Term
|
Definition
| Increaed property value and quality |
|
|
Term
|
Definition
| Pollution, traffic, fewer natural areas, noise |
|
|
Term
|
Definition
| development in rural areas beyond urban fringe |
|
|
Term
|
Definition
| Builders offer lower prices; costs for expansion (roads, schools) are paid for by community |
|
|
Term
|
Definition
| General guide to a community's future growth and development; population growth projection, water, other resources, schools |
|
|
Term
| Economic and environmental impact statements |
|
Definition
| Studies that analyze the project's effect on surrounding areas |
|
|
Term
|
Definition
| Development prohibited unless schools, police, etc. are put into place |
|
|
Term
| Affordale housing allocation |
|
Definition
| Required housing for low income housing |
|
|
Term
|
Definition
| Loval government plans to rovide public services beyond urban development is prohibited; boundaries established for 10-20 years |
|
|
Term
| Extraterritorial jurisdiction |
|
Definition
| Power to plan and control urban development outside boundaries until annexation |
|
|
Term
|
Definition
| Pre-automobile urban architecture style |
|
|
Term
|
Definition
| Regulate land use (structure, interior, safety, electrical, stairways, pipes, etc. |
|
|
Term
|
Definition
| Land use regulations; based on local needs (lot boundaries, limits/dimensions); exercise of police power |
|
|
Term
| Special use classification |
|
Definition
| Petition to reconsider specific zoning issue |
|
|
Term
|
Definition
| When zoning ordinance is revised some existing land falls outside of the classification (though may continue to exist for a period of time) |
|
|
Term
|
Definition
| Relief when regulations impose hardship or loss of value |
|
|
Term
|
Definition
| Overturn ordinances that exclude lower income groups or low/moderate housing |
|
|
Term
|
Definition
| Plans become property and responsibility of the local government to maintain |
|
|
Term
|
Definition
| Reviews petitions for variances; final decision, can only be appealed in court |
|
|
Term
| Planned unit development (PUD) |
|
Definition
| Determine setback requirements, densities, etc. |
|
|
Term
|
Definition
| Traffic, watershead, air quality; provide flexible substitutes to traditional land uses if meets performance standards |
|
|
Term
|
Definition
| If developer imposes costs to the community he must pay a fee |
|
|
Term
|
Definition
|
|
Term
|
Definition
| Hazardous materials on property; gases, abestos, fiberglass, radon, mold, etc. |
|
|
Term
|
Definition
| Determines whether it's reasonable to suspect an environmental risk (from toxic waste) |
|
|
Term
|
Definition
| Government's right to acquire private property without owner's consent, for public use |
|
|
Term
|
Definition
| Legal procedure for acquiring property |
|
|
Term
|
Definition
| One no longer requiring actual physical use by condeming agency, public benefit/purpose |
|
|
Term
|
Definition
| Market value of the property that restors financial position to the owner |
|
|
Term
|
Definition
| An action taken by the property owner against the government to recover loss in property value based on government activity |
|
|
Term
|
Definition
| If regulation goes too far |
|
|
Term
|
Definition
| Taxes applied in relation to the value of the property (between 1-4% of property's value) |
|
|
Term
|
Definition
| Dollars per $1000 of value; how tax rates are usually stated |
|
|
Term
|
Definition
| Tax rate converted into mills |
|
|
Term
|
Definition
| Government owned, schools, hospitals, churches |
|
|
Term
|
Definition
| Property owners deduct amount from valuation before caluclating property tax bill |
|
|
Term
|
Definition
| Appraiser of all taxable property in jurisdiction |
|
|
Term
|
Definition
|
|
Term
|
Definition
| Used for comparison purposes |
|
|
Term
|
Definition
| Levied to pay for specific improvements that benefit a particular group of properties (sidewalks, water systems) |
|
|
Term
| Equity rights of redemption |
|
Definition
| Right to pay unpaid taxes, interest, penalties before public sales |
|
|
Term
|
Definition
| Regressive, varies among areas and property types, poorly administered |
|
|
Term
|
Definition
| Unbiased, written estimate of market value of a subject property at a particular time |
|
|
Term
|
Definition
| Document the appraiser submits to client with reasons leading to final estimate |
|
|
Term
|
Definition
| Most probable selling price assuming normal conditions |
|
|
Term
|
Definition
| Value a particular investor places on a property |
|
|
Term
|
Definition
| Prices on sold properties; used to estimate market value of similar properties |
|
|
Term
| Uniform standards of professional appraisal practice (USPAP) |
|
Definition
| Ethical obligations and minimum appraisal standards |
|
|
Term
| Self-contained appraisal report |
|
Definition
| Includes all relevant information to derive market value and other conclusions |
|
|
Term
|
Definition
| Summarizes conclusions of appraisal |
|
|
Term
| Restricted appraisal report |
|
Definition
| Minimal discussion of appraisal, references internal documentation |
|
|
Term
|
Definition
| Longest and formal, step-by-step description of facts and methods to determine value |
|
|
Term
|
Definition
| Standarized, used for mortgage lenders for purchases/refinancing |
|
|
Term
|
Definition
| Additions and subtractions from comparable properties |
|
|
Term
| Arm's-length transactions |
|
Definition
| Farily negotiated transaction that occurred under typical market conditions |
|
|
Term
|
Definition
| Public records, multiple listing service (MLS), private data services |
|
|
Term
|
Definition
| Convert each comparable sale transaction into an approximation of the subject property |
|
|
Term
| Transactional adjustments |
|
Definition
| Involve the nature and terms of the deal (financing terms, conditions of sale, market conditions, etc.) |
|
|
Term
|
Definition
| Involve locational, physical, and economic differences between properties |
|
|
Term
|
Definition
| Track prices of individual properties that sell repeatedly over time |
|
|
Term
|
Definition
| Personal property (furniture, equipment, rugs); must be subtracted from original cost |
|
|
Term
|
Definition
| Cost to construct building today, replaces outdated features |
|
|
Term
|
Definition
| Cost to construct building of equal utility |
|
|
Term
|
Definition
| Difference between current market value and cost to produce it new (based on physical deterioration, external and functional obsolescence) |
|
|
Term
|
Definition
| Loss of value based on again and decay (carpet, roof, appliances) |
|
|
Term
|
Definition
| Loss in value within a structure due to changes in tastes, preferences, innovations, and market standards |
|
|
Term
|
Definition
| Loss in value due to deterioration of neighborhood, traffic, etc. |
|
|
Term
|
Definition
| Financial rights and obligations between borrower and lender; exact terms and conditions of the loan |
|
|
Term
| Adjustable rate mortgage (ARM) |
|
Definition
| Adjustable interest rates, common in commercial real estate |
|
|
Term
|
Definition
| Market based; moving part in ARM, cannot be influenced by borrower or lender |
|
|
Term
|
Definition
| 1 year treasury rate, used to establish ARM index rate |
|
|
Term
|
Definition
|
|
Term
|
Definition
| Common index for income producing property |
|
|
Term
|
Definition
| When IR is recomputed, must notify lenders 30 days in advance |
|
|
Term
|
Definition
| Lender's "mark up", varies but is normally constant though the life of the loan (~275 bp) |
|
|
Term
|
Definition
| Limits change in interest rates from one date to the next |
|
|
Term
|
Definition
| Limits change in interest rates over the life of the loan |
|
|
Term
|
Definition
| Temporarily reduced interest rate, usually one year |
|
|
Term
|
Definition
| Enables the lender to enjoy unconstrained interest rate adjustments while protecting the borrower against shock of large payment changes |
|
|
Term
|
Definition
| If the interest rate rises more than the cap then unpaid interest is added to the original balance |
|
|
Term
|
Definition
| Loan is paid down partially over a certain number of years, may require large principal payment at the end |
|
|
Term
|
Definition
| Loans that require interest but no regularly scheduled pament until the last payment |
|
|
Term
|
Definition
| Determined payments and schedule |
|
|
Term
|
Definition
| Determined when the remaining balance must be paid in full |
|
|
Term
|
Definition
| Loans to homeowners who do not qualify for standard home loans |
|
|
Term
| Yield maintenance prepayment penalty |
|
Definition
| Borrower must make payment and some amount to make up for the lender's loss of interest |
|
|
Term
| Defeasance prepayment penalty |
|
Definition
| Borrower must provide investment that replaces the cash flows of the loan being paid off |
|
|
Term
|
Definition
| 4-5% on home loans, larger on subprime |
|
|
Term
|
Definition
| When the borrower signs a note |
|
|
Term
|
Definition
| When the borrower fails to meet the note's conditions |
|
|
Term
|
Definition
| The lender has recourse in case of default (less common for commercial) |
|
|
Term
|
Definition
| Releases the borrower from liability for fulfillment of the contract |
|
|
Term
|
Definition
| Permits a lender to demand prepayment of loan (common with commerical banks if credit has deteriorated) |
|
|
Term
|
Definition
|
|
Term
|
Definition
|
|
Term
|
Definition
| Mortgage gives the lender the right to use the property as collateral |
|
|
Term
|
Definition
| To maintain property, lender has joint control of proceeds from major damage |
|
|
Term
|
Definition
| Borrower must make monthly deposits into escrow account to pay taxes, insurance, fees, etc. |
|
|
Term
|
Definition
| If borrower defaults, allows lender to declare balance due and payable |
|
|
Term
|
Definition
| Lender has right to accelerate loan if the property is leased (protects lender from new people paying loan) |
|
|
Term
|
Definition
| Buyer can preserve existing loan |
|
|
Term
|
Definition
| Can be used in place of a mortgage |
|
|
Term
|
Definition
| Violations of note that do not disrupt payments on the loan |
|
|
Term
| Deed in lieu of foreclosure |
|
Definition
| Borrower conveys property to the lender |
|
|
Term
|
Definition
| Ultimate recourse of lender, terminates all borrower's claims |
|
|
Term
|
Definition
| Early lien with priority (property taxes, assessments, etc.) |
|
|
Term
|
Definition
| Mortgagor's right to stop the foreclosure process by paying amount due |
|
|
Term
| Statutory right of redemption |
|
Definition
| Extends the right to extend the sale |
|
|
Term
|
Definition
| Aims at receiving funds not recovered through foreclosure, rare |
|
|
Term
|
Definition
| Sale of foreclosed property through court |
|
|
Term
|
Definition
| Court liquidates assets and distributes proceeds to reditors; quick, foreclosure remains |
|
|
Term
|
Definition
| Court supervised for business, creditors prohibited from legal action, court works out plan to stall foreclosure |
|
|
Term
|
Definition
| Same as Chapter 11, but applies to households, allows petitioner to propse repayment plan in court |
|
|
Term
|
Definition
| Secure real estate without mortgage; default and payments vary; done quickly and sometimes protections are forgotten |
|
|
Term
|
Definition
| Lenders may lend to avoid certain neighborhoods without regard to individual loan applications |
|
|
Term
|
Definition
| the monthly payment per $1 of loan (payment/principal) |
|
|
Term
|
Definition
| the PV of the remaining payments, discounted at the loan interest rate |
|
|
Term
|
Definition
| interest charged in advance/prepaid interest |
|
|
Term
|
Definition
| implied IRR from the borrower’s perspective (since the borrower pays closing costs and the lender does not) |
|
|
Term
|
Definition
| title insurance, mortgage insurance, recording fees and taxes, appraisal, survey |
|
|
Term
| Annual percentage rate (APR) |
|
Definition
| always computed under the assumption of no prepayments or a yield to loan maturity; true effective borrowing cost (expense items and finance charges are included); Whenever the lender charges up-front points, the earlier the loan is paid off, the higher the lender’s yield; the earlier the borrower pays off a loan, the higher the EBC |
|
|
Term
|
Definition
| discount points, loan origination fee, loan application, document preparation, appraisal, title insurance, mortgage insurance, transfer deed/mortgage, survey costs, pest inspection, attorney’s fees |
|
|
Term
| Level –payment mortgages (LPMs) |
|
Definition
| fully amortized loans with equal periodic payments |
|
|
Term
|
Definition
| repaid in full with one payment on maturity of the loan; interest payments made periodically over the life of the loan; often used in Jumbo loans, commercial real estate, and land |
|
|
Term
| Partially amortized mortgages |
|
Definition
| periodic payments of principal and interest, not paid off completely over the loan’s term to maturity (satisfied with balloon payment) |
|
|
Term
|
Definition
| must negotiate new loan with original lender at current rates, negotiate loan with new lender and pay off old, or sell property and pay off original lender |
|
|
Term
| Early payment mortgages (EPM) |
|
Definition
| If principal payments exceed the schedule of principal payments |
|
|
Term
|
Definition
| At a predetermined change date, the loan interest rate will rise or fall as the index rate rises or falls; borrowers should expect higher initial contract interest rate, higher margin, and more upfront costs |
|
|
