CT Real Estate key terms

The legal obligation a real estate agent owes a client to act in the client's best interest, including loyalty, obedience, disclosure, confidentiality, reasonable care, and accounting. These duties are stronger than those owed to a customer.

A legal relationship in which a broker or salesperson represents a client and acts on the client's behalf with authority, creating fiduciary duties and requiring disclosure of whom the licensee represents.

A situation where one broker represents both the buyer and the seller in the same transaction. Connecticut permits it only with informed written consent from both parties because the broker's loyalty is divided.

A form of brokerage where the broker appoints one licensee to represent the buyer and another to represent the seller within the same firm, reducing conflicts while the broker remains neutral.

A client has an agency agreement and receives fiduciary duties; a customer deals with a licensee without representation and receives honesty, fairness, and limited disclosure but not loyalty or confidentiality.

Information that could reasonably affect a person's decision to buy, sell, or lease property, such as known defects or financial issues. Licensees must disclose material facts to all parties.

The basic steps forming a contract: one party proposes definite terms, and the other agrees to those terms without changes, creating a binding agreement when communicated.

Something of value exchanged by the parties to make a contract enforceable, such as money, a promise, or a promise to perform. Real estate contracts need consideration.

A legal rule requiring certain contracts, including real estate sales contracts and leases over one year, to be in writing and signed by the party to be charged.

A contract condition that must be satisfied for the sale to proceed, such as a mortgage approval, home inspection, or appraisal. If the contingency fails, the buyer may cancel.

Money a buyer gives to show good faith and commitment to a purchase. It is usually held in escrow and applied to the purchase price or forfeited if the buyer defaults.

A response to an offer that changes its terms, which rejects the original offer and creates a new offer that the other party may accept or reject.

The most complete form of property ownership, giving the owner unlimited rights to use, sell, lease, mortgage, or transfer the property, subject only to government powers and private restrictions.

An ownership interest that lasts for the lifetime of a named person. The life tenant may use the property but usually cannot sell it forever, and the interest ends at death.

A legal right to use another person's land for a specific purpose, such as a driveway or utility line, without owning the land. Easements can be appurtenant or in gross.

A legal claim against property that secures payment of a debt. A lien can affect title and must usually be paid or released before the property can be sold with clear title.

A private limitation written into deeds or subdivision rules that restricts how land may be used, such as setbacks or home-based business limits.

Property where owners share interests in common areas and often belong to an association, such as condominiums, cooperatives, or planned communities. Connecticut regulates these communities by statute.

A legal doctrine allowing a person to acquire title to another's land by openly, continuously, exclusively, and hostilely possessing it for the statutory period, which is generally fifteen years in Connecticut.

The most probable price a property should bring in a competitive and open market under fair sale conditions, with both buyer and seller acting prudently and knowledgeably.

An opinion of value prepared by a real estate licensee using recent sales, active listings, and market data. It is not a formal appraisal and cannot be used for lending purposes.

The amount of a loan divided by the property's appraised value or purchase price, expressed as a percentage. Higher ratios usually require mortgage insurance and indicate greater lender risk.

The gradual repayment of a loan through scheduled payments that cover both interest and principal, so the balance declines over time until the loan is paid off.

A fee paid to a lender equal to one percent of the loan amount. Points may be charged to reduce the interest rate or to cover loan costs.

An account where a lender or closing agent holds funds for taxes, insurance, or transaction costs. Lenders often require monthly deposits to ensure bills are paid on time.

A written legal document that transfers ownership of real property from a grantor to a grantee. It must identify the parties, describe the property, and be delivered and accepted.

A deed in which the seller guarantees clear title and promises to defend the buyer against title defects, including defects arising before the seller owned the property.

A deed that transfers whatever interest the grantor may have in the property without any warranty of title. It offers the buyer little protection against title defects.

A review of public records to confirm the chain of ownership and identify liens, easements, judgments, or other encumbrances that affect the property.

A policy that protects an owner or lender against losses from certain title defects that existed before the policy date but were not found in the title search.

Title that is free from reasonable doubt and defects, so a buyer can accept it without fear of litigation. Sales contracts commonly require the seller to deliver marketable title.

The state board within the Department of Consumer Protection that licenses real estate brokers and salespersons, investigates complaints, and enforces Connecticut real estate law.

A separate bank account a broker uses to hold client funds, such as earnest money or security deposits. Connecticut rules require careful recordkeeping and prohibit mixing client funds with business funds.

A written form Connecticut residential sellers must give buyers disclosing known problems with the property, such as water, structural, or systems defects, before the buyer is bound.

Required coursework that licensed real estate professionals complete periodically to renew their licenses and stay current on law, ethics, and practice.

Laws prohibiting discrimination in the sale, rental, or financing of housing based on protected characteristics such as race, color, religion, sex, disability, familial status, or national origin.

A written notice explaining whom a real estate licensee represents and the duties owed, which Connecticut requires so consumers understand whether they are a client or customer.