Principles 1: Level 3

ad valorem taxes

a tax calculated according to the assessed value of a piece of real estate

amortization

the process of paying off a debt/mortgage in regular installments based on a fixed payment schedule

arrears

payment for an item or service after it is received

CLUE reports

stands for Comprehensive Loss Underwriting Exchange, a database used by insurance agencies that contains information on any claims made in the past five years by property owners on specific properties

common elements

portions of a shared ownership property not controlled by any one owner or tenant; examples include parking lots, lobbies, fitness centers, elevators, etc.

cooperative (co-op)

a residential building in which the title is held by a corporation, the residents are stockholders in the corporation, and the residents have a lease

homestead tax exemption

reduces the amount of ad valorem taxes assessed on a homestead

timeshare

a form of co-ownership where each owner has use of the property at a different prescribed period of time, also known as interval ownership

PITI

stands for Principal, Interest, Taxes, and Insurance, which are the components of most mortgage payments

planned unit development (PUD)

a subdivision that includes residential dwellings along with nonresidential real estate, departing from normal zoning and subdivision regulations; recreational facilities may be co-owned by PUD lot owners as tenants in common

prorate

the dividing of expenses for items like taxes, interest, and rent at the closing between the seller and the buyer

proration

the act of dividing or allocating expenses between buyers and sellers based on the actual period of usage of the item or service