Archives: Glossary Terms

An initial partial payment of the total selling price.

A value estimate prepared without the benefit of an interior inspection and which may not conform to USPAP Standard 1. See Self-contained appraisal report, a Summary appraisal report or a Restricted appraisal report. Limited appraisal. Example: Because of a contentious divorce, an appraiser hired by one of the parties was not allowed to enter the property, so a drive-by appraisal was performed.

An agent representing both the buyer and seller in a transaction. Dual agents should always get written consent of both parties. If a licensed real estate agent licensee lists a property which their buyer client wishes to buy, the licensee will be the agent for both the buyer and the seller. This is called Dual Agency. If this situation were to occur, the buyer would be informed and asked to sign a Dual Agency Consent Agreement. This Agreement provides that the agent will not disclose either client’s personal, financial or confidential information.

The illegal or unethical practice of providing two different contracts for the same transaction. Example: Abel wants to purchase a home from a builder for $144.000 but has no cash for the downpayment. The builder suggests that they prepare a fictitious contract for $160,000 and try to borrow 90% of $ 160,000. The bank’s attorney discusses the dual contract and explains that they could be guilty of attempted fraud.

The standard of conduct required of an ordinary, prudent and reasonable person. Example: While Professor Dirby was on sabbatical, the broker who managed his house was required to take due care of the property. The broker had to be certain that the tenant who occupied the property observed the lease.

1.The making of every reasonable effort to perform one’s contractual obligations. Example: A prospective homebuyer signed a sales contract contingent on the sale of her present residence. She is expected to use due diligence in marketing her present house. 2. The making of every reasonable effort to provide accurate, complete information. A study that often precedes the purchase of property, which considers the physical, financial, legal and social characteristics of the property and expected investment performance; the underwriting of a loan or inverstment.

A legal principle that notice must be given to all affected parties along with an opportunity to be heard when any governmental powers are exercised.

An acceleration clause granting the lender the right to demand full payment of the loan upon a sale of the property.

This usually means two dwelling units one above the other under one roof. See Double..

A place where people live such as apartments, hotels, mobile homes, nursing homes and single-family houses.