livable units sharing a common wall.

Dutch Colonial - dominated by a barn-like broad gambrel roof with flaring eaves.

Expanded Ranch/Farm Ranch - was built as a ranch, part of the home was extended up or out.

Farmhouse - originally having barns on the same property, utilized for extended families that worked on the farm.

Federal Colonial - reflects Greek and Roman culture, as its classical ornamentation around cornices, doors, and windows demonstrate.

French Provincial - identified by balconies and porch balustrades; and rectangular doors set in arched openings.

Gatehouse - originally next the entryway of an estate.

Hi Ranch/Splanch - a split level Ranch style house, commonly has stairs from the foyer going up or down to a basement with large windows.

Italianate - symmetrical bay windows in front; roofline are almost flat, small chimneys set in irregular locations; tall, narrow, windows; and in some cases towers, typify Italianate houses.

Post Modern - encompasses a blend of regal styles.

Prairie - originated by Frank Lloyd Wright, the Prairie-style house comes in two styles--boxy and symmetrical or low-slung and asymmetrical.

Queen Anne Victorian - the style employs inventive, multistory floor plans that often include projecting wings, several porches and balconies, and multiple chimneys.

Raised Ranch - incorporates a ranch that has been literally raised, basements are typically walk out with no steps, and front entries many steps.

Ranch - one story expansive homes with open, rambling floorplans.

Saltbox Colonial - has sharply sloping asymmetrical gable roof resembling antique boxes used for storing salt.

Split Level - A Modern style, Split level design sequesters certain living activities, such as sleeping or socializing on various levels throughout the house.

Townhouse - One of a row of houses connected by common side walls. You own the home and land that it sits on.

Tudor - Half-timbering on bay windows and upper floors, and facades that are dominated by one or more steeply pitched cross gables.

Victorian - often incorporates decorative details such as brackets, spindles, and patterned shingles. Rooflines typically are gothic in appearance and have more than one gable.

 
   





Terms
A B C D E F G H I J L M N O P Q R S T U W Z


Abstract of Title - A summary of recorded instruments that affects the title to the property.

Acceleration - The right of the mortgagee (lender) to demand the immediate repayment of the mortgage loan balance upon the default of the mortgagor (borrower), or by using the right vested in the due-on-sale clause.

Acre - 43,560 square feet. (Builders acre - 40,000 square feet)

Adjustable-rate mortgage (ARM) - A mortgage in which the interest rate is adjusted periodically based on a preselected index. Also sometimes known as the renegotiable-rate mortgage or variable-rate mortgage.
Amortization -The payment of a loan in equal periodic payments calculated to pay off the debt at the end of a fixed period, including accrued interest on the outstanding balance.

Annual percentage rate (APR) - An interest rate reflecting the actual cost of a mortgage, expressed as a yearly rate. This rate likely is higher than the stated note rate or advertised rate on the mortgage because it takes into account point(s) and other credit costs. Homebuyers use APR to compare different types of mortgages based on the annual cost for each loan.

Appraisal - An estimate of the value of property made by a qualified professional called an 'appraiser.' A mortgage lender will request an appraisal (paid by the home buyer) to ensure that the home's value at least equals the amount of money being borrowed.

Appraised value - The assessment of a fair value of the property as determined by a licensed professional. A mortgage lender will request an appraisal (paid by the home buyer) to ensure that the home's value at least equals the amount of money being borrowed.

Appreciation - The increase in value of a property over time due to property improvements, changes in market conditions or inflation.

Assessed value - A valuation placed on a property for the purpose of determining property taxes.

Assumption - The agreement between buyer and seller where the buyer takes over the payments on an existing mortgage from the seller. The assumption of a loan can usually save the buyer money because it is an existing mortgage debt, unlike a new mortgage where closing costs and new, possibly higher market-rate interest charges will apply.


Balloon (payment) mortgage - Usually a short-term fixed-rate loan that involves small payments for a certain period of time and one large payment for the remaining balance of the principal at a time specified in the contract.

Bankruptcy - occurs when a person is unable to pay debts on time. A person filing for bankruptcy can file in one of two ways. Chapter 7 bankruptcy relieves him/her of all debts (except taxes), but stays on the credit record for 10 years. Chapter 11 allows the debtor to work out a payment plan whereby all or some of the debt (e.g., $0.25 on the dollar) is paid out over a specified period of time. Chapter 11 generally remains on a credit record for seven years. Any bankruptcy filing is extremely detrimental to your credit score.

Blanket mortgage - A mortgage covering at least two pieces of real estate that serve as security for the same mortgage.

Bridge loan - A loan obtained to pay for the down payment on a new home before the old home is sold. No longer commonly used.

Buy-down - This occurs when the lender and/or the homebuilder subsidize the mortgage by lowering the interest rate during the first few years of the loan. While the payments are initially low, they will increase when the subsidy expires.




Capital gain - The monetary gain on the sale of a capital asset (in this case, the sale of one's home). Capital gains on a home are tax-free as long as they don't exceed $250,000 for one person or $500,000 for a married couple. The property also must have been the owner's primary residence for at least two of the last five years. If you bought a home for $150,000, lived in it for two years, then sold it for $225,000, your capital gain would be $75,000, and you would not owe taxes on the gain.

Closing -A meeting between the buyer, seller and the lender or their agents where the property and funds legally change hands.

Closing costs - Usually include an origination fee, discount points, appraisal fee, title search and insurance, survey, taxes, deed recording fee, credit report charge and other costs assessed at settlement. The cost of closing usually runs 3 percent to 6 percent of the mortgage amount.

Compound Interest - Interest calculated on unpaid interest as well as on unpaid principal.

Contingency - A condition that must be met before a sale can be completed.


Debt-to-income ratio - The ratio, expressed as a percentage, which results from a borrower's monthly payment obligations on long-term debts divided by gross monthly income. This also is referred to as a back-end ratio and is generally expected to come in at about 36-38 percent. Some lenders, especially those offering FHA or subprime loans, will stretch this ratio to 40 percent or even beyond. See housing expenses-to-income ratio.

Down payment - Money paid to make up the difference between the purchase price and the mortgage amount.


Easement - A right of way giving persons other than the owner access to or over a property.

Eminent domain - The right of a government to take private property for public use upon payment of its fair market value. Eminent domain is the basis for condemnation proceedings.

Encroachment - An improvement that intrudes illegally on another’s property.

Encumbrance - Anything that affects or limits the fee simple title to a property, such as mortgages, leases, easements, or restrictions.

Equal Credit Opportunity Act (ECOA) - A federal law that requires lenders and other creditors to make credit equally available without discrimination based on race, color, religion, national origin, age, sex, marital status, or receipt of income from public assistance programs. Equity - The difference between the fair market value of a home and current indebtedness; the value an owner has in real estate over and above the amount still owed on the property. Also referred to as the owner's interest.

Escrow - An account held by the lender into which the homebuyer pays money for tax and/or insurance payments. Also may include earnest deposits held pending loan closing.

Exclusive listing - A written contract that gives a licensed real estate agent the exclusive right to sell a property for a specified time.


Fixture - Personal property that becomes real property when attached in a permanent manner to real estate.



Fannie Mae - A taxpaying, government-chartered corporation created by Congress that purchases conventional residential mortgages. This institution, or government-sponsored enterprise (GSE), provides funds for one in seven mortgages, makes mortgage money more available and more affordable. Also known as Federal National Mortgage Association or FNMA.

FICO score - A mathematical equation developed by Fair Isaac Corp. that determines how likely you are to pay your bills on time. Many lenders use this score to determine not only if a mortgage loan will be made, but also the interest rate you will be charged. You can get more information on your FICO score by going to . Because of differences in calculation methods, not all credit scores are the same. Your credit scores may differ among the credit-reporting agencies and likely also will vary from your FICO score. Fixed-Rate Mortgage (FRM) - The mortgage interest rate on these mortgages will remain the same throughout the term of the mortgage for the original borrower.

Foreclosure - A legal process by which the lender or the seller forces a sale of a mortgaged property because the borrower has not met the terms of the mortgage. Also known as a repossession of property.

Freddie Mac - A quasi-governmental agency that purchases conventional mortgages. Also called Office of Thrift Supervision Federal Home Loan Mortgage Corporation (FHLMC).


Ginnie Mae - A corporation that functions much the same as Fannie Mae or Freddie Mac. Ginnie Mae buys government-backed loans from mortgage lenders, providing them with funds to make more loans. Also known as Government National Mortgage Association (GNMA).

Good Faith Estimate - A document detailing a list of charges that the borrower will likely be required to pay at closing. The lender must supply this estimate within three days after application is made.

Grantee - The person to whom an interest in real property is conveyed.

Grantor - The person conveying an interest in real property.


Home Equity Line of Credit (HELOC) - A variable-rate (usually based on the prime rate) line of credit that is secured by the equity in the home. Funds are available on demand, but repayment is not required until the borrower draws them down. Funds can be repaid and drawn repeatedly with no additional paperwork.

Homeowners' association - A nonprofit association that manages the common areas of a planned unit development (PUD) or condominium project. In a condominium project, it has no ownership interest in the common elements. In a PUD project, it holds title to the common elements.


Interest-only loan - A mortgage loan that is structured so that the borrower pays only the interest due for a certain amount of time, e.g., three, five, seven, or 10 years. After the interest-only period has expired, the loan is renegotiated at the current interest rate for the remaining life of the loan. For example, if the loan were set up as a seven-year interest-only loan, the borrower would pay only interest for the first seven years. At that time the principal would be amortized over the remaining 23 years of the 30-year loan at current interest rates.




Joint Tenancy - Joint ownership of a property by two or more persons, such as a husband and wife or partners. Each has equal rights to the property and the property passes to the remaining tenant(s) upon the death of one of the owners.

Jumbo Loan - A loan that is larger (more than $359,650 as of 1/1/2005) than the limits set yearly by Fannie Mae and Freddie Mac. Because jumbo loans cannot be funded by these two agencies, jumbo loans usually carry a higher interest rate. Also called a non-conforming loan.


Lease/purchase - A way to buy property with no down payment. Instead, installment payments are made over a period of time. With a lease/purchase, the potential buyer rents the property for a specified amount of time, with part of the rent going toward the purchase price (a down payment). During this time the seller retains ownership rights. Once the agreed-upon rental period elapses, ownership rights go to the renter. The renter is obligated to purchase the property at the agreed-upon price and time or forfeit any down payment money accumulated if the purchase is not completed.

Lien - A claim upon a piece of property for the payment or satisfaction of a debt or obligation.

Lis Pendens - A written notice that a lawsuit has been filed concerning real estate, involving either the title to the property or a claimed ownership interest in it. The notice is usually filed in the county land records office. Recording a lis pendens against a piece of property alerts a potential purchaser or lender that the property’s title is in question, which makes the property less attractive to a buyer or lender. After the notice is filed, anyone who nevertheless purchases the land or property described in the notice takes subject to the ultimate decision of the lawsuit.

Lock-in - An agreement whereby the lender promises to offer (or lock in) a specific interest rate on a mortgage for a period of time, e.g., a 30-day lock. A borrower may have to pay the lender a fee to lock a rate for a longer period.


Market value - The highest price that a buyer would pay and the lowest price a seller would accept on a property. Market value may be different from the price a property could actually be sold for at a given time. Mortgage insurance (MI) - Money paid to insure the mortgage when the down payment is less than 20 percent. Lenders will allow a smaller down payment or no down payment at all, in some cases, but in those cases borrowers are usually required to carry mortgage insurance that generally calls for an initial premium payment and may require an additional monthly fee depending on the structure of the loan. MI is not tax deductible and as a result, most homeowners have it removed once the value of the equity in the home reaches 20 percent. (See also FHA mortgage insurance)

Mortgagee - The lender.

Mortgagor - The borrower or homeowner.


Negative Amortization - Occurs when monthly payments are not large enough to pay all the interest due on the loan. This unpaid interest is added to the unpaid balance of the loan. The danger of negative amortization is that the homebuyer ends up owing more than the original amount of the loan.




One Time Show - This listing contract is similar to an Open Listing but is most often used by real estate agents who are showing a For Sale by Owner home to one of their clients. In this case, the seller would sign the agreement identifying the potential buyer and it guarantees the agent a commission should the purchase go through.

Open Listing - A property that is simultaneously marketed by multiple real estate agents with no obligations.


Planned unit development (PUD) - An area containing privately owned lots and buildings and jointly owned areas and facilities, such as a townhouse development.

Points (loan discount points) - Prepaid interest assessed at closing by the lender, reducing the amount of money the lender advances to the borrower. Each point is equal to 1 percent of the loan amount (e.g., two points on a $100,000 mortgage would cost $2,000).

Prime rate - The interest rate that banks charge their most creditworthy customers. This is a key interest rate for banks, and a standard within the banking industry. Many home equity lines of credit are based on the prime rate. They can be at prime, below prime, or prime plus 1 percent, for instance. The prime rate usually changes when the Federal Reserve Board increases or decreases the target fed funds rate, which is the interest rate banks charge each other for overnight loans. These loans are most often used to satisfy the bank's reserve requirement.

Power of attorney - A legal document authorizing one person to act on behalf of another.

Pre-approval - A commitment on behalf of the lender that a loan can be made for a certain amount of money pending property approval by a lender. The commitment is based on some credit investigation of the borrower.

Prepayment - A privilege in a mortgage permitting the borrower to make payments in advance of their due date without penalty.

Pre-qualified -Approval of a specific amount a mortgage lender likely would be willing to loan the borrower, based on unverified information provided by the borrower. Final approval requires a credit report, income verification and appraisal of the property to be purchased.

Principal - The amount of debt, not counting interest, remaining on a loan.

Planned Unit Development (PUD) - A project or subdivision that includes common property that is owned and maintained by a homeowners' association for the benefit and use of the individual PUD unit owners.


Qualifying ratio - A measure of creditworthiness obtained by determining the borrower's debt-to-income ratio. The outcome of this formula (dividing mortgage debt or total debt by income) will determine if the borrower qualifies for a loan and at what rate. This method of determining creditworthiness is losing ground to FICO scoring.

Quitclaim deed - A deed that gives all interest or title that the person signing the deed has at the time of conveyance to another individual.


Rescission - The cancellation of a contract. With respect to mortgage refinancing, in some cases the law gives the homeowner three days to cancel a contract once it is signed if the transaction uses equity in the home as security.



Right of first refusal - An agreement wherein the owner of a property must offer the first opportunity to buy to a designated person before offering it to others.


Second mortgage - A mortgage made subsequent to another mortgage and subordinate to the first one. Interest rates for secondary mortgages are typically higher than for first mortgages.

Sweat equity - Equity created by a purchaser performing work on a property being purchased.

Subdivision - A housing development that is created by dividing a tract of land into individual lots for sale or lease.


Tax lien - A claim that has been made against property for overdue and unpaid taxes.

Tenancy by entirety - Joint ownership in which a husband and wife are considered one person for the purpose of automatic survivorship. Only in effect in some states.

Tenancy in common - Joint ownership in which each person owns the property equally but there is no right of survivorship, nor can the property be passed on to others upon a person's death. Upon the death of one of the owners, his or her share will be inherited by a person or persons designated in the decedent's will.

Tenancy in partnership - Ownership in which the title is in the name of the partnership, not the individual partner names.

Title - A document that gives evidence of an individual's ownership of property.

Title Insurance - A policy, usually issued by a title insurance company, which insures a homebuyer against errors in the title search. The cost of the policy is usually a function of the value of the property, and is often borne by the purchaser and/or seller. Policies are also available to protect the lender's interests.

Title search - An examination of municipal records to determine the legal ownership of property. Usually performed by a title company.

Transfer tax/fee - A tax and/or fee assessed by state and local governments when a title changes hands.

Truth-In-Lending - A federal law requiring disclosure of the annual percentage rate (APR) on a mortgage loan to prospective homebuyers within three days after applying for a loan. The written document should also specify the rate, term, fees and other pertinent data related to the loan. Also known as Regulation Z.


Underwriting - The decision whether to make a loan to a potential homebuyer based on credit, employment, assets and other factors, and the matching of this risk to an appropriate rate and term or loan amount.


Wraparound mortgage - Results when an existing assumable loan is combined with a new loan, resulting in an interest rate somewhere between the old rate and the current market rate. The payments are made to a second lender or the previous homeowner, who then forwards the payments to the first lender after taking the additional amount off the top.


Zoning - City or municipal designation of property in an area for a specific purpose, such as residential or commercial use.