Commercial Real Estate Appraisal,

CONTINGENCY
A condition which must be satisfied before a contract is legally binding.

MILITARY CLAUSE
A clause inserted in some residential leases to allow the military tenant to terminate the lease in case of transfer, discharge or other circumstances making termination appropriate.

INSTITUTIONAL LENDER
Financial institutions such as banks, insurance companies, savings and loans or any lending institution whose loans are regulated by law.

DUPLEX
A structure that provides housing accommodations for two families by having separate entrances, kitchens, bedrooms, lanais, living rooms and bathrooms. A two-family dwelling.

VACANCY FACTOR
An allowance or discount for estimated vacancies(unrented units) in a rental project. The vacancy rate is the ratio between the number of vacant units and the total number of units in a specified project or area.

NOTICE OF NONRESPONSIBILITY
A legal notice designed to relieve a property owner from responsibility for the cost of improvements ordered by another person.

CERTIFICATE OF VETERAN STATUS
FHA form filled out by the VA to establish a borrower's eligibility for an FHA Vet loan. Obtainable through local VA office by submitting form DD 214 (Separation Paper) with form 26-8261a (request for certificate of veteran status).

COMPARABLES
Recently sold properties which are similar to a particular property being evaluated, and which are used to indicate a reasonable fair market value for the subject property.

SETTLEMENT COSTS
Also known as closing costs, these costs are for services that must be performed before your loan can be initiated. Examples include title fees, recording fees, appraisal fee, credit report fee, pest inspection, attorney's fees, taxes, and surveying fees.

FARM AREA
A selected geographical area or one specific building to which a real estate salesperson devotes special attention and study.

KICKERS
Different types of equity participation a lender may seek as a condition for lending money, such as participation in rentals, profits, or extra interest.

ZONING
The regulation of structures and uses of property within designated districts or zones. Zoning regulates and affects such things as use of the land, types of structure permitted, building heights, setbacks, and density (the ratio of land area to improvement area).

BUFFER ZONE
A strip of land separating one parcel from another.

COMMON WALL
A wall separating two living units.

LAW DAY
The date an obligation becomes due; sometimes refers to the closing date.

PRIME RATE
The minimum interest rate charged by a commercial bank on short-term loans to its largest and strongest clients(those with the highest credit standings).

FORECLOSURE (OR REPOSSESSION)
Legal process by which a mortgaged property may be sold to pay off a mortgage loan that is in default.

ZONING
The regulation of structures and uses of property within designated districts or zones. Zoning regulates and affects such things as use of the land, types of structure permitted, building heights, setbacks, and density (the ratio of land area to improvement area).

FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC, OR FREDDIE MAC)
This agency buys loans that are underwritten to its specific guidelines. These guidelines are an industry standard for residential conventional lending.

INNOCENT PURCHASER FOR VALUE
One who purchases real property without notice, actual or constructive, of any superior rights or interests in the real property.

MORTGAGE INSURANCE
Insurance to protect the lender in case you default on your loan. With conventional loans, mortgage insurance is generally not required if you make a down payment of at least 20% of the home's appraised value. (Note, however, that FHA and VA loans have different insurance guidelines.)

COMMINGLING
To mingle or mix; for example, to deposit client funds in the broker's personal or general account. A licensee found guilty of commingling can have the license suspended or revoked by the Real Estate Commission.

INCOME APPROACH
An approach to the valuation or appraisal of real property as determined by the amount of net income the property will produce over its remaining economic life.

RATE OF RETURN
The relationship (expressed as a percentage)between the annual net income generated by a business and the invested capital, or the appraised value, or the gross income, etc., of the business.

DISCRIMINATION
The act of making a distinction against or in favor of a person on the basis of the group or class to which the person belongs; the failure to treat people equally.

SALE AND LEASEBACK
A transaction in which, typically, an owner sells his improved property and as part of the same transaction signs a long-term lease and remains in possession.

DOMICILE
The state where an individual has his true, fixed, permanent home and principal business establishment and to which place he has the intention of returning whenever he is absent.

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