Florida Realtor Vocabulary

Earnest Money

Deposit showing buyer’s good faith

Equity

Property value minus debts/liens.

Encroachment

Unauthorized intrusion on neighbor’s property.

Fixture

Item once movable but attached to real property.

As-Is Sale

Property sold in current condition with no guarantees.

Mechanic’s Lien

Claim against property for construction work not paid.

Homeowners’ Association (HOA)

Organization regulating community properties.

Caveat Emptor

"Buyer beware" principle on property condition.

Florida-Specific Laws & Regulations

Florida Real Estate Commission (FREC)

Regulates licensing and conduct.

Florida Real Estate License Law

Rules for sales associate and broker practice.

Florida Real Estate Settlement Procedures (RESPA/TILA)

Loan disclosures.

Florida Fair Housing Act (F.S. § 760)

Prevents housing discrimination

Agency Disclosure Form

Required explanation of broker relationships.

Deed

Transfers property ownership legally

Grantor/Grantee

Seller and recipient of property.

Title Search & Insurance

Ensures clear ownership and protection.

Alienation Clause

Loan payable on property sale.

Quitclaim & Warranty Deeds

Different guarantees of title transfer.

Recording

Publicly documenting property transfer to protect ownership.

Appraisal

Estimate of property’s market value

Comparables ("Comps")

Similar properties used for valuation.

Depreciation

Loss in value due to wear or obsolescence.

Capitalization Rate (Cap Rate)

Return rate on investment.

Principle of Substitution

Buyer pays no more than equivalent property cost.

Plottage

Value increase from combining parcels.

Mortgage/Deed of Trust

Security instrument for a property loan.

Amortization

Loan repaid gradually with principal and interest

Adjustable Rate Mortgage (ARM)

Interest rate can fluctuate periodically.

Balloon Loan

Small payments with a large final balance.

Loan-to-Value Ratio (LTV)

Loan amount ÷ property value

Private Mortgage Insurance (PMI)

Protects lenders when down payment <20%.

Buydown

Prepaid amount to temporarily lower interest rate.

Escrow

Third-party management of funds/documents during transaction.

Offer

Proposal to enter a contract.

Acceptance

Agreement to the offer, creating binding contract.

Breach of Contract

Failing to perform contract obligations.

Bilateral Contract

Each party makes binding promises.

Unilateral Contract

One party promises action for performance.

Addendum/Amendment

Changes or supplements to contracts.

Contingency

Condition affecting enforceability of contract.

Novation

Substitution of new contract or party with consent.

Consideration

Value exchanged between parties to support contract.

Bundle of Rights (DEEPC)

Disposition, Enjoyment, Exclusion, Possession, Control

Fee Simple Absolute

Maximum property ownership with complete transfer rights.

Tenancy in Common

Co-ownership without survivor right.

Joint Tenancy

Co-ownership with right of survivorship.

Appurtenance

Right or object attached to property transferring with ownership.

Air and Water Rights

Rights to the space above and water bordering the property.

Easement

Legal right to use another’s land for a purpose.

Encumbrance

Claim or lien affecting ownership or transfer.

Zoning & Land Use Regulations

Controls how land may be developed or used.

Agent

Represents another party in a real estate transaction

Broker

Licensed professional who supervises agents and transactions.

Fiduciary Duty

Obligation of loyalty, care, obedience, disclosure, accounting, confidentiality

Dual Agency

When one agent represents both buyer and seller with consent.

Listing Agreement

Contract giving a broker authority to market property.

Principal/Client

The person hiring and represented by the agent.

Customer

A party to whom services are owed limited duties (not fiduciary).

Disclosure

Obligation to inform about material facts or conflicts.