The Real Estate Investing Dictionary By Adam Bryan ppt

AFTER TAX CASH FLOW: The amount of net cash flow remaining after any tax deductions ALIENTATION: To convey or transfer title and possession of a property AMORTIZATION: Gradually paying

The Real Estate Investing Dictionary

By Adam BryanSmashwords EditionCopyright 2012 Diamondhead Studios by Adam Bryan

Smashwords Edition, License Notes

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License Notes and Copyright

This book is licensed for your personal enjoyment only This book may not be re-sold or given away to other people even though it may seem tempting at times If you would like to share this book with another person, please please please purchase an additional copy for each person If you’re

reading this book and did not purchase it, or it was not

purchased for your use only, then please return to

Diamondhead Studios and purchase your own copy This book or any portions of it may not be copied without the consent of the author Thank you for respecting the hard work of this author He really does appreciate it! Thanks!

Before You Begin

Thank you so much for getting The Real Estate Investing Dictionary by Adam Bryan You will truly find this resource to

be very helpful and beneficial throughout your real estate investing endeavors This dictionary is filled with some of the most important real estate investing terms that ever

investor must know Once you go through this dictionary, you will find you real estate investing knowledge to be above far Thank you so much for reading and enjoy!

Adam Bryan

Author

www.RealAdamBryan.com

Plus, once you finish this going through this dictionary, I

encourage you to check out my real estate investing blog, http://www.realadambryan.com for investing tips, guides, and information Thank you so much and I look forward to seeing you on the blog!

ABSOLUTE DOLLARS: The amount of profit dollars in a

transaction that it notwithstanding of rate of return

ABSOLUTE RETURN: The amount of profit as a percentage of

investment notwithstanding of rate of return Take the dollar amount of the investment divide it by the profit This will then give you your absolute return as a percentage

ABSTRACT OF TITLE: Historic summary of all the proceedings

that affect the title of a property

ACCELERATION CLAUSE: A loan provision giving the lender the

right to declare the entire amount immediately due and

payable upon violation of another particular loan provision

ACCRETION: The rights and principles the law uses to deal

with the changes in the size and shape of a land due to

natural causes

ACCRUED INTEREST: Accumulated interest earned or due but

has not yet been paid

ACRE: A quantity of land equal to 43,560 square feet.

ADDENDUM: Something added as an attachment to a contract

ADJUSTABLE RATE MORTGAGE (ARM): A mortgage in which the

interest changes periodically, according to corresponding fluctuations in an index

ADJUSTED COST BASIS: The original cost plus improvements

minus depreciation or cost recovery taken for the property

ADJUSTED GROSS INCOME: The amount of income you have

which can be taxes This is your gross income minus any deductions

AFTER TAX CASH FLOW: The amount of net cash flow

remaining after any tax deductions

ALIENTATION: To convey or transfer title and possession of a

property

AMORTIZATION: Gradually paying down a loan balance

AMORTIZED LOAN: A loan in which the principal and interest is

payable in monthly or other periodic installments over the term of the loan

ANNUAL PERCENTAGE RATE (APR): Rate of interest for a loan

per year including fees and points

ANNUAL PROPERTY OPERATING DATA: Detailed cash flow

analysis of an income property

APPRAISAL: Estimating the value of a property

APPRAISED VALUE: The estimated current worth of a property

APPRAISER: A licensed and/or certified individual who, for a

fee, evaluates a property and estimates the property’s

value

APPRECIATION: The growth in value of a property.

APPURTENANCE: Anything attached to the land, which

becomes part of the property such as a fence

ARREARS: The mortgage payment that includes interest from

the prior month

ASKING PRICE: The market price that a property is being

asked for

ASSESSED VALUE: The value placed on a property, normally

used for taxing purposes

ASSESSMENT OF REAL ESTATE: Assessing the value of a

property so that it is taxed properly according to its value

ASSET: Any possession of value.

BALANCE SHEET: A financial statement that shows assets,

liabilities, and net worth

BALOON MORTGAGE: A mortgage loan that requires the

remaining balance to be paid at a specific point in time

BALLOON PAYMENT: A loan payment that is larger than

normal

BANKRUPTCY: The financial inability to pay one's debts when

it’s due

BASIC INCOME FORMULA: The calculation used to determine

the net operating income on a property

BEFORE TAX CASH FLOW: The amount of cash flow while also

taking into account any debt services and expenses This is the final cash flow amount before taxes are taken out

BILL OF SALE: The document used to transfer title to personal

property

BLANKET MORTGAGE: One mortgage that covers several

different pieces of real property

BOND: A securitized I.O.U issued by an entity such as a

municipality, government, or corporation It is basically a debt owed to the bondholder for borrowing the entity

BOUNDS: Boundaries that are natural like trees and artificial

like roads

BROKER: A state licensed agent who acts for property owners

in real estate transactions

BUYDOWN: A payment of discount points in exchange for a

lower interest rate

CAP:A provision of an adjustable rate mortgage (ARM) that

can limit how much the interest rate or loan payment can increase or decrease

CAP RATE: A percentage that shows how much net operating

income a rental property produces relative to it’s fair market value or purchase price

CAPITAL: Money used for investing purposes or to create

income

CAPITAL GAIN: The profit between the total acquisition of cost

and net sales price of a property

CASH OUT: Cash given to the borrower from the proceeds of a

loan

CASH FLOW: Gross income minus operating income and debt

services Can be either positive or negative

CASH FLOW STATEMENT: Shows income and expenses from all

sources

CASH OUT REFINANCE: When a borrower refinances his or her

mortgage at a higher amount than the current loan balance with the intention of pulling out money for personal use,

such as buying another property or other things

CAVEAT EMPTOR: Let the buyer beware

CERTIFICATE OF ELIGIBILITY: A document issued by the

Veterans Administration (VA) that certifies whether a veteran

is eligible for a VA loan

CERTIFICATE OF REASONABLE VALUE (CRV): Once the appraisal

has been performed on a property being bought with a VA loan, the Veterans Administration issues a certificate of

reasonable value

CHATTEL: Personal property.

CHATTEL MORTGAGE: The mortgage on personal property.

CLEAR TITLE: A title that is free of any liens or legal questions

as to ownership of the property

CLOSING- The formal meeting where loan documents are

signed and funds are paid

CLOSING COSTS: The expenses that borrowers incur to fully

complete the loan transaction such as title searches, title insurance, closing fees, recording fees, and processing fees

CLOSING DATE: A predetermined date, agreed to by both the

buyer and the seller, that the transaction of buying/selling property will take place

COLLATERAL: Properties or assets pledged to secure a debt in

case the borrower cannot repay what was borrowed

COMMISSION: A percentage of the purchase price paid to the

real estate broker or agent for their services

COMPARABLE MARKET ANALYSIS (CMA): The estimate of fair

market value that is determined by comparing the subject property with other comparable properties in the local area

CONCESSIONS: During negotiations, these are the items that

each party is willing to give up in order to get the items each party really wants and come to an agreement

CONDOMINIUM CONVERSION: Changing the ownership of an

existing building, such as a rental property to the

condominium form of ownership Converting from an

apartment to a condominium

CONSIDERATION: Anything of value given as an incentive to

enter a contract.

CONSUMER PRICE INDEX (CPI): A measure of the average

change in price, over time, of basic goods and services

compiled and reported by the Bureau of Labor Statistics of the Department of Labor

CONTINGENCY: A condition that must be met before the

contract is legally binding

CONTRACT: A legal agreement entered into by two or more

parties that create an agreement to do or not to do certain things

CONVENTIONAL MORTGAGE: Home loans other than

government loans (VA and FHA)

CONVERTABLE ARM: An adjustable rate mortgage (ARM) that

allows the borrower to change the ARM to a fixed-rate

mortgage within a specific time

CONVEY: To deed or transfer title from one person to another

COOPERATIVE: A form of ownership in which a corporation

usually owns the building and land The individual residents own the stock of the corporation and have a proprietary

lease in a unit or apartment

COUNTEROFFER: The rejection of an offer to buy or sell, with a

simultaneous substitute offer

CREDIT LIMIT: The maximum amount someone can charge to

CREDIT REPORT: A document that summarizes an person’s

credit history

CREDIT SCORE: Scores that predict the likelihood that you will

payback the money you borrowed

DEAD ASSET: An asset that an investor does not want mainly

because it has limited value

DEBT CONSOLIDATION: The process where all monthly debt

payments are combined into one single debt and payment

DEBT SERVICE: Sum of the annual principal and interest

payments made on a loan

DEBT TO INCOME RATIO: The ratio between the monthly

payments on all debt to the gross monthly income of a

property

DEED: A written document that conveys title to real property

DEED IN LIEU OF FORECLOSURE: Giving property back to the

lender without foreclosure

DEED OF TRUST: An instrument by which a borrower transfers

title to a third party or trustee as security for a debt The beneficiary of the trust is normally the lender

DEFAULT: Failure to meet all the commitments and

obligations specified in the mortgage or deed of trusts

DEFLATION: When the amount of money in circulation

decreases relative to the supply of a good or service

DEPRECIATION: When the value of a property reduces

DEPRECIABLE BASIS: The amount of the cost of a depreciable

asset like a rental property to which the depreciation

schedule is applied to

DISTRESSED PROPERTY: A property that is prices well below it’s

market value after renovation

DOWN PAYMENT: A percentage of the purchase price of a

property that the buyer pays in cash and does not finance with a mortgage

DUE ON SALE CLAUSE: When the loan is due upon the sale of

the property

DUPLEX: A two unit home where the units share a common

wall and are usually side by side

EARNEST MONEY: A deposit of money given by a party to bind

the contract, which is usually credited toward the sales price

EASEMENT: An interest held by one party in the real property

of another, giving that person the legal right to trespass on the other's property

EFFECTIVE INTEREST RATE: The interest rate the borrower

actually pays as opposed to the nominal interest rate

ENCUMBRANCE: A limitation on the title to real property

EQUAL CREDIT OPPORTUNITY ACT (ECOA): A federal law that

requires lenders and other creditors to make credit equally available without discrimination based on race, color,

religion, national origin, age, sex, marital status, or receipt of income from U.S public assistance programs

EQUITY: The money value of a property or of an interest in a

property in excess of any claims or liens against it

EQUITY PARTNER: A co-investor who shares the risk and

reward of ownership of a property

EQUITY OF REDEMPTION: The right of a borrower to buy back a

property after a foreclosure sale

ESCAPE CLAUSE: A clause added to the contract that gives the

party an option of exiting the contract, with no further

contractual obligations

ESCROW: Money or documents held by a neutral third party.

ESCROW ACCOUNT: An account from which funds can be

disbursed only for specified reasons

ESTATE: Ownership interest in real property.

ESTATE BY THE ENTIRETIES: Ownership by husband and wife

with the right of survivorship

ESTIMATED ANNUAL GROSS INCOME: The estimate of the total

amount of income one will receive in a period of one year

ESTOPPEL LETTER: A letter certifying the exact balance of a

mortgage or another loanat a certain time

ET AL: And others.

ET UX: And wife.

EVICTION: The lawful eviction of an occupant from real estate

property

EXCLUSIVE RIGHT TO SELL: A relationship between an agent

and his or her principal wherein the agent gets a commission regardless of who sells the property

EXCULPATORY CLAUSE: Provisions in a mortgage allowing the

borrower to surrender the property to the lender without any personal liability

EXPENSES: The costs of maintenance, repairs, insurance,

taxes, management, and other rental costs

EXTENSION CLAUSE: A clause in a contract that lists the terms

under which an agreement can be extended

FACE VALUE: The dollar amount shown by words or numbers

on a document

FAIR MARKET VALUE: The highest estimated price in which a

property would be able to be sold at

FANNIE MAE (FNMA): The Federal National Mortgage

Association is a congressionally chartered,

shareholder-owned company that is the nation's largest supplier of home mortgage funds

FEDERAL HOUSING ADMINISTRATION (FHA): An agency of the

U.S Department of Housing and Urban Development (HUD) whose main activity is insuring that residential mortgage loans made by private lenders The FHA also sets standards for construction and underwriting but does not lend money

or plan or construct any housing

FINANCIAL ANALYSIS: The determined value of a property

based on income and expenses

FINANCIAL LEVERAGE: The use of other peoples' money (OPM)

for investment purposes

FINANCING: How an investor obtains the capital to purchase a

property

FIRST DEED OF TRUST: First mortgage

FIXED-RATE MORTGAGE: A mortgage in which the interest rate

does not change during the entire term of the loan

FLEXIBLE SELLER: A seller who is willing to sell property in a

nontraditional manner

FLIPPING: The rapid turnover of property An investor buys a

property and immediately sells it for a profit, usually after

renovations and improvements to increase its value

FORCED EQUITY: The equity an investor receives from

proactive adding new developments to the property as opposed to waiting for the property to appreciate

FOUND EQUITY: The equity an investor receives when they

first buy a property

FORECLOSURE: The process where property pledged as

security on a note is sold under court order because of default on the note such as failure to pay the mortgage

FRBO: For rent by owner

GAIN: An increase in money or property value

GOVERNMENT LOAN: A mortgage that is insured by the

Federal Housing Administration (FHA) or guaranteed by the Department of Veterans Affairs (VA) or the Rural Housing Service (RHS)

GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GINNIE MAE):

A government owned corporation within the U.S Department

of Housing and Urban Development (HUD) that provides

funds to lenders for making home loans

GRANTEE: A person that obtains the title to real property by

deed

GRANTOR: One who conveys the title to property by deed.

GROSS INCOME: The total income from a property before the

deducting any expenses

GROSS MONTHLY INCOME: The amount earned per month

before any deductions

GROSS SCHEDULED INCOME: The amount of income a rental

property is capable of bringing in if it is fully rent and does not have any vacancies It’s the maximum potential income

a property can produce

GROUND LEASE: Leasing the ground only

HARD MONEY: Funds and money that is obtained from private

lenders Hard money tends to have higher fees and interest rates

HEREDITAMENT: Personal or real property that can be

inherited

HOME EQUITY LINE OF CREDIT: A mortgage loan that allows the

borrower to obtain cash drawn against the equity of his or her home, up to a predetermined amount

HOME INSPECTION: Inspecting a house to evaluate the

structural and mechanical condition of the property Usually done by a professional

HOMEOWNER'S ASSOCIATION: A nonprofit association that

manages the common areas of a planned unit development (PUD) or condominium project

HOMEOWNER'S INSURANCE: Insurance coverage that

compensates for any physical damage to a property from any hazards such as fire, wind, vandalism, etc

HOMEOWNER'S WARRANTY: Insurance that covers repairs to

certain items, such as heating or air conditioning

HOUSING AND URBAN DEVELOPMENT (HUD): A government

agency that is a fantastic source for real estate statistics Can be found at www.hud.gov

HUD MEDIAN INCOME: The median family income for a

particular county or metropolitan statistical area (MSA), as estimated by the Department of Housing and Urban

Development (HUD)

INSTANT EQUITY: The difference between the property's value

and what you paid for it at the time of purchase

INTEREST RATE: An amount of money that a borrower must

repay in addition to the full amount of the loan

INVOLUNTARY LIEN: A lien, like real property tax liens, which

are recorded against a property without the consent of the owner

JOINTLY AND SEVERALLY LIABILITY: A creditor can demand full

repayment from any of those who have borrowed and each borrower is liable for the full debt

JOINT VENTURE: An agreement between two or more parties

who invest in a single property

JUDICIAL FORECLOSURE: A foreclosure ordered by a court of

jurisdiction

JUMBO LOAN: A loan that exceeds conventional conforming

loan limits which is set at $625,500

JUNIOR MORTGAGE: A mortgage whose claim against the

property will be satisfied only after prior mortgages have already been repaid

KICKER: A payment required by the mortgage in addition to

the normal principle and interest