[
Dictionary of Terms ]
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
E
EARNEST
MONEY a deposit made by a purchaser of real estate to evidence
good faith.
EASEMENT
the right, privilege, or interest that one party has in the land
of another.
EASEMENT
BY NECESSITY the right of an owner to cross over another's property
for a special necessary purpose.
EASEMENT
BY PRESCRIPTION continued use of another's property for a special
purpose can ripen into a permanent use if conditions are met.
EASTLAKE
HOUSE a nineteenth-century-style house with three-dimensional
ornamentation made with a chisel, gouge, and lathe rather than
the scroll saw. Many of the parts of the ornamentation resemble
furniture legs and knobs. This distinctive type of ornamentation
is the major characteristic of this style and separates the Eastlake-style
house from the Queen
ECONOMIC
BASE industry within a geographic market area that provides employment
opportunities that are essential to support the community.
ECONOMIC
DEPRECIATION loss of value from all causes outside the property
itself.
ECONOMIC
LIFE that remaining period for which real estate improvements
are expected to generate more income than operating expenses
cost.
ECONOMIC
OBSOLESCENCE same as economic depreciation.
ECONOMIC
RENT 1. in economics, the cost commanded by a factor that is
unique or inelastic in supply. 2. in appraisal, the market rent.
Contrast with contract rent
EFFECTIVE
AGE the age of a property based on the amount of wear and tear
it has sustained. Contrast with actual age.
EFFECTIVE
GROSS INCOME for income-producing property, potential gross income,
less a vacancy and collection
EFFECTIVE
RATE the true rate of return considering all relevant financing
expenses.
EFFICIENCY
RATIO the proportion of a building's area that is leasable space.
EFFICIENCY
UNIT OR APARTMENT a small dwelling unit, often consisting of
a single room, within a multifamily structure. In most cases,
kitchen and bath facilities are not complete.
EGRESS
access from a land parcel to a public road or other means of
exit.
EJECTMENT
action to regain possession of real property, when there is no
lease.
ELIZABETHAN
OR HALF TIMBER STYLE an English-style 2- or 21/2 story house,
often with part of the second story overhanging the first. It
has less tone work and is less fortlike than the Tudor. Stone
and stucco walls with half timbers are most common.
ELLWOOD
TECHNIQUE in the appraisal of mortgaged income property, a technique
used to estimate the present value of the property. The appraiser
determines and discounts to a present value the annual cash flow
to the equity owner and the expected resale proceeds. Those amounts
are added together to derive the equity value, then added to
the mortgage balance to offer a property value estimate. The
late L. W. Ellwood provided capitalization rate tables that accelerate
the process.
EMBLEMENT
a growing crop. Annual crops are generally considered personal
property
EMINENT
DOMAIN the right of the government or a public utility to acquire
property for necessary public use by condemnation; the owner
must be fairly compensated.
EMPTY
NESTERS a couple whose children have established separate households;
important segment of the housing market, since empty nesters
often seek to reduce the amount of housing space they occupy.
Thus empty nesters are one source of demand for smaller housing
units.
ENCROACHMENT
a building, a part of a building, or an obstruction that physically
intrudes upon, overlaps, or trespasses upon the property of another.
ENCUMBRANCE
any right to or interest in land that affects its value. Includes
outstanding mortgage loans, unpaid taxes, easements, deed restrictions.
END
LOAN same as permanent mortgage.
ENDORSEMENT
1. the act of signing one's name, as the payee, on the back of
a check or note, with or without further qualification; the signature
itself 2. offering support or credibility to a statement.
ENERGY
EFFICIENT as applied to buildings, generally indicating the existence
of extra insulation, weatherproofing, and/or special features
and equipment designed to reduce the cost of energy for heating,
co671ing and hot water.
ENERGY
TAX CREDITS a reduction in income tax, generally based on the
cost of installing insulation and other energy-saving devices.
Note: At the federal level, energy tax credits generally expired
before 1987 and were not renewed by the 1986 Tax Act.
ENTITY
the legal form under which property is owned.
ENTREPRENEUR
an individual who generates business activity. A businessman
or businesswoman. Often associated with one who takes business
risks.
ENVIRONMENTAL
IMPACT STATEMENT (EIS) an analysis of the expected effects of
a development or action on the surrounding natural and fabricated
environment. Such statements are required for many federally
supported developments under the National Environmental Policy
Act of 1969.
ENVIRONMENTAL
PROTECTION AGENCY (EPA) an agency of the U.S. government established
to enforce federal pollution abatement laws and to implement
various pollution prevention programs. EQUAL CREDIT OPPORTUNITY
ACT a federal law, enacted in 1974, to discourage discrimination
by lenders on the basis of sex or marital status. Amended in
1976 to prohibit discrimination on the basis of age, race, color,
religion, national origin, or receipt of public assistance.
EQUALIZATION
BOARD a government agency that determines the fairness of taxes
levied against properties.
EQUITABLE
CONVERSION a legal doctrine in some states in which, under a
contract of sale, buyers and sellers are treated as though the
closing had taken place in that the seller in possession has
an obligation to take care of the property.
EQUITABLE
TITLE the interest held by one who has agreed to purchase but
has not yet closed the transaction.
EQUITY
the interest or value that the owner has in real estate over
and above the liens against it.
EQUITY
BUILDUP the gradual increase in a mortgagor's equity in a property
caused by amortization of loan principal.
EQUITY
DIVIDEND the annual cash flow that an equity investor receives.
EQUITY
OF REDEMPTION the right of an owner to redeem property securing
a loan that has been accelerated prior to fore- closure.
EQUITY
PARTICIPATION same as participation mortgage.
EQUITY
YIELD RATE the rate of return on the equity portion of an investment,
taking into account periodic cash flow and the proceeds from
resale. Considers the timing and amounts of cash flow after annual
debt service, but not income taxes.
EROSION
the gradual wearing away of land through processes of nature,
as by streams and winds.
ERRORS
AND OMISSIONS INSURANCE liability protection against professional
malpractice, mistakes in business dealings by insured, etc.
ESCALATOR
CLAUSE a provision in a lease that requires the tenant to pay
more rent based on an increase in costs. Same as stop clause.
ESCAPE
CLAUSE a provision in a contract that allows one or more of the
parties to cancel all or part of the contract if certain events
or situations do or do not happen.
ESCHEAT
the reversion of property to the state in the event that the
owner dies without leaving a will and has no legal heirs.
ESCROW
an agreement between 2 or more parties providing that certain
instruments or property be placed with a third party for safekeeping,
pending the fulfillment or performance of a specified act or
condition.
ESCROW
ACCOUNT same as trust account.
ESCROW
AGENT any person engaged in the business of receiving escrows
for deposit or delivery.
ESCROW
CLOSING ten-n meaning the same as closing, especially in states
where deeds of trust are used instead of mortgages.
ESTATE
the degree, nature, and extent of interest that a person has
in real property.
ESTATE
AT SUFFERANCE the wrongful occupancy of property by a tenant
after the lease has expired.
ESTATE
AT WILL the occupation of real estate by a tenant for an indefinite
Period, terminable by one or both parties at will.
ESTATE
FOR LIFE an interest in Property that terminates upon the death
of a specified person.
ESTATE
FOR YEARS an interest in land allowing Possession for a specified
and limited time.
ESTATE
IN REVERSION an estate left by the grantor for himself or herself,
to begin after the termination of some particular estate granted
by him or her.
ESTATE
TAX a tax based on the value of property left by the deceased.
Since 1987, the estate and gift tax laws exempt approximately
$600,000 of property.
ESTOPPEL
a doctrine of law that stops one from later denying facts which
that person once acknowledged were true and others accepted on
good faith.
ESTOPPEL
CERTIFICATE a document by which the mortgagor (borrower) certifies
that the mortgage debt is a lien for the amount stated. The debtor
is thereafter prevented from claiming that the balance due differs
from the amount stated.
ESTOVERS
the legally supported right to take necessities from property.
Contrast with waste.
ET
AL abbreviation of the Latin et alii "and others.'
ET
CON abbreviation of the Latin et conjunx. Legal term signifying "and
husband."
ET
UX abbreviation of the Latin et axor, which means "and wife."
EVALUATION
a study of potential property uses, but not to determine its
present value.
EVICTION
a legal proceeding by a lessor (landlord) to recover possession
of property.
EVICTION,
ACTUAL exists where one is removed from the property, either
by force or by process of law.
EVICTION,
CONSTRUCTIVE exists when, through the fault of the landlord,
physical conditions of the property render it unfit for the purpose
for which it was leased.
EVICTION,
PARTIAL exists where the possessor of the property, such as a
tenant, is deprived of a portion thereof.
EVIDENCE
OF TITLE documents, such as deeds, that demonstrate ownership.
EXAMINATION
OF TITLE research of the title to a piece of real estate; less
thorough than a title search, usually concentrates on recent
records.
EXCESS
ACCELERATED DEPRECIATION the accumulated difference between accelerated
depreciation claimed for tax purposes and what straight-line
depreciation would have been. Generally, excess accelerated depreciation
is recaptured (taxed) as ordinary income upon a sale, instead
of receiving more favorable capital gains treatment.
EXCESS
RENT when the rent of an existing lease exceeds the rental rate
on comparable existing space. Should the lease expire or the
tenant break the lease, the new rate will probably be at market
rates.
EXCHANGE
under Section 1031 of the Internal Revenue Code, likekind property
used in a trade or business or held as an investment can be exchanged
tax-free.
EXCLUSIVE
AGENCY LISTING employment contract giving only one broker for
a specified time, the right to sell the property and also allowing
the owner alone to sell the property without paying a commission.
EXCLUSIVE
RIGHT TO SELL LISTING employment contract giving the broker the
right to collect commission if the property is sold by anyone,
including the owner, during the term of the agreement.
EXCULPATORY
CLAUSE a provision in a mortgage allowing the borrower to surrender
the property to the lender without personal liability for the
loan.
EXECUTE
to sign a contract; sometimes, to Perform a cOlItIO4 fully.
EXCUTED
CONTRACT a contract whose terms have been completely fulfilled.
EXECUTOR
a person named in a will to carry out its provisions for the
disposition of the estate.
EXECUTORY
CONTRACT a contract under which one or more parties has not yet
performed.
EXECUTRIX
a woman who Performs the duties of an executor.
EXEMPTION
an amount provided by law that reduces taxable . income or taxable
value.
EXPENSE
RATIO a comparison of the operating expenses to potential gross
income. This ratio can be compared over time and with that of
other properties to determine the relative operating efficiency
of the property considered.
EXPOSURE
(MARKET) the advertising, whether free or paid, of property that
is for sale.
EXTENDED
COVERAGE insurance that covers specific incidences normally excluded
from standard insurance policies.
EXTENSION
an agreement between 2 parties to extend the time period specified
in a contract.
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