A junior lien, also known as a subordinate lien, refers to any lien that will be paid after earlier liens have been paid. It denotes the secondary position of the lien in order of payment priorities.
Laches is a legal doctrine used to bar claims in which plaintiffs have unreasonably delayed in asserting their rights, causing detriment to the defendant.
An organization devoted to the exchange of information and ideas pertaining to land economics, fostering a network of professionals engaged in various aspects of land use, development, and conservation.
Land encompasses any part of the Earth's surface that is not covered by water. It is a fundamental real estate term that includes the ground itself, soil, and any other sub-surface materials.
Land banking refers to the practice of acquiring parcels of land with the intention of holding onto them until they become more valuable or are ready to be developed.
A Land Contract is a real estate installment sale arrangement whereby the buyer can use, occupy, and enjoy the land, but the seller retains the deed and title until all or a specified part of the purchase price has been paid.
Land economics is a branch of economics that studies the allocation, use, and value of land. This field aims to understand how land resources are utilized, valued, and managed, with a special focus on agriculture and urban development. It integrates knowledge from geography, environmental studies, and economic theory to analyze land-related issues.
A land lease, also known as a ground lease, is a contractual agreement where the tenant leases the land on which they intend to construct a building or other improvements, while the land itself remains the property of the landlord.
A land lease community is a type of housing development where homeowners lease the land under their homes from a landowner who often provides community infrastructure and amenities. These communities are commonly associated with manufactured or mobile homes.
Land reclamation is the process of creating new land from oceans, seas, riverbeds, or lake beds. This process is used for various purposes including agricultural, industrial, residential, and infrastructural development.
The Land Residual Technique is a method used in real estate appraisal to estimate the value of land by using the net operating income (NOI) and the value and return of improvements on the property. It is especially useful for feasibility analysis and determining the highest and best use of a property.
A land sale-leaseback is a financial transaction where the owner of a piece of land sells it to an investor and simultaneously enters into a lease agreement to continue using the land for a specified period.
Land use controls or regulations refer to government ordinances, codes, and permit requirements designed to ensure that private use of land and natural resources aligns with established policy standards.
Land Use Intensity (LUI) refers to the extent to which a land parcel is developed, considering the conformity with zoning ordinances and regulations.
Land Use Planning is an activity, generally conducted by a local government, aimed at guiding public and private land use decisions to ensure they are consistent with community policies. It is primarily used to inform Zoning decisions.
Land Use Succession refers to the change in the predominant use of a neighborhood or area over time, often driven by social, economic, and environmental factors. This process can significantly alter the character and demographic makeup of a region.
In early English law, the phrase 'land, tenements, and hereditaments' was used to encompass all sorts of real property, including the rights and interests inherent in real estate ownership.
The land/building ratio is a comparative value of land relative to the improvements, commonly used in the assessment of property worth in real estate to understand property valuation dynamics.
Landlocked refers to a condition where a property has no direct access to a public road, requiring access through an adjacent property.
A landlord is a property owner who rents out their property to a tenant in exchange for rent. They have the right to lease property for a specific time period while earning rental income.
A landmark can serve as a boundary marker for land, or it could be a historically significant or well-known structure that attracts attention and tourist interest.
A Landscape Architect is a professional who designs building sites, subdivisions, and other projects requiring expertise in areas like drainage, grading, vegetation, installation of utilities, and site improvements.
In condemnation proceedings, the larger parcel refers to the overall property from which the condemned property is taken. It includes properties that are affected, although not actually taken, to determine severance damages.
A late charge or late fee is a penalty that businesses or lenders impose on customers who fail to make a payment by the specified due date, including any applicable grace period. These fees can be quite substantial, sometimes up to 5% of the regular payment amount, and are meant to incentivize timely payments.
Latent defects are hidden flaws in a property that are not apparent at the time of purchase or during an initial inspection but may reveal themselves later, often causing significant issues.
Lead is a toxic metal once commonly used in construction materials such as plumbing pipes and paint, but now it is identified as a hazardous substance. Its presence in property necessitates special disclosures during transactions.
Lead-based paint is considered a hazardous material and capable of causing poisoning. Disclosure of its existence in a property is mandatory when selling or leasing, as dictated by federal laws such as the Residential Lead-Based Paint Hazard Reduction Act of 1992.
LUST refers to leaking underground storage tanks, a critical environmental issue requiring prompt attention and remediation. These tanks often contain hazardous substances that can contaminate soil and groundwater.
Leaking Underground Storage Tanks (LUSTs) are a major environmental concern, as they can release hazardous substances into the ground, posing risks to both the environment and human health.
A lease is a legal contract in which the entity entitled to the possession of real property (lessor) transfers those rights to another entity (lessee) for a specified period in exchange for payment called rent.
A Lease Abstract encapsulates the major highlights and key provisions of a lease agreement, offering a quick reference for property managers, landlords, and tenants while ensuring essential information is easily accessible.
A Lease Proposal is an offering made to a prospective tenant that outlines the key terms and conditions of a potential lease agreement, facilitating the leasing process.
A lease purchase agreement, also known as a lease with option to purchase, is a contractual arrangement that combines elements of a traditional rental lease with an option to buy the property within a specified timeframe. It can provide benefits for both buyers and sellers.
A Lease with Option to Purchase is a leasing arrangement where the lessee (tenant) has the right to purchase the leased property at a predetermined price within a specified timeframe, subject to certain conditions.
A lease-own hybrid model is a commercial real estate lease arrangement in which a tenant leases space in a property and simultaneously gains an ownership stake in the entity owning the property. This model allows tenants to participate in annual profits and appreciate in the property’s value while committing to long-term, above-market rent payments.
A Leaseback, often referred to as a Sale-Leaseback, is a financial transaction in which a property owner sells their asset and leases it back from the buyer. This allows the original owner to continue using the property while freeing up liquid capital.
Leased Fee refers to the landlord's ownership interest in a property that is under lease. It's the structure for defining income from rental property, emphasizing the importance of anticipated rental income for assessing value.
Leased Fee Adjustment in real estate appraisal is the reduction in market value of a leased fee estate caused by current leases at below-market rent, resulting in a positive value for the leasehold estate held by the lessee enjoying the rent savings.
Leased fee value represents the worth of a property to the landlord based on the current rental agreements in place. It's crucial for understanding property valuation under existing lease conditions.
Leased land, also referred to as leasehold land, involves leasing a parcel of land from a landowner for a specified time period, often for development or long-term residency. This arrangement grants the tenant certain property rights without transferring land ownership.
A leasehold estate refers to a tenant’s right to occupy and use real estate for a defined period as stipulated in a lease agreement. Leasehold estates provide tenants with significant rights over the property during the lease term.
Leasehold improvements refer to any changes or additions made to a rental space by a tenant that are intended to enhance or adapt the space for their particular use. These modifications are typically attached to the property, involve investment in fixtures or installations, and must comply with the terms of the lease agreement.
A leasehold mortgage is a lien placed on a tenant’s interest in real estate, usually a long-term lease, to provide security for the repayment of a loan.
Leasehold value refers to the valuation of a tenant's interest in a property, especially beneficial when the rent is below the current market rates and the lease term is significant. It plays a crucial role in investment decisions where there is a discrepancy between market rent and the agreed lease rent.
LEED Certification is a globally recognized certification system for buildings, homes, and communities that are designed and built to meet high environmental performance standards in areas such as site development, water savings, energy efficiency, materials selection, and indoor environmental quality.
Legal age refers to the official standard of maturity upon which an individual is considered legally responsible for their actions. In the context of real estate, contracts involving minors are typically voidable.
A legal description is a formally recognized and unique identifier used to describe the precise boundaries of a parcel of real estate. It is essential for legal transactions including deeds, mortgages, and other property-related documents.
A legal entity is an individual, company, or organization that has legal rights and obligations, including the ability to enter into contracts, sue and be sued, own assets, and borrow money.
The term 'legal name' refers to the name recognized by government authorities for official purposes, as recorded on documentation such as birth certificates, identification cards, and legal contracts.
A legal notice serves as a formalized notification required by law to communicate specific information to others. It ensures that all parties are informed about legal proceedings, decisions, or actions.
Legal residence, also known as domicile, refers to the place where an individual has their permanent home or principal establishment and to where, whenever they are absent, they intend to return. It plays a crucial role in determining tax responsibilities, voting rights, and other legal and financial obligations.
Legal title refers to the officially recognized ownership of property, as defined and protected by law. A person or entity with legal title has the full rights to control and transfer the property, subject to any restrictions that may apply.
A legatee is an individual or entity that receives property or assets from a will upon the death of the testator.
A lender is a party that originates or holds loans. They can include entities such as commercial banks, thrifts, credit unions, mortgage bankers, and mortgage brokers.
Lender participation refers to the scenario where multiple lenders jointly provide financing by sharing the credit risk and loan proceeds of a single transaction, commonly seen in participation mortgage structures.
Lender’s Title Insurance, also known as Mortgagee’s Title Insurance, provides protection to mortgage lenders against any issues that may arise with a property's title, such as disputes or defects.
A less than freehold estate refers to an estate in land that has a predetermined time span, most commonly associated with leases and leasehold properties.
In real estate, a lessee is an individual or entity that rents or leases property from a lessor. The lessee is responsible for adhering to the terms of the lease agreement, including payment of rent and maintenance obligations.
A lessor is a person or entity that rents out property to another party, known as the lessee, under the terms outlined in a lease agreement. Often referred to as the landlord, the lessor retains ownership of the property while allowing the lessee to use it for a specified period.
In real estate, a 'LET' refers to the act of renting out a property to a tenant. It commonly applies to residential or commercial properties that are being leased for an agreed-upon rent amount over a specified period.
A legal document indicating that a tenant recognizes a new owner of the property as their landlord, effectively transferring tenancy.
A Letter of Commitment serves as official notification to a borrower from a lender, indicating the latter's intent to grant a loan. This letter typically specifies the terms of the loan, including interest rate, loan term, and sets a date for closing.
A letter of credit is a financial instrument issued by a bank that guarantees a buyer's payment to a seller will be received on time and for the correct amount. It reduces risk in transactions, especially in real estate, by substituting the bank's credit for the customer's.
A Letter of Intent (LOI) is a formal document expressing the intention to enter into a contract or agreement without formally binding the parties involved.
A Letter of Intent (LOI) in real estate serves as a preliminary agreement that outlines the terms and details before finalizing a contract. It is commonly used during property sales, leases, and development transactions.
A level annuity is a financial product that provides a series of equal periodic payments for a specified period, typically in retirement planning or loan schedules.
A level-payment income stream refers to a series of equal payments made at regular intervals over a specific period of time. It is typically associated with annuities, mortgages, or other financial instruments.
A level-payment mortgage is a type of mortgage that requires the same payment each month (or other period) for full amortization. This means that the amount paid in monthly installments remains constant over the life of the loan.
Leverage involves the use of borrowed funds to increase an investor's purchasing power and potentially amplify the profitability of an investment. It can result in higher returns but also carries additional risk.
A 'levy' refers to the legal imposition, assessment, or collection of charges such as taxes, fines, or other financial obligations. When an authority such as a government or court mandates a collection, it is termed a levy.
In real estate, liability refers to any legal debts or financial obligations incurred during the course of business. It stands in contrast to assets, which represent ownership of resources or properties.
Liability insurance provides protection for a property owner from claims that arise due to injuries or damage to others or their property. It covers legal costs and any payouts for which the insured would be responsible if found legally liable.
The term 'liable' refers to being responsible or obligated, especially in the context of financial and legal commitments within the realm of real estate. It often indicates a party that is legally bound to uphold agreements or settlements.
A Liar Loan is a category of mortgages where borrowers are allowed to state their income and assets without providing any documentation to verify this information. These loans became notorious during the housing boom of the mid-2000s when many borrowers exaggerated their financial standing to qualify for larger loans.
LIBOR, or the London Interbank Offered Rate, is the interest rate at which major international banks lend Eurodollars to one another. It is widely used as a benchmark for adjustable-rate mortgages and other financial products.
License laws govern the activities of real estate salespersons to ensure that transactions are conducted fairly, ethically, and legally, thereby protecting consumers and maintaining integrity in the marketplace.
A licensed appraiser is a professional who holds a designation that allows them to appraise non-complex residential properties of one to four units valued up to $1 million and complex properties of one to four units up to $250,000.
A licensee in real estate refers to an individual who holds a valid real estate license, who can be either a licensed salesperson or broker.
A licensing examination is a written test administered to prospective real estate brokers or salespersons to determine their ability to represent the public in real estate transactions effectively.
A lien is a legal claim or right against a property that is used as security for the payment of a debt, judgment, mortgage, or taxes. It serves as an encumbrance and imposes restrictions on transferring the property until the debt is satisfied.
A lien waiver is a document from a contractor, subcontractor, materials supplier, or other party to the construction project, stating they have received payment and waive any future lien rights to the property for the amount received.
States whose laws give a lien on property to secure debt. This is contrasted with title-theory states where the lender holds the title. In lien-theory states, borrowers have the right to use and enjoy the property unless they default, at which point lenders may foreclose.
A lienholder is an individual or entity that holds a lien on a property, thus having a legal right or claim against the property as a security for a debt or obligation.
A Life Estate is a type of freehold interest in real property that lasts for the lifetime of an individual. Upon their death, the property either reverts to the original owner or passes to a remainderman.
A Life of Loan Cap is a contractual limitation on the maximum interest rate that can be applied to an adjustable-rate mortgage during the term of the loan.
A life tenant is an individual who holds the right to use, occupy, and control a property for the duration of their own life or the lifetime of another specified individual.
A life-support system in real estate encompasses all critical infrastructure and systems in a building aimed at ensuring safety, security and sustenance. These include camera surveillance, fire protection, communications systems, backup lighting, and more, crucial for both tenant safety and property utility.
Assets considered to be of the same nature and character, even if they differ in quality or grade, which can be exchanged under Internal Revenue Code Section 1031 to defer capital gains taxes.
Limited liability refers to the restriction of an individual's potential losses to the amount they have invested in a particular asset or business. This concept limits their personal liability and prevents them from losing more than their initial investment, provided they do not otherwise agree to assume additional liability.
A Limited Liability Company (LLC) is an organizational form recognized in many states, offering limited liability protection to its owners and potential tax advantages of a partnership, making it an attractive option for real estate ownership.
A limited partnership (LP) is a business structure where at least one partner is passive, with liability limited to their investment, and at least one partner with unlimited liability.
A plan offered by some real estate brokers that allows buyers or sellers to contract for less than the full array of brokerage services at reduced commission rates.
The Lincoln Institute of Land Policy is a nonprofit educational organization committed to the research and discussion of land policy and property tax issues on a global scale.
A line of credit (LOC) is an arrangement between a financial institution and a borrower that establishes a maximum loan balance that the lender permits the borrower to access or maintain. The borrower can draw funds, repay, and redraw, provided the borrowing does not exceed the agreed credit limit.
The lineal foot is a unit of measurement used in real estate to represent a one-foot length measured in a straight line along the ground. Commonly used in pricing land and determining costs for building materials, the concept assumes consistent depth or width.
A LINK is a unit of distance commonly used by surveyors, where 100 links form a surveyor’s chain. One link is equivalent to 7.92 inches or 0.66 foot.
The term 'linkage' in real estate refers to the physical or economic connection, often pertaining to the time and distance between a land use and support facilities, or between people and their activities. Successful linkage leads to enhanced property value and better quality of life for residents.
A liquid asset is a property that can be converted to cash quickly and with minimal loss of value. Liquid assets provide the ability to raise cash for financial needs such as down payments for real estate.
Liquidation involves the process of closing a business, selling its assets, and distributing the proceeds to creditors and shareholders. It can also refer to retiring debts by paying them off.
Liquidated damages are a predetermined sum agreed upon in a contract which one party will pay to the other in the event of a breach of contract. This provision aims to cover the non-breaching party's estimated losses without requiring a legal battle.
