Real Estate Dictionary

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PACKAGE MORTGAGE - Mortgage covering both real and personal property.

PARCEL - A general term meaning any part of portion of land.

PARTIAL RELEASE - A release of a portion of property covered by a mortgage. A sub divider may obtain a partial release as each lot is sold and upon payment of an agreed upon amount.

PARTICIPATION - Lender involvement in a development for a percentage of the gross sales or profit, as well as interest on the loan. Usually occurs when money is difficult to obtain.

PAYOFF - The payment in full of an existing load or other lien.

PER ANNUM - Yearly, annually.

PERCOLATION - The absorption of liquid into soil by seepage.

PERCOLATION (PERK) TEST - The test to determine the capability of the soil to absorb liquid, both for construction and septic systems.

PER DIEM - Daily.

PERFORMANCE BOND - A bond posted by a builder to insure completion of a project.

PERPETUITY - Continuing forever. In real property terms any condition extending the inalienability of property beyond the time of a life or lives in being twenty-one years.

PER SE - By itself; of itself; inherently.

PERSONAL PROPERTY - Any property which is not designated by law as real property.

PIGGYBACK LOAN - A loan made by two or more lenders on the same property under one mortgage or trust deed. A 90% loan, for example may have one lender loaning 80% and another (subordinate) lender loaning the top 10% (high risk portion).

P.I.T.I. - Principal, interest, taxes and insurance, which combined make a monthly mortgage payment.

PLANNING COMMISSION - A board of a city, county or similar local government, which must approve proposed building projects.

PLANS - All drawings necessary to a construction project, including the subcontractors drawings.

PLAT (PLAT MAP) - A map dividing a parcel of land into lots, as in a subdivision.

PLAT BOOK - Holds plat maps.

PLOT PLAN - A plan of the location of improvement on a parcel of land. Also called a plot map. Don't confuse with plat.

POINTS - A one time payment to lower the interest rate of a mortgage. One point is equal to 1% of the total loan amount.

POLICY - A general term used to describe all contracts of insurance.

POSSESSION - Being in physical control of land or personal property, whether the owner or not. Possession may be lawful or wrongful.

POWER OF ATTORNEY - An authority by which one person (principal) enables another (attorney in fact) to act for him.

PRE-APPROVAL - Amount a borrower can borrow predicated on certain conditions such as an appraisal.

PREFABRICATION - The manufacturer of parts of a structure, such as walls, roofs, etc, which are assembled at the construction site. More recently called modular housing.

PRELIMINARY TITLE REPORT - A report showing the condition of title before a sale or loan transaction . After completion of the transaction, a title insurance policy is issued.

PREMIUM - Money paid for an insurance policy. The opposite of a discount.

PREPAID INTEREST - Interest paid before becoming due.

PREPAYMENT ITEMS - Those expenses of property which are paid in advance and will usually be prorated upon sale, such as taxes, insurance, etc.

PREPAYMENT PENALTY - A fee paid by the borrower if loan is paid before its due date.

PREPAYMENT PRIVILEGE - A right to prepay a loan without penalty, either in full or in part.

PRE-QUALIFICATION - A non-binding opinion of how much a borrower will be qualified to borrow.

PRIME LENDING RATE - The most favorable interest rates charged by commercial banks on short term loans, (not mortgages).

PRIVATE MORTGAGE INSURANCE (P.M.I.) - Insurance required by lender from a non-go0vernment insurer if down payment is less than around 20%.

PROMISSORY NOTE - A promise in writing, and executed by the maker, to pay a specified amount during a limited time, or on demand, or at sight, to a named person, or on order, or to bearer.

PROPERTY - Anything which is owned by someone.

PROPERTY LINE - The boundary line of a parcel of land.

PROPERTY TAX - Generally, a tax levied on both real and personal property; the amount of the tax is dependent of the assessed value of the property.

PRO RATE - To divide in proportionate shares, such as taxes, insurance or other items which buyer and seller share as of the time of closing or other agreed upon time.

PRORATION - To divide (prorate) between buyer and seller.

PROSPECT - A potential buyer, seller or tenant rather than one which actually in the process of buying, selling or leasing.

PROSPECTUS - A brochure, presenting for a prospective buyer or investor the details of the offering.

PROXY - The term legally encompasses any agent who has written authority to act on behalf of another.

PUBLIC LAND - Land belonging to the government.

PUBLIC OFFERING STATEMENT - A report given to prospective buyers or investors for a new subdivision, stating the conditions of the offerings (cost of common facilities and areas). Should disclose important fact such as availability of schools, noise factors (i.e. airports), or any other information that would effect the owner. Normally issued by the real estate commission.

PUBLIC RECORDS - Usually located at the county level of government and containing all documents which are necessary to give public notice. The records are available to the public. Although a deed does not have to be recorded it should be to protect the rights of the owner.

PUBLIC REPORT - See Public Offering Statement.

PUBLIC SALE - An auction open to the public. Could be due to a foreclosure, tax sale, excess state land sale etc. required notice (advertising) and must be held in a place accessible to the general public.

PUBLIC UTILITY - Usually a gas, water, or electric company. Any business given access to provide services for the good of the public. Companies under the control of the Public Utilities Commission.

PUFFING - An opinion not based on fact, but intended to enhance the value of a property.

PUR AUTRE VIE - During the life of another. A life estate measured not by the life of the grantee, but by the life of another.

PURCHASE AND SALES AGREEMENT (PURCHASE AGREEMENT) - An agreement between the buyer and seller of real property setting the price and terms of the offer and acceptance.

PURCHASE MONEY MORTGAGE - A mortgage given by the buyer to the seller as part of the purchase consideration.

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