D

DAMAGES - Compensation or indemnity for loss owing to breach of contract, or a tort (civil wrong).

DAMP-PROOFING - Usually involves the coating of exterior foundation walls with a one-quarter inch layer of mortar or tar, which ideally extends down to the footing. The foundation/footing joint is also covered to improve the seal and direct the water into the drainage tile.

DAMPER - A valve or plate operated mechanically or manually to regulate air flow to or from any prescribed point.

DEBT RATIO - One of several commonly used financial ratios (e.g., total liabilities to total assets measures the proportion of assets financed by borrowing).

DECLARATION - The constitution of a condominium corporation which creates the condominium and defines the responsibilities of the owners and the corporation.

DEED - A legal document, duly executed and delivered, that conveys title or an interest in real property.

DEED RESTRICTION - An imposed restriction in a deed to limit the use of the land.

DEFAULT - Failure to fulfill a promise or obligation.

DEFERRED MAINTENANCE - Ordinary maintenance that is not performed and negatively affects a property's use and value.

DELEGATION OF DUTIES - The authorization given by one party to another to carry out the specific responsibilities that party has undertaken on behalf of a client.

Delinquency – Occurs when a tenant is late in rental payments that have been agreed upon in a tenancy agreement.

 

DEMAND LOAN/LINE OF CREDIT - An arrangement between the business customer and a financial institution respecting the maximum amount of credit allowed that business.

DEMISED PREMISES - Premises or parts of real estate in which an interest or estate has been transferred temporarily, such as an interest in real property conveyed in a lease.

DENSITY - References the maximum allowable usage for a given parcel of land (e.g., number of people, amount of residential units, or square footage).

DEPOSIT - Payment of money or other valuable consideration as a pledge for fulfillment of a contract.

DEPRECIATION - Any decline in the value of a physical asset, usually resulting from physical (ordinary wear and tear) deterioration and functional/ locational obsolescence.

DESCRIPTION, LEGAL - A legal identification of land or premises.

DEVELOPER - One who engages in the subdivision or improvement of land.

Development – Includes an excavation, building, addition, replacement, repair or change in the use of land or building.

 

Development Permit – Official authorization, issued by the municipality, of the proposed use of the property.

 

DIFFUSER - A device for reducing the velocity of air flow from a mechanical duct system supplying air within a structure. Its shape is usually circular or square and is set in the ceiling at predetermined locations to diffuse air within a defined space. Diffusers, in residential property, are the small rectangular grates normally located at floor level.

Direct Control of Land – Land use districts in which uses are entirely decided by the municipality.

 

DISBURSEMENTS - The term disbursement, for real estate purposes, normally refers to those items requiring apportionment as of the date of closing. Such disbursements include any rents, mortgage interest, realty taxes, local improvement rates, unmetered public or private utility charges, and unmetered cost of fuel. Such disbursements are apportioned and allowed to the day of completion, the day of completion itself to be charged to the purchaser.

Discharge of Contract – Termination of the contract.

 

Discharge of Mortgage - A document signed by the lender and given to the borrower when a mortgage loan has been repaid in full.

 

DISCLAIMER - The repudiation or denial of a claim.

DISCLOSURE - The open and forthright discussion of relevant matters by an agent to his/her principal.

DISCOUNTING - The process of purchasing the face or remaining value of a mortgage at a lower cost to increase yield.

Discretionary Uses – Land used for purposes deemed to be generally appropriate for the district but not necessarily compatible with the surrounding uses. A discretionary use may be approved, either permanently or for a limited period of time, either with or without conditions.

 

DISTRAIN (DISTRESS) - Right of the mortgagee or landlord to seize and suction chattels, after due notice of a public auction, in settlement of the mortgagor's or tenant's debt.

DISTRIBUTION PANEL - An electrical panel providing the interface between the service entrance wires to a structure and dispersing of power throughout that structure.

DOMINANT TENEMENT - The estate or property which derives benefit from an easement over a servient tenement, as in a right-of-way.

DOUBLE HUNG WINDOW - Made up of two movable parts, an outer part in the top half of the opening and an inner part on the bottom half of the opening. They move up and down on their guides.

DOWER - To give a widow a life interest in one-third of her husband's real estate. To convey clear title, a wife would have to release her interest or bar her dower rights if the husband was an owner and wished to sell or mortgage the property.

Dower Act – Provincial legislation created to provide protection to one spouse from disposition of property by the other spouse.

 

Dower Affidavit – A document signed by the owner of a property when there is only one name on title to show that there is no need for consent. Either the owner is not married or the owner and/or spouse have never lived on the property.

 

Dower Rights – All rights given by the Dower Act to the spouse of a married person in respect to the homestead and property of the married person.

 

Dower Schedule – The schedule in the Purchase Contract that addresses dower issues such as consent, acknowledgement or the dower affidavit.

 

Down Payment - The portion of the house price the buyer must pay up front from personal resources, before securing a mortgage. It generally ranges from 5%-20% of the purchase price.

DUAL AGENCY - Representation of two principals (usually seller and buyer) by the same agent in the same transaction.

Dual Agency Disclosure – Since the brokerage is working for both parties in a dual agency situation, it becomes necessary to limit the fiduciary duties owed to both clients. The dual agent may not disclose that the seller/landlord will accept less or the buyer/tenant will pay more than the asking price/rate. The motivation for the sale/lease can also not be disclosed.

 

DUPLEX - A two-family dwelling or house have two self-contained residential units. There is only one deed for the ownership of both units.

DURESS - The threat of violence, force or undue pressure to coerce a person into an action against his/her will.

E

EASEMENT - A right enjoyed by one tenement over another tenement, usually granted for a specific purpose rather than for the general use and occupation of the land, and once granted attaches to the land and binds subsequent owners.

ECONOMIC LIFE - The period over which improvements to real estate contribute to the value of the property.

ECONOMICS - The study of how individuals and society allocate scarce resources in satisfying their wants and needs, including production, distribution, and consumption of goods and services to meet the needs of various economic units.

 

EFFECTIVE AGE - The estimated age in years as indicated by the condition and utility of a structure based on the age of structures of equivalent utility, condition, and remaining life expectancy, as distinct from chronological age.

EFFECTIVE DATE - The day or date upon which something occurs or ceases to occur.

EFFECTIVE RATE OF INTEREST - The true rate of interest charged on a mortgage loan.

ELECTRICAL SERVICE SIZE - The size of the electrical service (amps) provided from the primary line to the building. (e.g., 6OA, 100A, 200A)

ELEVATION - The exterior of a structure usually viewed from the front or otherwise identified - e.g., side elevation, rear elevation.

EMINENT DOMAIN - The right of a government or municipal quasi-public body to acquire private property for public use (e.g., through condemnation or expropriation).

Encroachment – A fixture, such as a wall or fence, which illegally intrudes into or invades on private property, diminishing the size and value of the invaded property.

 

Encroachment Agreement – An agreement that allows the encroachment to remain. The owner of the development that encroaches onto the adjoining property is granted the right to enter onto that property to maintain or repair the construction.

 

Encumbrance - A registered claim for debt against a property, such as a mortgage.EQUALIZATION (TAXATION) - The raising or lowering of assessed values for tax purposes in a particular county or taxation district to make them equal to assessments in other counties or districts.

Equity - The difference between the price for which a home could be sold and the total debts registered against the home. Equity usually increases as the outstanding principal of the mortgage is reduced through regular payments. Market values and improvements to the property also affect equity.EQUITY CAPITALIZATION RATE - Expresses the relationship between cash flow and the equity invested in a property, usually obtained from comparable properties.

EQUITY OF REDEMPTION- The right of the mortgagor to reclaim clear title to the property upon full repayment of the debt. It is a right granted to mortgagors but is extinguishable upon foreclosure.

ESCALATION CLAUSE - A clause in a contract providing for increases or decreases in rent payments in accordance with fluctuations of certain direct costs or expenses of the landlord.

ESCHEAT -The reversion of property to the state or some agency of the state in the event the owner thereof dies leaving no will and having no legally qualified heir to whom the property may pass by lawful descent.

ESCROW - A written agreement between two or more parties providing that certain instruments of property be placed with a third party to be delivered to a designated person upon the fulfillment or performance of some act or condition.

ESTATE - An interest in land or more specifically the degree, quantity, nature, and extent of interest that a person has in real property.

ESTOPPEL - A bar to alleging or denying a fact because of one's own previous actions or words to the contrary.

ESTOPPEL CERTIFICATE - This certificate provides a reasonably complete report on the financial health of the condominium corporation but is not exhaustive.

Ethics – Rules of behaviour or conduct that provide a standard of fair, moral practice and a guide by which that behaviour or conduct is evaluated.

 

EVICTION - The forced removal, by legal means, of a tenant from the leased premises.

EVICTION NOTICE - A written notice to a tenant to vacate the leased premises within a specified time for infractions of the lease or other specified causes.

EXCLUSIVE AGENT - An agent with the exclusive rights to sell, lease or exchange the property owned by another for a fixed period.

Exclusive Listing – Only one brokerage has the sole authority to sell the property during a specified period of time.

 

EXECUTOR / EXECUTRIX - (also referred to as the estate trustee) A person appointed by testator to carry out the provision of the testator's will.

EXPANSION JOINT - An opening designed for expansion that is located between independent segments within a structure.

EXPENSE RATIO - The fraction of gross income consumed by expenses.

EXPRESS AUTHORITY - A precise instruction, either in writing or orally, in which an authority is granted.

EXPROPRIATIONS - Taking of private property by the state for public use, with fair compensation to the owner, through the exercise of the right of eminent domain.

F

Failure to Disclose – When a seller fails to disclose or actively conceals a latent defect when that defect is so fundamental to the enjoyment of the property that a buyer might not enter into a contract if the buyer knew the defect existed.

 

FALSE REPRESENTATION - A false statement of fact.

Innocent Misrepresentation - A statement by one party of a material fact, that is untrue, but is believed to be true. Fradulent Misrepresentation - Made with the knowledge of its falsity or with reckless disregard for its truth on the part of the person making it; the purpose must have been to induce the other party to enter a contract; it must have been acted upon to the other party's prejudice. Negligent Misrepresentation - if there is a special relationship between the parties and a misrepresentation is made negligently, then the person who is mislead will have an action for damages.

 

FEE SIMPLE - The highest estate or absolute right in real property.

FHLI - First Home Loan Insurance - This is a CMHC product of particular interest to people looking for their first home. It allows qualified first-time buyers to purchase a home with as little as 5% down. In these cases, CMHC will insure mortgages of up to 95% of the home's purchase price or the market value of the property, whichever is less. (Restrictions may apply. Contact your local lender.)

 

FIDUCIARY RELATIONSHIP - A person to who power or property is entrusted for the benefit of another.

FIDUCIARY RESPONSIBILITIES - An agent owes to his/her principal various fiduciary duties such as competence, obedience, good faith, and full disclosure, and full accounting.

Competence - A degree of care and skill that might be expected from an average person in that trade or profession. Obedience - A duty to follow the principal's lawful instructions whether the agent agrees with them or not. Good Faith & Full Disclosure - Honesty of intention, abstention from taking advantage of another and freedom from knowledge of circumstances that ought to cause a reasonable person to investigate. Full Accounting - The requirement for full and complete accounting, such as details of all funds held in trust, and all monies handled on behalf of the principal.

 

Final Order of Foreclosure – Judgement taken against a borrower, extinguishing the equity of redemption.

 

Financing Schedule – The schedule in the Purchase Contract that is used for the assumption of existing mortgages, for other value provided by the buyer as part of the purchase price and for financing provided by the seller to the buyer.

 

FINDER'S FEES (MORTGAGE) - Often referred to as a mortgage referral fee, is paid to persons such as real estate brokers or mortgage brokers for successfully referring customers to lending institutions.

Fire and Property Insurance - Before closing date, the purchaser must gave fire and property Insurance arranged and in effect.  Evidence of the insurance is required by the mortgage lender prior to advancing mortgage funds.

 

FIT UP - Sometimes referred to as fitting up or build-outs, it is the construction necessary within the enclosing walls to divide and improve the tenant's space into a functional layout.

FIXED ASSETS - Frequently referred to as capital assets, add value to a business and are used in the operation of the enterprise, and are being held by the company for the intention of resale in the marketplace.

FIXED EXPENSES - Charges that do not vary with occupancy, and have to be paid whether the property is occupied or vacant.

FIXTURES - An item that is attached to the real property or building to become part of it.

FLASHING - Sheet metal or other material used in roof and wall construction to shed water.

FLAT PAYMENT - A payment structure in which the borrower is not required to repay any of the principal until the maturity date.

FLOOD PLAIN - The area (usually low lands) adjoining a watercourse that has been or may be covered by floodwater.

FOOTING - The widened section (usually concrete) at the base or bottom of a foundation wall, pier, or column.

FORECLOSURE - Remedial court action taken by a mortgagee, when default occurs on a mortgage, to cause forfeiture of the equity of redemption of the mortgagor, and also subsequent encumbrancers' equity of redemption.

Forfeiture – When a buyer fails to comply with the terms of the Purchase Contract, the buyer may forfeit a pre­estimated sum to cover liquidated damages. This sum will be given to the seller.

 

FRAMING - The rough timber work of a house, including the flooring, roofing, partitioning, ceiling and beams.

FRI (FELLOW OF THE REAL ESTATE INSTITUTE) - Designation to licensed individuals who have completed the Real Estate Institute of Canada (REIC) education program.

FRI (A) (FELLOW OF THE REAL ESTATE INSTITUTE APPRAISAL SPECIALIST) - Members who specialize in residential appraisals.

FRI (E) (FELLOW OF THE REAL ESTATE INSTITUTE EXECUTIVE) - Designation for unlicensed management professionals, who are not involved in residential or commercial sales.

Frustration – Occurs when a contract cannot be performed because of events beyond the control of the parties.

 

Fully Amortized Loan – A mortgage loan wherein the stipulated repayments repay the loan in full by its maturity date.

 

FUNCTIONAL OBSOLESCENE - Impairment of functional capacity or efficiency. Reflects the loss in value brought about by such factors as overcapacity, inadequacy, and changes in technology that affect the property item itself or its relation with other items comprising a larger property.

G

GABIONS - A metal enclosure made of mesh or chain links normally filled with stone designed to act as a retaining wall.

GABLE - An inverted 'V' or triangular shaped portion of a wall, extending down to the roof line, above the first floor level and may or may not contain a window or a decorative structure.

GARNISHMENT - A proceeding whereby property, money, or credits of a debtor; in the possession of another (the garnishee), are applied to the payments of debts by means of process against the debtor and the garnishee.

GENERAL CONTRACTOR - Normally selected through bidding procedures, is responsible for completion of the project in a skillful manner that is acceptable to both architect and owner.

General Listing – The seller Tves any number of brokerages the right to find a buyer for the property on the Multiple Listing Service^® (MLS). The seller, however, still reserves the right to sell the property him/herself.

 

Genuine Consent – In a binding contract, the mutual agreement expressed must be real and genuine. Thecontract might not be as intended if there has been a mistake, misrepresentation, failure to disclose or duress. GOODWILL - The expectation of continued business activity arising from the reputation of a business, and can be a salable asset of a corporation and as such can be included in the balance sheet.

GRADUATED LEASE - A lease that provides for specific increases or decreases in rent at definite times based on specified conditions during the term of the lease.

GRADUATED PAYMENT - A blended payment plan with regular increases of individual payments to a predetermined level.

GRANDFATHER CLAUSE - A colloquial expression pertaining to a rule or regulation placed in force, but exempts various persons or situations owing to pre-existing conditions.

GRANT - A legal term used in deeds of conveyance to indicate a transfer of an interest or estate in real property by the grantor to the grantee.

GRANTEE/GRANTOR - The grantee is the party to whom an interest in real property is conveyed. The grantor conveys an interest in real property.

GROSS DEBT SERVICE RATIO (GDS RATIO) - Refers to the relationship between a borrower's income and the sum of principal, interest, and property tax payment during the year.

GROUND FAULT CIRCUIT INTERERRUPTER - A ground fault specifically designed to shut the power off to a circuit when as little as .005 amps are leaking.

GUARANTOR - Person providing a separate personal covenant over and above a named party in a contract regarding some obligations (e.g., mortgage, personal loan, or lease).

H

HIGH RATIO MORTGAGE - A mortgage loan that exceeds the normal limit (75% of the value of the property) of a conventional first mortgage, with regard to the percentage of the loan amount to the property's lending value, and is insured through a mortgage insurance plan.

Holdback - An amount of money withheld by the lender during construction of a house to ensure that construction is satisfactory at every stage. A standard holdback is 10% of the total cost of the building project.

 

HOLDING OVER - The act of a tenant retaining possession of the premises longer than the term expressed in the lease; often referred to as over-holding.

HOLDOVER CLAUSE - A clause in a listing agreement that protects a real estate brokerage for a specific period of time of time after the listing agreement expires. It requires the payment of a commission fee when a buyer makes a private offer to purchase, after having been introduced to the property during the time the property was listed with the brokers.

HOME INSPECTION - The process by which a qualified person examines and evaluates various components of a residential building including but not limited to structural aspects, components, exterior coverings, roofing system, plumbing, electrical, heating, central air conditioning, insulation, ventilation, and interior structure. It is designed to provide a client with a thorough understanding of the condition of a property as of the date of inspection.

HOUSING ABSORPTIONS - Refers to the rate for newly completed units sold or rented.

HOUSING STARTS - The number applied to quantity of units, where construction has advanced to a stage where full (100%) footings are in place. In the case of multiple unit structures, the definition of a start applies to the entire structure.

HVAC - An acronym used primarily in commercial and industrial leasing/sales to indicate the Heating, Ventilating and Air-Conditioning facilities within a particular building/structure.

I

IC & I – Industrial, Commercial & Investment as a specialty field. Also referred to as commercial real estate.

ICX.CA – The ICX.CA website, administered by CREA, is a cooperative marketing system that lists information about commercial properties, including agribusinesses. Listings are provided by National Commercial Council (NCC) members.

 

Illegal Use – A development to a property that is not allowed under the zoning classification, i.e., a use not permitted by the Land Use Bylaw.

 

IMPLIED - Created by the conduct or words of other parties, and not arising from explicit agreements.

IMPOSSIBILITY OF PERFORMANCE - A contract may be discharged because of the impossibility of performance, or frustration due to supervening and unanticipated circumstances.

INCOME APPROACH - A procedure in appraisal analysis that converts anticipated benefits (dollar income) to be delivered from the ownership of property into a value estimate.

INCOME SOURCE VERIFICATION - Lenders will vary in terms of the type of proof required to support an application for mortgage financing. The most complete form is an Income Verification Form completed by the applicant's employer, which provides information concerning both the reliability and durability of the applicant's income stream.

INCURABLE DEPRECIATION - A loss in value resulting from physical deterioration or functional obsolescence that either cannot be corrected, or can only be corrected at a cost greater than their contribution to the value of the property.

Indemnification – The client’s duty to compensate the agent for liabilities (damages, losses or expenses) which the agent incurs in carrying out his/her responsibilities.

 

INDEMNIFY - To secure against hurt, loss or danger; to make compensation for incurred hurt, loss or damage.

INDENTURE - A deed or agreement setting out specific objects and executed by the parties.

INDEPENDENT CONTRACTOR - Generally an individual who works according to his/her own methods and judgment.

INDUCEMENTS - The act of persuading or in some way influencing the actions and/or attitudes of others.

Industry Member – Any person who holds an authorization as an appraiser, real estate broker or mortgage broker, or as any category or class of real estate broker or mortgage broker, issued by the Real Estate Council of Alberta (RECA).

 

INFILL HOUSING - Any project that create new housing within an existing established neighbourhood.

INHERITANCE - Property that passes to heirs after the death of the owner.

Initial Deposit – The amount of money a buyer pays to indicate a serious interest in the property. This amount must be noted in the Purchase Contract.

 

Injunction – The court can require a party to do something, or forbid a party from doing something.

 

Inspection - The examination of the house for structural and other defects by an expert selected by the buyer.

 

INSTRUMENT - A form of written legal document.

INTENSIFICATION - Regarding urban planning, involves the expanded use of buildings and serviced land to provide additional housing stock and more effectively use of existing municipal services as opposed to the creation of new housing stock through subdivision developments, and has various dimensions which includes the increased use of existing housing stock through the creation of accessory apartments.

Interest - The cost of borrowing money for a given period of time. Interest is usually paid to the lender in instalments along with repayment of the principal loan amount.

 

INTEREST ADJUSTMENT DATE - The date in a blended payment plan, prior to commencement of the mortgage term, to which accrued interest computed on the various advances is calculated.

Interest Rate - The rate at which you pay interest to the lender. For example, when the mortgage balance is $100,000, and the interest rate is 6 per cent, one single annual payment will include $6,000 interest. More frequent payments will result in different amounts.

 

Interim Financing - Short term financing to help bridge the gap between the closing date on the purchase of a new home and the closing date on the sale of the current home.

 

INTERIOR PARTITIONS - All types of interior non-load-bearing partitions that enclose or subdivide space and may be of steel, wood, glass, masonry, or combinations of these materials and can be either movable or non-movable, prefabricated, or built on the job.

INTESTATE - A person who dies without a will, or leaves one defective in form, in which case his/her estate descends by operation of law to the heirs or next of kin.

Invitation to Treat – A statement which invites prospective buyers to negotiate a purchase contract.

 

IRREVOCABLE - Incapable of being recalled or revoked; unchangeable, unalterable.

J

JOINT AND SEVERAL - This is a term that is normally used regarding loans and mortgages in which one or more parties are liable for the repayment of a debt.

JOINT TENANCY - Ownership of land by two or more persons whereby, on the death of one, the surviving tenants take the whole interest in the property.

JOINT VENTURE - A real estate project undertaken by a group of investors in which the parties share in the project including any profits or losses.

JUDGMENT - The decision of the court and is most commonly found as a lien registered against land and is more fully described as a charge, or lien, upon the lands of a debtor.

JUDICIAL SALE - Is one type of remedy available to a mortgagee when the mortgage is in default. The mortgagee looks to the court to sell the property with the proceedings being applied against the mortgage debt.

JURISDICTION - Refers to the authority to act and the defined limitations of that authority.

K

 

L

LAND - Includes The earth’s surface, a column of air above it, and any structures attached to it, such as buildings.

Land Use Districts – The Land Use Bylaw divides the municipality into a number of districts classified as residential, commercial, industrial, and special.

 

LANDSCAPING - The planting of shrubs, grass and trees, including alterations to the contours of the property to improve the overall aesthetic appeal of the site.

Landlord Agency – A situation where the brokerage (including the broker, all associate brokers and agents registered to it) has entered into an agency relationship with a landlord to list real property for sale or lease.

 

LATENT DEFECT - (also referred to as a hidden defect) A physical deficiency or construction defect not readily ascertainable from a reasonable inspection of the property, such as a defective septic tank or underground sewage system, or improper plumbing or electrical lines.

Law – Rules based on moral duties and customs designed to both prevent certain actions and to compel others. Laws are binding and enforced by a controlling authority.

 

Law of Property Act – Provincial legislation relating to real estate transactions including foreclosures.

 

Lawful Consideration – The obligations that each party has in a contract must be lawful.

 

LAWFUL OBJECT - Being within the bounds of the law, in regards to a real estate transaction, it is the transferal of ownership of the seller's property to a purchaser.

LEACHING BED - One component of a disposal system normally built using two or more rows of buried distribution pipe.

LEASE - A contract between the landlord (lessor) and tenant (lessee) for the occupation or use of the landlord's property by the tenant, for a specified time and for a specified consideration (rent).

LEASE BUYOUT - A cash payment or other settlement made by the tenant to the landlord to terminate a lease.

Leaseback Financing – A method of obtaining financing through the sale and leasing back of a property by a borrower.

 

Leasehold Estate – An interest in the property for the time of the lease period.

 

Legal Intention – An element of a contract which means that the parties must intend to create a binding agreement.

 

Legality of Object (Lawful Object) – The purpose of the contract must be legal.

 

Lender - The individual, party or financial institution from whom money is borrowed. Also known as the mortgagee, in the case of a mortgage loan.

 

Lending Value - The purchase price or appraised value of a property, whichever is less.

 

LETTER OF INTENT - A general understanding of the parties that may ultimately lead to a detailed agreement setting out various provisions, covenants, terms and other matters between those parties.

LETTER OF OPINION - A brief, unsubstantiated statement of an appraiser's opinion of value or value range.

LEVERAGE - The use of borrowed funds to make investment(s) in real property in the hope of realizing a profit in addition to monies necessary to pay for the borrowed funds.

LEVY - To impose or assess a tax on a person or property.

LICENCE - Permission given by an authority to engage in an action for a particular purpose that would otherwise not be legally permissible.

LICENCE LAW - A general reference in real estate to the regulatory controls imposed on real estate practitioners by a governing body.

LIEN - A right of encumbrance affecting any property; it can be either in the form of an agreement between two parties, namely, the party owing the money (lienor) and the party to whom those funds are due (lienee).

LIFE ESTATE - An interest in property that continues for the life of an individual and terminates in favour of others in the event of his/her death.

LIMITED LIABILITY - Limitation of responsibility for the debts of a business in relation to the amount of investment one makes within that enterprise.

LIMITED PARTNER - A participant in a limited partnership whose liability is confined to his/her investment and who does not have a voice in the management of the partnership.

LIMITED PARTNERSHIP - An investment arrangement that limits the partner's liability to the amount invested and also limits the profit he/she can make.

LINE OF CREDIT - A line of credit is a highly flexible form of interim financing that is based on the past performance and strength of personal or corporate covenants.

LINTEL - A horizontal structural member (beam) that supports the load over an opening, such as a door or window.

LISTING AGREEMENT - A written agreement under which the owner appoints a real estate broker for a designated period of time to sell, lease or exchange the property based on the owner's stated terms, and under which the owner agrees to pay the broker a commission.

LISTING TYPES - There are three major listing types -

Open Listing - These are usually written arrangements in which the owner gives one or more brokers authority to find a purchaser for the property. Exclusive Listing - Gives one broker the authority to offer the property for sale (lease, exchange, etc.) during a specified time period. MLS® Listing - A signed multiple listing form contains an authority from the seller permitting the broker to employ the services of cooperating brokers who are members of the real estate board or association. The responsibility regarding promotion, negotiations, and payment of commission to cooperating brokers is that of the listing agent.

 

LOAN RATIO - The ratio of the principal amount of the loan to the lending value of the property.

Local Board – A board represents its members in local real estate matters at the municipal level, operates the Multiple Listing Service^® (MLS^®), and offers orientation and other professional development courses. Members are usually made up of agents, associate brokers and brokers who live within a defined geographical area. There are 11 real estate boards in the province.

 

Locational Obsolescence – A loss in value of a building arising from causes near, but external to, the property. An example would be a poorly kept service station next to a house.

 

LOT GRADING - The general topography of the lot.