Compact, early twentieth-century single-storey
house.
One-storey house, in a post-Second-World-War
style, known for its ground hugging design and low, pitched roof.
A lender's right to demand payment of the
outstanding balance of the loan at a time specified in the loan
agreement.
Provision in a contract that gives one or
more parties the right to terminate the contract if a specific event
occurs.
A limit. In variable rate mortgages, a limit
as to how high periodic payments may go or how much the interest
may change within a given time period or over the life of the mortgage.
Short form for capitalization rate.
Legal competence to sign and be bound by
a contract. One might lack capacity as a result of being a minor,
being mentally challenged or not being of right mind. A contract
signed by an incapable person is not binding.
A one-storey house, compact in design and
in an early-American-style. Symmetrical layout with a central entrance.
Steep, gable-type roof, usually shingled, with a low central chimney.
A property to which certain tax rules (capital
gains and capital losses) apply.
Money spent to improve a property and enhance
its value over an extended period of time (as opposed to a repair).
May be added to the adjusted cost base of the property improved
or depreciated over the useful life of the improvement.
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increase in value of a capital property (a
property other than a principal residence) upon which tax is payable,
either upon disposition of the property or the deemed disposition
of the property under tax rules.
Value enhancing work carried out on a capital
property.
Decrease in value of a capital property (a
property other than a principal residence). May be set off against
capital gains or against regular income according to the tax rules.
The working money in a business venture.
A comparison of the sales or leasing rate
of a particular real estate development to the sales or leasing
rate of all developments in the same market.
The expense required to maintain a property
over a given period of time, including property taxes, maintenance,
insurance payments, interest charges on financing, etc.
The amount a vendor would have realized on
the sale of a property had she not accepted unfavourable (or favourable)
financing of the purchaser but received cash instead.
Description of the net income from a property
after all expenses of holding and carrying the property are paid.
An accounting method, based on actual cash
moving in and out of the company over a given period. See accrual
method.
An amount of money that the purchaser of
a property still has after the transaction closes. Some lenders
require a certain level of cash reserve (equal to two payments)
before granting a mortgage.
See cash flow.
When an owner renegotiates or negotiates
a new mortgage and the proceeds of the new financing exceed the
money required to pay out the old mortgage and any other costs,
liens or expenses, leaving money for the borrower.
Latin, meaning "Let the Buyer beware".
Maxim which applies to real estate transactions where the onus is
on the Purchaser to satisfy herself as to the suitability and condition
of the property she is considering for purchase. Vendor is not responsible
to the Purchaser for the condition of the property and, unless he
is specifically asked, does not generally have an obligation to
reveal problems to the Purchaser (except where the defect is hidden,
serious and could not be discovered by the Purchaser after reasonably
prudent inquiries and investigations).
Short form for "covenants, conditions,
and restrictions", which are the rules of general application
governing the relations between land owners in a specific subdivision,
development, condominium development or cooperative housing facility.
May be registered on title.
The limit over which the interest rate on
a variable rate mortgage may not rise over the life of the loan.
The business and commercial "core"
of a municipality (also known as "Downtown").
Document issued by the Department of Veteran's
Affairs to qualifying veterans which entitles them to apply for
subsidized or guaranteed loans.
A document, issued by the insurance company,
setting out the particulars of the insurance coverage for a particular
property.
Document which sets out a certain
set of facts which the issuer is agreeing to be bound by. Same as
estoppel certificate.
Document issued by the local municipality
indicating that a new dwelling is suitable for occupation. Generally
confirms that the dwelling complies with local building, safety
and health by-laws.
Document issued by the Department of Veterans
Affairs (VA). Based on an appraisal, sets out market value of a
particular property for the purposes of establishing maximum principal
amount available for a VA mortgage on the property.
Document registered on title which provides
evidence from the lender that a loan instrument (deed of trust,
mortgage, other lien) has been paid out and released.
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A written opinion of the quality of a person's
ownership of property, issued by a lawyer or a title insurance company
after a search of the title records has been conducted. May contain
qualifications to the certification regarding defects found or potential
defects not investigated.
Document issued by Department of Veteran's
Affairs confirming that the person named in the Certificate has
served at least 90 days of continuous active duty (including training
time) and is eligible for certain VA benefits (such as a VA mortgage).
A copy of a document which bears some form
of declaration (usually by the holder of the original document)
that it is a true copy of the original.
A person who has met the requirements to
be licensed to appraise the value of property. Qualification requirements
may vary from one jurisdiction to the next.
A person who has met the requirements to
be "certified" to inspect the physical condition of homes.
Qualification requirements may vary from one jurisdiction to the
next.
A person who has met the requirements of
the Institute of Real-Estate Management.
A person who has met the requirements to
be licensed to appraise the value of residential properties of no
more than four units.
A person who has met the requirements of
the Realtors National Marketing Institute.
A person who has met the requirements of
the Realtors National Marketing Institute.
The beneficiary of a trust, the person who
is the beneficial/equitable owner of the property held in trust
for which the trustee holds legal title.
A part of a title search. A listing, in chronological
order, of successive legal owners of a property, often listing as
well the registration particulars of the document by which title
is transferred from each owner to his successor in title.
An old unit of measurement of land, measuring
66 feet in length. A chain equals 100 links, each 0.66 feet in length.
Term describing the period of time between
changes in the interest rate and/or payments of a variable rate
(adjustable rate) mortgage or loan (i.e. one week, one month etc.).
An item of personal property which is not
affixed to the land or building (as opposed to a fixture, an item
which is a part of the land or building). Chattels are generally
not included in the sale of property unless specifically included
in the Agreement of Purchase and Sale.
A debt secured against items of personal
property rather than against land, buildings and fixtures.
Ownership of land which is marketable and
free of competing claims, liens, mortgages or other encumbrances.
A right asserted against another party. One
might register a claim on title to the property to which the claim
applies, file a claim under an insurance policy or file a Statement
of Claim in court to assert one's rights.
A legal proceeding which presents the related
or similar claims of an identifiable group against a single or group
of defendants, usually by using one representative claimant to assert
the claims on behalf of the group.
Customer. The person who hires a professional
(broker, banker, lawyer, investment counsellor, etc.)
A land loan that cannot be prepaid
or re-negotiated before the end of its term without the payment
of an interest penalty.
A mortgage with a set principal amount which
cannot be increased or extended during the life of the mortgage.
The culmination of any transaction in which
the interested parties (or their representatives) meet to exchange
documents, funds, and property and, if necessary, to register the
transfer of title.
Moneys expended by a party in completing
a transaction, over and above the purchase price, including: legal
fees, taxes, mortgage application charges, interest adjustments,
registration fees, appraisal fees, etc.
Also known a Completion Date. The date set
in the Agreement of Purchase and Sale upon which the transaction
is to be completed, the purchase price paid and the transfer of
title registered.
Also known as HUD-1 statement. A document
which sets out the financial agreement between the parties, the
costs each must pay, and all other similar information regarding
a transaction (may be joint or separate for each party).
Any unresolved claim against ownership of
all or part of a property, affecting the owner's title to the property
and marketability of that title.
Development design which places attached
dwelling in close proximity to each other, with nearby open spaces
set out for common use of the dwelling owners.
A set of rules governing the behavior of
members of the organization that has established the Code. Lawyers
and real estate brokers/agents both have their own Codes.
A technique used to share the risk of a larger
development between several insurance companies, each company covering
a certain percentage of the total value of the insured property.
Each policy may include a clause setting a minimum percentage of
the total value of the insured property which the owner must keep
insured in order to be eligible for payment under the policy.
Also known as "Cold Call". Contacting
home owners out of the blue to solicit business or, in the case
of a real estate broker or agent, listings.
Property (real or personal) which is pledged
to secure a loan or mortgage. If the debt is not paid, the lender
has the right to sell the collateral to recoup the outstanding principal
and interest on the loan.
A loan which is secured by some sort of written
note of indebtedness (such as a Promissory Note) which is secondarily
secured by a mortgage registered against a property.
The act of pursuing a debtor who is delinquent
on his loan payments.
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Also known a "Guarantor". Someone
who signs a loan document along with the principal borrower, pledging
to be responsible for the loan should the borrower fail to pay it.
: A
real estate professional who deals in properties with commercial
(business, retail, etc.) uses.
As opposed to residential or industrial property.
Property zoned, designed or intended for use retail, office, or
similar users.
To allow to mix, as in money belonging to
two or more people deposited to the same account and used by each
person regardless of the amount they have deposited.
Payment to a salesperson (a listing real
estate agent or broker) for her efforts
in marketing and selling a property, usually expressed as a percentage
of the purchase price.
The division of the payment made to the listing
agent between that agent and her broker, or between the listing
agent and agent representing the Purchaser (the selling agent).
A promise, usually in writing, to provide
a mortgage or other loan. May also be used in insurance field. Sets
out details of mortgage, insurance. Often referred to as Commitment
Letter or Binder.
The fee charged by the lender to commit itself
to a mortgage or loan on specific terms.
Also known as Common Element Fees. A periodic
charge levied against all of the owners of units in a condominium
or planned unit development (PUD) project which is used by the condominium
corporation or homeowner's association to pay for repair, maintenance
and other expenses of the common areas in the development.
Portions of the property and buildings owned
by a condominium corporation or planned unit development (PUD) homeowners'
association, or a cooperative development's association that are
available for the use of all unit owners. Also used in rental properties
to refer to those facilities for the use of all tenants.
A common area in a condominium project which
is owned by the condominium corporation and for the use of all unit
owners.
As opposed to statute law. Laws or legal
principles that have been established by courts over the years.
May be codified into a statute or overruled by a statute passed
by the government.
Any organization established and run by property
owners in a particular area, often to represent the common interests
of the owners in dealings with government, planning bodies, developers
or other outside parties.
Program established to find creative ways
to finance home purchases for people with modest income.
The principle that property accumulated by
the joint efforts of a married couple should be considered to be
owned by both of them in equal shares, no matter who has legal title
to the property.
Used in assessing or establishing the fair
market value of a property, a property which has been sold recently
that is similar in size, condition, location and amenities to the
subject property.
People who are legally capable of entering
and being bound by a contract (i.e. of age, mentally capable).
See Closing Date.
For tax purposes, allocating a portion of
the total cost of renovation to each component of the renovation
(roof, plumbing, electrical, foundation, etc.) and then depreciating
the cost of each component separately.
As opposed to simple interest. The accumulation
of interest on a loan over time where interest is charged not only
on the principal of the loan but also on all interest accrued against
the principal to the end of the last compound period.
Sacrifices made by a party to convince another
party to enter a contract.
1. The taking of private land for public
use by a municipal or other government body through a court action
under the principal of Eminent Domain. See also Expropriation.
2. An order made by a health or building department barring the
use of a dangerous or hazardous property.
Clauses in the Agreement which must be fulfilled
before the Agreement becomes firm and binding. If the condition
is not fulfilled, the Agreement will usually become null and void
and any deposit paid returned to the Purchaser.
An offer to purchase a property which is
contingent on the fulfillment of certain conditions before it becomes
firm and binding. Also known as "Conditional Sales Contract".
A development where individuals own dwelling
units but share common areas with the other unit owners of the complex.
The maintenance of the common areas etc. is taken care of by the
Condominium Corporation in which every unit owner owns a share and
has voting rights. The Condominium Corporation is created by the
registration of a Declaration and by-laws on title to the property
and all individual units.
An organization made up of unit owners in
a condominium development established to govern relations between
the owners and to administer the rules, by-laws and covenants of
the condominium
Complying with the requirements of a certain
statute, by-law or organization.
Also called a Committee, Personal Representative
or Guardian, a person appointed by the Court to administer the property
of a person who is not capable of managing his own affairs.
The value, asset, service, information etc.
which is offered to another party in a contract in exchange for
that party's agreeing to enter the contract. A contract is not binding
if each party does not offer at least some consideration to the
other party(ies).
A type of loan which requires equal, periodic
payments over a certain term, at the end of which the amount owing
under the loan will be completely paid out.
A structured, short-term loan to a builder
or developer to allow for the development of land. Funds are advanced
at certain stages of the development project to pay for specific
expenses, fees or costs.
Actions of a landlord (or third party) which
interfere with a tenant's use and enjoyment of the rented premises
to such an extent that the tenant is, at law, considered to have
been improperly forced out of the premises.
The legal principle that deems that a person
has knowledge of a certain fact once that fact is made a part of
a public record. The registration of a lien on title to a property
represents constructive notice to all persons interested in that
property of that lien, whether they have investigate the title records
or not.
Also known as Credit Bureau. The source to
which the banks or other lenders turn for information on the credit
history of an applicant.
See also Abutting. Sharing a common boundary,
touching.
An event which may (or may not) happen in
the future, a condition that must be fulfilled before a contract
becomes firm and binding.
A legally binding agreement (oral or written)
between two or more persons regarding an exchange of some sort.
A legally binding contract must include consideration passing between
the parties, an intention on the part of all parties to be bound
to the contract, a meeting of the minds of the parties as to the
contents of the contract, and an element of clarity such that the
terms of the contract may be interpreted, understood and enforced
by a court.
Also known as a Land Contract or Land Installment
Contract. Transfer of a property where the title remains in the
Vendor's name until the Purchaser makes the final payment to the
Vendor of the Purchase Price.
Also known as Agreement of Purchase and Sale,
Offer to Purchase, Contract of Purchase. The written agreement between
the Vendor and Purchaser for the sale of property which contains
all of the terms, conditions and financial details of the transaction.
The periodic rental payment as set out in
the lease contract.
A tradesman who works in the construction
industry under a contract with the owner of the property. See also
"sub-contractor".
1. A loan or mortgage to which the normal
rules of such transactions apply without the inclusion of a government
program (i.e. VA or FHA insurance).
2. A loan or mortgage with a fixed interest rate, fixed payments
and a fixed term.
A provision in a variable rate mortgage (adjustable
rate mortgage) which allows the borrow to change the mortgage to
a fixed rate mortgage upon the occurrence of certain events.
1. a change in the use of a property, or
in the way a property is owned (i.e. from private to condominium
ownership)
2. the improper taking of the property of another for one's own
use;
3. In Ontario, the transfer of a property from the Registry System
of land registration to the new Land Titles Conversion Qualified
(LTCQ) computerized system by the agents of the Ontario government.
See "Conversion Clause".
To transfer title to (or any other interest
in) a property to someone else.
The act of transferring an interest in property
to someone else or the document which effects the transfer.
Short for Cooperative, a mode of land ownership
where the occupiers of individual units in a building own an interest
in the Cooperative Corporation that owns the whole property.
A Broker who is involved in a real estate
transaction and is, therefore, entitled to share in the commission
from the transaction.
See "Co-op".
The movement of an employee of a corporation
to a new city (or other location) as part of the normal business
of the corporation. The employee's moving expenses (including the
costs of selling and buying a home) may be paid by the corporation
and are tax deductible.
A legal entity created by the registration
of appropriate incorporating documents with the supervising government
office. May be private (ownership held by specific individuals and
not traded on a public stock exchange) or public (shares traded
on stock exchange). Shareholders are protected from liability for
the actions of the corporation. Corporations may enter contracts
and own property.
Tangible.
An appraisal method where a property's value
is estimated using the cost of the property plus cost of all improvements,
minus depreciation.
Predicting the total cost of a construction
project by estimating, in advance, the actual costs of all elements
in the project, including legal fees, labor, permits, materials
etc.
An agreement with a contractor or builder
which sets the contractor's compensation for the project as a percentage
of the total cost of all labor and materials.
When more than one person owns a piece of
property. Title will be held by the owners as Joint Tenants (each
owns the land equally and, in the event of the death of one of the
owners, the survivors continue to share title equally by right of
survivorship) or as Tenants in Common (each owner has title to a
specific percentage of the land and may sell, mortgage, or bequeath
her interest to a third party without consent of the other owners).
An answer to an offer. If a prospective Purchaser
presents an offer to purchase a property to the owner of the property,
that owner may accept the offer as it stands, reject it outright
or respond with a "counteroffer" which changes certain
terms of the original offer. Making a counteroffer, at law, entails
rejection of the original offer. The Purchaser may then counteroffer
back, making changes to the owner's counteroffer. Sometimes, the
process of counteroffering is referred to as "signing back"
the offer.
A territorial division of land in a geographic
region (state or province). Similar to Regions and Regional Municipality.
A promise contained in a contract or agreement.
A covenant that is literally attached to
the land and binds present and future owners to the requirements
of the covenant. In new developments, such covenants may be restrictive:
the owner is not allowed to alter grading patterns of the land,
or erect new fences, or put up TV aerials, or to change the color
of the exterior of the house. Such restrictive covenants may be
enforced by a Homeowners' Association.
An arrangement for the financing of the purchase
of a property which is outside the normal practice of residential
financing.
1. The ability to access money, to use money
prior to earning it.
2. The accounting term for a liability or for equity, entered on
the right side of the ledger.
3. As a verb, to allot for the benefit of a person (i.e. You must
credit the Purchaser on closing for the deposit paid).
A statement of the debts and obligations,
whether current or past, of a person which helps a lender to assess
the risk of a loan to that person.
A form of insurance which is designed specifically
to pay out the debts of the insured person in case of their death.
The maximum amount available to a person
under a loan, credit card or other borrowing arrangement.
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Based on an analysis of a person's credit
history, an evaluation of that person's ability to manage a new
debt or debts overall.
The potential for a borrower to fail to live
up to her obligations under a loan arrangement.
Any person to whom money is owed. May be
secured (the debt has been registered against the property of the
debtor) or unsecured.
French term for a "dead-end street".
A street which meets another street at one end but is closed at
the other, such that little traffic will travel down it and the
property owners enjoy excellent privacy.
The total amount charged as interest on a
loan or mortgage to a certain date.
A builder or developer who specializes in
creating homes to the specifications and requirements of individual
land owners.
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