Real Estate Dictionary B
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"Batchelor Apartments" - "Bylaws"
We try to provide as much information as possible to buyers of Ocala Real Estate. These terms and definitions apply pretty much nation wide, and we try to update with terms specifically relating to Florida Real Estate as soon as we come across something we've missed. We welcome your comments and suggestions!
BACHELOR APARTMENT:
A small rental dwelling unit which combines living and bedroom spaces
into one room (and, sometimes, kitchen space as well). Also known as "efficiency
suite" or "studio apartment".
BACK END RATIO:
A comparison of a borrower's monthly expenses to her gross monthly income
used to assess her ability to carry a mortgage or other loan.
BACK TITLE LETTER (OR CERTIFICATE):
Notice by a Title Insurance Company to a person searching and certifying
title that a previous search has been completed, setting out the status of title
of the property as at a given date such that the person searching need only
up-date the search.
BACKUP CONTRACT:
An Agreement of Purchase and Sale for a particular property which is
conditional (becomes binding) upon the failure of another Agreement for the same
property.
BAILMENT:
The delivery of goods or money to another in trust.
BALANCE:<
Often as in "balance due", the amount of principal on a loan remaining to
be paid at any given time.
BALANCE SHEET:
Financial document used by a business showing the assets, liabilities and
net worth at a specific time.
BALLOON (LOAN)
MORTGAGE:
A loan which is repaid by a series of small, periodic payments until a
given date, when either the balance comes due in a single, large payment or the
amount of the payments rises significantly.
BALLOON PAYMENT:
Where the final installment payment on a note is greater than the
preceding installment payments, and it pays the note in full, such final
installment is termed a balloon payment.
BAND OF INVESTMENT:
A method of computing the capitalization rate by considering the return
demanded by the holders of the various loans, and the owner.
BANKRUPT:
A noun or adjective. Noun - a person or business which has made an
assignment in bankruptcy or has been petitioned into bankruptcy. Adjective -
owing more money than you have assets or income to repay.
BANKRUPTCY:
The state of being unable to pay your debts such that you submit yourself
to the protection of the state. A person or business may voluntarily assign
himself into bankruptcy or may be petitioned into bankruptcy by his creditors.
Once in bankruptcy, the person surrenders his assets to a trustee in bankruptcy
who sells the assets for the benefit of the bankrupt's creditors, first secured
creditors then unsecured creditors. Once a person is discharged from bankruptcy,
none of his former creditors may pursue him for his former debts.
BASE AND MERIDIAN:
Imaginary lines used by surveyors to find and describe the location of
private or public lands.
The set rent payable by a tenant under a lease, to which is added Additional rents as required by the lease (for common area maintenance, for example, or for utilities).
BASIS POINT:
One 100th of 1%.
BEARER INSTRUMENT:
A valuable document (a bond or other security) which does not bear the
name of its legal owner; may be redeemed by whoever is in possession of it.
BEARING WALL OR PARTITION:
A wall or partition supporting any vertical load in addition to its own
weight.
BEDROOM COMMUNITY:
A neighborhood or area which offers little in the way of employment
opportunities but plenty of housing, similar to a "suburb" or commuter town.
BEFORE-TAX CASH
FLOW:
Gross amount of money available for the use of the owner before taking
into consideration taxes.
BEFORE-TAX INCOME:
A person or corporation's gross earnings before taxes are deducted.
BELOW-MARKET
INTEREST RATE (BMIR):
A subsidized interest rate on a mortgage or loan, often provided by a
government to allow for acquisition of property or reduction in rents charged to
tenants.
BENCH MARK:
A location indicated in a durable marker by surveyors.
BENEFICIARY:
1. One entitled to the benefit of a trust.
2. One who receives profit from an estate, the title which is vested in a
trustee.
3. The lender on the security of a note and deed of trust.
BEQUEATH:
To give or hand down personal property by will; to leave by will.
BEQUEST:
That personal property which is given by the terms of a will.
BETTERMENT:
An improvement upon property which increases the property value and is
considered as a capital asset, as distinguished from repairs or replacements
where the original character or cost is unchanged.
BIANNUAL:
Or semiannual. Occurring every six months or twice per year.
BID:
An offer of a certain amount of consideration.
BIENNIAL:
Occurring once in every two years.
BILATERAL CONTRACT:
A contract in which both parties agree to perform certain acts.
BI-LEVEL:
A description of a house with two levels, where the main entrance to the
house is between the two levels.
BILL OF SALE:
A written instrument given to pass title of personal property from vendor
to vendee.
BINDER:
A notation of coverage on an insurance policy, issued by an agent, and
given to the insured prior to issuing of the policy.
BIWEEKLY LOAN OR
MORTGAGE:
A loan which features payments equaling one half of the usual monthly
payment made every two weeks (to total 26 in a year), thus substantially
reducing the life of the mortgage and the interest payable over the life of the
mortgage.
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BLANKET ENCUMBRANCE:
An encumbrance which covers more than one parcel of property.
BLANKET INSURANCE
POLICY:
A single insurance policy that applies to more than one person or
property.
BLANKET MORTGAGE:
A single mortgage which covers more than one piece of real estate.
BLENDED RATE:
Created when an old loan is refinanced and extended at an interest rate
which is different from the original rate: the old debt is still payable at the
old rate; the new debt is payable at the new rate; the total amount of the debt
is payable at a rate of interest that is somewhere between the two rates.
BLIGHTED AREA:
A declining area in which real property values are seriously affected by
destructive economic forces, such as encroaching inharmonious property usages,
infiltration of lower social and economic classes of inhabitants, and/or rapidly
depreciating buildings.
BLUEPRINT:
Construction plans, containing great detail about the particular
building.
BOARD FOOT:
A unit of measurement of lumber; one foot wide, one foot long, one inch
thick;144 cubic inches.
BOARD OF
EQUALIZATION:
United States government body with a mandate to assure uniform property
tax assessments.
BOILER PLATE:
A standard clause or provision in a contract which appears in all similar
contracts.
BONA FIDE:
In good faith; without fraud.
BOND:
1. A sum of money paid into court as an assurance of the performance of
some requirement or as security for payment on a claim. May be used to allow for
the removal of a claim for lien from a property while the court action over the
lien continues.
2. An interest-bearing instrument.
BOOK DEPRECIATION:
The depreciation shown on the accounting books of the owner. Used for
income tax.
BOOK VALUE:
Value of the property as shown on the accounting books of the owner.
BOOT:
Profit gained in exchange of properties on which income tax is not
deferred. May be anything of value, including mortgage relief.
BORROWER
(MORTGAGOR):
The person or company that receives money from a lender (often a bank,
credit union or trust company) in exchange for a written promise to pay and a
registered lien on property.
BOTTOMLAND:
Low lying land, near a water course or in a valley or similar geographic
contour.
BOUNDARY:
Edge or limit of a property; property line.
BOUNDS:
Boundaries in a metes and bounds description.
BREACH:
The breaking of a law, or failure of duty, either by omission or
commission.
BRIDGE FINANCING:
Also known as a swing loan, a loan used to fill a gap in financing, often
between the purchase of a new home and the sale of the old one. If the purchase
closes before the sale, the home owner needs to borrow enough money to pay for
the new house for the period of time before the equity in his old house comes
available as a result of the completion of the sale.
BRITISH THERMAL UNIT
(B.T.U.):
A unit of heat or cooling. That required to change the temperature of a
pound of water by one degree Fahrenheit.
BROKER:
A licensed person who does real estate acts for compensation or in
expectation of compensation. He acts for himself and is paid directly by his
client.
BROWNSTONE, BRICK
ROW HOUSE, OR EASTERN TOWNHOUSE:
A nineteenth-century-style row house, with up to five stories and a front
stoop, verandah or porch leading up to the front door.
B.T.U.:
British Thermal Unit. The quantity of heat required to raise the
temperature of one pound of water one degree Fahrenheit.
BUDGET MORTGAGE:
A mortgage in which the borrower is required to make periodic payments
not only for interest and principal, but also for insurance premiums and realty
tax installments.
BUFFER ZONE:
An area of land specifically designed to separate one zoning use from
another, such as separating a residential neighborhood from an industrial area.
BUILD TO SUIT:
An offer by a landowner to develop the land in a manner dictated by a
potential tenant, in return for a long-term lease from the tenant for the
developed land.
BUILDER WARRANTY:
An enforceable guarantee of the quality of construction given by a
builder or developer.
BUILDING CODE:
Set of regulations established by a municipality to govern the standards
of construction in that municipality.
BUILDING LINE OR
SETBACK:
A line, set by law, a certain distance from a street line in front of
which an owner cannot build on his lot (a setback line).
BUILDING PERMIT:
A document obtained from the local government, allowing for the
construction of a structure in accordance with the terms of the permit.
BUILDING RESIDUAL:
A method of appraising. The value of the land is subtracted from the
value of the property leaving the value of the building.
BUILDING
RESTRICTIONS:
Limiting rules which may appear in building codes or in title documents
which control the size, placement, materials, design or location of new
construction.
BUILT-INS:
Items which could be chattels but which are installed so as to form part
of a building.
BULK SALE:
The sale of merchandise in bulk rather than in the ordinary course of
business.
BUNDLE OF RIGHTS:
Beneficial interests or rights.
BUNGALOW:
A small, one-storey home built in a turn of the century style, often with
a prominent front verandah.
BUSINESS DAY:
A day in which normal business is transacted. Generally, Monday to Friday
but not weekends or holidays.
BUSINESS OPPORTUNITY:
The sale or lease of a business. It includes personal property and it may
include real property.
BUY-BACK AGREEMENT:
A contract between a purchaser and vendor in which the vendor agrees to
repurchase the property from the purchaser if a certain event occurs within a
specified period of time. The buy-back price is usually set out in the
agreement.
BUY DOWN (ACCOUNT OR
MORTGAGE):
The payment of extra money on a loan now so as to reduce the interest
rate over a given period or over the life of the loan. This extra payment may be
made by the borrower, by the lender (as an incentive to the borrower to borrow
from the lender) or by the vendor/builder (as an incentive to the borrower to
buy a certain property).
BUYER'S BROKER:
A real estate broker who contracts to represent the interests of a person
wishing to purchase a home. (see also "selling agent", "Purchaser's agent").
BUYER'S MARKET:
A condition of the real estate market where there are more properties for
sale than people interested in buying them. Buyer's have more choice and less
competition for the available properties, resulting in lower prices.
BUY-SELL AGREEMENT:
A pact between partners in a business or shareholders in a company,
obliging one to buy the other's interest (and obliging the other to sell) upon
the occurrence of some event stated in the agreement.
BYLAWS:
The rules of an organization such as a corporation or partnership.