Lesson 11 Paralegal

Air rights

The entitlement to control, occupy, or use the airspace above the land to a “reasonable” height

Appurtenant easement

An easement, such as shared driveway, that benefits one parcel (the dominant estate) and burdens another (the servient estate)

Bundle of rights

The collection of legal privileges (such as possession, control, exclusion, enjoyment, and disposition) that comes with property ownership

Closing disclosure

A document showing final loan terms and all closing costs, required to be given at least three days before closing

Compensatory damages

Money awarded to cover actual losses caused by a breach of contract

Constructive notice

The legal presumption that the public is aware of a recorded document’s contents, regardless of actual knowledge

Consummation

The point at which a buyer is legally obligated to begin repaying a loan, distinct from the property closing

Contingency

A condition that must be met for a contract to move forward (getting financed or passing inspection)

Deed of trust or mortgage

A legal document securing a loan with the property as collateral

Earnest money

A deposit made by the buyer to show serious intent to purchase a property

Easement

A legal right allowing someone to use part of another person’s land for specific purpose without owning it

Easement in gross

An easement benefiting a person or entity versus the adjoining parcel of land; commonly granted to utilities for accessing equipment

Escrow

An arrangement where a neutral third party holds funds and documents until a real estate transaction is complete

Exclusive listing

A listing that gives one broker the exclusive right to sell the property

Fee simple absolute

The most complete form of landownership, granting unrestricted rights to use, sell, lease, or transfer the property, subject only to legal restrictions

Fixture

A item of personal property that, once permanent attached to real property, becomes part of real estate and transfers with it

Freehold estate

A type of ownership in real estate that has an open-minded period, giving the holder lasting control over the land and the rights that come with it

General warrant deed

A deed in which the grantor guarantees clear title and makes multiple covenants -including seizin, quiet enjoyment, and against encumbrances-protecting the grantee

Hazard insurance

Insurance protecting the property against damage from things like fire, storms, or vandalism

Inspection report

A document summarizing a home inspector’s findings about the condition of a property

Joint tenancy

A form of concurrent ownership with equal shares and right of survivorship, upon one tenant’s death, their interest passes to surviving tenant

Lead-based paint disclosure

A federally required notice for homes built before 1978, informing buyers about lead-based paint hazards

Lien waiver affidavit

A document confirming that contractors or suppliers have been paid, preventing future claims on the property

Life estate

An interest in property that lasts for the duration of a specified person’s life, after which ownership passes to remainder man

Listing agreement

A contract between a property owner and a real estate broker that authorizes the broker to find a buyer

Littoral rights

Water rights belonging to landowners whose property borders a lake, sea, or ocean, allowing reasonable use of the shoreline water

Lot and block system

A legal description method identifying parcels by lot and block numbers within a recorded subdivision plat

Metes and bounds

A method of legally describing land or specifying boundary lines with distances and compass directions, starting and ending at a point of beginning

Mortgage

A loan used to purchase real estate, where the property serves as collateral

Multiple Listing Services (MLS)

A system that lets real estate agents share property listings and work together to find buyers

Offer of purchase

A formal proposal from a buyer to purchase real estate under specific terms

Open listing

A nonexclusive listing that allows multiple brokers to market the property, only the one who brings a buyer gets paid

Personal property

Movable items not permanently attached to land, like furniture, vehicles, tools

Promissory note

A written promise by the buyer to repay a loan

Prorate

To divide or allocate costs like property taxes fairly between the buyer and seller based on time of ownership

Punitive damages

Extra money awarded to punish someone for intentional wrongdoing; rare in real estate

Quiet enjoyment

A covenant in a general warranty deed assuring the grantee’s possession will not be distributed by superior claims

Quitclaim deed

A deed that transfers whatever interest the grantor has without warranties or guarantees, placing all risk on the grantee

Real property

Land and anything permanently attached to it, such as buildings, trees

Recording statutes

State laws governing how and when deeds and other property interests must be filed to establish public notice and priority

Rescission

Cancellation of a contract with both parties returning any exchanged benefits

Restitution

Repayment or return of what was received under a canceled contract

Riparian rights

Water rights belonging to landowners whose property borders a river or streams, allowing reasonable use of water

Risk of loss

A contract term stating which party is responsible if the property is damaged before the sale closes

Settlement agent

The person (often an attorney or escrow agent) who oversees the real estate closing process

Special warranty deed

A deed in which the grantor warrants only that they did not create title defects during their ownership, offering more limited protection than a general warranty deed

Specific performance

A legal remedy where a court orders a party to complete the contract, especially common in real estate

Statute of Frauds

A law requiring certain contracts to be in writing to be enforceable

Subsurface rights

The entitlement to use and extract natural resources, such as minerals or oils, below the land’s surface

Tenancy by the entirety

A form of joint tenancy available only to married couples; with right of survivorship and extra protections against individual debts

Tenancy in common

A form of concurrent ownership where co-owners hold separate, undivided (and possibly unequal) interests and may pass their shares to heirs

“Time is of the essence”

A clause making all contract deadlines legally binding

Title

Legal ownership of a property, typically proven with a deed

Title insurance

Protection for buyers and lenders against problems with the property’s title after closing

Title opinion

A lawyer’s written judgment on the legal status of the property’s title

Title search

A review of public records to confirm that the seller legally owns the property and that there are no liens or claims

Tract indexing

A system assigning each parcel a permanent identification number tied to public records, consolidating all transactions for that parcel

Trade fixture

Personal property installed by a tenant for use in business removable at lease end without significant damage and not transferring with the land

TRID

Federal rules that require lenders to provide clear disclosures of loan terms and closing costs