Real Estate Glossary
P trap
A drainage plumbing pipe in the approximate shape of a "p" laid on its face, providing a trap that prevents sewer gasses from entering the living space. (See construction terms)
P.A.R.
To answer behavior-based interview questions, use the P.A.R. approach: (a) State a Problem that you were given, (b) Describe the Action you took, (c) Explain the Results of that action.
package loan
A real estate loan used to finance the purchase of both real property and personal property, such as in the purchase of a new home that includes carpeting, window coverings and major appliances.
packet
A block of data transmitted over a packet switching network. The Internet and local area networks transmit data in "packets." (See Internet, local area network)
paid outside of closing (P.O.C.)
Paid outside of closing (P.O.C.) charges are paid outside of settlement by the borrower, seller, loan originator, real estate agent, or any other person.
paired data set analysis
A method of estimating the amount of adjustment for the presence or absence of any feature by pairing the sales prices of otherwise identical properties with or without the features in question. A sufficient number of sales must be found to allow the appraiser to isolate the effect on value of the pertinent factor (also called paired sales analysis and matched pairs analysis).
paired sales analysis
A method of estimating the amount of adjustment for the presence or absence of any feature by pairing the sales prices of otherwise identical properties with or without the features in question. A sufficient number of sales must be found to allow the appraiser to isolate the effect on value of the pertinent factor (also called paired data set analysis and matched pairs analysis).
Paired testing
A critical methodology for assessing discrimination in the housing market for both research and enforcement purposes.
par
The face value of a bond or security. (See security)
parameter
A single number or attribute of the individual things, persons, or other entities in a population.
parcel map
Map that shows all property boundaries within a subdivision.
parity
Equality, as in amount, status, or value.
parol evidence rule
A rule of evidence providing that a written agreement is the final expression of the agreement of the parties, not to be modified by oral or written negotiations.
partial interest
Any property interest that is less than full fee simple ownership of the entire property.
partial release clause
A mortgage provision under which the mortgagee agrees to release certain parcels from the lien of the blanket mortgage upon payment of a certain sum of money by the mortgagor. The clause is frequently found in tract development construction loans.
partial zoning
Zoning that does not consider its effect on other areas. (See zoning)
participation certificates
Certificates issued by Freddie Mac backed by pools of mortgages. (See Freddie Mac)
participation financing
Where a lender becomes a partner in a development.
participation mortgage
A mortgage loan wherein the lender has a partial equity interest in the property or receives a portion of the income from the property.
participatory leadership
A leadership style in which employees at all levels are encouraged to contribute ideas towards identifying and setting organizational-goals, problem solving, and other decisions.
partition
Co-tenants who wish to terminate their co-ownership may file an action in court to partition the property. Partition is a legal way to dissolve the relationship when the parties do not voluntarily agree to its termination. If the court determines that the land cannot be divided physically into separate parcels without destroying its value, the court will order the real estate to be sold. The proceeds of the sale will then be divided among the co-owners according to their fractional interests. (See co-ownership)
partition action
A court proceeding by which co-owners may force a division of the property or its sale, with co-owners reimbursed for their individual shares.
partners
Partners participate in the operation and management of a partnership business and share liability for business losses and obligations. (See partnership)
Uniform Partnership Act - Full Text
partnership
An association of two or more individuals who carry on a continuing business for profit as co-owners. Under the law a partnership is regarded as a group of individuals rather than as a single entity. (See general partnership, limited partnership, joint venture)
parts per billion (ppb)
Units commonly used to express contamination ratios, as in establishing the maximum permissible amount of a contaminant in water, land, or air. These ratios can also be expressed in "parts per million (ppm)."
parts per million (ppm)
Units commonly used to express contamination ratios, as in establishing the maximum permissible amount of a contaminant in water, land, or air. These ratios can also be expressed in "parts per billion (ppb)."
party wall
A wall that is located on or at a boundary line between two adjoining parcels of land and is used or is intended to be used by the owners of both properties.
party wall easement
A party wall can be an exterior wall on a building that straddles the boundary line between two lots, or it can be a commonly shared partition wall between two connected properties. Each lot owner owns the half of the wall on his or her lot, and each has an appurtenant easement in the other half of the wall. A written party wall agreement must be used to create the easement rights. Expenses to build and maintain the wall are usually shared. A party driveway shared by and partly on the land of adjoining owners must also be created by written agreement, specifying responsibility for expenses. (See easement, appurtenant easement)
pass-through certificates
Pass-through certificates are financial instruments used in the mortgage-backed securities (MBS) market. They represent an undivided interest in a pool of mortgages. Essentially, these certificates allow investors to receive payments derived from the principal and interest payments made by the borrowers on the mortgages that make up the pool.
pass-through security
A security issued by the Government National Mortgage Association (Ginnie Mae) to mortgage investors. Cash flows from the underlying block individual mortgage loans are "passed through" to the holders of the securities in pro rata share, including loan prepayments. With a mortgage-backed security, the timely payment of principal and interest is guaranteed by Ginnie Mae. In 1982, the Federal National Mortgage Association (Fannie Mae) instituted its own mortgage-backed securities program designed to attract billions of dollars into the conventional mortgage market from pension funds and other investors. (See FHA, Fannie Mae, Freddie Mac, Ginnie Mae, mortgage-backed securities, VA loan)
pass-throughs
Payments on securities sold in the secondary market that are sent directly to investors. (See secondary market)
passive activity loss limitations (PALL)
For most rental property owners, real estate is a passive activity for tax purposes. Losses, termed passive activity losses, up to $25,000, with some limitations, can be written off against regular salary, wages or business profits - Line 17 on the 1040 Form.
passive activity loss limitations (PALL)
For most rental property owners, real estate is a "passive activity" for tax purposes. Losses, termed passive activity losses, up to $25,000, with some limitations, can be written off against regular salary, wages or business profits - Line 17 on the 1040 Form. (See 1040 Form, 1040 form line 17 - rental income and losses)
passive income
Income generated when a person is not active in a business or occupation. Examples of situations where passive income is generated include limited partnerships or rental income remaining after allowable deductions. (See limited partnerships)
passive losses
Losses left over when deductions for annual operating expenses, loan interest, and depreciation exceed annual rents. For tax purposes, passive losses can only be used to offset passive income. (See annual operating expenses, depreciation, passive income)
patent
The instrument that conveys real property from the state or federal government to an individual.
patent defect
A defect that is obvious from a reasonable inspection of a property.
pathogen
A pathogen is any organism, such as a virus, bacterium, fungus, protozoan, or parasite, that causes disease or illness in its host organism. Pathogens can vary widely in their characteristics, modes of transmission, and the diseases they cause.
pattern or practice
The courts have found a "pattern or practice" when the evidence establishes that the discriminatory actions were the defendant's regular practice, rather than an isolated instance. This does not mean that the Prosecutor has to prove that a defendant always discriminates or that a large number of people have been affected. A "pattern or practice" means that the defendant has a policy of discriminating, even if the policy is not always followed.
payback period method
Calculates how many years it will take for your cash investment to be repaid to you based off the investment's net cash flows. Like 4, 7, or 12 years until all your money is back in your bank account.
payee
The person to whom a debt instrument, such as a check or promissory note, is made payable; obligee, the "receiver." (See maker, receiver)
payment bond
Bond that may be required of a building contractor to compensate the property owner if the contractor defaults in performance of contract obligations, such as payment of subcontractors, workers, and suppliers.
payment cap
The limit on the amount the monthly payment can be increased on an adjustable-rate mortgage when the interest rate is adjusted. (See adjustable-rate mortgage)
payment option ARM
A nontraditional mortgage that allows the borrower to choose from a number of different payment options. For example, each month, the borrower may choose a minimum payment option based on a "start" or introductory interest rate, an interest-only payment option based on the fully indexed interest rate, or a fully amortizing principal and interest payment option based on a 15-year or 30-year loan term, plus any required escrow payments. The minimum payment option can be less than the interest accruing on the loan, resulting in negative amortization. The interest-only option avoids negative amortization but does not provide for principal amortization. After a specified number of years, or if the loan reaches a certain negative amortization cap, the required monthly payment amount is recast to require payments that will fully amortize the outstanding balance over the remaining loan term.
payment shock
With the change in interest rate of an ARM, the payment may be substantially higher for the borrower which could cause a shock to their income.
payoff statement
See reduction certificate.
payor
The debtor on a promissory note or the party who makes payment to another. (See obligor)
PCOR
A common term used to refer to the preliminary change of ownership (PCOR) report, required before closing and prepared by the buyers of a sale transaction or completing the memorandum of a lease. The form provides essential information regarding the terms of the sale. Each county in California has its own form. Escrow delivers to the county a completed copy at closing.
peak
The top segment of the business cycle curve, a period during which productivity and employment are higher than in the preceding and succeeding periods. (See recession, recovery, trough)
pecuniary
Consisting of or measured in money.
pension funds
Pension funds usually have large amounts of money available for investment. Because of the comparatively high yields and low risks offered by mortgages, pension funds have begun to participate actively in financing real estate projects. Most real estate activity for pension funds is handled through mortgage bankers and mortgage brokers. (See noninstitutional lenders)
per capita income
A measure of the amount of money being earned per person in an area. Per capita income can apply to the average per-person income for a city, region or country and is used as a means of evaluating the living conditions and quality of life in different areas. It can be calculated for a country by dividing the country's national income by its population.
percent
Parts of the whole, when the whole is divided into one hundred parts.
percent funded
Comparing how much is saved in a homeowners association's reserves, for example $200,000 divided by how much should be saved according to the reserve analyst, like $1,000,000. In this case they would be 20.0% funded ($200,000 / $1,000,000).
percentage fee
A property management fee expressed as a percentage of the gross collectable income from a property. (See flat fees)
percentage lease
A lease, commonly used for commercial property, whose rental is based on the tenant's gross sales at the premises. It usually stipulates a base monthly rental plus a percentage of any gross sales above a certain amount. (See lease)
Perception bias
Human unconscious tendency to form stereotypes and assumptions about certain groups, which makes it impossible to form judgments about individuals in those groups. This is an unconscious function of the human mind.
percolation
1) The movement of water downward in a circular direction through subsurface soil layers, usually continuing downward to ground water. Can also involve upward movement of water. 2) Slow seepage of water through a filter.
percolation test
A test of soil to determine if it will absorb and drain water adequately to use a septic system for sewage disposal.
perfect market
The following assumptions hold for a "Perfect Market":
(a) a large number of buyers;
(b) a large number of sellers;
(c) the quantity of goods bought by any individual is so small relative to the total quatity traded that individual trades leave the market unaffected;
(d) the units of goods sold by different sellers are the same (the product is homogeneous);
(e) all buyers and sellers have complete information on the prices being asked and offered in the entire market; and
(f) there is perfect freedom of entry to and exit from the market. (See imperfect market)
performance
The execution of an action; the fulfillment of a promise or request; implementation.
performance bond
A performance bond is a financial guarantee issued by a surety company to ensure the completion of a project according to the terms of a contract. It protects the project owner by providing compensation if the contractor fails to fulfill their obligations, thereby mitigating the risk of non-performance. Performance bonds are commonly used in construction and other industries where project completion is critical.
performance bonus
A bonus that is paid to a residential leasing agent or manager working under the supervision of a licensed real estate broker and that is based on performance, that is received no more frequently than monthly and that does not exceed one-half of the agent's or manager's total compensation for the time period is considered a bonus.
It is not considered to be a special compensation, and it is perfectly legal for an unlicensed person to collect such bonus.
performance criteria
Performance criteria are standards determined by an employer by which employees are rated on how well they do their jobs.
performance review
Performance reviews are an analysis of an employee's work undertaken at a fixed point in time to determine the degree to which stated objectives and expectations have been met.
peril
A cause of a loss, like a fire, flood or theft.
perimeter
periodic tenancy
A leasehold interest from period to period that renews automatically unless a notice of termination is given. (See leasehold)
permanent access (Arizona definition)
Permanent access to subdivided land means ingress and egress over terrain that is traversable by a conventional motor vehicle, and access to and from a Federal, state, or county highway.
person
A person is a natural person, corporation, company, limited liability company, partnership, or association.
personal and collaborative goal setting
Goal setting is critical to effective evaluation in that it can be the primary means through which employees shape their growth. Goals can be set individually or in consultation with others. It helps to include in the goal-setting process those with more experience and or expertise.
personal digital assistant (PDA)
Any small, mobile hand-held device that provides computing and information storage; PDAs combine features such as address book, appointment calendar, calculator, Internet access and telephone directory.
personal income
A person's gross income from wages, salaries, commissions, interest and profits from businesses or investments.
personal property
Personal property are things that are tangible and movable; property that is not classified as real property, such as chattels. Title to personal property is transferred by way of a bill of sale, as contrasted with a deed for real property.
Items of personal property frequently become the object of dispute between buyer and seller, most often due to whether an item is considered a fixture or due to the seller's attempt to substitute a similar item. Some cautious buyers insert a clause in their purchase contracts to the effect that the buyer will get the appliances "as currently installed and used in the premises."
A tree is real property while it is rooted in the ground, but when severed it is transformed into personal property. When lumber is assembled, however, and used as material to construct a house, it once again becomes a fixture or real property. (See fixture)
personal relationships
The following can be helpful in your job search: immediate family, extended family, close friends, neighbors and acquaintances, service professionals, helping professionals, and social groups.
Personal Responsibility and Work Opportunity Act
The Personal Responsibility and Work Opportunity Act took effect August 1, 1998. This federal law requires that certain public benefits be withheld from illegal immigrants.
Personal Responsibility and Work Opportunity Act
The Personal Responsibility and Work Opportunity Act took effect August 1, 1998. This federal law requires that certain public benefits be withheld from illegal immigrants, including professional and occupational licenses issued by state agencies.
Personal Responsibility and Work Opportunity Act
Personal Responsibility and Work Opportunity Act
Federal law, effective August 1, 1998, requiring that certain public benefits be withheld from illegal immigrants, including professional and occupational licenses issued by state agencies. The text of the law is at www.access.gpo.gov/congress/wm015.txt.
personnel file
A personnel file is a company's documentation of the history and status of an employee's entire relationship with the company. It includes employment application materials, emergency contacts, employee addresses, performance evaluations, disciplinary letters, employee recognition, and work history, to name just a few. Some employee records are required by federal or state governments for employers to keep.
petty offense (AZ)
A petty offense is a type of misdemeanor but is punishable with no jail and a maximum $300 fine.
phish
To phish is to try to trick people into giving secret information using fake emails or websites. The details are then used to steal people's money, or to steal their identity in order to commit crimes.
phishing
Phishing is a criminal process of attempting to acquire sensitive information like usernames or passwords by masquerading as a trustworthy entity in an electronic communication.
physical deterioration
A reduction in a property's value resulting from a decline in physical condition; can be caused by action of the elements or by ordinary wear and tear.
physical life
The length of time a structure can be considered habitable, without regard to its economic use.
physical obsolescence
An appraisal term that describes the ordinary deteriorization of a property due to aging. (See economic obsolescense, functional obsolescence)
piggyback loans
A loan divided into two parts with one lender taking a secondary security position.
PITI
Acronym for Principal, Interest, Taxes & Insurance. The four elements of a monthly mortgage payment; payments of principal and interest go directly towards repaying the loan while the portion that covers taxes and insurance (homeowners and mortgage, if applicable) goes into an escrow account to cover the fees when they are due.
plain meaning approach
The plain meaning rule dictates that statutes are to be interpreted using the ordinary meaning of the language of the statute, unless a statute explicitly defines some of its terms otherwise. In other words, the law is to be read word for word and should not divert from its ordinary meaning.
plaintiff
A person who brings an action; the party who complains or sues in a personal action and is so named on the record. (See defendant)
planned unit development (PUD)
A planned unit development (PUD) is a type of residential or mixed-use development that is planned and built as a single entity, typically featuring a combination of residential, commercial, and recreational spaces. These developments are designed to include a variety of housing types and amenities within a cohesive community layout, often incorporating parks, schools, and local shops. PUDs are governed by their own set of rules and regulations, which allow for deviations from standard zoning laws to create a more integrated and efficient community design.
plasterboard
Drywall; interior wall finishing material.
plat map
A plat map is a map of a town, section or subdivision indicating the location and boundaries of individual properties.
platform frame
Platform frame is a construction technique in which each floor of a building provides support for the floor above it.
pledge
Something given or held as security to guarantee payment of a debt or fulfillment of an obligation. A solemn binding promise to do, give, or refrain from doing something.
plenary license
An unqualified or absolute license; one that is not restricted.
plot plan
A plot plan shows the layout of improvements on a property site. The plot plan usually includes location, dimensions, parking areas, landscaping and other details of the improvements. (See construction terms)
plottage
The increase in value or utility resulting from the consolidation (assemblage) of two or more adjacent lots into one larger lot. (See assemblage)
plumbing system
Includes the building components that provide water, a method of warming the water, and disposal of waste water, including the water supply system, water heater, vent piping system, and drainage system.
PMI
Acronym for Private Mortgage Insurance. Privately-owned companies that offer standard and special affordable mortgage insurance programs for qualified borrowers with down payments of less than 20% of a purchase price. (See private mortgage insurance)
pocket listing
Property listing that the listing agent markets privately before entering it in the multiple listing service (MLS); usually a violation of MLS rules. (See multiple-listing service)
podcast
MP3 or other audio file that can be downloaded off your Web page or e-portfolio. It is delivered off a web site via a RSS feed. All you need to know is the URL (website address) of the RSS. Unlike radio, you can listen to recorded podcasts at any time.
point of beginning (POB)
In a metes-and bounds legal description, the starting point or point of beginning (POB) of the survey, is situated in one corner of the parcel; all metes-and-bounds descriptions must follow the boundaries of the parcel back to the point of beginning. (See metes-and-bounds descriptions)
point source
A stationary location or fixed facility such as an industry or municipality that discharges pollutants into the air or surface water through pipes, ditches, lagoons, wells, or stacks - a single identifiable source such as a ship or a mine.
points and fees
Points and fees include all items listed in 15 U.S.C. § 1605(a)(1) through (4), except interest or the time-price differential; all charges for items listed under § 226.4(c)(7) of Title 12 of the Code of Federal Regulations, as amended from time to time, but only if the lender receives direct or indirect compensation in connection with the charge or the charge is paid to an affiliate of the lende; all compensation paid directly or indirectly to a mortgage broker, including a broker that originates a loan in its own name in a tablefunded transaction; the cost of all premiums financed by the lender, directly or indirectly, for any credit life, credit disability, credit unemployment, or credit property insurance, or any other life or health insurance, or any payments financed by the lender directly or indirectly for any debt cancellation or suspension agreement or contract, except that insurance premiums calculated and paid on a monthly basis will not be considered financed by the lender.
points and fees
Points and fees for closed-end loans include all items required to be disclosed under 12 CFR 226.4 (a) and 226.4 (b) or 209 CMR 32.04(1) and 209 CMR 32.04(2), except interest or the time-price differential; charges for items listed under sections 226.4(c)(7) of Title 12 of the Code of Federal Regulations or 209 CMR 32.04(3)(g) (other than amounts held for future payment of taxes) unless the charge is reasonable, the creditor receives no direct or indirect compensation in connection with the charge, and the charge is not paid to an affiliate of the creditor; the maximum prepayment fees and penalties that may be charged or collected under the terms of the loan documents; all prepayment fees or penalties that are incurred by the borrower if the loan refinances a previous loan made or currently held by the same lender; all compensation paid directly or indirectly to a mortgage broker, not otherwise included in 209 CMR 40.02; the cost of all premiums financed by the lender for any credit life, credit disability, credit unemployment, or credit property insurance, or any other life or health insurance, or any payments financed by the lender for any debt cancellation or suspension agreement or contract, except that insurance premiums or debt cancellation or suspension fees calculated and paid on a monthly basis will not be considered financed by the lender.
Points and fees do not include taxes, filing fees, recording and other charges and fees paid to a public official for determining the existence of or for perfecting, releasing or satisfying a security interest, and fees paid to a person other than a lender or to the mortgage broker for the following: fees for flood certification; fees for pest infestation; fees for flood determination; appraisal fees; fees for inspections performed before closing; credit reports; surveys; notary fees; escrow charges; title insurance premiums; and fire insurance and flood insurance premiums, including homeowner premiums.
Points and fees, for open-end loans, must be calculated by adding the total points and fees included within 209 CMR 40.02, plus the minimum additional fees the borrower would be required to pay to draw down an amount equal to the total credit line.
police power
The inherent right of the state to regulate for the purpose of promoting health, safety, welfare, and morality. Police power gives the state the right to impose certain restraints on human conduct which are reasonably necessary in order to safeguard the public interest. This right is the basis of zoning, the official map, building codes, and subdivision regulations.
political subdivision
An administrative division that is a part of another division. It is established for the purpose of government; and granted a certain degree of autonomy. Political subdivisions are required to manage themselves through their own local governments.
political subdivision (Arizona)
A county, city, town, or other municipal corporation, a public authority, and generally any publicly owned entity that is an instrumentality of the state of Arizona or of a municipal corporation.
pollution
Any substances in water, soil, or air that degrades the natural quality of the environment, offends the senses of sight, taste or smell, or causes a health hazard. The usefulness of the natural resource is usually impaired by the presence of pollutants and contamination.
pollution prevention
Actively identifying equipment, processes, and activities which generate excessive wastes or use toxic chemicals and then making substitutions, alterations, or product improvements. Conserving energy and minimizing wastes are pollution prevention concepts used in manufacturing, sustainable agriculture, recycling, and clean air/clean water technologies.
polychlorinated biphenyls (PCBs)
Used as an insulating material in dielectric oil. It can linger in the environment for long periods of time and can cause health problems.
pool insurance
'Pool insurance' insures pools of 'A' or 'prime' mortgages. The coverage is a percentage of the original aggregate unpaid balance of the pool. Traditional pool insurance pays 100 percent of all losses on individual defaulted mortgages after the equity in the home and any primary insurance is exhausted until the aggregate pool coverage amount is reached. Modified pool insurance pays 25 percent. Insurers offer Government-Sponsored Enterprise (GSE) pool insurance, a thin layer of coverage between the equity in the mortgage and any primary insurance and the GSE's guarantee.
population
All of the individual variates (items or units) of a group.
popup window
A pop-up is a graphical user interface display area, usually a small window, that suddenly appears ("pops up") in the foreground of the visual interface.
Many websites, including proU.net courses, use popup windows to deliver content. Please make sure popup blocking is turned off (unchecked) in your web browser settings.
portfolio
Tangible, easily accessible proof of your skills and accomplishments; collection of career-related documents that adds value to your presentation. A portfolio tells a story. It is a visual representation of your experience, strengths, abilities, and skills - the things you like to do best. It is a collection of things - artifacts - tangible materials - that represent work-related events in your life. The portfolio provides "evidence" of your potential by demonstrating, or representing, what you accomplished in the past.
portfolio loan
A loan originated and maintained by the lender and not sold in the secondary mortgage market. (See secondary mortgage market)
positive leasehold
Positive leaseholds are created when market rent prices go above the contract rent price.
positive personal qualities
Qualities necessary to keep a job, such as responsibility, self-esteem, sociability, self management, integrity/honesty.
post-and-beam frame
Post-and-beam frame is a construction technique in which interior posts support ceiling boards, allowing for more open space within a structure than is possible with other forms of construction.
post-possession
Post-possession is the Seller of a property retaining possession of all or part of a property after escrow has closed and the Seller is no longer the owner of record. This is not limited to possession by people. It also applies to partial possession of the property to store personal belongings.
potential
Existing in possibility; capable of developing into actuality.
potential gross income
The maximum income that property is capable of producing.
potential gross income multiplier
A ratio calculated by dividing the sales price of a comparable property by its potential gross income to form an opinion of the subject property's value.
potentially responsible party (PRP)
Any individual or company that is potentially responsible for or has contributed to a spill or other contamination at a Superfund site. Whenever possible, EPA requires PRP's to clean up sites they have contaminated. (See Superfund)
Power of Attorney - Instructor Note
INSTRUCTOR NOTE ABOUT POWER OF ATTORNEY
power of eminent domain
The right of the government to acquire title to property for public use by condemnation; the property owner receives compensation which is generally fair market value. (See taking)
FindLaw® eminent domain
power of issue
The "power of issue" is the authority to print money. The Federal Reserve is the only entity with the authority to print currency in the United States.
power of sale
A clause commonly inserted in a mortgage and deed of trust that grants the creditor or trustee the right and authority, upon default in the payment of the debt, to advertise and sell the property at public auction, without resorting to a court for authorization to do so.
power of termination
power-of-attorney
A written instrument authorizing a person, the attorney-in-fact, to act as the agent on behalf of another to the extent indicated in the instrument.
power-of-sale
The power that may be given by a promissory note to a trustee, a mortgagee, or another lienholder to sell secured property without judicial proceedings if the borrower defaults.
power-of-sale clause
A clause in a mortgage authorizing the holder of the mortgage to sell the property in the event of the borrower's default. The proceeds from the public sale are used to pay off the mortgage debt first, and any surplus is paid to the mortgagor. A power-of-sale clause is also found in trust deeds, giving the trustee authority to sell the trust property under certain circumstances.
pre-approval for loan
The process of supplying a lender with pre-qualification information, and the lender basically underwriting the loan, so they are virtually committed to lending money to buy property. The borrower can then find and contract the property they want to purchase.
Pre-licensure Education Certificate (AZ)
The Pre-licensure Education Certificate is emailed by the providing school to a student who passes the proctored school final exam.
pre-possession
Pre-possession is the Buyer of a property taking possession or all or part of a property before close of escrow. This is not limited to possession by people. It also applies to partial possession of the property to store personal belongings.
predatory lending
Predatory lending refers to secured loans such as home or car loans that are made by a lender with the intention that the borrower default on the loan, allowing the lender to seize the car or home and sell it for a profit. The term has been expanded to refer to the practice of convincing borrowers to agree to unfair and abusive loan terms.
preliminary notice
Notifies a customer that work to be completed is subject to the lien rights of the contractor. Preliminary notice must be given prior to recording of a mechanic's lien, and should be filed by a contractor at least 20 days prior to the start of work. If notice is given later, liens will cover only the work starting 20 days prior to filing. (See mechanic's lien)
preliminary public report
Under the Subdivided Land Law the preliminary public report can be issued before the public report, and allows a subdivider to take reservations from buyers but not sell parcels. (See public report, Subdivided Land Law)
preliminary report
A title report that is made before a title insurance policy is issued or when escrow is opened. A preliminary report or policy of title insurance reports only on those documents having an affect on the title and should not be relied on as being an abstract. An abstract of title, on the other hand, reflects all instruments affecting title from the time of the original grant and also includes a memorandum of each instrument, and makes no attempt to determine which of the documents currently affects record title. The "preliminary" is not a binder or commitment that the title company will insure the title to the property, although this commitment may be obtained at an added cost. (See abstract of title)
premium
A fee paid to an insurance company.
premium
The amount by which the price of a security exceeds its face value or principal amount. When the nominal or coupon rate (the interest rate stated on the bond or security) is higher than the prevailing market interest rate for similar securities, investors are willing to pay more than the face value to buy the bond. This additional amount over the face value is called a "premium."
premium (in excess of par)
A price paid for a security in excess of its face value. (See par)
prepaid items
On a closing statement, items that have been paid in advance by the seller, such as insurance premiums and some real estate taxes, for which he or she must be reimbursed by the buyer. (See closing statement)
Prepaid Rental Listing Service (PRLS)
A Prepaid Rental Listing Service (PRLS) is a business that supplies prospective tenants with property listings on payment of a fee. It may be operated by a licensed real estate broker or under the authority of a PRLS license.
prepayment
Additional payments made to a loan principal by the borrower.
prepayment penalty
The amount set by the creditor as a penalty to the debtor for paying off the debt before it matures; an early-withdrawal charge. The prepayment penalty is charged by the lender to recoup a portion of interest that the lender had planned to earn when the loan was made. It covers the lender for initial costs to set up the loan, to service it and to carry it in the early years of high risk. This punitive device also may represent the loss of income to the lender for the time the mortgage is paid off and the funds remain uncommitted. The reason most lenders are willing to allow prepayment after five years without penalty is that much of the total note's interest has been paid in by that time.
preponderance of evidence
The greater weight of the evidence for the trier of fact to decide in favor of one side or the other. This preponderance is based on the more convincing evidence and its probable truth or accuracy, and not on the amount of evidence. For example, a knowledgeable witness might provide a preponderance of evidence over a dozen witnesses with unreliable or questionable testimony. Likewise, a signed agreement with definite terms will likely outweigh opinions or speculation about what the parties intended.
prequalify
Determine the maximum loan amount a prospective buyer qualifies for prior to showing them properties. Failing to prequalify may result in wasted efforts showing the prospect properties they cannot afford to purchase. (See back-end qualification, front-end qualification)
prescription
Acquiring a right in property, usually in the form of an intangible property right such as an easement or right-of-way, by means of adverse use of property that is continuous and uninterrupted for the prescriptive period established by state statute. Use of land is adverse when it is made under a claim or right. Therefore, there is no adverse use if the owner has granted permission, or if the user has paid for the use of the property, or if the user has admitted that the owner has a superior right in the property.
present value (PV)
If one is going to earn $1,000 five years from now, or a stream of cash flows over a few years, the "present value" is today's value of a future cash flow(s), discounted back to today at an appropriate discount rate.
present worth
The discounted present-day value of money to be collected in the future.
preservation
1. The protection of ecologically important resources in perpetuity through the implementation of appropriate legal and physical mechanisms. Preservation may include protection of upland areas adjacent to wetlands as necessary to ensure protection of the overall ecosystem. 2. Applying measures to sustain the existing form, integrity and material of a building or structure. It may include stabilization work, as well as ongoing maintenance of the historic building materials.
press release
A news announcement written by a property manager or advertising specialist highlighting a property's features. Sent to local newspapers and real estate magazines to promote a property.
pressed wood products
Materials used in building and furniture construction that are made from wood veneers, particles, or fibers bonded together with an adhesive under heat and pressure.
pressure relief valve
A valve used on hot water heating appliances to help keep the pressure in the heated tank or boiler from getting too high by allowing the relief of pressure from the valve.
pretax cash flow
Income that remains from net operating income (NOI) after debt service is paid but before ordinary income tax on operations is deducted.
pretexting
Pretexting is the practice of obtaining personal information under false pretenses. Pretexters sell the information to people who may use it to get credit in another person's name, steal assets, or investigate or sue a person. Pretexting is against the law.
preventive maintenance
Includes regularly scheduled activities such as painting and seasonal servicing of appliances and systems. Preventive maintenance preserves the long-range value and physical integrity of the building. This is both the most critical and the most neglected maintenance responsibility. Failure to perform preventive maintenance invariably leads to greater expense in other areas of maintenance.
price
The amount of money set or paid as the consideration in the sale of an item at a particular time.
price of a loan
The combination of rate and points on your loan.
price supports
Price supports are a form of government subsidy for the production of commodities. The market price of certain goods is fixed at a level that guarantees the producer an "adequate" return on investment. That price is not determined by the free interaction of supply and demand, but rather by government regulators, and often the government purchases surpluses that remain unsold at an artificially high fixed price.
pricefixing
The practice of conspiring to establish fixed fees or prices for services rendered or goods sold. In recent years, the setting of attorney fees by local bar associations and commission percentages and management fees by local realty associations has been successfully attacked as price fixing and thus a violation of the Sherman Antitrust Act.
prima facie
At first sight; on the first appearance; on the face of it; so far as can be judged from the first disclosure; presumably; a fact presumed to be true unless disproved by some evidence to the contrary.
primary lenders
Originators of real estate loans including commercial banks, savings and loan associations and mutual savings banks.
primary mortgage market
The mortgage market in which loans are originated and consisting of lenders such as commercial banks, savings and loan associations and mutual savings banks. (See secondary mortgage market)
primary personal residence
The dwelling in which a taxpayer lives and occupies most of the time.
prime mortgages
A classification of mortgages that are considered to be of high quality.
prime rate
The minimum interest rate a commercial bank will charge to its largest clients. Prime rates are determined in part, by the rate banks pay for the money they lend to borrowers. Decisions of the Federal Reserve Bank to increase or decrease the supply of money, can cause the prime rate that banks charge to fluctuate.
principal
1. One of the main parties to a transaction. For example, the buyer and seller are principals in the purchase of real property. 2. In a fiduciary relationship, the person who hires a real estate broker to represent him or her in the sale of property. The phrase, "principals only," often found in real estate ads, is meant to exclude real estate agents from contacting the owners of the property. 3. A loan principal is the original amount of money borrowed via a loan.
principal (in a fiduciary relationship)
The principal in a fiduciary relationship is the party who entrusts their interests, or affairs to the agent who represents them (the fiduciary). The principal relies on the agent to act in their best interests, with honesty, loyalty, and care.
principal loan originator
A principal loan originator is the licensed loan originator in charge of, and responsible for, the operation of a mortgage lender or mortgage broker, including all of the activities of the mortgage lender's or mortgage broker's loan originators and branch managers, whether employees or independent contractors.
principal meridian
The main imaginary line running north and south and crossing a base line at a definite point, used by surveyors for reference in location and describing land under the rectangular (government) survey system of legal description. (See base line, government survey system, legal description, meridian)
principal place of business
A principal place of business is a mortgage broker's or mortgage lender's primary business office, the street address, or physical location that is designated on the application for licensure or any amendment to such application.
Principal Reduction Alternative (PRA)
A program of the Departments of the Treasury & Housing and Urban Development (HUD) for home owners who owe more on their mortgage than what their home is currently worth. The program encourages non-Government Sponsored Entity mortgage servicers and investors to reduce the principal loan amount.
printer
A hardware device that transfers computer text and graphics to paper.
prior appropriation
A concept of water ownership in which the landowner's right to use available water is based on a government administered permit system.
prior restraint
Prior restraint is censorship imposed, usually by a government, on expression before the expression actually takes place. An alternative is to allow the expression to take place and to take appropriate action afterward, if the expression is found to violate the law, regulations, or other rules.
priority
The order of position, time or place. The priority of liens is generally determined by the chronological order in which the lien documents are recorded; tax liens, however, have priority even over previously recorded liens. Thus the old adage "prior in time is prior in right" is applicable.
priority of claims
Order in which creditors will be paid when there are claims against a homestead that result in a judgment against the homeowner.
private benefits
The benefits an individual or firm receive when they carry on consumption or production of goods or services. In the case of consumption, the benefits are mainly satisfaction from consumption. In the case of production, the benefits are revenue received by the firm from the sale of the good or service.
private costs
Costs that are incurred by an individual or firm when they are carrying out the activities of consumption or production; Costs that individuals or firms have to pay.
private industry councils (PICs)
Private Industry Councils (PICs) are local organizations composed of business, education, and community leaders who collaborate to address workforce development and employment issues within their regions. Established under the Job Training Partnership Act (JTPA) in the United States, PICs aim to ensure that job training programs align with the needs of local employers and industries. They play a crucial role in fostering public-private partnerships, developing workforce strategies, and enhancing the skills and employability of the local labor force.
private mortgage insurance (PMI)
Insurance provided by private carrier that protects a lender against a loss in the event of a foreclosure and deficiency. A special form of insurance designed to permit lenders to increase their loan-to-market-value ratio, often up to 95 percent of the market value of the property. Many lenders are restricted to 80 percent loans by government regulations, special loss reserve requirements or internal management policies related to mortgage portfolio mix. A lender, however, may lend up to 95 percent of the property value if the excess of the loan amount, over 80 percent of value, is insured by a private mortgage guaranty insurer. (See deficiency, foreclosure) (Mortgage Insurance Companies of America)
private offering
An offering of securities to no more than 25 persons and sale to no more than 10 persons.
private restrictions
The covenants, conditions and restrictions (CC&Rs) found in the typical declaration of restrictions filed by a subdivision developer and incorporated by reference in the deed to each subdivision lot.
private road
A private road is a road owned and maintained by a private individual, organization, or company rather than by a government. Consequently, unauthorized use of the road may be considered trespassing, and some of the usual rules of the road may not apply. The most common type of private road is a residential road maintained by a homeowners association, housing co-op, or other group of individual homeowners.
privity of contract
The relationship between contracting parties (mortgagor-mortgagee or assignee-assignor).
prize property
A prize property is a location, location, location, fanciest most "braggable" property in an area. Many of these are beautiful properties, like a beach house or fancy downtown condo, but most of these are terrible investments that will rarely build wealth. You can spot these by their signature negative cash flows and negative Cash on Cash Returns (or very low returns).
pro-forma
A presentation of data, typically financial statements, where the data reflect the world on an 'as if' basis. That is, as if the state of the world were different from that which is in fact the case. For example:
Probable cause
In the context of a regulatory agency's disciplinary action, probable cause is a reasonable belief, based on facts and evidence, that a licensee or entity has violated laws, rules, or regulations under the agency's jurisdiction. It is the threshold determination that justifies moving forward with formal charges or disciplinary proceedings.
Probable cause panel
In the context of the Florida Real Estate Commission (FREC), a Probable Cause Panel is a subgroup of FREC members responsible for reviewing complaints, investigative reports, and evidence to decide whether probable cause exists to believe a real estate licensee has violated Florida real estate laws or regulations.
probate
The formal judicial proceeding to prove or confirm the validity of a will, to collect the assets of the decedent's estate, to pay the debts and taxes and to determine the persons to whom the remainder of the estate will pass. (See decedent, will)
Probate Code
The portion of California law that covers the court proceedings for disposition of property on the death of the property owner. (See probate)
probate listing
When owns real estate and dies, their property goes through probate to determine how it will be transferred to heirs or beneficiaries. A probate listing is a real estate listing for a property that is part of a probate estate and is being offered for sale as a part of the probate process.
probate value
Probate value of real estate is determined based on the fair market value of the assets at the time of the individual's death, as opposed to fair market value, which is the price the property would fetch in an open market.
procedures manual
Procedures manuals provide instructions and directions for the day-to-day operation of a business, and are essential to ensure consistency and quality in products and services. Every business from a sole proprietor to large corporations should have a procedures manual for each staff member as part of the written job description.
process
Something going on; a natural phenomenon marked by gradual changes that lead toward a particular result; a series of actions or operations conducting to an end.
procuring cause
The cause originating a series of events that lead directly to the intended objective; in a real estate transaction the procuring cause is the real estate agent who starts the uninterrupted chain of events that leads to the sale.
productivity
A measurement of economic output per unit of input. Inputs include labor and capital, while output is typically measured in revenue and other gross domestic product (GDP) components such as business inventories. Productivity measures may be examined collectively (across the whole economy) or viewed industry by industry to examine trends in labor growth, wage levels and technological improvement. (See gross domestic product)
professional corporation
Professional corporations (abbreviated as PC) are those corporate entities for which many statutes make special provision, regulating the use of the corporate form by licensed professionals such as attorneys and real estate licensees.
professional limited liability company (PLLC)
A professional limited liability company, or PLLC, is a type of limited liability company that is owned and operated by members of the same profession and can only offer services related to its profession. The ADRE issues a license for PLLC only if all members and managers hold active real estate licenses. The name of the PLLC must be the name of the licensee, with the letters “PLLC” appended.
professional or trade information
Associations, conferences, and other professional development resources.
professional or trade journal ads
Ads in professional or trade journals, appropriate to your field.
professional portfolio
A professional portfolio is a record of goals, growth, achievement, and professional attributes developed over time and in collaboration with others.
professional relationships
Organizational colleagues, colleagues in other organizations, customers, clients, and collaborators, vendors, consultants, contractors, and union representatives.
professional vita
Resume that is chronological in format and emphasizes educational background first, and then work history. It can exceed two pages because it can include publications, patents and research. (see curriculum vita)
proficiency
Advancement in knowledge, skill, or position regardless of the cost.
profit and loss statement
A detailed statement of income and expenses of a business that reveals the operating position of the business over a period of time. Commonly referred to a P&L.
profit center
A profit center is a distinctly identifiable department or business unit that contributes to the overall financial results of a company.
progression
An appraisal principle that states that, between dissimilar properties, the value of the lesser-quality property is favorably affected by the presence of the better-quality property. (See appraisal)
progressive tax
A progressive tax is a tax that takes an increasing proportion of income as income rises. (See income tax)
project
Project refers to the number of dwelling units constructed, rehabilitated, or converted to a cooperative or condominium with the assistance of a mortgage loan from the Housing Finance Agency. This includes the acquisition, construction, or rehabilitation of lands, buildings, equipment, improvements, and other ancillary facilities, such as streets, sewers, utilities, parks, site preparation, and landscaping. It also includes other ancillary facilities, offices, and nonhousing facilities, such as administrative, community, health, recreational, educational, and welfare facilities as the Housing Finance Agency determines to be necessary, convenient, or desirable appurtenances. In addition, it also includes the acquisition, construction, or rehabilitation of such ancillary commercial facilities as the agency determines to be necessary to make the remainder of the project economically feasible.
projected gross sales
The total income that a project is expected to produce.
projection device
Any computer hardware device that projects information onto a screen.
promissory note
An unconditional written promise of one person to pay a certain sum of money to another person, order or bearer at a future specified time. A broker who accepts a promissory note as a deposit from a prospective purchaser must generally disclose to the seller that the buyer's deposit is in the form of a promissory note.
Proof of Legal Presence (AZ)
Arizona regulations require that all applicants for state licensure submit proof of legal presence in the United States. Proof of legal presence must be in the form of a government-issued identification such as a driver's license or passport.
property
Property is any real property located in this state and improved by a one- to four-family dwelling used or occupied, or intended to be used or occupied, as the home or residence of one or more persons. But property may not refer to unimproved real property upon which such dwellings are to be constructed.
property analysis
A study made to familiarize a property manager with the nature and condition of a building, its relative market position, and its estimated income and operating expenses.
property and casualty insurance
Property and casualty insurance protects against property losses to a business, home or car and/or against legal liability that may result from injury or damage to the property of others. This type of insurance can protect a person or business with an interest in the insured physical property against losses.
property brief
Produced by the listing agent, a property brief is simply a one-page flier about the property pointing out attractive features. It usually contains a drawing or photograph of the home, and is given to people the agent feels are especially interested in the property.
property inspection waiver (PIW)
An option to waive an appraisal for an eligible loan purchased by Fannie Mae.
property management
A branch of the real estate business involving the marketing, operation, maintenance, and other day-to-day requirements of rental properties by an individual or a firm acting as agent of the owner. (See property manager)
property management reserve account
An account whereby a portion of the rental proceeds are set aside by property management company to meet any unexpected costs that may arise in the future as well as the future costs of upkeep. In most cases, the fund is simply a savings account, although the fund might be established to meet the costs of scheduled upgrades
property manager
Someone who manages real estate for another person for compensation. Duties include collecting rents, maintaining the property and keeping up all accounting. (See property management)
Property owners or homeowners
Property owners or homeowners are any or all record title owners of the residential real property in foreclosure or, where applicable, default at the time of the equity sale.
property reports
The mandatory federal and state documents compiled by subdividers and developers to provide potential purchasers with facts about a property prior to their purchase.
property rights
The rights of an individual to own and sell property and keep the income earned from it, subject to certain restrictions, such as zoning. (See bundle of rights)
Property Tax Postponement Law
The Property Tax Postponement Law gives qualified persons who are 62 or older, blind or disabled with a minimum household income the option of having the state pay all or part of the taxes on their homes. The amount of taxes postponed must be repaid to the State of California. The postponed amount becomes due and payable when the Individual moves, sells the property or dies.
property tax year
Fiscal year for California property tax purposes runs from July 1 to June 30. Taxes charged for that period become a lien on the property on the preceding January 1. (See property taxes)
property taxes
A tax levied on land and buildings (real estate) and on personal property. Assessment are made by county or city assessor's office for real property taxes. Payment dates may vary according to state regulation.
Proposed list price
Proposition 13
A voter initiative that added Article XIII A to the California Constitution. It limits property tax rates to no more than 1% of full cash value. Increases in assessed value per year are capped at 2% or the percentage growth in the Consumer Price Index (CPI), whichever is less. In 2002-03, the increase was 1.87%. It has been less than the 2% cap only five times since 1977. New construction and the sale of property, with some exceptions, also increase assessed values.
proposition 19
Limits prior propositions in that transfers to children and grandchildren require they use the property as a residence.
proprietary lease
A proprietary lease is a special type of lease associated with cooperative housing, where the leaseholder is also a shareholder in the cooperative corporation that owns the building. This lease grants the shareholder the right to occupy a specific unit within the cooperative, while also delineating the rights and responsibilities of both the tenant-shareholder and the cooperative association. Unlike traditional leases, a proprietary lease does not have a set expiration as it is tied to the ownership of shares in the cooperative, making it effective as long as the individual remains a shareholder.
prorations
Expenses, either prepaid or paid in arrears, that are divided between the buyer and seller at closing.
prospecting
Locating owners of properties who are interested in selling, or buyers who are interested in purchasing property. (See endless chain, farming, networking)
prospective economic advantage
Legal term for one's expectations in doing business.
protected class
Any group of people designated as such by the Department of Housing and Urban Development (HUD) in consideration of federal and state civil rights legislation. Currently includes ethnic minorities, women, religious groups, the handicapped and others.
protected classes (State-specific FH Acts)
Other protected classes include:
protein
Any of numerous naturally occurring extremely complex combinations of amino acids that contain the elements carbon, hydrogen, nitrogen, oxygen, usually sulfur, occasionally phosphorus, iron or other elements, are essential constituents of all living cells, and are synthesized from raw materials by plants but assimilated as separate amino acids by animals. Proteins, along with carbohydrates and lipids constitute the principal structural components of living cells. (See carbohydrates, lipids)
provisional license
A license the ADRE issues that allows a licensee to practice as a salesperson or broker subject to either a consent order or the Commissioner's terms, conditions and restrictions
psychological contract
The goal of human resource management is to forge a psychological contract between the company and the individual workers. The psychological contract is a set of expectations held by both employer and employee. Employers expect employees to provide a fair day's work, to accept the authority of management, and report to work regularly. Employees expect just compensation, career enhancement and quality in work life.
Public Buildings Element
This element must show locations that have civic and community centers, public schools, libraries, police and fire stations, and other public buildings.
public debt
Public debt is money (or credit) owed by the government—federal, state, or local. The government accumulates debt over time by running a deficit; it spends more than it receives in tax revenue. Governments borrow by issuing securities (bonds). (See credit, bond, security)
Public Health movement
This movement focused on the establishment of industrial safety requirements, maximum work hours, minimum housing standards, public recreation amenities, and ensuring the provision of light and air in cities.
public hearing
A formally announced meeting of a planning commission, the express purpose of which is to receive written and oral testimony on specific matters open to the public for attendance and testimony. Commission members may ask questions, but no deliberation takes place. A full record of information should be kept, reviewed by the staff, and incorporated into its report for subsequent commission deliberation.
public records
Records which by law give constructive notice of matters relating to property.
public report
A disclosure statement required by the Subdivided Lands Law stating that a buyer is not obligated until he or she has read the report and signed a receipt. (See Subdivided Lands Law)
Public Services and Facilities Element
This element must show general plans for police, fire, emergency services, sewage, refuse disposal, drainage, local utilities, rights-of-way, easements and facilities for them.
public water system
A system that provides piped water for human consumption to at least 15 service connections or regularly serves 25 individuals.
puffery
Exaggerated praise or claims, especially when used for promotional purposes.
puffing
Exaggerated or superlative comments or opinions not made as representations of fact and thus are not grounds for misrepresentation, such as, "This property is a real good buy." One test used is whether a reasonable person would have relied on the statement. A statement such as, "The apartment has a fantastic view, " is puffing because the prospective buyer can clearly assess the view for himself or herself, whereas a statement such as "The apartment has a fantastic view of the lake," when in fact all its windows face the street, would be misrepresentation. (See caveat emptor, misrepresentation)
pulse
A regular throbbing caused in the arteries by the contractions of the heart.
pulse rate
The number of heartbeats per unit of time.
punitive damages
Damages awarded to one party to punish another party for dishonest conduct. Meant to deter others from committing a similar offense.
punitive damages
Damages awarded to one party to punish another party for dishonest conduct. Meant to deter others from committing a similar offense.
pur autre vie
"For the life of another." A life estate pur autre vie is a life estate that is measured by the life of a person other than the grantee.
purchase option
A right given to a prospective purchaser or lessee to buy or lease the owner's property at a fixed price within a specified period of time.
purchase-money mortgage
A mortgage given as part of the buyer's consideration for the purchase of real property, and delivered at the same time that the real property is transferred as a part of the transaction. It is commonly a mortgage taken back by a seller from a purchaser in lieu of purchase money. A purchase-money mortgage is usually used to fill a gap between the buyer's down payment and a new first mortgage or mortgage assumed, as when the buyer pays 10 percent in cash, gets an 80 percent first mortgage from a bank, and then the seller takes back a purchase-money second mortgage for the remaining 10 percent.
purify
To clear from material defilement or imperfection; to free from undesirable elements.
purpose approach
This approach to statutory interpretation assesses the aims and objectives of the statute (i.e., legislative intent).
pyramiding
The process of acquiring properties by refinancing properties already owned and investing the loan proceeds in additional properties.
A drainage plumbing pipe in the approximate shape of a "p" laid on its face, providing a trap that prevents sewer gasses from entering the living space. (See construction terms)
P.A.R.
To answer behavior-based interview questions, use the P.A.R. approach: (a) State a Problem that you were given, (b) Describe the Action you took, (c) Explain the Results of that action.
package loan
A real estate loan used to finance the purchase of both real property and personal property, such as in the purchase of a new home that includes carpeting, window coverings and major appliances.
packet
A block of data transmitted over a packet switching network. The Internet and local area networks transmit data in "packets." (See Internet, local area network)
paid outside of closing (P.O.C.)
Paid outside of closing (P.O.C.) charges are paid outside of settlement by the borrower, seller, loan originator, real estate agent, or any other person.
paired data set analysis
A method of estimating the amount of adjustment for the presence or absence of any feature by pairing the sales prices of otherwise identical properties with or without the features in question. A sufficient number of sales must be found to allow the appraiser to isolate the effect on value of the pertinent factor (also called paired sales analysis and matched pairs analysis).
paired sales analysis
A method of estimating the amount of adjustment for the presence or absence of any feature by pairing the sales prices of otherwise identical properties with or without the features in question. A sufficient number of sales must be found to allow the appraiser to isolate the effect on value of the pertinent factor (also called paired data set analysis and matched pairs analysis).
Paired testing
A critical methodology for assessing discrimination in the housing market for both research and enforcement purposes.
par
The face value of a bond or security. (See security)
parameter
A single number or attribute of the individual things, persons, or other entities in a population.
parcel map
Map that shows all property boundaries within a subdivision.
parity
Equality, as in amount, status, or value.
parol evidence rule
A rule of evidence providing that a written agreement is the final expression of the agreement of the parties, not to be modified by oral or written negotiations.
partial interest
Any property interest that is less than full fee simple ownership of the entire property.
partial release clause
A mortgage provision under which the mortgagee agrees to release certain parcels from the lien of the blanket mortgage upon payment of a certain sum of money by the mortgagor. The clause is frequently found in tract development construction loans.
partial zoning
Zoning that does not consider its effect on other areas. (See zoning)
participation certificates
Certificates issued by Freddie Mac backed by pools of mortgages. (See Freddie Mac)
participation financing
Where a lender becomes a partner in a development.
participation mortgage
A mortgage loan wherein the lender has a partial equity interest in the property or receives a portion of the income from the property.
participatory leadership
A leadership style in which employees at all levels are encouraged to contribute ideas towards identifying and setting organizational-goals, problem solving, and other decisions.
partition
Co-tenants who wish to terminate their co-ownership may file an action in court to partition the property. Partition is a legal way to dissolve the relationship when the parties do not voluntarily agree to its termination. If the court determines that the land cannot be divided physically into separate parcels without destroying its value, the court will order the real estate to be sold. The proceeds of the sale will then be divided among the co-owners according to their fractional interests. (See co-ownership)
partition action
A court proceeding by which co-owners may force a division of the property or its sale, with co-owners reimbursed for their individual shares.
partners
Partners participate in the operation and management of a partnership business and share liability for business losses and obligations. (See partnership)
Uniform Partnership Act - Full Textpartnership
An association of two or more individuals who carry on a continuing business for profit as co-owners. Under the law a partnership is regarded as a group of individuals rather than as a single entity. (See general partnership, limited partnership, joint venture)
parts per billion (ppb)
Units commonly used to express contamination ratios, as in establishing the maximum permissible amount of a contaminant in water, land, or air. These ratios can also be expressed in "parts per million (ppm)."
parts per million (ppm)
Units commonly used to express contamination ratios, as in establishing the maximum permissible amount of a contaminant in water, land, or air. These ratios can also be expressed in "parts per billion (ppb)."
party wall
A wall that is located on or at a boundary line between two adjoining parcels of land and is used or is intended to be used by the owners of both properties.
party wall easement
A party wall can be an exterior wall on a building that straddles the boundary line between two lots, or it can be a commonly shared partition wall between two connected properties. Each lot owner owns the half of the wall on his or her lot, and each has an appurtenant easement in the other half of the wall. A written party wall agreement must be used to create the easement rights. Expenses to build and maintain the wall are usually shared. A party driveway shared by and partly on the land of adjoining owners must also be created by written agreement, specifying responsibility for expenses. (See easement, appurtenant easement)
pass-through certificates
Pass-through certificates are financial instruments used in the mortgage-backed securities (MBS) market. They represent an undivided interest in a pool of mortgages. Essentially, these certificates allow investors to receive payments derived from the principal and interest payments made by the borrowers on the mortgages that make up the pool.
pass-through security
A security issued by the Government National Mortgage Association (Ginnie Mae) to mortgage investors. Cash flows from the underlying block individual mortgage loans are "passed through" to the holders of the securities in pro rata share, including loan prepayments. With a mortgage-backed security, the timely payment of principal and interest is guaranteed by Ginnie Mae. In 1982, the Federal National Mortgage Association (Fannie Mae) instituted its own mortgage-backed securities program designed to attract billions of dollars into the conventional mortgage market from pension funds and other investors. (See FHA, Fannie Mae, Freddie Mac, Ginnie Mae, mortgage-backed securities, VA loan)
pass-throughs
Payments on securities sold in the secondary market that are sent directly to investors. (See secondary market)
passive activity loss limitations (PALL)
For most rental property owners, real estate is a passive activity for tax purposes. Losses, termed passive activity losses, up to $25,000, with some limitations, can be written off against regular salary, wages or business profits - Line 17 on the 1040 Form.
passive activity loss limitations (PALL)
For most rental property owners, real estate is a "passive activity" for tax purposes. Losses, termed passive activity losses, up to $25,000, with some limitations, can be written off against regular salary, wages or business profits - Line 17 on the 1040 Form. (See 1040 Form, 1040 form line 17 - rental income and losses)
passive income
Income generated when a person is not active in a business or occupation. Examples of situations where passive income is generated include limited partnerships or rental income remaining after allowable deductions. (See limited partnerships)
passive losses
Losses left over when deductions for annual operating expenses, loan interest, and depreciation exceed annual rents. For tax purposes, passive losses can only be used to offset passive income. (See annual operating expenses, depreciation, passive income)
patent
The instrument that conveys real property from the state or federal government to an individual.
patent defect
A defect that is obvious from a reasonable inspection of a property.
pathogen
A pathogen is any organism, such as a virus, bacterium, fungus, protozoan, or parasite, that causes disease or illness in its host organism. Pathogens can vary widely in their characteristics, modes of transmission, and the diseases they cause.
pattern or practice
The courts have found a "pattern or practice" when the evidence establishes that the discriminatory actions were the defendant's regular practice, rather than an isolated instance. This does not mean that the Prosecutor has to prove that a defendant always discriminates or that a large number of people have been affected. A "pattern or practice" means that the defendant has a policy of discriminating, even if the policy is not always followed.
payback period method
Calculates how many years it will take for your cash investment to be repaid to you based off the investment's net cash flows. Like 4, 7, or 12 years until all your money is back in your bank account.
payee
The person to whom a debt instrument, such as a check or promissory note, is made payable; obligee, the "receiver." (See maker, receiver)
payment bond
Bond that may be required of a building contractor to compensate the property owner if the contractor defaults in performance of contract obligations, such as payment of subcontractors, workers, and suppliers.
payment cap
The limit on the amount the monthly payment can be increased on an adjustable-rate mortgage when the interest rate is adjusted. (See adjustable-rate mortgage)
payment option ARM
A nontraditional mortgage that allows the borrower to choose from a number of different payment options. For example, each month, the borrower may choose a minimum payment option based on a "start" or introductory interest rate, an interest-only payment option based on the fully indexed interest rate, or a fully amortizing principal and interest payment option based on a 15-year or 30-year loan term, plus any required escrow payments. The minimum payment option can be less than the interest accruing on the loan, resulting in negative amortization. The interest-only option avoids negative amortization but does not provide for principal amortization. After a specified number of years, or if the loan reaches a certain negative amortization cap, the required monthly payment amount is recast to require payments that will fully amortize the outstanding balance over the remaining loan term.
payment shock
With the change in interest rate of an ARM, the payment may be substantially higher for the borrower which could cause a shock to their income.
payoff statement
See reduction certificate.
payor
The debtor on a promissory note or the party who makes payment to another. (See obligor)
PCOR
A common term used to refer to the preliminary change of ownership (PCOR) report, required before closing and prepared by the buyers of a sale transaction or completing the memorandum of a lease. The form provides essential information regarding the terms of the sale. Each county in California has its own form. Escrow delivers to the county a completed copy at closing.
peak
The top segment of the business cycle curve, a period during which productivity and employment are higher than in the preceding and succeeding periods. (See recession, recovery, trough)
pecuniary
Consisting of or measured in money.
pension funds
Pension funds usually have large amounts of money available for investment. Because of the comparatively high yields and low risks offered by mortgages, pension funds have begun to participate actively in financing real estate projects. Most real estate activity for pension funds is handled through mortgage bankers and mortgage brokers. (See noninstitutional lenders)
per capita income
A measure of the amount of money being earned per person in an area. Per capita income can apply to the average per-person income for a city, region or country and is used as a means of evaluating the living conditions and quality of life in different areas. It can be calculated for a country by dividing the country's national income by its population.
percent
Parts of the whole, when the whole is divided into one hundred parts.
percent funded
Comparing how much is saved in a homeowners association's reserves, for example $200,000 divided by how much should be saved according to the reserve analyst, like $1,000,000. In this case they would be 20.0% funded ($200,000 / $1,000,000).
percentage fee
A property management fee expressed as a percentage of the gross collectable income from a property. (See flat fees)
percentage lease
A lease, commonly used for commercial property, whose rental is based on the tenant's gross sales at the premises. It usually stipulates a base monthly rental plus a percentage of any gross sales above a certain amount. (See lease)
Perception bias
Human unconscious tendency to form stereotypes and assumptions about certain groups, which makes it impossible to form judgments about individuals in those groups. This is an unconscious function of the human mind.
percolation
1) The movement of water downward in a circular direction through subsurface soil layers, usually continuing downward to ground water. Can also involve upward movement of water. 2) Slow seepage of water through a filter.
percolation test
A test of soil to determine if it will absorb and drain water adequately to use a septic system for sewage disposal.
perfect market
The following assumptions hold for a "Perfect Market":
(a) a large number of buyers;
(b) a large number of sellers;
(c) the quantity of goods bought by any individual is so small relative to the total quatity traded that individual trades leave the market unaffected;
(d) the units of goods sold by different sellers are the same (the product is homogeneous);
(e) all buyers and sellers have complete information on the prices being asked and offered in the entire market; and
(f) there is perfect freedom of entry to and exit from the market. (See imperfect market)
performance
The execution of an action; the fulfillment of a promise or request; implementation.
performance bond
A performance bond is a financial guarantee issued by a surety company to ensure the completion of a project according to the terms of a contract. It protects the project owner by providing compensation if the contractor fails to fulfill their obligations, thereby mitigating the risk of non-performance. Performance bonds are commonly used in construction and other industries where project completion is critical.
performance bonus
A bonus that is paid to a residential leasing agent or manager working under the supervision of a licensed real estate broker and that is based on performance, that is received no more frequently than monthly and that does not exceed one-half of the agent's or manager's total compensation for the time period is considered a bonus.
It is not considered to be a special compensation, and it is perfectly legal for an unlicensed person to collect such bonus.
performance criteria
Performance criteria are standards determined by an employer by which employees are rated on how well they do their jobs.
performance review
Performance reviews are an analysis of an employee's work undertaken at a fixed point in time to determine the degree to which stated objectives and expectations have been met.
peril
A cause of a loss, like a fire, flood or theft.
perimeter
periodic tenancy
A leasehold interest from period to period that renews automatically unless a notice of termination is given. (See leasehold)
permanent access (Arizona definition)
Permanent access to subdivided land means ingress and egress over terrain that is traversable by a conventional motor vehicle, and access to and from a Federal, state, or county highway.
person
A person is a natural person, corporation, company, limited liability company, partnership, or association.
personal and collaborative goal setting
Goal setting is critical to effective evaluation in that it can be the primary means through which employees shape their growth. Goals can be set individually or in consultation with others. It helps to include in the goal-setting process those with more experience and or expertise.
personal digital assistant (PDA)
Any small, mobile hand-held device that provides computing and information storage; PDAs combine features such as address book, appointment calendar, calculator, Internet access and telephone directory.
personal income
A person's gross income from wages, salaries, commissions, interest and profits from businesses or investments.
personal property
Personal property are things that are tangible and movable; property that is not classified as real property, such as chattels. Title to personal property is transferred by way of a bill of sale, as contrasted with a deed for real property.
Items of personal property frequently become the object of dispute between buyer and seller, most often due to whether an item is considered a fixture or due to the seller's attempt to substitute a similar item. Some cautious buyers insert a clause in their purchase contracts to the effect that the buyer will get the appliances "as currently installed and used in the premises."
A tree is real property while it is rooted in the ground, but when severed it is transformed into personal property. When lumber is assembled, however, and used as material to construct a house, it once again becomes a fixture or real property. (See fixture)
personal relationships
The following can be helpful in your job search: immediate family, extended family, close friends, neighbors and acquaintances, service professionals, helping professionals, and social groups.
Personal Responsibility and Work Opportunity Act
The Personal Responsibility and Work Opportunity Act took effect August 1, 1998. This federal law requires that certain public benefits be withheld from illegal immigrants.
Personal Responsibility and Work Opportunity Act
The Personal Responsibility and Work Opportunity Act took effect August 1, 1998. This federal law requires that certain public benefits be withheld from illegal immigrants, including professional and occupational licenses issued by state agencies.
Personal Responsibility and Work Opportunity ActPersonal Responsibility and Work Opportunity Act
Federal law, effective August 1, 1998, requiring that certain public benefits be withheld from illegal immigrants, including professional and occupational licenses issued by state agencies. The text of the law is at www.access.gpo.gov/congress/wm015.txt.
personnel file
A personnel file is a company's documentation of the history and status of an employee's entire relationship with the company. It includes employment application materials, emergency contacts, employee addresses, performance evaluations, disciplinary letters, employee recognition, and work history, to name just a few. Some employee records are required by federal or state governments for employers to keep.
petty offense (AZ)
A petty offense is a type of misdemeanor but is punishable with no jail and a maximum $300 fine.
phish
To phish is to try to trick people into giving secret information using fake emails or websites. The details are then used to steal people's money, or to steal their identity in order to commit crimes.
phishing
Phishing is a criminal process of attempting to acquire sensitive information like usernames or passwords by masquerading as a trustworthy entity in an electronic communication.
physical deterioration
A reduction in a property's value resulting from a decline in physical condition; can be caused by action of the elements or by ordinary wear and tear.
physical life
The length of time a structure can be considered habitable, without regard to its economic use.
physical obsolescence
An appraisal term that describes the ordinary deteriorization of a property due to aging. (See economic obsolescense, functional obsolescence)
piggyback loans
A loan divided into two parts with one lender taking a secondary security position.
PITI
Acronym for Principal, Interest, Taxes & Insurance. The four elements of a monthly mortgage payment; payments of principal and interest go directly towards repaying the loan while the portion that covers taxes and insurance (homeowners and mortgage, if applicable) goes into an escrow account to cover the fees when they are due.
plain meaning approach
The plain meaning rule dictates that statutes are to be interpreted using the ordinary meaning of the language of the statute, unless a statute explicitly defines some of its terms otherwise. In other words, the law is to be read word for word and should not divert from its ordinary meaning.
plaintiff
A person who brings an action; the party who complains or sues in a personal action and is so named on the record. (See defendant)
planned unit development (PUD)
A planned unit development (PUD) is a type of residential or mixed-use development that is planned and built as a single entity, typically featuring a combination of residential, commercial, and recreational spaces. These developments are designed to include a variety of housing types and amenities within a cohesive community layout, often incorporating parks, schools, and local shops. PUDs are governed by their own set of rules and regulations, which allow for deviations from standard zoning laws to create a more integrated and efficient community design.
plasterboard
Drywall; interior wall finishing material.
plat map
A plat map is a map of a town, section or subdivision indicating the location and boundaries of individual properties.
platform frame
Platform frame is a construction technique in which each floor of a building provides support for the floor above it.
pledge
Something given or held as security to guarantee payment of a debt or fulfillment of an obligation. A solemn binding promise to do, give, or refrain from doing something.
plenary license
An unqualified or absolute license; one that is not restricted.
plot plan
A plot plan shows the layout of improvements on a property site. The plot plan usually includes location, dimensions, parking areas, landscaping and other details of the improvements. (See construction terms)
plottage
The increase in value or utility resulting from the consolidation (assemblage) of two or more adjacent lots into one larger lot. (See assemblage)
plumbing system
Includes the building components that provide water, a method of warming the water, and disposal of waste water, including the water supply system, water heater, vent piping system, and drainage system.
PMI
Acronym for Private Mortgage Insurance. Privately-owned companies that offer standard and special affordable mortgage insurance programs for qualified borrowers with down payments of less than 20% of a purchase price. (See private mortgage insurance)
pocket listing
Property listing that the listing agent markets privately before entering it in the multiple listing service (MLS); usually a violation of MLS rules. (See multiple-listing service)
podcast
MP3 or other audio file that can be downloaded off your Web page or e-portfolio. It is delivered off a web site via a RSS feed. All you need to know is the URL (website address) of the RSS. Unlike radio, you can listen to recorded podcasts at any time.
point of beginning (POB)
In a metes-and bounds legal description, the starting point or point of beginning (POB) of the survey, is situated in one corner of the parcel; all metes-and-bounds descriptions must follow the boundaries of the parcel back to the point of beginning. (See metes-and-bounds descriptions)
point source
A stationary location or fixed facility such as an industry or municipality that discharges pollutants into the air or surface water through pipes, ditches, lagoons, wells, or stacks - a single identifiable source such as a ship or a mine.
points and fees
Points and fees include all items listed in 15 U.S.C. § 1605(a)(1) through (4), except interest or the time-price differential; all charges for items listed under § 226.4(c)(7) of Title 12 of the Code of Federal Regulations, as amended from time to time, but only if the lender receives direct or indirect compensation in connection with the charge or the charge is paid to an affiliate of the lende; all compensation paid directly or indirectly to a mortgage broker, including a broker that originates a loan in its own name in a tablefunded transaction; the cost of all premiums financed by the lender, directly or indirectly, for any credit life, credit disability, credit unemployment, or credit property insurance, or any other life or health insurance, or any payments financed by the lender directly or indirectly for any debt cancellation or suspension agreement or contract, except that insurance premiums calculated and paid on a monthly basis will not be considered financed by the lender.
points and fees
Points and fees for closed-end loans include all items required to be disclosed under 12 CFR 226.4 (a) and 226.4 (b) or 209 CMR 32.04(1) and 209 CMR 32.04(2), except interest or the time-price differential; charges for items listed under sections 226.4(c)(7) of Title 12 of the Code of Federal Regulations or 209 CMR 32.04(3)(g) (other than amounts held for future payment of taxes) unless the charge is reasonable, the creditor receives no direct or indirect compensation in connection with the charge, and the charge is not paid to an affiliate of the creditor; the maximum prepayment fees and penalties that may be charged or collected under the terms of the loan documents; all prepayment fees or penalties that are incurred by the borrower if the loan refinances a previous loan made or currently held by the same lender; all compensation paid directly or indirectly to a mortgage broker, not otherwise included in 209 CMR 40.02; the cost of all premiums financed by the lender for any credit life, credit disability, credit unemployment, or credit property insurance, or any other life or health insurance, or any payments financed by the lender for any debt cancellation or suspension agreement or contract, except that insurance premiums or debt cancellation or suspension fees calculated and paid on a monthly basis will not be considered financed by the lender.
Points and fees do not include taxes, filing fees, recording and other charges and fees paid to a public official for determining the existence of or for perfecting, releasing or satisfying a security interest, and fees paid to a person other than a lender or to the mortgage broker for the following: fees for flood certification; fees for pest infestation; fees for flood determination; appraisal fees; fees for inspections performed before closing; credit reports; surveys; notary fees; escrow charges; title insurance premiums; and fire insurance and flood insurance premiums, including homeowner premiums.
Points and fees, for open-end loans, must be calculated by adding the total points and fees included within 209 CMR 40.02, plus the minimum additional fees the borrower would be required to pay to draw down an amount equal to the total credit line.
police power
The inherent right of the state to regulate for the purpose of promoting health, safety, welfare, and morality. Police power gives the state the right to impose certain restraints on human conduct which are reasonably necessary in order to safeguard the public interest. This right is the basis of zoning, the official map, building codes, and subdivision regulations.
political subdivision
An administrative division that is a part of another division. It is established for the purpose of government; and granted a certain degree of autonomy. Political subdivisions are required to manage themselves through their own local governments.
political subdivision (Arizona)
A county, city, town, or other municipal corporation, a public authority, and generally any publicly owned entity that is an instrumentality of the state of Arizona or of a municipal corporation.
pollution
Any substances in water, soil, or air that degrades the natural quality of the environment, offends the senses of sight, taste or smell, or causes a health hazard. The usefulness of the natural resource is usually impaired by the presence of pollutants and contamination.
pollution prevention
Actively identifying equipment, processes, and activities which generate excessive wastes or use toxic chemicals and then making substitutions, alterations, or product improvements. Conserving energy and minimizing wastes are pollution prevention concepts used in manufacturing, sustainable agriculture, recycling, and clean air/clean water technologies.
polychlorinated biphenyls (PCBs)
Used as an insulating material in dielectric oil. It can linger in the environment for long periods of time and can cause health problems.
pool insurance
'Pool insurance' insures pools of 'A' or 'prime' mortgages. The coverage is a percentage of the original aggregate unpaid balance of the pool. Traditional pool insurance pays 100 percent of all losses on individual defaulted mortgages after the equity in the home and any primary insurance is exhausted until the aggregate pool coverage amount is reached. Modified pool insurance pays 25 percent. Insurers offer Government-Sponsored Enterprise (GSE) pool insurance, a thin layer of coverage between the equity in the mortgage and any primary insurance and the GSE's guarantee.
population
All of the individual variates (items or units) of a group.
popup window
A pop-up is a graphical user interface display area, usually a small window, that suddenly appears ("pops up") in the foreground of the visual interface.
Many websites, including proU.net courses, use popup windows to deliver content. Please make sure popup blocking is turned off (unchecked) in your web browser settings.
portfolio
Tangible, easily accessible proof of your skills and accomplishments; collection of career-related documents that adds value to your presentation. A portfolio tells a story. It is a visual representation of your experience, strengths, abilities, and skills - the things you like to do best. It is a collection of things - artifacts - tangible materials - that represent work-related events in your life. The portfolio provides "evidence" of your potential by demonstrating, or representing, what you accomplished in the past.
portfolio loan
A loan originated and maintained by the lender and not sold in the secondary mortgage market. (See secondary mortgage market)
positive leasehold
Positive leaseholds are created when market rent prices go above the contract rent price.
positive personal qualities
Qualities necessary to keep a job, such as responsibility, self-esteem, sociability, self management, integrity/honesty.
post-and-beam frame
Post-and-beam frame is a construction technique in which interior posts support ceiling boards, allowing for more open space within a structure than is possible with other forms of construction.
post-possession
Post-possession is the Seller of a property retaining possession of all or part of a property after escrow has closed and the Seller is no longer the owner of record. This is not limited to possession by people. It also applies to partial possession of the property to store personal belongings.
potential
Existing in possibility; capable of developing into actuality.
potential gross income
The maximum income that property is capable of producing.
potential gross income multiplier
A ratio calculated by dividing the sales price of a comparable property by its potential gross income to form an opinion of the subject property's value.
potentially responsible party (PRP)
Any individual or company that is potentially responsible for or has contributed to a spill or other contamination at a Superfund site. Whenever possible, EPA requires PRP's to clean up sites they have contaminated. (See Superfund)
Power of Attorney - Instructor Note
INSTRUCTOR NOTE ABOUT POWER OF ATTORNEY
Remember, A power of attorney is a very special kind of agency relationship... one that is NOT common for agents representing buyers or sellers. A power of attorney that authorizes one person to sign on behalf of another must be a written document with the original signature of the person who is authorizing the other person to sign. The power of attorney must state the words "POWER OF ATTORNEY" at the top of the document, and the signature of the authorizing party must be notarized. Agents are NEVER (I repeat NEVER) authorized to sign any document on behalf of a client without a valid power of attorney with an original notarized signature. |
power of eminent domain
The right of the government to acquire title to property for public use by condemnation; the property owner receives compensation which is generally fair market value. (See taking)
FindLaw® eminent domainpower of issue
The "power of issue" is the authority to print money. The Federal Reserve is the only entity with the authority to print currency in the United States.
power of sale
A clause commonly inserted in a mortgage and deed of trust that grants the creditor or trustee the right and authority, upon default in the payment of the debt, to advertise and sell the property at public auction, without resorting to a court for authorization to do so.
power of termination
power-of-attorney
A written instrument authorizing a person, the attorney-in-fact, to act as the agent on behalf of another to the extent indicated in the instrument.
power-of-sale
The power that may be given by a promissory note to a trustee, a mortgagee, or another lienholder to sell secured property without judicial proceedings if the borrower defaults.
power-of-sale clause
A clause in a mortgage authorizing the holder of the mortgage to sell the property in the event of the borrower's default. The proceeds from the public sale are used to pay off the mortgage debt first, and any surplus is paid to the mortgagor. A power-of-sale clause is also found in trust deeds, giving the trustee authority to sell the trust property under certain circumstances.
pre-approval for loan
The process of supplying a lender with pre-qualification information, and the lender basically underwriting the loan, so they are virtually committed to lending money to buy property. The borrower can then find and contract the property they want to purchase.
Pre-licensure Education Certificate (AZ)
The Pre-licensure Education Certificate is emailed by the providing school to a student who passes the proctored school final exam.
pre-possession
Pre-possession is the Buyer of a property taking possession or all or part of a property before close of escrow. This is not limited to possession by people. It also applies to partial possession of the property to store personal belongings.
predatory lending
Predatory lending refers to secured loans such as home or car loans that are made by a lender with the intention that the borrower default on the loan, allowing the lender to seize the car or home and sell it for a profit. The term has been expanded to refer to the practice of convincing borrowers to agree to unfair and abusive loan terms.
preliminary notice
Notifies a customer that work to be completed is subject to the lien rights of the contractor. Preliminary notice must be given prior to recording of a mechanic's lien, and should be filed by a contractor at least 20 days prior to the start of work. If notice is given later, liens will cover only the work starting 20 days prior to filing. (See mechanic's lien)
preliminary public report
Under the Subdivided Land Law the preliminary public report can be issued before the public report, and allows a subdivider to take reservations from buyers but not sell parcels. (See public report, Subdivided Land Law)
preliminary report
A title report that is made before a title insurance policy is issued or when escrow is opened. A preliminary report or policy of title insurance reports only on those documents having an affect on the title and should not be relied on as being an abstract. An abstract of title, on the other hand, reflects all instruments affecting title from the time of the original grant and also includes a memorandum of each instrument, and makes no attempt to determine which of the documents currently affects record title. The "preliminary" is not a binder or commitment that the title company will insure the title to the property, although this commitment may be obtained at an added cost. (See abstract of title)
premium
A fee paid to an insurance company.
premium
The amount by which the price of a security exceeds its face value or principal amount. When the nominal or coupon rate (the interest rate stated on the bond or security) is higher than the prevailing market interest rate for similar securities, investors are willing to pay more than the face value to buy the bond. This additional amount over the face value is called a "premium."
premium (in excess of par)
A price paid for a security in excess of its face value. (See par)
prepaid items
On a closing statement, items that have been paid in advance by the seller, such as insurance premiums and some real estate taxes, for which he or she must be reimbursed by the buyer. (See closing statement)
Prepaid Rental Listing Service (PRLS)
A Prepaid Rental Listing Service (PRLS) is a business that supplies prospective tenants with property listings on payment of a fee. It may be operated by a licensed real estate broker or under the authority of a PRLS license.
prepayment
Additional payments made to a loan principal by the borrower.
prepayment penalty
The amount set by the creditor as a penalty to the debtor for paying off the debt before it matures; an early-withdrawal charge. The prepayment penalty is charged by the lender to recoup a portion of interest that the lender had planned to earn when the loan was made. It covers the lender for initial costs to set up the loan, to service it and to carry it in the early years of high risk. This punitive device also may represent the loss of income to the lender for the time the mortgage is paid off and the funds remain uncommitted. The reason most lenders are willing to allow prepayment after five years without penalty is that much of the total note's interest has been paid in by that time.
preponderance of evidence
The greater weight of the evidence for the trier of fact to decide in favor of one side or the other. This preponderance is based on the more convincing evidence and its probable truth or accuracy, and not on the amount of evidence. For example, a knowledgeable witness might provide a preponderance of evidence over a dozen witnesses with unreliable or questionable testimony. Likewise, a signed agreement with definite terms will likely outweigh opinions or speculation about what the parties intended.
prequalify
Determine the maximum loan amount a prospective buyer qualifies for prior to showing them properties. Failing to prequalify may result in wasted efforts showing the prospect properties they cannot afford to purchase. (See back-end qualification, front-end qualification)
prescription
Acquiring a right in property, usually in the form of an intangible property right such as an easement or right-of-way, by means of adverse use of property that is continuous and uninterrupted for the prescriptive period established by state statute. Use of land is adverse when it is made under a claim or right. Therefore, there is no adverse use if the owner has granted permission, or if the user has paid for the use of the property, or if the user has admitted that the owner has a superior right in the property.
Prescription is often used interchangeably with the term adverse possession, which more strictly refers to the acquiring of title to lands. As in adverse possession, the essential elements are that the prescriptive right be adverse, under claim of right, continuous and uninterrupted, open, notorious and exclusive, with the knowledge and acquiescence of the servient owner, and continuing for the full prescriptive period. By "continuous" is meant that the property is used on a regular basis.
present value (PV)
If one is going to earn $1,000 five years from now, or a stream of cash flows over a few years, the "present value" is today's value of a future cash flow(s), discounted back to today at an appropriate discount rate.
present worth
The discounted present-day value of money to be collected in the future.
preservation
1. The protection of ecologically important resources in perpetuity through the implementation of appropriate legal and physical mechanisms. Preservation may include protection of upland areas adjacent to wetlands as necessary to ensure protection of the overall ecosystem. 2. Applying measures to sustain the existing form, integrity and material of a building or structure. It may include stabilization work, as well as ongoing maintenance of the historic building materials.
press release
A news announcement written by a property manager or advertising specialist highlighting a property's features. Sent to local newspapers and real estate magazines to promote a property.
pressed wood products
Materials used in building and furniture construction that are made from wood veneers, particles, or fibers bonded together with an adhesive under heat and pressure.
pressure relief valve
A valve used on hot water heating appliances to help keep the pressure in the heated tank or boiler from getting too high by allowing the relief of pressure from the valve.
pretax cash flow
Income that remains from net operating income (NOI) after debt service is paid but before ordinary income tax on operations is deducted.
pretexting
Pretexting is the practice of obtaining personal information under false pretenses. Pretexters sell the information to people who may use it to get credit in another person's name, steal assets, or investigate or sue a person. Pretexting is against the law.
preventive maintenance
Includes regularly scheduled activities such as painting and seasonal servicing of appliances and systems. Preventive maintenance preserves the long-range value and physical integrity of the building. This is both the most critical and the most neglected maintenance responsibility. Failure to perform preventive maintenance invariably leads to greater expense in other areas of maintenance.
price
The amount of money set or paid as the consideration in the sale of an item at a particular time.
price of a loan
The combination of rate and points on your loan.
price supports
Price supports are a form of government subsidy for the production of commodities. The market price of certain goods is fixed at a level that guarantees the producer an "adequate" return on investment. That price is not determined by the free interaction of supply and demand, but rather by government regulators, and often the government purchases surpluses that remain unsold at an artificially high fixed price.
pricefixing
The practice of conspiring to establish fixed fees or prices for services rendered or goods sold. In recent years, the setting of attorney fees by local bar associations and commission percentages and management fees by local realty associations has been successfully attacked as price fixing and thus a violation of the Sherman Antitrust Act.
prima facie
At first sight; on the first appearance; on the face of it; so far as can be judged from the first disclosure; presumably; a fact presumed to be true unless disproved by some evidence to the contrary.
primary lenders
Originators of real estate loans including commercial banks, savings and loan associations and mutual savings banks.
primary mortgage market
The mortgage market in which loans are originated and consisting of lenders such as commercial banks, savings and loan associations and mutual savings banks. (See secondary mortgage market)
primary personal residence
The dwelling in which a taxpayer lives and occupies most of the time.
prime mortgages
A classification of mortgages that are considered to be of high quality.
prime rate
The minimum interest rate a commercial bank will charge to its largest clients. Prime rates are determined in part, by the rate banks pay for the money they lend to borrowers. Decisions of the Federal Reserve Bank to increase or decrease the supply of money, can cause the prime rate that banks charge to fluctuate.
principal
1. One of the main parties to a transaction. For example, the buyer and seller are principals in the purchase of real property. 2. In a fiduciary relationship, the person who hires a real estate broker to represent him or her in the sale of property. The phrase, "principals only," often found in real estate ads, is meant to exclude real estate agents from contacting the owners of the property. 3. A loan principal is the original amount of money borrowed via a loan.
principal (in a fiduciary relationship)
The principal in a fiduciary relationship is the party who entrusts their interests, or affairs to the agent who represents them (the fiduciary). The principal relies on the agent to act in their best interests, with honesty, loyalty, and care.
principal loan originator
A principal loan originator is the licensed loan originator in charge of, and responsible for, the operation of a mortgage lender or mortgage broker, including all of the activities of the mortgage lender's or mortgage broker's loan originators and branch managers, whether employees or independent contractors.
principal meridian
The main imaginary line running north and south and crossing a base line at a definite point, used by surveyors for reference in location and describing land under the rectangular (government) survey system of legal description. (See base line, government survey system, legal description, meridian)
principal place of business
A principal place of business is a mortgage broker's or mortgage lender's primary business office, the street address, or physical location that is designated on the application for licensure or any amendment to such application.
Principal Reduction Alternative (PRA)
A program of the Departments of the Treasury & Housing and Urban Development (HUD) for home owners who owe more on their mortgage than what their home is currently worth. The program encourages non-Government Sponsored Entity mortgage servicers and investors to reduce the principal loan amount.
printer
A hardware device that transfers computer text and graphics to paper.
prior appropriation
A concept of water ownership in which the landowner's right to use available water is based on a government administered permit system.
prior restraint
Prior restraint is censorship imposed, usually by a government, on expression before the expression actually takes place. An alternative is to allow the expression to take place and to take appropriate action afterward, if the expression is found to violate the law, regulations, or other rules.
priority
The order of position, time or place. The priority of liens is generally determined by the chronological order in which the lien documents are recorded; tax liens, however, have priority even over previously recorded liens. Thus the old adage "prior in time is prior in right" is applicable.
priority of claims
Order in which creditors will be paid when there are claims against a homestead that result in a judgment against the homeowner.
private benefits
The benefits an individual or firm receive when they carry on consumption or production of goods or services. In the case of consumption, the benefits are mainly satisfaction from consumption. In the case of production, the benefits are revenue received by the firm from the sale of the good or service.
private costs
Costs that are incurred by an individual or firm when they are carrying out the activities of consumption or production; Costs that individuals or firms have to pay.
private industry councils (PICs)
Private Industry Councils (PICs) are local organizations composed of business, education, and community leaders who collaborate to address workforce development and employment issues within their regions. Established under the Job Training Partnership Act (JTPA) in the United States, PICs aim to ensure that job training programs align with the needs of local employers and industries. They play a crucial role in fostering public-private partnerships, developing workforce strategies, and enhancing the skills and employability of the local labor force.
private mortgage insurance (PMI)
Insurance provided by private carrier that protects a lender against a loss in the event of a foreclosure and deficiency. A special form of insurance designed to permit lenders to increase their loan-to-market-value ratio, often up to 95 percent of the market value of the property. Many lenders are restricted to 80 percent loans by government regulations, special loss reserve requirements or internal management policies related to mortgage portfolio mix. A lender, however, may lend up to 95 percent of the property value if the excess of the loan amount, over 80 percent of value, is insured by a private mortgage guaranty insurer. (See deficiency, foreclosure) (Mortgage Insurance Companies of America)
private offering
An offering of securities to no more than 25 persons and sale to no more than 10 persons.
private restrictions
The covenants, conditions and restrictions (CC&Rs) found in the typical declaration of restrictions filed by a subdivision developer and incorporated by reference in the deed to each subdivision lot.
private road
A private road is a road owned and maintained by a private individual, organization, or company rather than by a government. Consequently, unauthorized use of the road may be considered trespassing, and some of the usual rules of the road may not apply. The most common type of private road is a residential road maintained by a homeowners association, housing co-op, or other group of individual homeowners.
privity of contract
The relationship between contracting parties (mortgagor-mortgagee or assignee-assignor).
prize property
A prize property is a location, location, location, fanciest most "braggable" property in an area. Many of these are beautiful properties, like a beach house or fancy downtown condo, but most of these are terrible investments that will rarely build wealth. You can spot these by their signature negative cash flows and negative Cash on Cash Returns (or very low returns).
pro-forma
A presentation of data, typically financial statements, where the data reflect the world on an 'as if' basis. That is, as if the state of the world were different from that which is in fact the case. For example:
- A pro forma balance sheet might show the balance sheet as if a debt issue under consideration had already been issued.
Probable cause
In the context of a regulatory agency's disciplinary action, probable cause is a reasonable belief, based on facts and evidence, that a licensee or entity has violated laws, rules, or regulations under the agency's jurisdiction. It is the threshold determination that justifies moving forward with formal charges or disciplinary proceedings.
Probable cause panel
In the context of the Florida Real Estate Commission (FREC), a Probable Cause Panel is a subgroup of FREC members responsible for reviewing complaints, investigative reports, and evidence to decide whether probable cause exists to believe a real estate licensee has violated Florida real estate laws or regulations.
probate
The formal judicial proceeding to prove or confirm the validity of a will, to collect the assets of the decedent's estate, to pay the debts and taxes and to determine the persons to whom the remainder of the estate will pass. (See decedent, will)
Probate Code
The portion of California law that covers the court proceedings for disposition of property on the death of the property owner. (See probate)
probate listing
When owns real estate and dies, their property goes through probate to determine how it will be transferred to heirs or beneficiaries. A probate listing is a real estate listing for a property that is part of a probate estate and is being offered for sale as a part of the probate process.
probate value
Probate value of real estate is determined based on the fair market value of the assets at the time of the individual's death, as opposed to fair market value, which is the price the property would fetch in an open market.
procedures manual
Procedures manuals provide instructions and directions for the day-to-day operation of a business, and are essential to ensure consistency and quality in products and services. Every business from a sole proprietor to large corporations should have a procedures manual for each staff member as part of the written job description.
process
Something going on; a natural phenomenon marked by gradual changes that lead toward a particular result; a series of actions or operations conducting to an end.
procuring cause
The cause originating a series of events that lead directly to the intended objective; in a real estate transaction the procuring cause is the real estate agent who starts the uninterrupted chain of events that leads to the sale.
productivity
A measurement of economic output per unit of input. Inputs include labor and capital, while output is typically measured in revenue and other gross domestic product (GDP) components such as business inventories. Productivity measures may be examined collectively (across the whole economy) or viewed industry by industry to examine trends in labor growth, wage levels and technological improvement. (See gross domestic product)
professional corporation
Professional corporations (abbreviated as PC) are those corporate entities for which many statutes make special provision, regulating the use of the corporate form by licensed professionals such as attorneys and real estate licensees.
professional limited liability company (PLLC)
A professional limited liability company, or PLLC, is a type of limited liability company that is owned and operated by members of the same profession and can only offer services related to its profession. The ADRE issues a license for PLLC only if all members and managers hold active real estate licenses. The name of the PLLC must be the name of the licensee, with the letters “PLLC” appended.
professional or trade information
Associations, conferences, and other professional development resources.
professional or trade journal ads
Ads in professional or trade journals, appropriate to your field.
professional portfolio
A professional portfolio is a record of goals, growth, achievement, and professional attributes developed over time and in collaboration with others.
professional relationships
Organizational colleagues, colleagues in other organizations, customers, clients, and collaborators, vendors, consultants, contractors, and union representatives.
professional vita
Resume that is chronological in format and emphasizes educational background first, and then work history. It can exceed two pages because it can include publications, patents and research. (see curriculum vita)
proficiency
Advancement in knowledge, skill, or position regardless of the cost.
profit and loss statement
A detailed statement of income and expenses of a business that reveals the operating position of the business over a period of time. Commonly referred to a P&L.
profit center
A profit center is a distinctly identifiable department or business unit that contributes to the overall financial results of a company.
progression
An appraisal principle that states that, between dissimilar properties, the value of the lesser-quality property is favorably affected by the presence of the better-quality property. (See appraisal)
progressive tax
A progressive tax is a tax that takes an increasing proportion of income as income rises. (See income tax)
project
Project refers to the number of dwelling units constructed, rehabilitated, or converted to a cooperative or condominium with the assistance of a mortgage loan from the Housing Finance Agency. This includes the acquisition, construction, or rehabilitation of lands, buildings, equipment, improvements, and other ancillary facilities, such as streets, sewers, utilities, parks, site preparation, and landscaping. It also includes other ancillary facilities, offices, and nonhousing facilities, such as administrative, community, health, recreational, educational, and welfare facilities as the Housing Finance Agency determines to be necessary, convenient, or desirable appurtenances. In addition, it also includes the acquisition, construction, or rehabilitation of such ancillary commercial facilities as the agency determines to be necessary to make the remainder of the project economically feasible.
projected gross sales
The total income that a project is expected to produce.
projection device
Any computer hardware device that projects information onto a screen.
promissory note
An unconditional written promise of one person to pay a certain sum of money to another person, order or bearer at a future specified time. A broker who accepts a promissory note as a deposit from a prospective purchaser must generally disclose to the seller that the buyer's deposit is in the form of a promissory note.
Proof of Legal Presence (AZ)
Arizona regulations require that all applicants for state licensure submit proof of legal presence in the United States. Proof of legal presence must be in the form of a government-issued identification such as a driver's license or passport.
property
Property is any real property located in this state and improved by a one- to four-family dwelling used or occupied, or intended to be used or occupied, as the home or residence of one or more persons. But property may not refer to unimproved real property upon which such dwellings are to be constructed.
property analysis
A study made to familiarize a property manager with the nature and condition of a building, its relative market position, and its estimated income and operating expenses.
property and casualty insurance
Property and casualty insurance protects against property losses to a business, home or car and/or against legal liability that may result from injury or damage to the property of others. This type of insurance can protect a person or business with an interest in the insured physical property against losses.
property brief
Produced by the listing agent, a property brief is simply a one-page flier about the property pointing out attractive features. It usually contains a drawing or photograph of the home, and is given to people the agent feels are especially interested in the property.
property inspection waiver (PIW)
An option to waive an appraisal for an eligible loan purchased by Fannie Mae.
property management
A branch of the real estate business involving the marketing, operation, maintenance, and other day-to-day requirements of rental properties by an individual or a firm acting as agent of the owner. (See property manager)
property management reserve account
An account whereby a portion of the rental proceeds are set aside by property management company to meet any unexpected costs that may arise in the future as well as the future costs of upkeep. In most cases, the fund is simply a savings account, although the fund might be established to meet the costs of scheduled upgrades
property manager
Someone who manages real estate for another person for compensation. Duties include collecting rents, maintaining the property and keeping up all accounting. (See property management)
Property owners or homeowners
Property owners or homeowners are any or all record title owners of the residential real property in foreclosure or, where applicable, default at the time of the equity sale.
property reports
The mandatory federal and state documents compiled by subdividers and developers to provide potential purchasers with facts about a property prior to their purchase.
property rights
The rights of an individual to own and sell property and keep the income earned from it, subject to certain restrictions, such as zoning. (See bundle of rights)
Property Tax Postponement Law
The Property Tax Postponement Law gives qualified persons who are 62 or older, blind or disabled with a minimum household income the option of having the state pay all or part of the taxes on their homes. The amount of taxes postponed must be repaid to the State of California. The postponed amount becomes due and payable when the Individual moves, sells the property or dies.
property tax year
Fiscal year for California property tax purposes runs from July 1 to June 30. Taxes charged for that period become a lien on the property on the preceding January 1. (See property taxes)
property taxes
A tax levied on land and buildings (real estate) and on personal property. Assessment are made by county or city assessor's office for real property taxes. Payment dates may vary according to state regulation.
Proposed list price
Proposition 13
A voter initiative that added Article XIII A to the California Constitution. It limits property tax rates to no more than 1% of full cash value. Increases in assessed value per year are capped at 2% or the percentage growth in the Consumer Price Index (CPI), whichever is less. In 2002-03, the increase was 1.87%. It has been less than the 2% cap only five times since 1977. New construction and the sale of property, with some exceptions, also increase assessed values.
proposition 19
Limits prior propositions in that transfers to children and grandchildren require they use the property as a residence.
proprietary lease
A proprietary lease is a special type of lease associated with cooperative housing, where the leaseholder is also a shareholder in the cooperative corporation that owns the building. This lease grants the shareholder the right to occupy a specific unit within the cooperative, while also delineating the rights and responsibilities of both the tenant-shareholder and the cooperative association. Unlike traditional leases, a proprietary lease does not have a set expiration as it is tied to the ownership of shares in the cooperative, making it effective as long as the individual remains a shareholder.
prorations
Expenses, either prepaid or paid in arrears, that are divided between the buyer and seller at closing.
prospecting
Locating owners of properties who are interested in selling, or buyers who are interested in purchasing property. (See endless chain, farming, networking)
prospective economic advantage
Legal term for one's expectations in doing business.
protected class
Any group of people designated as such by the Department of Housing and Urban Development (HUD) in consideration of federal and state civil rights legislation. Currently includes ethnic minorities, women, religious groups, the handicapped and others.
protected classes (State-specific FH Acts)
Other protected classes include:
- age;
- source of income;
- marital status
- sexual orientation;
- occupation.
protein
Any of numerous naturally occurring extremely complex combinations of amino acids that contain the elements carbon, hydrogen, nitrogen, oxygen, usually sulfur, occasionally phosphorus, iron or other elements, are essential constituents of all living cells, and are synthesized from raw materials by plants but assimilated as separate amino acids by animals. Proteins, along with carbohydrates and lipids constitute the principal structural components of living cells. (See carbohydrates, lipids)
provisional license
A license the ADRE issues that allows a licensee to practice as a salesperson or broker subject to either a consent order or the Commissioner's terms, conditions and restrictions
psychological contract
The goal of human resource management is to forge a psychological contract between the company and the individual workers. The psychological contract is a set of expectations held by both employer and employee. Employers expect employees to provide a fair day's work, to accept the authority of management, and report to work regularly. Employees expect just compensation, career enhancement and quality in work life.
Public Buildings Element
This element must show locations that have civic and community centers, public schools, libraries, police and fire stations, and other public buildings.
public debt
Public debt is money (or credit) owed by the government—federal, state, or local. The government accumulates debt over time by running a deficit; it spends more than it receives in tax revenue. Governments borrow by issuing securities (bonds). (See credit, bond, security)
Public Health movement
This movement focused on the establishment of industrial safety requirements, maximum work hours, minimum housing standards, public recreation amenities, and ensuring the provision of light and air in cities.
public hearing
A formally announced meeting of a planning commission, the express purpose of which is to receive written and oral testimony on specific matters open to the public for attendance and testimony. Commission members may ask questions, but no deliberation takes place. A full record of information should be kept, reviewed by the staff, and incorporated into its report for subsequent commission deliberation.
public records
Records which by law give constructive notice of matters relating to property.
public report
A disclosure statement required by the Subdivided Lands Law stating that a buyer is not obligated until he or she has read the report and signed a receipt. (See Subdivided Lands Law)
Public Services and Facilities Element
This element must show general plans for police, fire, emergency services, sewage, refuse disposal, drainage, local utilities, rights-of-way, easements and facilities for them.
public water system
A system that provides piped water for human consumption to at least 15 service connections or regularly serves 25 individuals.
puffery
Exaggerated praise or claims, especially when used for promotional purposes.
puffing
Exaggerated or superlative comments or opinions not made as representations of fact and thus are not grounds for misrepresentation, such as, "This property is a real good buy." One test used is whether a reasonable person would have relied on the statement. A statement such as, "The apartment has a fantastic view, " is puffing because the prospective buyer can clearly assess the view for himself or herself, whereas a statement such as "The apartment has a fantastic view of the lake," when in fact all its windows face the street, would be misrepresentation. (See caveat emptor, misrepresentation)
pulse
A regular throbbing caused in the arteries by the contractions of the heart.
pulse rate
The number of heartbeats per unit of time.
punitive damages
Damages awarded to one party to punish another party for dishonest conduct. Meant to deter others from committing a similar offense.
punitive damages
Damages awarded to one party to punish another party for dishonest conduct. Meant to deter others from committing a similar offense.
pur autre vie
"For the life of another." A life estate pur autre vie is a life estate that is measured by the life of a person other than the grantee.
purchase option
A right given to a prospective purchaser or lessee to buy or lease the owner's property at a fixed price within a specified period of time.
purchase-money mortgage
A mortgage given as part of the buyer's consideration for the purchase of real property, and delivered at the same time that the real property is transferred as a part of the transaction. It is commonly a mortgage taken back by a seller from a purchaser in lieu of purchase money. A purchase-money mortgage is usually used to fill a gap between the buyer's down payment and a new first mortgage or mortgage assumed, as when the buyer pays 10 percent in cash, gets an 80 percent first mortgage from a bank, and then the seller takes back a purchase-money second mortgage for the remaining 10 percent.
purify
To clear from material defilement or imperfection; to free from undesirable elements.
purpose approach
This approach to statutory interpretation assesses the aims and objectives of the statute (i.e., legislative intent).
pyramiding
The process of acquiring properties by refinancing properties already owned and investing the loan proceeds in additional properties.
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