"What
Did He Say?"
A Short Dictionary of
Real Estate Terms
We're guilty! We use terms that know one else but
us understand and we rarely explain. Its like talking to your mechanic. If you
don't understand its our fault, so please ask. If you forget to ask, check out these
definitions.
Property taxes, electricity, gas fuel and mortgage interest
already paid out for future service must be pro-rated. This can involve an
expenditure of several hundred dollars payable when the sale is completed.
A contract by which one party agrees to sell and another
agrees to purchase. The contract may be firm (no conditions attached) or
conditional (certain conditions must be fulfilled).
The act or process of estimating value. An appraisal is
prepared for mortgage lending purposes and may not reflect the market
value of the property.
A valuation placed upon property by the Province, as a basis
for municipal taxation.
An intermediary between the buyer and seller who is licensed
to carry out such activities.
The vendor effectively lowers the rate of interest of a
mortgage by prepaying a portion of the interest on his own existing
mortgage or on a mortgage arranged by the purchaser.
An offer to purchase subject to specified conditions. These
conditions could be the arranging of a mortgage or the selling of a
present home. Usually a time limit is stipulated in which the specified
conditions must be met.
The federal Crown corporation which administers the National
Housing Act. CMHC services include providing housing information and
assistance to consumers and insuring home purchases loans for lenders.
Personal property which is tangible and moveable.
The date specified in the Agreement of Purchase and Sale,
when the purchaser is to deliver the balance of money due and the vendor
is to deliver a duly executed deed and vacant possession of the property
(unless otherwise agreed).
A condition in a contract which calls for the happening of
some event, or performance of some act before the agreement becomes
binding on the parties.
The final document prepared by a lawyer or notary to be
signed by the seller and purchaser transferring ownership. This document
is then registered against the property as evidence of ownership.
Payment of money or other valuable consideration as pledge
for fulfilment of contract.
The removal of all mortgages and other financial encumbrances
on a property.
The right acquired for access to or over another person 5
land for a specific purpose, such as for a driveway or public utilities.
The unauthorized extension of boundaries of land.
Outstanding claim or liens recorded against property or any
legal right to the use of the property by another person who is not the
owner.
The highest price in terms of money, which the property will
bring to a willing seller if exposed for sale on the open market while
allowing a reasonable time to find a willing purchaser, buying with the
knowledge of all the uses, and with neither party acting under necessity,
compulsion or peculiar and special circumstances.
Permanent improvements to property that may not be removed at
the expiration of the term of lease or tenure.
An amount of money withheld by the lender during the progress
of construction of a house to ensure that construction is satisfactory at
every stage. The amount of the holdback is generally equivalent to the
estimated cost to complete construction.
The examination of the house by an expert selected by the
buyer.
Before the transaction can be closed, the purchaser must have
fire insurance arranged and in effect. A certificate from the insurance
company may be required at the closing.
Incapable of being recalled or revoked unchangeable and
unalterable.
The difference between the price for which a property could
be sold and the total debts registered against it.
A document stipulating that, in exchange for a deposit, a
specified individual
is to be given first chance of buying a property within a
specified period of time. If the option-holder does not buy within the
specified time, he loses his deposit.
The right of a mortgagee to force the sale of the property
without judicial proceedings should default occur.
A potential buyer or customer.
Includes real property, lease-hold and business whether with
or without premises, fixtures, stock-in trade, goods of chattels in
connection with the operation of the business.
The combination of the tangible and intangible attributes of
land and improvements. Value- wise, it is the sum of the value of the real
estate, considered as land and structure and, for example, the tangible
value arising by reason of a favourable lease. The real estate plus the
rights that go with it.
An employee of or an independent contractor connected to a
broker authorized to trade in Real Estate.
A term indicating that a conveyor has received adequate
consideration as evidenced by his voluntary delivery. The word
"sealed" adds more strength, since under old conveyancing law an
official seal was used as a substitute for consideration.
A statement of the financial breakdown of the transaction
prepared by the solicitor for the vendor setting out, in balance sheet
form, the credits to the vendor (e.g. purchases price, prepaid taxes,
prepaid insurance, etc.) and the credits to the purchaser (e.g. deposits,
taxes) and the balance due on closing.
The accurate mathematical measurement of land and building
thereon, made with the aid of instruments.
The means of evidence by which the owner of land has lawful
ownership thereof.
Seller of real property.
Where the seller of a property provides some or all of the
mortgage financing in order to sell the property.
Municipal laws restricting the use of land for specific
purposes. The zoning is important to know because the purchaser may not be
able to use the property for the purpose intended.
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