Property-Only key terms

The most complete ownership interest in real property, lasting indefinitely, freely inheritable, and subject only to government powers and private restrictions. The owner holds title with no conditions that could end it.

An ownership interest lasting only for the lifetime of a named person. The holder may use and profit from the property but cannot pass it to heirs; it ends at death or reverts to the remainderman.

A future ownership right held by a person who receives the property when a prior estate, such as a life estate, ends. The remainderman holds a present vested right to future possession.

The future interest a grantor keeps when transferring a lesser estate than the one owned, such as granting a life estate while keeping the right to regain possession when that life ends.

Sole ownership of property by one person or one legal entity, with no co-owners. Title is held entirely by that single owner, who may convey or encumber it alone.

Co-ownership in which each owner holds a separate, undivided fractional interest with no right of survivorship. Interests may be unequal, and each owner may sell or will their share independently.

Co-ownership with equal undivided shares and the right of survivorship, so a deceased owner's share passes automatically to the surviving owners. Creation requires unity of time, title, interest, and possession.

A feature of joint tenancy and tenancy by the entirety under which a deceased co-owner's interest transfers automatically to the surviving co-owners, avoiding probate on that share.

A form of co-ownership available only to married couples in some states, giving each spouse an equal undivided interest with survivorship and requiring both spouses to consent to a conveyance.

A marital property system, used in a minority of states, in which property acquired during marriage is owned equally by both spouses, while separate property brought to the marriage stays individual.

A right to use a neighboring parcel that benefits the holder's own land. The benefit and burden run with the land, so the easement transfers automatically when either parcel is sold.

A personal right to use another's land that benefits a person or entity rather than a parcel. It is not tied to ownership of neighboring land, and commercial easements in gross are generally assignable.

The parcel that benefits from an easement appurtenant, whose owner may use the burdened land for the stated purpose. The servient tenement is the parcel that carries the burden.

The parcel burdened by an easement, whose owner must allow the easement holder to use part of the property for the stated purpose. The burden generally runs with the land to later owners.

An easement acquired through open, notorious, continuous, and adverse use of another's land for a statutory period, similar to adverse possession but limited to a right of use.

An easement implied by law when a parcel is landlocked or lacks any reasonable access to a public road, allowing the owner a right of way across neighboring land that created the problem.

Any claim, lien, restriction, or easement that burdens a property and may reduce its value or limit the owner's use. Encumbrances do not necessarily prevent transfer of title.

A legal claim against property that secures payment of a debt or obligation. A lien does not transfer title, but it must be cleared or paid before a buyer accepts marketable title.

A statutory lien filed by a contractor, subcontractor, or supplier who furnished labor or materials for improvements and was not paid. It attaches to the improved property and can cloud title.

A lien that attaches to all property of a debtor rather than to one specific parcel, arising from obligations such as unpaid taxes or a court judgment.

A lien that attaches only to one identified parcel, such as a mortgage or a mechanic's lien on a particular project. It does not reach the debtor's other property.

Any claim, unreleased lien, or defect that casts doubt on an owner's title and may prevent a sale or loan until it is removed by release, quitclaim, or court action.

A doctrine allowing a person who openly, continuously, exclusively, and hostilely occupies another's land for a statutory period to acquire title, subject to state notice and tax requirements.

A written document that appears to convey title but is legally defective, such as a deed from someone who did not own the land. It can shorten adverse possession periods in some states.

Title free from reasonable doubt, undisclosed encumbrances, and defects that would expose a buyer to litigation or loss. Most purchase contracts require delivery of marketable title at closing.

A one-time premium policy protecting an owner or lender against losses from title defects, liens, or errors existing at closing. Owner's and lender's policies are commonly purchased separately.

A deed containing the broadest covenants of title, including seisin, right to convey, quiet enjoyment, warranty, and further assurances, covering defects arising even before the grantor owned the property.

A deed that conveys whatever interest the grantor may have with no covenants or warranty of title. It is common for clearing clouds, family transfers, and correcting defects.

A deed that implies the grantor holds title and has the right to convey it, but contains no warranty against defects. It is often used in foreclosure and tax sales.

A deed in which the grantor warrants title only against defects arising during the grantor's own period of ownership, not against earlier defects. Common in commercial and trustee conveyances.

The legal obligation of an agent to act in the principal's best interest with loyalty, obedience, disclosure, confidentiality, and accounting. Breach can lead to license discipline and civil liability.

A consensual arrangement in which one person, the agent, acts on behalf of another, the principal, under the principal's control and with fiduciary obligations. It can be express, implied, or created by law.

A situation in which one broker represents both buyer and seller, or both landlord and tenant, in the same transaction. It requires informed written consent and limited confidentiality in most states.

An opinion of value prepared by a licensee using recent comparable sales, pending listings, and active competition, adjusted for differences. It is not an appraisal and cannot be used for federally related loans.

A valuation method that estimates value by analyzing prices of similar properties and adjusting for differences in location, size, condition, and features. It is the primary approach for residential property.

A valuation method that estimates value as the cost to replace or reproduce improvements, minus depreciation, plus land value. It is most reliable for new or special-purpose properties with few comparable sales.

A valuation method that converts expected net operating income into value using a capitalization rate. It is the primary approach for income-producing property such as apartments and offices.

The ratio of a property's net operating income to its value or purchase price, used to convert income into an estimate of value. Higher rates generally reflect greater risk or lower growth expectations.

Effective gross income minus operating expenses, excluding debt service, income taxes, and capital improvements. It is the income figure used in direct capitalization and debt coverage calculations.

The loan amount divided by the property's appraised value or purchase price, whichever is lower. Lenders use it to set risk, pricing, and mortgage insurance requirements.

Insurance protecting a lender against borrower default on loans with a high loan-to-value ratio. It is usually required above 80 percent LTV and may be cancelable as equity grows.

Net operating income divided by annual debt service, used by lenders to measure whether a property's income covers its mortgage payments. Lenders typically require a ratio above 1.0.

A security instrument used in some states in place of a mortgage, in which a trustee holds bare legal title for the lender until the debt is repaid or foreclosure is completed.

A clause in a mortgage or deed of trust allowing the lender or trustee to sell the property without going to court after default. It speeds up nonjudicial foreclosure.

A foreclosure process conducted through the court system, requiring a lawsuit and court order. It takes longer and costs more than nonjudicial foreclosure but provides more borrower protections.

A local law that divides land into districts and specifies permitted uses, lot size, density, and building height. It implements the comprehensive plan and is enforced through permits and variances.

A use of property that existed lawfully before a zoning ordinance was adopted but does not comply with current rules. It may generally continue but often cannot be expanded or resumed after abandonment.

An administrative exception allowing an owner to depart from a zoning rule because of hardship unique to the property, such as an odd lot shape, without changing the district's overall character.

A written contract setting out the manager's authority, duties, fees, and reporting obligations on behalf of an owner. It establishes an agency relationship and should state its term and termination terms.

A quick valuation tool calculated as sale price divided by gross monthly or annual rent. It lets a candidate compare similar rental properties without adjusting for expenses.

The division of ongoing costs such as taxes, rent, or homeowners association dues between buyer and seller at closing, based on the number of days each party owns the property.

A closing document itemizing debits and credits for buyer and seller, including loan charges, prorations, commissions, and recording fees. It shows the final cash due at closing.

A deposit made by a buyer to show good faith and bind the contract. It is usually held in trust and applied to the purchase price or forfeited under the contract's default terms.

A federal law prohibiting discrimination in the sale, rental, and financing of housing based on race, color, religion, sex, national origin, familial status, and disability. It also requires reasonable accommodations.

A change in rules, policies, or practices, or permission to make a modification, that lets a person with a disability use and enjoy housing equally, such as allowing a service animal.

A protected class under fair housing law covering households with children under 18 and pregnant women, including those in the process of securing custody. It restricts adult-only housing rules.

An illegal practice of persuading owners to sell by suggesting that members of a protected class are moving into the neighborhood, thereby profiting from the resulting fear and turnover.

Directing prospective buyers or tenants toward or away from neighborhoods based on protected characteristics. It is prohibited under fair housing law even when the customer does not object.

The illegal practice of denying or limiting loans, insurance, or services in certain neighborhoods based on race or ethnicity rather than creditworthiness. Federal fair lending laws prohibit it.