title, consisting of the various links in the chain of title, together with a statement of all liens, charges or encumbrances affecting a particular property. ACCELERATION CLAUSE A clause in a contract stating that upon the happening of a certain event, like failure to pay any installment due, shall make the entire balance immediately due and payable. ACCEPTANCE When the seller or agents principal agrees to the terms of the contract of sale and approves the negotiation on the part of the agent, and acknowledges receipt of the deposit in subscribing to the agreement of sale.
ACTUAL USE In assessment and taxation of real
property, this refers to the present or predominant utilization of the property. AD VALOREM According to valuation. ADMINISTRATOR A person appointed by the probate court to administer the estate of a deceased person. ADVERSE CLAIM A claim of a person on property owned by another (Good only for 30 days no second adverse claim is allowed).
ACCESSION The right of the owner to everything
produced, incorporated or attached thereto naturally or physically to his property.
ADVERSE POSSESSION Right of an occupant of
land to acquire title against the real estate owner, where possession has been actual, continuous, hostile, visible, distinct and in the concept of owner for the statutory period. (Note: Statutory period is 30 years, and adverse possession does not apply on lands titled under the Torrens System)
ACCOUNTING An act of recording, classifying,
analyzing in a significant manner, transactions or events which form part of the financial character and interpreting the results thereof.
AFFIDAVIT A statement or declaration reduced in
writing sworn to or affirmed before some officer who has authority to administer an oath or affirmation.
ACCRETION An addition to land from natural
causes as, for example, from gradual action of the ocean or the river waters.
AFFIRM To confirm, to ratify, to verify.
ACKNOWLEDGMENT A formal declaration before
a duly authorized officer by a person who has executed an instrument that such execution is his act and deed. ACQUIRED ASSETS Usually refer to real estate properties that were previously mortgaged to the bank, by which because the owner failed to pay the mortgage, the ownership of the property transferred to the bank through a judicial foreclosure proceeding. Acquired Assets are also called Foreclosed Properties. ACQUISITION The act or process by which a person procures property.
AGENCY, EXCHANGE The authority given by the
property owner for the broker to exchange his property with another. AGENCY, LEASE The authority given by an ownerlessor for the broker to find a lessee for the formers property, or by a prospective lessee for the broker to find a property for lease. AGENCY, LOAN The authority given by the property owner-borrower for the broker to negotiate for a loan with a financing company. AGENCY, PURCHASE The authority given by a buyer-client for the broker to look for property that the former can buy or purchase. AGENCY, SALES The authority given by a property owner-seller for the broker to look for a buyer.
AGENT One who acts for and has the authority to
represent another who is known as the principal AGREEMENT OF SALE A written agreement or contract between seller and purchaser where they reach a meeting of the minds on the terms and conditions of the sale. AIR RIGHT The right of the property owner to use, control, or occupy the air space over his property, subject to the requirements of air navigation and government regulation. ALIENATION The transfer of property to another; the transfer of property and possession of lands, or other things, from one person to another. ALLUVION Refers to soil deposited in the process of accretion. AMENITIES Refer to anything that adds to ones comfort and convenience. AMORTIZATION staggered payment of the thing purchased. Also known as INSTALLMENT. It refers to the process of paying off a debt (often from a loan or mortgage) over time through regular payments. A portion of each payment is for interest while the remaining amount is applied towards the principal balance. An amortization could be in Equal Payments which has fixed amounts throughout the loan period. It could also be a Ballooning Payment wherein the monthly due increases through time. Given a number of payperiods and interest rate, the amortization amount is calculated using an Amortization Factor Table. The liquidation of a financial obligation on installment basis. (A periodic payment which includes interest and principal necessary to liquidate a financial obligation) ANTICHRESIS A form of mortgage wherein the mortgagee takes possession of the mortgaged property, pays the real estate taxes and receives the fruits with an obligation to apply them in payment of the principal and interest. APPOINTMENT Appointment is one way of how an agency relationship is created. It means that the
principal gives express authorization to the agent.
Under both common and statutory law, this requires writing when the sale of real estate is involved. APPRAISAL The act or process of determining the value of a property as of a specific date for a specific purpose; an estimate and opinion of value of a property. APPRAISER also known as valuer, refers to a person who conducts valuation/appraisal; specifically, one who possesses the necessary qualifications, ability and experience to execute or direct the valuation/appraisal of real or personal property. A Real Estate Appraiser is a duly registered and licensed natural person who, for a fee, compensation or other valuable consideration, performs or renders, or offers to perform services in estimating and arriving at an opinion of or acts as an expert on real estate values, such services of which shall be finally rendered by the preparation of the report in applicable written form. APPRECIATION A rise in value or price due to such factors as inflation or market conditions. APPRECIATION/GAINS Increase in the value of a property due to economic causes or inflation. APPURTENANCE Something annexed to another thing which may be transferred incident to it; that which belongs to another thing as a barn, dwelling, garage or orchard is incident to the land to which it is attached. ARTICLE 1385 OF THE CIVIL CODE The statute of frauds; a legal provision which requires agreements for the sale of real estate to be in writing in order to be enforceable. ASSESSED/TAXABLE VALUE The value placed on a taxable property by the assessor for ad valorem tax purposes. The assessed value when multiplied by the tax rate will produce the amount of tax due. ASSESSMENT The act or process of determining the value of the property or proportions thereof
subject to tax including the discovery, listing and
appraisal of properties.
BLANKET MORTGAGE A mortgage that has two or
more properties pledged as security for a debt.
ASSESSMENT LEVEL The percentage applied to
the market value to determine the taxable or assessed value of the property.
BREACH The breaking of a law, or failure of duty,
either by omission or commission
ASSESSOR refers to a government official who
conducts appraisal and assessment of real properties for taxation purposes. ASSIGNMENT The transfer of property or rights and obligations over it, in favor of another. The one who assigns or transfers the property is called Assignor, while those to whom property is assigned are called Assignees or Assigns. ASSIGNMENT OF LEASE The lessee assigns or transfers the lease to a third party. In this case, the personality of the original lease is extinguished. The parties to the contract now become the lessor and the assignee. If the contract is silent as to the right to assign the lease, the lessee cannot assign the lease without the consent of the lessor. AUTOMATIC REDEMPTION CLAUSE A stipulation in a mortgage of several properties providing that when a buyer of one or more lots pays in full the purchase price, a portion of the payments shall be applied to the mortgage obligation and the mortgagee shall correspondingly release said lot or lots from the mortgage. BALLOON PAYMENT Where the final installment payment on a note is greater than the preceding installment payments and the payer pays the note in full, such a final installment is termed a balloon payment. (Payment in lump sum although not yet due) BASE AND MERIDIAN Imaginary lines used by surveyors to find and describe the location and boundaries of a real property BINDER A agreement to cover a down payment for the purchase of real property, as evidence of good faith on the part of the purchaser.
BREACH OF WARRANTY FOR HIDDEN DEFECT An
action to procure the return of a part of the purchase price paid by the vendee to the vendor by reason of such defect. BROKER A Real Estate Broker is a duly registered and licensed natural person who, for a fee, commission or other valuable consideration acts as an agent of a party in a real estate transaction to offer, advertise, solicit, list, promote, mediate, negotiate, or effect the meeting of the minds on the sale, purchase, exchange, mortgage, lease or joint venture, or other similar transactions on real estate or any interest therein. BTCRP Bureau of Trade Regulation and Consumer Protection. BUNDLE OF RIGHTS The rights of ownership whereby the owner has the right to enjoy, dispose, exclude others, and to recover. BUYERS MARKET This exists when there are many sellers in a particular area as against very few buyers. CAPITAL ASSET Capital asset means property held by the taxpayer (whether or not connected with his trade or business), but does not include (a) Stock in trade of the taxpayer or other property of a kind which would properly be included in the inventory of the taxpayer if on hand at the close of the taxable year; or (b) Property held by the taxpayer primarily for sale to customers in the ordinary course of his trade or business; or (c) Property used in the trade or business of a character which is subject to the allowance for depreciation provided in subsection (F) of Sec. 34 of the Code; or (d) Real property used in trade or business of the taxpayer. CAPITAL GAINS TAX Capital Gains Tax is a tax imposed on the gains presumed to have been realized by the seller from the sale, exchange, or
other disposition of capital assets located in the
Philippines, including pacto de retro sales and other forms of conditional sale.
subject of housing loans for several beneficiaries,
specifically residents of blighted or depressed areas.
CAPITAL PROPERTY Property belonging
exclusively to the husband
CONDEMNATION The taking of public private
(Thank you, JTJ) property for public use with fair compensation to the owner. An exercise of the Right of Eminent Domain.
CAVEAT EMPTOR Means let the buyer beware
(The buyer is duty-bound to examine the property he is purchasing and he assumes conditions which are readily ascertainable on the face of the title) CENRO Community Environment and Natural Resources Officer of the DENR CHATTEL MORTGAGE A contract whereby personal property is recorded in the chattel mortgage registry as security for the performance of the obligation. CLIENT A client is a person who empowers another to act as his or her representative or agent. Client-Agent relationship is equal to fiduciary relationship. CLOSED MORTGAGE A mortgage which can be paid off only upon its maturity. CLOUD ON THE TITLE Any condition revealed by a title search which affects the title to property; usually relatively unimportant items but which cannot be removed without a quit claim deed or court action. CO-OWNERSHIP This exists whenever the ownership in an individual thing or right to it belongs to different persons. COMMISSION An agents compensation for performing the duties of his agency; in real estate practice, a percentage of the selling price of property, percentage of rentals, etc. COMMON AREAS The entire project except all units separately granted, held, or reserved. COMMUNITY MORTGAGE This is a type of financing under the Unified Home Lending Program (UHLP) where undivided titles of land are made the
CONDEMNATION VALUE Just compensation; the
money paid by the State when a public agency takes private property and converts it for public use. CONDOMINIUM An interest in real property consisting of a separate interest in a unit in a residential, industrial, or commercial building and an undivided interest in common areas; sometimes referred to as vertical subdivision. CONJUGAL PROPERTY property owned in common by the husband and wife. CONSULTANT A Real Estate Consultant is a duly registered and licensed natural person who, for a fee, compensation or other valuable consideration, offers or renders professional advice and judgment on: (i) the acquisition, enhancement, preservation, utilization or disposition of lands or improvements thereon; and (ii) the conception, planning, management and development of real estate projects. CONTRACT OF SALE An agreement between a buyer and a seller whereby there is transmission of ownership on the object of the contract CONTRACT TO SELL An agreement whereby the seller promises to sell a thing in consideration of the buyers compliance to the terms and conditions of the contract and that only after the buyers compliance will the seller be obligated to transfer or convey the ownership of the thing or subject of the contract. CONVEYANCE The means by which title to real estate is transferred
CORNER INFLUENCE The added desirability or
utility of a property due to its frontage to two streets, which for residential use provides better ventilation and as to commercial or industrial use, it provides better access, display and transportation convenience.
partial payment of the purchase and it must be
deducted therefrom. (see also BINDER)
COUNTER OFFER It is a qualified or conditional
acceptance
ECA Environmentally Critical Area is an area that
is environmentally sensitive.
CUL DE SAC A passageway with one outlet; a
blind alley.
ECC Environmental Compliance Certificate is the
document issued by the DENR Secretary or the Regional Executive Director certifying that based on the representation of the proponent and the preparers, as reviewed and validated by the EIARC, the proposed project or undertaking will not cause a significant negative environmental impact; that the proponent has complied with all the requirements of the EIS System, and that the proponent is committed to implement its approved EMP in the EIS or mitigation measures in IEE.
CUSTOMER A customer generally refers to a
person without representation involved in the transaction. All agents and brokers have a duty to treat customers fairly. DACION EN PAGO Payment in kind. Payment of the debt or obligation with a property DEED A written instrument which, when properly executed and delivered, conveys title. DEFAULT The failure to fulfill a duty or promise or to discharge an obligation; an omission or failure to perform any act. DEFEASANCE CLAUSE The clause in a mortgage that gives the mortgagor the right to redeem his property upon the payment of his obligations to the mortgagee DEFICIENCY JUDGMENT It is a judgment for the mortgagor to pay the balance of the obligation if the proceeds of the foreclosure sale are not sufficient to cover the principal obligation. DEPRECIATION Loss in value brought about by deterioration through ordinary wear and tear and action of the elements, functional or economic obsolescence. EARNEST MONEY A sum of money tendered by a buyer to the seller which, if accepted by the seller, shall form part of the purchase price and as proof of the perfection of the contract. It is a sign of good faith on the part of the buyer. Actually, it is a
EASEMENT The right, advantage or privilege
which an individual has in the land of another, such as a right of way
ECONOMIC LIFE The period over which a
property will yield a return on the investment. ECONOMIC RENT The potential rent which a property can command, considering rental of similar or comparable properties in the neighborhood. ECP Environmentally Critical Project is a project that has a high potential for significant negative environmental impact. EIS Environmental Impact Statement refers to the documents or studies on the environmental impacts of a project including the discussions on direct and indirect consequences upon human welfare and ecological and environmental integrity. EMB Environmental Management and Protected Areas Sector of the DENR EMINENT DOMAIN The right of the government to acquire property for necessary public or quasipublic use EMP Environmental Management Plan is a section of the EIS that details the prevention,
mitigation, contingency and monitoring measures
to enhance positive impacts and minimize negative impacts of a proposed project or undertaking. ENCROACHMENT A building, part of building, or obstruction which intrudes upon or invades a highway or sidewalk or trespasses upon property of another. ENCUMBRANCE Anything which affects or limits the fee simple title to property, such as mortgages, easements, or restrictions of any kind. Liens are money encumbrances which make the property security for the payment of a debt or obligations, such as mortgages and taxes. ESCHEAT It is the reservation or automatic conveyance of real property to the State upon the owners death due to the absence of heirs or other legal claimants, to the title, or when the owner fails to pay the real estate taxes. ESTOPPEL One way of creating an agency relationship. It means that if the principal makes third persons believe that someone is his agent and that third party deals with the agent, then the principal cannot deny the agency relationship even though it did not exist in fact. EQUITY OF REDEMPTION Right of the original owner to reclaim property sold through judicial foreclosure proceedings by payment of debt, interest, and cost. EQUITY The interest or value which an owner has in real estate over and above the mortgage against it. ESCALATION CLAUSE A provision in a contract providing for periodic proportional upward or downward adjustment of price or consideration ESCHEAT Reversion of property to the state owing to lack of any heirs capable of inheriting; or due to other causes provided by law ESCROW An agreement entrusted to a third person to be held by him until the performance or fulfillment of some act or condition
ETHICS That branch of moral science, idealism,
justness, and fairness, which speaks of the duties that a member of a profession or craft owes to the public, to his clients or patron, and to his professional brethren or members. FAIR MARKET VALUE The price which a willing seller will sell and a willing buyer will buy, neither being under abnormal pressure. FEE SIMPLE Largest estate of ownership in real property in which the owner holds all rights not reserved by society. Absolute ownership. FIDUCIARY A person in a position of trust and confidence, as between a principal and a broker; the broker as fiduciary owes certain loyalty which cannot be breached under rules of agency. FORECLOSURE A procedure where by property pledged as security for a debt is sold to pay the debt in the event of default in payments or terms. It is a process instituted by a mortgagee by which the mortgaged property is sold at public auction to satisfy the principal obligation which the debtor failed to fulfill. The property that has been transferred to the bank through a foreclosure proceeding is called a Foreclosed Property, which is also known as Bank Acquired Asset. FORFEITURE The loss of money or anything of value, due to failure to perform, such as under an agreement to purchase HIGHEST AND BEST USE PRINCIPLE The use for a property which will bring the optimum or highest returns or advantage as of a certain time HOLD-OVER CLAUSE A provision in a listing agreement which entitles the broker to commission even when the sale was closed after the period of the authority provided that the buyer was registered by him with the seller and with whom he has negotiated during the period of his authority IN-HOUSE FINANCING Also known as VENDOR FINANCING, is real estate buying on installment
basis, wherein the mortgage agreement is between
the property developer and the buyer. When the buyer fails to fulfill the obligation to pay, the ownership of the property reverts back to the developer. In-house financing packages usually have higher interest rates compared to bank loans. What is bad in in-house financing is that the seller only issues a Contract-to-Sell. In Bank Financing, the seller issues an Absolute Deed of Sale to the name of the buyer, and then automatically mortgages the property to the bank. KEY LOT A lot adjoining a corner, at right angle to it and fronting an intersecting street. LACHES Delay or negligence in asserting ones legal right LIEN A hold or claim which one person has upon a property of another as security for a debt or charge, judgments, mortgages LIS PENDENS An annotation in the title which serves as notice that the property is subject to a pending litigation. Lis pendens is Latin for suit pending. This may refer to any pending lawsuit or to a specific situation with a public notice of litigation that has been recorded in the same location where the title of real property has been recorded. LISTING The brokers stock in trade or the property being handled by the broker: it can be referred to also as the contract between the owner and broker: or the authority of the broker to negotiate the transaction of a property for a commission. MARKET ANALYSIS The study of current supply and demand conditions in a particular area for a specific type of property.
furnished materials in the erection or repair of a
building METES AND BOUNDS Measurements and boundaries. A term used in describing the boundary lines of land, setting forth all the boundary lines, together with their terminal points and angles. MULTIPLE LISTING An arrangement among a group of real estate brokers to share its listings with a pre-arranged agreement especially on commission sharing OBSOLESCENCE Impairment of desirability and usefulness brought by physical, economic, functional deterioration, or other causes. Loss in value due to reduced desirability and usefulness of a structure because its design and construction becomes obsolete; loss due to becoming oldfashioned and not in keeping with modern needs with consequent loss of income. OPEN MORTGAGE A mortgage which can be paid off at any time even before its maturity. OPEN-END MORTGAGE A mortgage containing a clause which permits the mortgagor to borrow additional money after the loan has been reduced, without re-writing the mortgage OPTION The right to purchase or lease a property at a certain price for a certain designated period, for which right a consideration is paid OPTION MONEY The amount paid to a property owner in consideration of giving a prospective buyer or lessee the exclusive right to buy or lease his property within a specified period at the agreed price and term. (Within the option period, the owner cannot sell or lease except to the person who paid the option money).
MASTER DEED A document executed by a
property owner which creates or converts his properly into a condominium pursuant to Rep. Act. 4726
ORDINARY ASSET Ordinary asset refers to all
properties specifically excluded from the definition of capital assets under Sec. 39 (A)(1) of the NIRC.
MECHANICS LIEN A lien created by law which
exists in favor of persons who have performed or
OVER-IMPROVEMENT The improvement which
does not produce an adequate return for the
amount invested on a building or property. An
improvement which is not suitable to the site on which it is placed due to excessive size or cost. PACTO DE RETRO SALE A contract of sale with the stipulation that the vendor shall have the right to buy back the property within the agreed period PACTUM COMMISSORIUM A stipulation which authorizes the mortgagee to appropriate the property as his own upon failure of the debtor to fulfill the principal obligation PACTUM DE NON ALIENDO A stipulation which prohibits the mortgagor from alienating the property within the period of the mortgage PARAPHERNAL PROPERTY Property exclusively owned by the wife PENRO Provincial Environment and Natural Resources Officer of the DENR PERCENTAGE LEASE A lease of a property in which the rental is based upon the volume of sales made upon the leased property POLICE POWER The right of the state to enact laws and enforce them for the order, safety, health, morals and general welfare of the public PRINCIPAL A principal is commonly known as the person who engages the agent for representation.
property which the grantor may have had a protest
or adverse claim. RATIFICATION Ratification is one way of how an agency relationship is created. It means that if a person having no authority whatsoever purports to act as an agent and the purported principal later adopts the acts of that agent, an agency relationship has retroactively been created. REAL ESTATE Refers to the land and all those items which are attached to the land. It is the physical, tangible entity which can be seen and touched, together with all the addition on, above or below the ground. REAL ESTATE DEVELOPMENT PROJECT The development of land for residential, commercial, industrial, agricultural, institutional and recreational purposes, or any combination of such including, but not limited to, tourist, resorts, reclamation projects, building or housing projects, whether for individual or condominium ownership, memorial parks and others of similar nature. REAL PROPERTY includes all the rights and benefits related to the ownership of real estate. REAL ESTATE SERVICE PRACTITIONERS shall refer to and shall consist of Real Estate Salesperson, Real Estate Broker, Real Estate Appraiser, and Real Estate Consultant. RED Regional Executive Director of DENR
PRINCIPLE OF CONFORMITY The principle of real
property values that maximum value is realized when a reasonable degree of homogeneity is present, sociological as well as economic. PROBATE The proof or act of proving at a court that a last will and testament is actually that of the deceased person PROCURING CAUSE The act of a broker leading to the meeting of minds between the parties to a transaction or the consummation of a transaction. QUITCLAIM A deed of release or renunciation of a legal right. A deed to relinquish any interest in
SALESPERSON A Real Estate Salesperson is a duly
accredited natural person who performs service for, and in behalf of, a real estate broker who is registered and licensed by the Professional Regulatory Board of Real Estate Service for or in expectation of a share in the commission, professional fee, compensation or other valuable consideration. TACITA RECONDUCTA It means that if, at the end of the period of lease, the lessee continues to enjoy the thing leased with the acquiescence of the lessor, it is understood that there is an implied new lease.
TIE LINE An imaginary line connecting from the
known geographic position (tie point) to the corner of the titled property. This term is used in Map Reading. TIE POINT is a reference point with known geographic position established by the Bureau of Lands. This term is used in Map Reading. UNDER IMPROVEMENTS That improvement which does not sufficiently improve the land to produce the highest and best value of return of which the land is capable. UNEARNED INCREMENT A value added to land for which the owner is in no way responsible, like the increase of population VALUE IN EXCHANGE Objective Value. Propertys value to an impartial buyer who represents the market. VALUE IN USE Subjective Value. The propertys value to its occupants or users. WARRANTY DEED A deed used to convey real property which contains warranties of title and quiet possessions. In a warranty deed, the grantor is to defend the premises against the lawful claims of the third person. WRIT OF EXECUTION Authorizes and directs the proper officer of the court, usually the sheriff, to carry into effect a judgment or decree of the court. ZONING ORDINANCE The exercise of police power by the municipality or city and regulating and controlling the character and use of property.