Texas Real Estate Principles & Glossary

Comprehensive vocabulary flashcards covering real estate principles, legal descriptions, estates, forms of ownership, title transfers, and statutory requirements.

Economic Characteristics of Land

The four economic aspects of real estate that govern its value: scarcity, improvements, permanence of investment, and area preference or situs.

Physical Characteristics of Land

The three inherent physical features of land: immobility, nonhomogeneity (heterogeneity), and indestructibility.

Texas Rule 535.2(i)(5)

A rule stating that, at a minimum, when a sales agent performs a type of brokerage activity for the first three times, the sponsoring broker must require the sales agent to receive coaching and assistance from an experienced, competent license holder.

Seven Sources of Law

The collection of legal authorities governing real estate in the United States: the U.S. Constitution, laws passed by Congress, federal and state regulations, state constitutions, laws passed by state legislatures, local ordinances, and court decisions.

Bundle of Legal Rights

The legal theory of land ownership entitling the owner to possession, control within the law, enjoyment, exclusion, and disposition, rather than ownership of the physical land itself.

Subsurface Rights

Ownership rights to oil, gas, minerals, and groundwater beneath the land surface; these interests are legally dominant over surface rights because holders must have surface access to extract minerals.

Fructus Industriales (Emblements)

Annual cultivated crops, such as corn and grapes, produced through human labor and industry that are legally classified as personal property.

Fructus Naturales

Perennial plantings, trees, and native grasses that do not require annual cultivation, legally classified as real property.

Trade Fixture

An article installed on leased real estate by a tenant for business purposes that remains personal property, provided it is removed before lease expiration without damaging the premises.

Eminent Domain Repurchase Right

A statutory protection allowing an original owner to repurchase condemned property for the original sale price if the condemning entity fails to redevelop or reuse it within $10\,\text{years}$.

Freehold Estate

An estate in real property in which ownership continues for an indeterminate, unpredictable length of time, including fee simple and life estates.

Leasehold Estate

A tenant's nonfreehold possessory interest in real estate for a definite or determinable period, legally classified as personal property.

Determinable Fee Estate

A defeasible fee simple estate that automatically terminates and reverts to the grantor or heirs immediately upon the occurrence or nonoccurrence of a specified condition or event.

Fee Simple Subject to a Condition Subsequent

A defeasible fee simple estate granted on the condition that an event not occur; if breached, the grantor or heirs must explicitly exercise a right of reentry to terminate the estate.

Pur Autre Vie

A life estate whose duration is measured by the lifetime of a person other than the tenant ("for the life of another").

Homestead

Land owned and occupied as the family home, protected in Texas from forced sale by creditors with nine exceptions (including property taxes, mortgages, mechanics' liens, home equity loans, and HOA liens).

Easement Appurtenant

An easement that runs with the land upon conveyance, benefiting a dominant tenement and encumbering a neighboring servient tenement.

Easement in Gross

An individual or corporate interest in the land of another that is personal in nature rather than for the benefit of a separate parcel, such as a commercial utility easement.

Easement by Prescription

An easement acquired through continuous, open, uninterrupted, exclusive, and adverse use of another's real estate for a statutory period of $10\,\text{years}$.

Riparian Rights

Water rights held by owners of land bordering or containing a flowing stream or river, permitting domestic water use and ownership to the center of nonnavigable waterways.

Littoral Rights

The rights of landowners bordering large navigable lakes and oceans, permitting reasonable water use and establishing private property boundaries up to the mean vegetation line.

Rule of Capture

The legal doctrine in Texas granting landowners ownership of the groundwater beneath their property as real property, along with the right to drill and extract it.

Texas Workforce Commission (TWC) Wage Lien

A general lien against all real and personal property of an employer who owes unpaid wages to an employee, ranking higher in priority than all liens except ad valorem taxes.

Statutory Right of Redemption (Texas Tax Foreclosure)

The legal right of a defaulted property owner to buy back real estate after a tax sale within a maximum period of $2\,\text{years}$ for residential homesteads, agricultural land, and mineral interests.

Metes-and-Bounds Description

A method of land identification that starts at an identifiable point of beginning and follows distances (metes) and monuments or boundaries (bounds) completely around the tract back to the start.

Rectangular Survey System

A federal surveying method utilizing base lines and principal meridians, composed of townships measuring $6\,\text{miles}$ by $6\,\text{miles}$ ($36\,\text{sections}$), each section containing $640\,\text{acres}$ ($43,560\,\text{square feet}$ per acre).

Datum

A horizontal reference plane—such as the mean sea level in New York Harbor established by the U.S. Geological Survey—used to calculate vertical elevations, depths, and air lots.

Benchmark

A permanent reference mark, such as an embossed brass plate, established by surveyors to indicate precise, official elevations.

Vara

A traditional Texas unit of linear measurement equal to $33\frac{1}{3}\,\text{inches}$.

League

A traditional Texas land grant measurement originating under the Mexican government, equal to $6.919\,\text{square miles}$.

Ownership in Severalty

Title to real property held solely by one person or one recognized legal entity (sole ownership).

Tenancy in Common

A concurrent co-ownership estate where each cotenant owns an undivided fractional interest in severalty; there is no right of survivorship, and interests pass to the deceased cotenant's heirs.

Joint Tenancy

A form of co-ownership requiring the four unities of time, title, interest, and possession, characterized by a right of survivorship that transfers a deceased tenant's share to surviving co-owners.

Community Property Right of Survivorship

A formal written agreement between spouses stipulating that community property vests directly in the surviving spouse upon the death of either partner, bypassing probate proceedings.

Real Estate Investment Trust (REIT)

A security vehicle allowing a pool of at least $100\,\text{investors}$ to purchase ownership shares in commercial real estate or mortgage assets, exempt from corporate income tax if earnings are distributed.

Real Estate Mortgage Investment Conduit (REMIC)

A specialized tax vehicle that securitizes and channels cash flows from commercial mortgage pools through to investors without being taxed at the agent or entity level.

Delayed Exchange

A tax-deferred property exchange where an investor relinquishes real estate, identifies qualified replacement property within $45\,\text{days}$, and takes title within $180\,\text{days}$.

Equitable Title

The recognized legal interest a buyer acquires upon executing an enforceable real estate sales contract or contract for deed, entitling them to complete the purchase and demand legal title.

General Warranty Deed

A deed offering the maximum protection to the grantee by binding the grantor to full covenants warranting good and clear title against defects arising both before and during ownership.

Special Warranty Deed

A deed in which the grantor warrants and defends title solely against defects or encumbrances that arose "by, through, or under" the grantor's own period of ownership.

Deed Without Warranty

A deed (bargain and sale deed) that implies the grantor holds title to convey the property, but offers no express or implied covenants or warranties against defects.

Quitclaim Deed

A conveyance transferring only whatever right, title, or interest the grantor may currently hold in the real estate, containing no warranties or covenants whatsoever.

Adverse Possession (10-Year Statute)

Acquisition of legal title through continuous, exclusive, visible, hostile, and notorious use, cultivation, or enjoyment of another's real estate for $10\,\text{years}$, limited generally to $160\,\text{acres}$.

Abstract of Title with Lawyer's Opinion

A condensed, certified title history compiled by an abstracter that is reviewed by an attorney, who provides a written opinion regarding the condition and marketability of the title.

Title Commitment

A preliminary statement issued by a title underwriter identifying the terms, exceptions, encumbrances, and requirements under which it is prepared to issue a formal title insurance policy.

Hypothecation

The legal pledge of specific real or personal property as collateral to secure a debt without giving up physical possession of the property.

Acceleration Clause

A clause in a mortgage, note, or deed of trust enabling the lender to declare the entire unpaid balance of principal and interest immediately due upon borrower default.

Alienation Clause (Due-on-Sale Clause)

A mortgage provision stating that the entire remaining loan balance becomes immediately due and payable at the mortgagee's option if the borrower transfers or sells the secured property.

Nonjudicial Foreclosure (Power-of-Sale Notice)

A public foreclosure sale conducted by a deed-of-trust trustee without court oversight, requiring written notice posted at the courthouse and mailed to debtors at least $21\,\text{days}$ prior to the sale date.

FIRPTA Residential Withholding Tiers

Federal tax withholding tiers on foreign sellers when the buyer acquires a primary residence: $0\%$ if under $"\$300,000"$, $10\%$ if between $"\$300,000"$ and $"\$1,000,000"$, and $15\%$ if over $"\$1,000,000"$ (paid within $20\,\text{days}$ of closing).

Doctrine of Relation Back

The legal rule establishing that when conditions of a valid escrow agreement are satisfied, the title transfer is legally effective as of the date the grantor deposited the deed with the escrow agent.

Statutory Year Proration

A closing calculation method based on a $360\,\text{day}$ financial year, allocating $30\,\text{days}$ to each calendar month to divide ongoing expenses between buyer and seller.

TRID Rule Timelines

The CFPB rule mandating delivery of the Loan Estimate to a borrower within $3\,\text{business days}$ of loan application and the Closing Disclosure at least $3\,\text{business days}$ before consummation.

Attachment

The judicial taking of a defendant's real or personal property into custody under court order to hold it available for potential application toward an unpaid debt pending trial.

Lis Pendens

A recorded document providing constructive notice that a civil lawsuit has been filed in state or federal court that may alter or affect title to a specific real estate parcel.