Real Estate Glossary

An engagement, pledge or commitment by a bank or person, made at the request of a customer, stating that the issuer will honor drafts or other demands for payment upon full compliance with the conditions specified in the letter of credit.

A formal method through which a prospective developer, buyer or tenant expresses his/her interest in property. Depending on the language, a legal obligation may be created.

An encumbrance against property for money, either voluntary or involuntary. All liens are encumbrances but all encumbrances are not liens.

Generally, a waiver of mechanic's lien rights signed by a general contractor and his subcontractors.

A mortgagee or other creditor who has a lien against the property of another.

A tax term used in certain real property exchanges. Property must be exchanged for like kind property and the tax consequences postponed pursuant to Section 1031 of the Internal Revenue Code.

A partnership created under state law which consists of one or more general partners who conduct the business and arc responsible for any losses, and one or more special or limited partners who contribute capital and are liable only up to the amount contributed.

An agreement between a real estate broker and the property owner which authorizes the broker to assist in the sale or lease of that property in return for a fee, commission or other form of compensation. See Also: Exclusive Listing

A percentage of the rentable area of a building that is dedicated to building "load", ie., common stairways, chases, lobby, etc. The load is added to the usable area to determine the rentable area. Also known as a "Core Factor".

A lease whose term exceeds ten years from initial signing until the date of expiration or renewal option.

A parcel of land, generally part of a series of parcels which make up a subdivision, the boundaries of which are created by and shown on a "plat."

A construction contract requiring the contractor to complete a building for a specified amount, usually established by competitive bidding. The contractor absorbs any loss or retains any profit.

Member of Appraisal Institute.

One who executes (i.e., signs) a note in the capacity of the maker (i.e., borrower).

Statistical measures of construction and real estate activity, including issued permits, indices of building costs, deeds recorded and homes for sale.