Welcome to our new Real Estate Glossary of real estate terms and definitions. We have tried to give the reader a thorough common-sense explanation of terms commonly used in real estate transactions. These are furnished as a convenience to the reader and we make no representation as to the accuracy of these definitions. Please consult an attorney for the legal meaning of all words contained in this reference guide.

Call option   A call option is a clause in a loan agreement that allows a person or entity who lends money to a borrower to ask for the balance of the loan at any time.  A call option clause is sometimes, although very rarely, "at will," meaning that the lender can require full repayment of any outstanding balance of the loan at any time for any reason.  Usually, however, in the real estate context, a lending institution will offer a borrower a mortgage with a call option that requires repayment of the full balance of the mortgage upon the occurrence of a specified event, such as the sale or transfer of the property from the original loan borrower to another person or entity.   Can lights   Can lights are cylindrical chambers that contain light bulbs, which are recessed into the ceiling of a building.  Can lights are also called "recessed lights," "down lights," "top hats," and "pot lights."  Can lights have been and continued to be very popular light fixtures in homes in the United States because of their recessed location and thus subtle presence.  They are especially popular in kitchens and bathrooms.  However, can lights are rather inefficient in terms the amount of energy they use compared to the light that they provide compared to other lighting options; some states, including California, have included provisions in their building codes that limit the number of can light fixtures a structure may include.    Cancellation clause   A cancellation clause is a clause that details the conditions under which each party to a contract may terminate the agreement.  A cancellation clause in a real estate transfer agreement sets out clearly terms that must be adhered to by both the buyer and the seller and how violation of such terms can be sufficient cause legally cancel the contract in its entirety.  A cancellation clause may also be included in a lease agreement, specifying terms under which the owner of the property can cancel the lease and force the tenant to vacate the premises, or terms under which the tenant can cancel the lease and leave without having to pay further rental installments.  Cancellation clauses usually require some minimal notice by the canceling party to the other party.   Cantilever   A cantilever is a structure projecting out and away from a wall, supported on only one end, such as a balcony or an exterior deck.  Cantilevers are also found in bridge construction.  A cantilever is anchored to one wall, such as the exterior wall of a house in the case of a balcony, or by one support post at one end, such as is the case with a bridge.  The part of the anchoring structure above the cantilever provides a balance from above that keeps the protruding cantilever in place.  1920s American design also saw the popularity of a cantilever chair, in which there are no back legs.   Cap   A cap refers to the limit on the amount that an interest rate or monthly installment payment can increase in an adjustable-rate mortgage (ARM).  Two types of interest rate caps are possible with ARMs: periodic caps, which limit the amount by which an interest rate can increase from one ARM adjustment period (which will vary depending on what ARM is selected) to the next; and overall caps, which limit the amount by which an interest rate can increase over the full life or the loan.  The monthly payment on a loan may also have a cap on how much it can increase from payment to payment or over the life of the loan.   Cape Cod style   Cape Cod style is a style of architecture that features a wood-frame or shingled house with a steep roof, and numerous windows projecting from the home´s second floor.  The Cape Cod style was first popular in New England in colonial days, when the homes were usually single story or one-and-a-half story houses.  Today, the term "Cape Cod" refers usually to two-story homes with the Cape Cod-shape that were particularly popular in the United States in the 1930s through the 1950s.  Popular features of the Cape Cod style include a symmetrical appearance with the front entry door in the center, multi-paned windows with shutters, and hardwood detail on the exterior and interior (including floors and cabinetry).   Capital   Capital is money that is used to create further income, such as funds invested in rental property.  Capital is the money one has that they use to invest in some profitable market, such as real estate, or in stocks or bonds, or a variety of other investments.  Investment of capital in real estate involves using one´s existing funds to purchase real property and then renting that property to tenants and collecting rent from those tenants.  Once the amount of money collected through rent has reached the "break even" point-that is, the point at which the amount of capital initially invested has been repaid-all further money paid to the property owner is additional profit.   Capital expenditure   Capital expenditure is the cost of making improvements or repairs to a property.  When capital is invested in the real estate market in the form of purchase of a rental property, additional expenses will occur with respect to making the property habitable for and aesthetically attractive to tenants and potential tenants.  In the case of real estate purchases for business purposes, capital expenditure may include money used to purchase fixtures or machinery that are required for the business.  In addition, capital expenditures are any money spent on any assets that will increase the value or the useful life of a particular property, such as money invested in additions or improvements to the property.     Capital gains   Capital gains are the profits an investor makes from the sale of real estate or other investments.  For example, if you purchase a home at one price, and subsequently resell it for a higher price, the difference in price will be a gain to you, and is termed a capital gain.  The opposite of a capital gain is a capital loss, in which a property at a price which causes the seller of the property to lose money.  Nearly everything that is sold that a person owns for personal use or as an investment qualifies as a capital asset, including houses, furniture, cars, and stocks and bonds.   Capital gains tax   A capital gains tax is a tax that is imposed on capital gains, which are any profits that a seller realizes from the sale of real or personal property, including real estate or other investments.  The tax rate that applies to capital gains on a particular property or investment is determine in part by how long the asset has been in the possession of the seller.  Long-term capital gain, in which the profit is realized in a sale that occurs after the seller has owned the property for more than one year, is taxes at a lower rate; property that has been held for less than one year is subject to a higher capital gains tax rate.   Capital improvement   A capital improvement is any improvement that extends the life of a parcel of property, or that increases the value of the property.  The term is applied not only to improvements made to personal real estate, such as a family home, but also to any improvements or value-adding alterations made to any structure or construction project.  In the real estate context, homeowners may make capital improvements such as updated heating and cooling, remodeled rooms, professional landscaping, new paint or flooring, room additions, and anything else that makes the property more valuable.   Capitalization   Capitalization refers to a mathematical formula that investors and property assessors use in order to compute the value of a property based on the net income realized from that property.  The method of calculation a particular property´s capitalization involves first making a determination of the fair capitalization rate, or market rate, that would likely be satisfactory to an average lending institution or a typical investor.  This rate is used to determine an estimate of how much return profit a particular investment should yield.  Capitalization is useful as a predictor for how much a property should be worth and can help investors determine whether or not a particular property is a sound investment.             Capitalization rate   The capitalization rate of a parcel of property is the percentage rate of return that is expected from an investment in that property, as estimated from the net income of the property. The market capitalization rate is based on a number of factors, including the property´s location and the age and condition of the property.  A determination is made of the fair capitalization rate, or market rate, that would likely be satisfactory to an average lending institution or a typical investor.  This rate is then used to determine an estimate of how much return profit a particular investment should yield.    Caravan   A caravan is a group of real estate agents who together, at one time, tour a house that has been recently listed for sale.  The idea behind organizing a caravan, which is usually done by the agent who is listing the home that is for sale on the market, is to give real estate agents an opportunity to see the property to evaluate what it has to offer and to potentially recommend a visit to their respective clients who they feel may be interested in the house.  In addition, the real estate agents in the caravan are a source of information for the listing agent and the seller of the property, providing feedback that can be important in preparing a home to be seen by potential buyers.   Carport   A carport is a roof that covers a driveway or other parking area.  In common parlance, the word "carport" is frequently used to refer to the entire parking area, the driveway and the roof that covers it.  A carport may be located separately from a house on a property, or the roof may extend out from the side of the house to cover an adjacent parking space.  Carports are less expensive than enclosed garages, and are particularly popular in geographical locations where the weather is mild and temperate, such as the southwest United States, because those areas less frequently require the protection from the natural environment that an enclosed structure provides.   Casement window   A casement window is a window that is hinged on its sides, in order to allow it to swing open vertically.  The hinge is located on the side of the window sash, or the narrow bar that separates the panes of the window.  Casement windows usually open outward, although some structures have casement windows that swing inwards into the structure.  Casement windows were originally a Dutch invention, and were designed to open inwards.  Today, they are popular architectural details that are reminiscent of older, European aesthetics.           Cash flow   Cash flow refers to the amount of cash that an investor in a rental property receives after he or she deducts and operating expenses and loan payments applicable to the property from his or her gross income realized on the property.  In other words, the total earnings the investor gains on renting the property to tenants is reduced by the amount that must be paid towards the investor´s initial loan for the property and the cost of any repairs, improvements, or upkeep maintenance performed on the property.   Cash-out refinance   A cash-out refinance refers to the refinancing of a mortgage, in which the money that is received from the new loan is greater than the amount remaining due on the old loan.  This allows the first loan to be paid off in its entirety, leaving the borrower with extra funds from the balance of the subsequent mortgage.  The borrower can use the extra funds in any manner he or she desires.  A cash-out refinance, like any mortgage, requires the borrower to pay closing costs; however, the interest rate on the second mortgage may be lower than that on the first, and is almost always lower than interest due on a home equity loan.   Cashier's check   A cashier´s check is a check that a bank draws on itself, rather than on the account of the  depositor.  Cashier´s checks are also known as bank checks, official checks, treasurer´s checks, teller´s checks, or bank drafts.  Because the amount of money for which the check is issued is guaranteed by the bank, rather than by the individual, cashier´s checks are usually a more trusted source of funds, particularly in a transaction involving a large sum of money, such as a real estate purchase.  Cashier´s checks are typically required when the payment amount must be credited immediately, as in the case of a real estate transaction.   Cathedral ceiling   A cathedral ceiling is a high, open, slanting or pointed ceiling, which is formed by finishing exposed roof rafters.  The architectural style is associated with open air space among the rafters, which increases the risk of moisture damage over other construction types.  However, many modern-day cathedral ceilings are enclosed and insulated.  Cathedral ceilings remain popular architectural details because of their soaring, open style and dramatic aesthetic appearance.  A cathedral ceiling usually eliminates the potential to include an attic in a home.              Caulk   Caulk is an acrylic or silicon sealant that is used to fill cracks, crevices, and holes in a home.  Various types of caulk are available and are suited to different types of home repair and improvement jobs; silicone-based caulk is usually the best choice since it is durable and lasts the longest, but it is also more difficult to apply than other types of caulk, and cannot be painted.  When properly applied, caulk seals a home against leaks of air or moisture, fills any spaces (as between tiles or boards) that expand and contract, and increases energy efficiency in a home by improving insulation.    Caveat   A caveat is a formal notice filed with a court that asks the court to suspend some legal action until the party which filed the challenge can be heard (that is, allowed to appear before the court to present his or her case and offer any relevant evidence to support that party´s position).  The term is also used in reference to a written warning provided by a seller of real property to a potential buyer which limits or eliminates the seller´s liability with respect to some aspect of the property listed for sale.   Caveat emptor   Caveat emptor, a Latin phrase literally translated as "let the buyer beware," is a legal principle which establishes that once a final legal contract is signed, the party that is buyer in the transaction in question cannot hold the seller liable or seek any remedy for a subsequently discovered problem with the property being transacted.  In real estate, traditionally a buyer could not recover damages from a seller for any defects to the property once the closing had been completed.  However, the modern legal trend is more favorable to the buyer, requiring certain disclosures by the seller and attributing certain implied warranties to him or her.   Cavedium   A cavedium is a courtyard or an atrium; the word is also seen spelled as cavaedium, a throwback to its Latin etymology.  An extremely popular architectural detail in ancient Roman construction, the cavedium is today found primarily in geographical locations with temperate climates, although a cavedium may also be shielded from environmental elements by the construction of a protective roof.  Cavediums are used by homeowners to bring some exterior nature into the interior of a house, and often include vegetation, fountains, or other garden elements.               Ceiling height   Ceiling height refers to the distance between the floor of a level of a structure and the ceiling of that level.  The standard height of a ceiling is eight feet.  Many new home builders offer higher ceilings as upgrades, and many home buyers prefer increased ceiling heights, as they provide a more open, airy, spacious atmosphere in a home.  Nine feet is a common upgrade for ceiling height, and some houses offer ceilings that are even higher.  Higher ceiling heights, in today´s real estate market, generally are listed as an asset to a home, and frequently increase the value of the home, particularly when offered not only on the main floor, but on upper levels and in basements.   Central air conditioning   Central air conditioning is a system of air conditioning provided by a device that generates cold air through an outside unit that is connected to ductwork inside the house, and which circulates the cold air throughout the house.  This is in contrast to a window unit air conditioner, the range of cool air which such a unit exerts being limited to the room in which the unit is mounted, and varying in intensity of the coldness from very cold near the unit to less cold further away.  Central air conditioning is an efficient way to cool a home, and is standard in almost all new home construction.   Central business district   The central business district of a city is the area of the city where most large businesses are located.  A central business district, or CBD, is usually located downtown, or in some other commercial heart of a municipality.  A CBD usually is characterized by a high concentration of retail and service establishments, vertical zoning laws (that is, allowing for vertical construction, such as skyscrapers), and high land values.  In addition, a city´s CBD is usually also where its government offices are located, and often the focal point for public transportation services.   Certificate of Deposit (CD)   A certificate of deposit, or CD, is a document which shows that the bearer has a specified amount of money on deposit with a bank, a stock-brokerage firm, or other financial institution that has issued the CD.  CDs are risk-free investments, and are insured for the value they represent, and like a savings account, they offer some interest rate that makes them grow in value over time.  However, unlike a traditional savings account, a CD is held by the bearer for a fixed period of time, ranging from several months to several years, and the money it represents may not be withdrawn until the end of that term (referred to as the CD´s "maturity").           Certificate of deposit index   A certificate of deposit index, or CODI, is an index that is based on the interest rates on six-month CDs. It used to determine the interest rate for some adjustable-rate mortgages, or ARMs.  A certificate of deposit index takes into account a wide variety of factors, including characteristics of the market as a whole, the volatility of the market, and relevant historical data.  The information provided by a CODI is useful in evaluating whether interest rates are favorable or not on a particular CD, and are useful to investors when planning their investment portfolios.   Certificate of eligibility   A certificate of eligibility is a document that is issued by the Veterans Administration  that verifies that a person is eligible as a United States Veteran for a loan through the Administration´s Veterans loan program.  Lending institutions make special home loans to veterans who qualify; part of each loan is guaranteed by the Veterans Administration itself, which protects the lending institution in the event that the borrowing veteran defaults on his or her loan.  Certain restrictions apply regarding who is eligible to receive such a loan and to get a certificate of eligibility issued by the Veterans Administration.   Certificate of occupancy   A certificate of occupancy is a legal document which states that a home or other building has met all applicable building codes for the area in which it is located, and that it is suitable for habitation.  The certificate of occupancy for each structure is issued by the local building authority to the builder of the structure, stating that the structure is approved for habitation, and allowing the builder to then offer that property for use as a dwelling or otherwise.  A building cannot be legally sold to a buyer until a certificate of occupancy is issued by the applicable regulatory authority.   Certificate of sale   A certificate of sale is a document that is issued at a judicial sale, which is a sale of a person´s goods pursuant to an order by a court, conducted by a trusted official (such as a sheriff) appointed by the court in order to satisfy a judgment against the owner of the goods, as when he or she owes money on a loan on which he or she has defaulted.  The certificate of sale is issued upon completion of the sale, and it entitles any buyer of property at the judicial sale to receive a deed of legal ownership after court confirmation of the purchase of the property.               Certificate of title   A certificate of title is a legal document, a written opinion regarding the status of a piece of property based on an examination of the public record.  A certificate of title deems the property to be free of what are called "title defects," or reasons why an owner of property may not have full ownership rights to the property in question.  When a certificate of title is issued, the buyer in a real estate transaction is assured thereby that he or she is getting full title to the property they are purchasing, and that no challenge to their ownership is in question.     Chain of title   A chain of title is the official record regarding who has held title to a particular parcel of real property and for what time period.  A chain of title details the ownership history of a piece of property, making it clear to prospective buyers whether any liabilities may still be outstanding related to the property, as well as providing information regarding who owned the property when in the event that some question related to the property in its past existence arises that the current owner is unable to answer.   Chair railing   A chair railing is a decorative trim that is installed on a wall, usually about 32 to 36  inches above the floor, or approximately one-third of the way up from the floor of a room vertically towards the ceiling.  Chair railings are designed for the practical purpose of protecting the wall against scuffs from furniture (such as chairs); however, in modern home construction, chair railings are often included for aesthetic purposes, resulting in a unique architectural detail that enhances an otherwise plain interior wall.  Chair railings are commonly offered by builders as upgrades to new home construction, and are an addition that home sellers market as worth paying an extra purchase price for.   Change frequency   A change frequency is the adjustment schedule on an adjustable-rate mortgage.  With an adjustable-rate mortgage (or ARM), the dollar amount of payment of both the principal due on the loan and the interest rate applied for the privilege of borrowing the mortgage change over time, on a fixed schedule that may be every year or every several years, depending on the specific ARM.  The change frequency of an ARM is that schedule-how frequently the amount of installment payments on the principal of the loan and the interest rate payments change.               Change order   A change order is a modification of a construction contract associated with a structure, which is used to authorize a change in the work, an adjustment in the amount of money the purchase clause in the contract calls for, or a change in the contract-specified time for completion of part or all of the building project. The owner or home buyer, the architect, and the building contractor must all sign the change to make it effective and legally enforceable.  Change orders may consist of additions, deletions, or any alterations to the term of the contract, but all parties must be in agreement for those alterations to be recognized by a court of law.   Chattel   A chattel is any item of personal property, such as furniture, clothing, or a car.  To qualify as a chattel, property must be "moveable," that is, transportable with relative ease.  For this reason, real property, such as a house or a lot, is NOT considered a chattel.  In addition to personal goods, chattels also include money, securities, investments, and intangible assets.  The time period during which rights in chattels are enforceable, and any applicable statute of limitations that governs how long a property owner has to file a lawsuit with respect to the property, is typically considerably shorter with respect to chattels than with respect to real property, since chattels are considered more easily replaceable.   Chattel mortgage   A chattel mortgage is a lien on personal property that is used as collateral for a loan; the resulting loan may be used, for example, for the purchase of real property.  The personal property, rather than the real estate itself, is offered as security for a loan used to purchase real estate.  With a chattel mortgage, a borrower defaulting on his or her loan is subject to the taking in exchange or the mortgaged chattels, which are sold (as through a judicial sale), with the proceeds going to pay of the amount due on the loan.  Chattel mortgages were used historically, but today have been largely replaced by security agreements, the form of which is governed by federal regulations.   Chimney back   A chimney back is the back wall or lining of a fireplace or furnace chimney.  A wood-burning chimney often creates a problematic potential risk in that it may develop on the chimney back deposits of creosote, which is a flammable substance that can interfere with airflow through the chimney or cause a house fire.  A chimney back which is properly constructed offers strong support for a chimney, important to prevent crumbling and other deterioration associated with age, use, and external factors such as inclement weather and earthquakes.       Chimney flue   A chimney flue is the passage inside a chimney that channels smoke and heat from the base of the chimney, usually a fireplace in a structure´s interior, to the outside.  A clean, well-maintained chimney flue will circulate air into a home while channeling out smoke and heat byproducts that result from burning materials in a fireplace.  However, chimney flues can become plugged, either with dirt or external objects such as birds´ nests.  When a flue is clogged, smoke and heat are either unable to escape a home´s interior, or their ability to do so is impaired, which presents a number of extremely dangerous hazards, including fire risk and potential carbon monoxide poisoning.   Chimney pot   A chimney pot is a short pipe at the top of a chimney that increases ventilation to the fireplace and that acts to reduce smoke.  A chimney pot caps a chimney flue, making a chimney taller and narrowing its opening, which allows for an increase in the updraft of a chimney; this keeps more smoke from remaining inside of a house.  In addition, chimney pots are used as decorative architectural details, and may exist in numerous shapes and styles, adding uniqueness and an aesthetically pleasing design to a home´s roofline.   Cinder block   A cinder block is a block that is made of ash and cement, and which is a commonly used construction material.  Cinder blocks are rectangular in shape, and are made of coal cinders and Portland cement, which is a finely ground powder that is the most common type of cement used.  Cinder blocks are similar in shape and size to concrete blocks, which are also composed of Portland cement (as well as sand or fine gravel), but are generally lighter and therefore easier to work with than the heavier concrete blocks.  Furthermore, cinder blocks, because of their content, are generally less expensive that concrete blocks.   Cinder fill   Cinder fill is the term used to describe cinders which are used in construction below a basement or around a foundation to promote drainage.  Ensuring proper drainage is imperative in protecting a home against flooding, mold, and mildew, as well as infestation by termites and other insects.  Cinder fill consists of cinders spread below the lowest level of a home, which act as a barrier against moisture by repelling and absorbing groundwater that would otherwise seep into a foundation or basement.  The appropriate depth for a layer of cinder fill will depend on the moisture content of the soil of a given property and on the typical weather conditions in the area.           Circuit breaker   A circuit breaker is an electric fuse that activates or deactivates a circuit.  In a house, a circuit breaker is one of the most important and useful safety devices available, acting to prevent too much electrical current from flowing, a situation which could lead to tragic consequences such as house fires or harmful or even lethal electrical shock.  When the current, or the flow of a charge of electrical energy through a house, rises above what is set as a "safe" level, a circuit breaker cuts off the circuit entirely, eliminating the electrical flow altogether.    Cistern   A cistern is a tank on a parcel of real property that is used to store rainwater, which can then be utilized for a number of purposes.  A cistern is usually dug into the ground, with the only access through the opening at the top, at ground level.  Walls are waterproof, allowing the cistern to retain the water it collects from rainfall without leakage.  Cisterns are usually utilized in geographical areas where water resources are scarce; the water collected in a cistern may be used for cooking, washing, or irrigating agricultural crops, and may in some situations be purified and used as drinking water.   Classified property tax   A classified property tax is a tax that varies in rate depending on the use of the property to which the tax is applied.  Different tax rates apply, for example, to real property, such as a house, than to personal property, such as a car, cash, or other chattels.  For real property tax purposes, classifications that determine the appropriate rate of taxation include the following uses of land: agricultural, residential, commercial or industrial, waste, protected nature preserves, or vacant property, among other classifications.  In general, agricultural and natural lands are taxed at the lowest rate, industrial and commercial property is taxed at a high rate, and residential property tax rates fall somewhere in between.   Clear title   Clear title to a property means that the property does not have liens, defects, or other legal encumbrances.  Commonly in real estate transactions, the phrase clear title is applied when, even though the seller of the property in question may not own clear title (since there is often a remaining encumbrance associated with the seller, such as a mortgage that has not yet been paid off in full), it is within the power of the seller to convey clear title to the buyer.  A buyer can get fully clear title to the property if he or she has sufficient money to pay for both the purchase price of the property and the balance of the outstanding mortgage.         Closing   The closing is the final procedure in a real estate transaction during which documents are signed and recorded, and during which the property involved in the transaction is legally transferred from the seller to the buyer.  Closing occurs on a mutually agreed-upon day, typically a few weeks after the seller has accepted the buyer´s purchase offer, to allow time for intermediate events such as a home inspection and the securing of a mortgage by the buyer.  At closing, the buyer (or the buyer´s bank) submits a check for the purchase price (with money going to the seller in an amount less closing costs and mortgage fees), the buyer signs the deed to the property over to the seller and gives him or her the keys, and the new deed is registered (usually by a title company).   Closing costs   Closing costs are expenses that arise which are incidental to the sale of real estate.  These are paid during the official closing, and usually include at least the following: loan payments (any costs associated with the issuance of a loan to the buyer to facilitate the purchase, include mortgage application fees), title fees (costs imposed by the title company for their services, as well as the cost of registering title on the public record), appraisal fees (costs of having a parcel of property appraised to determine its market value), attorney fees if an attorney or attorneys are involved who represent the interests of one or more parties to the transaction, and a brokerage commission (fees paid to the real estate agent or agents for their services).   Closing statement   A closing statement is a legal document which details the final financial settlement between a buyer and seller of a real property, and the costs required to be paid by each party.  For example, a typical closing statement will include information regarding the payment of taxes; real property taxes are due annually and are generally prorated to the date of closing so that the buyer receives a credit towards the tax payment based on how many days in the applicable year the seller owned the property.  In addition, interest payments are specified in a typical closing statement; these are also prorated depending on the ownership of the property by the seller during the previous payment period.   Cloud on title   A cloud on title is an invalid encumbrance on real property.  In other words, a cloud on title to a parcel of real property which has been recorded, but which has some encumbrance, such as an outstanding amount of money due on the property or a defect in ownership, so that it cannot be transferred to a buyer in a real estate transaction until the issue is resolved.  A cloud on title is usually discovered by a title company when it does a title search prior to the closing on the property in question.  Many times, the problem is a result of logistical errors or bookkeeping mistakes, and can be easily resolved; other encumbrances, such as those associated with contested wills, may take a much longer time before final resolution. Cluster development   Cluster development is, most simply, a development approach that involves squeezing more homes into less space.  The idea is to create a "cluster" of residential units so that more people can be accommodated in a smaller geographical area.  One benefit of cluster development is that it can be used to preserve and protect environmental resources, such as water sources, agricultural lands, vegetative expanses (such as forests, swamps, and marshes), and wildlife preserves by limiting the area in which people, and attendant noise, pollution, and other detrimental effects of growing populations, settle.  Cluster development is usually associated with smaller lot sizes, but is regularly included in development plans as the human population grows and land become scarce.   Co-housing   Co-housing refers to individual housing units that are clustered around a common building in which residents of the independent housing units share cooking and other activities.  Co-housing communities are planned, owned, and managed by their group of  residents.  Residents who choose co-housing usually prefer to have greater social interaction with neighbors.  Shared facilities generally include a kitchen in which residents take turns cooking for the whole community and a dining room in which all residents eat together.  Other shared facilities may include laundry rooms, child care, and entertainment rooms.   Co-insurance   Co-insurance refers to insurance coverage that involves two or more parties, among whom the risk of insurance is spread.  A typical situation of co-insurance arises when the insured party and the insurer (usually an insurance agency) split the cost of anything the insurance policy covers in some predetermined way, specified in the signed insurance contract between the two.  Co-insurance may also refer to a situation in which a person or entity has more than one insurance policy, through separate insurers, to cover the same insured item (multiple insurers may, for example, be necessary to cover a single home owner´s homeowners´ insurance policy, or a single patient´s medical insurance policy).    Co-maker   A co-maker is a person who signs a promissory note with the borrower of a loan and thereby assumes responsibility for the loan.  A co-maker is also sometimes referred to as a co-signer of a loan.  The co-maker has the same responsibilities with respect to repayment of the loan as the primary borrower, and is jointly and severally liable for the debt incurred by the issuance of the loan, which means that if the primary borrower defaults on all or part of the loan in question, the lending institution can legally require the co-maker to pay for the outstanding amount of the loan.       Co-signer   A co-signer is a person who signs a promissory note with the borrower of a loan and thereby assumes responsibility for the loan.  A co-signer is also sometimes referred to as a co-maker of a loan.  The co- signer has the same responsibilities with respect to repayment of the loan as the primary borrower, and is jointly and severally liable for the debt incurred by the issuance of the loan, which means that if the primary borrower defaults on all or part of the loan in question, the lending institution can legally require the co- signer to pay for the outstanding amount of the loan.   Codicil   A codicil is a change to a will that adds or subtracts provisions in the original will, or that  clarifies some portion or portions of the will document.  A codicil is a separate legal document, and for the additions, subtractions, or changes set forth in the codicil to be legally valid and applicable to the will, the codicil must be drafted according to the same legal formalities as are applicable to the legal construction of the will in the applicable jurisdiction-for example, a codicil must usually be in writing, signed by the person whose will is being modified, and with the signature witnessed by one or more witnesses.   Coign   A coign is the cornerstone of a building that differs in shape or color from the rest of the building´s wall.  A coign is often seen on buildings in the form of a keystone of an arch detail; the keystone of a building is the central building block that appears at the top of an arch or vault.  Coigns may be architectural details that are frequently added to increase the uniqueness of a building exterior.  They may also serve as wedges to support or anchor other building details.  Alternative spellings that are commonly encountered are quoin and coigne.       Collar beam   A collar beam is the structural element that connects roof rafters.  Also sometimes referred to as a collar brace, a collar bream is a horizontal piece of framing lumber, and is used to provide support for rafters.  The collar beam may also perform double duty as a ceiling joist if the attic of a home is used to accommodate living space.  Collar beams generally connect two rafters, approximately halfway along the rafters, forming a triangle at the connection point.  The beams run parallel to the floor below, and in an open-ceiling building are sometimes used for storage.               Collateral security   Collateral security is additional security that a borrower supplies to a lending institution in order to obtain a loan.  Collateral security is sometimes required in instances when the loan is for a particularly large amount, or is considered high-risk because of the borrower´s credit or current or future financial situation.  The borrower offers other collateral besides what the loan is being used for to insure that the lending institution will be able to recover the money it has loaned to him or her; for example, collateral security on a real estate purchase may involve not only subjecting the home a borrower is purchasing as collateral for a home mortgage, but also unrelated assets such as his or her car or other personal property.   Collection   Collection refers to the series of steps a lending institution takes in order to bring a delinquent mortgage up to date.  A lender may use a collection agency for the purpose of collecting debt owed on a loan by a borrower; agents employed by collection agencies usually charge a fee for their services that represents some percentage of the amount owed by the borrower to the lender.  State and Federal laws govern collection procedures, both those conducted by collection agents and those conducted by lenders directly, to ensure that collection does not involve threatening behavior or undue harassment of the borrower.   Collusion   Collusion is the action of two or more people in agreement to break the law.  Collusion in the real estate context generally involves planning and cooperation among a pair or a group to take advantage of a party with some involvement in a the transaction or rental of a parcel of real estate.  For example, collusion may occur between real estate investors and government officials to unlawfully diminish the rights of a rental tenant or to somehow negatively his or her rental experience. Collusion may also occur between a seller of real property and a home inspector or assessor to limit the amount or skew the quality of information about a property provided to a potential buyer.   Colonia   Colonia are unincorporated communities along the southern border of the United States with its neighbor, Mexico.  Colonias are most common along the Mexican border in Texas, but are also present in Arizona, California, and New Mexico.  The communities are low-income, very poor areas typically created upon cheap farmland in rural areas.  Colonias usually lack basic necessities such as safe and structurally sound housing, drinkable water, sanitary sewage systems, adequate drainage, usable streets, and utilities.  Colonias consist of small populations of mostly Hispanic residents who legally own their land but almost always live below poverty level.     Column   A column is a slender, vertically upright structure that consists of a base, a round or square shaft, and a capital.  Architecturally, columns extend the weight of a structure, such as the upper levels of a house, through its length and to other structural elements below, such as a home´s foundation.  Columns are frequently found in basements, where they are used to support the floor of the level above by transmitting its weight down to below the basement.  In addition to their construction use, columns are often used as decorative features in a home, and may have intricate carvings or shapes that add to the aesthetic appeal of a house.   Column footing   Column footing refers to the support base for a load-bearing column.  The footing is usually made of reinforced concrete, which is also called ferroconcrete, and which contains reinforcement bars (abbreviated as "rebars") or other fibers to strengthen the material.  The footing of a column is usually wider and sturdier than the upper part of the column.  A column footing typically is built directly on top of a concrete foundation so that the weight of the load it bears (that is, whatever the column is intended to support) is distributed down from the upper supported structure to the lower foundation.   Combination door   A combination door is an outer door in a home that has interchangeable screen and glass panels.  Combination doors, also referred to as storm/screen doors, are particularly energy efficient.  The eliminate any extra dead air space that exists when only a solid door is in place.  A storm door breaks the force of wind and moisture, reducing leakage into a home, and protects a primary door from weather conditions such as excessive sunlight that may alter the appearance or even damage the integrity of the primary door.  The screen element in a combination door allows for protection of the interior of a home from unwanted debris and insects, while permitting exterior air to enter into the house.   Combination window   A combination window is a window that has interchangeable screen and glass panels, and its benefits are similar to those of a combination door.  Combination windows are energy efficient, in that the glass panels break the force of wind and moisture, reducing leakage into a home, and protect interior flooring, carpeting, furniture, and cabinetry from excessive sunlight that may alter their appearance or damage their integrity.  The screen element in a combination window allows for protection of the interior of a home from unwanted debris and insects, while permitting exterior air to enter into the house.           Commercial bank   A commercial bank is a financial institution that provides a broad range of services besides just traditional savings or checking accounts.  Commercial banks regularly provide checking and savings accounts as well as business loans and credit cards, among other services.  A commercial bank operates by collecting money in the form of deposits by its clients into checking and savings accounts, and uses the money collected to make loans to clients.  It also buys corporate and government bonds to make money through interest on those bonds.    Commercial property   A commercial property is an area that is zoned for businesses uses.  Commercial property is property that is intended to be operated at a profit to the property owner; profit may be realized from capital gains or from rental income paid by business tenants utilizing the property for their commercial endeavors.  Commercial property may include business properties such as office buildings, retail stores and malls, medical business, hotels and other services, and industrial property.  The tax rates and regulations applicable to property that is zoned commercial differ from property that is zoned to be residential.    Commingling   Commingling refers to the mixing of money that is held in trust with other funds.  Commingling is illegal, as well as against the codes of conduct imposed by government and professional organizations.  Commingling occurs when a fiduciary, or some person or entity who holds responsibility for keeping his or her client´s money safe and separate from other money for a specific purpose, mixes that money with other funds so that it is no longer clear which money belongs to the client.  In the real estate context, real estate brokers are prohibited from commingling funds held as earnest money on behalf of their clients; attorneys are prohibited from commingling trust funds, to be paid only as the attorney completes work on behalf of a client, with other personal or firm funds.   Commission   A commission is the negotiable percentage of the purchase price of a home that is paid to the respective real estate agents of the buyer and seller.  Real estate agents make their income based on successful sales and purchases of real property.  At closing, they are paid some percentage of the final price of the property agreed upon by the buyer and seller in the transaction.  The contracts that buyers and sellers individually sign with their respective agents specify the percent of the ultimate purchase price that will be due to the agents upon closing; the percentage is split among all agents involved in the transaction.  Commissions vary depending on agents´ experience, geographical location, and other factors; the national average is typically between 5% and 8%.       Commitment   A commitment is a promise by a lending institution to make a loan to a borrower according to specific terms for a specified period of time.  A commitment, also sometimes called a loan commitment or commitment letter, generally takes the form of a written, signed, usually form letter that states a formal offer and specifies the explicit terms that must be met for loan to be issued.  Terms may include, in addition to the length of time over which the loan must be repaid, the frequency and amount of payments, the interest rate imposed, and any fees or penalties that the borrower may be subject to if he or she fails to adhere to the specified terms of the commitment.   Commitment fee   A commitment fee is the fee that a lending institution charges for promising to make a loan to a borrower.  The fee acts as insurance for the lending institution for holding credit available for the borrower to utilize.  The fee pays the lender for keeping a line of credit open for the borrower or to guarantee that the lender will make a loan in a specified amount to the borrower at some future date, although the credit or loan may not be utilized by the borrower at the time the fee must be paid.  Commitment fees are usually paid by borrowers who do not need the money they are guaranteed through the loan immediately, but who wish to lock in an attractive interest rate.   Common area   A common area is an area within a housing development that is owned and can be used by all residents of the development.  Common areas may include amenities such as greenways, lakes or ponds, parks, playgrounds, walking or biking trails, community swimming pools, sports fields and courts, or community clubhouses that may be available for use for individual residents´ use for special occasions by reservation.  Common area maintenance is typically accomplished through the engagement of services paid for by homeowners´ association fees paid monthly or annually by community residents.   Common law   Common law refers to a body of laws that is based on custom, usage, and rulings by courts in various jurisdictions.  This is in contrast to statutory law, which is law that is created by legislative bodies, such as the federal Congress, and regulatory law, which involves regulations set out by regulatory agencies.  Common law is dynamic, changing with the various interpretations by judges in different jurisdictions of preceding case law in light of changing world circumstances.  Because interpretations vary based on a number of factors, and because the political climate in various jurisdictions differs, common law may be very different from state to state.          Common-area assessments   Common-area assessments are fees paid by the homeowners of a condominium project or a planned-unit residential development to maintain, repair, improve, or operate common areas.  Common area maintenance and upkeep services may be performed by personnel employed directly by the community, or by external service providers, and may include services such as mowing and irrigation of grass, trash removal, repairs of amenities such as playground equipment or sports facilities, cleaning of community swimming pools, and sometimes exterior maintenance of the residential units.  Homeowners pay assessments that cover these costs usually on a monthly or annual basis.   Common-interest development   A common-interest development is a residential development project composed of individually owned units that share usage and financial responsibility for common areas.  Common-interest developments are similar to communities in which residents pay common-area assessments to a homeowners´ association or other community governing body, but are more resident-oriented in that residents themselves pool funds and make decisions regarding what services are needed or desired for the community common areas, how much money should be paid for those services, and who should provide those services.   Community property   Community property is property that is accumulated during marriage through the joint efforts of a husband and wife. It is a classification of property peculiar to certain states.  Property acquired during marriage by either party in a community property jurisdiction is considered to be owned jointly by spouses, with each have a one-half interest.  Joint ownership is presumed unless there is specific evidence offered that the spouses did not intend for the property in question to be jointly owned.  Upon divorce, annulment, or death, property in a community property state that has not been specifically excluded from joint ownership is divided exactly equally between the spouses (or their estates).   Community Reinvestment Act   The Community Reinvestment Act, or CRA, is a federal law that encourages financial institutions to loan money to people in those neighborhoods where primarily minority depositors live.  The idea behind the CRA is to make available funds to minorities so that they can utilize the money to further their educations, improve the condition of their homes, or invest in business ventures that will increase the income flowing to individual persons and into the community as a whole.  Under the CRA, banks and other lenders are prohibited from "redlining," or limiting their loans to wealthy and successful communities.        Commute   A commute is the distance and time it takes a person to reach his or her workplace or school from home, or his home from his or her workplace or school.  Commutes are a troublesome issue in large metropolitan areas because the number of people driving between home and work or school (commuters) overwhelms the available road space.  Commuting is particularly difficult during times when many other commuters are also on the road, such as morning hours and hours at the end of a typical work day ("rush hours").  Many homeowners take the distance and time involved in a necessary commute into account when deciding on a location in which to purchase a home.   Comparables   Comparables are real estate properties that are used for comparison to a specific parcel of real estate in order to determine the approximate value of that parcel.  Real estate agents and appraisers, as well as home buyers and sellers, use comparables to estimate how much a particular home is worth on the market.  Factors taken into consideration when determining which properties should be used as comparables for a home include the geographic location, the square footage of the house, the lot size, the number of bedrooms and bathrooms, features such as garage size or swimming pools, and the age and condition of the property being evaluated compared to those of the comparables.   Comparative market analysis   Comparative market analysis is a method of estimating the value of a parcel of real property based on an analysis of the sales of other real properties with similar characteristics.  Comparative market analysis (CMA) is a useful tool that can be utilized to determine an approximate value for a particular house.  A comparative market analysis is usually performed by a real estate agent on behalf of his or her client to provide a picture of why a home the buyer is interested in is worth a predicted amount of money and whether it is over- or under-priced compared to other, similarly situated homes on the market.   Competent   The word "competent" is used as a legal term to refer to a buyer who is legally fit to enter into a sales contract.  Competency is required for entry into a real estate transaction agreement in order to ensure that the buyer truly understands all of his or her rights and obligations with respect to the transaction.  Specific requirements that must be met in order for a buyer in a real estate transaction to be considered competent to enter into the transaction usually include a minimum age requirement, the ability to understand the sales contract, and the authority to enter into the agreement.           Compound interest   Compound interest is the interest paid on the principal balance of a mortgage, as well as on the accrued and unpaid interest applicable to the loan.  Compound interest is added to the original principal of the loan, and new interest is calculated based on the total amount of the principal and the newly-added interest.  Principal grows faster as the frequency with which interest is compounded increases.  Interest is usually compounded on an annual basis, although some lenders use a compounding system that is more or less frequent; if the frequency of compounding is not specified, yearly compounding is presumed.   Concrete tilt-up   Concrete tilt-up is the process of pouring concrete into forms on the ground, allowing the forms to harden into solid pieces, and then raising the material to a vertical position to form walls for a building.  Concrete tilt-up construction has been used since the early 1900s and has been the most popular method of wall construction since the 1940s in the construction of industrial structures, although the process also is commonly used in the construction of residential buildings.  Concrete tilt-up is associated with efficiency and longevity for the walls of the structure.   Condemnation   Condemnation is the process by which the government takes private property for a public use without the consent of the owner.  The legal term for condemnation is "eminent domain."  Historically, condemnation was used to take the land of private property owners for uses that were primarily related to the construction of railroads or utilities.  Today, condemnation is also used to secure land for public buildings, parkland, and military uses.  Specific condemnation laws vary among jurisdictions, but the government is usually required to pay the property owner an amount that is considered to be a fair market value as compensation for the taking of the property.   Conditional commitment   A conditional commitment is a promise made by a lending institution to a borrower to make a loan only if the borrower meets certain conditions.  Like a regular loan commitment, a conditional commitment is a written, signed, usually form letter that states a formal offer and specifies the explicit terms that must be met for loan to be issued, such as the length of time over which the loan must be repaid, the frequency and amount of payments, the interest rate imposed, and any fees or penalties that the borrower may be subject to if he or she fails to adhere to the specified terms of the commitment.  However, under a conditional commitment, the lender is not required to make the loan unless the borrower meets the conditions specified in the commitment prior to the date on which the loan is to be issued.     Condominium   A condominium is a residential building or community development made up of individual residential units in which the owners of the units hold title to the interior space in which they reside, while common areas are communally owned by all condominium residents.  Condominiums usually require the payment of a monthly or annual fee for the maintenance of communal amenities such as parking lots, community rooms, and recreational areas, and sometimes services such as waste management, lawn maintenance, or snow removal.  Condominiums are attractive to some home buyers as low- or no-maintenance residential options that maintain the element of ownership.   Condominium conversion   Condominium conversion refers to the change in title from a single owner of an entire project or building to multiple owners of individual units.  For example, a single owner may own an entire building with discrete units that the owner rents to tenants as apartments; following a condominium conversion, each individual unit in the building would become owned by the unit´s residence, and title would pass from the former building owner to multiple titles issued to the owners of the individual unites.  Condominium conversions become popular when mortgage interest rates decrease, making home ownership, to many a more desirable option than renting, more financially feasible.   Conduit   A conduit is a pipe, usually made of metal, that houses the electrical wiring in a home or other structure.  Conduits are insulated, rigid, and durable, usually composed of steel or aluminum, although some may be constructed from plastic encased in metal or concrete.  Conduits are used to house, protect, and cover electrical wires and cables.  Some of the standard types of conduits commonly used include flexible metal conduits (wound into a helix), liquid-tight conduits, and galvanized rigid conduits (which are coated with zinc to provide increased resistance to metal corrosion or abrasion).   Consent judgment   A consent judgment is a binding written agreement between two parties in which both consent to have a legal judgment entered and recorded.  Consent judgments are legally binding on the parties once entered by a judge, usually in the form of a legal document called a consent decree.  Consent judgments are used when the parties have been involved in some sort of dispute, and wish to complete the litigation on the topic and come to some mutually acceptable compromise.  The judgment if final and enforceable, so parties to a consent judgment must be certain that their agreement to the specific terms is acceptable prior to the issuance of the court order.       Conservator   A conservator is a court-appointed guardian.  The responsibility of a conservator is bestowed upon a guardian by the court through a conservatorship.  A conservator is generally appointed when the person as whose guardian the conservator is to act is in some way in competent to take care of him- or herself or his or her finances.  A conservator may also be appointed as a guardian of a person´s estate, in which case the conservator´s duty is to act in the best interest of the estate owner while making decisions with respect to distribution of the estate, including whether and for what price to sell any real property.   Consideration   Consideration refers to anything that is legal and that has value that induces a person to enter into a contract.  The most basic example of consideration in a real estate contract is the money paid by a buyer to a seller of a property-the money is consideration given for the resulting ownership of the property.  Consideration, however, may also be anything that is of value to the other party in a transaction; the value need not be quantifiable as an average or market value, and need not be understood or approved of by courts or other persons or entities-it is sufficient for a legally enforceable contract for a transfer of property that the consideration offered by one party is adequately valuable to the other.   Construction budget   A construction budget is funding that an owner of real property arranges for the construction of a project upon that property.  Planning for construction usually involves preparing a budget in order to organize, understand, and control costs during construction.  The total amount of a construction budget involves both hard costs and soft costs.  Hard costs are costs for labor and materials, which are used directly to construct the project.  Soft costs are all other costs and fees involved, such as fees for permits required for certain types of construction projects.  A construction budget should be considered in advance of planning the physical construction, to ensure that funds are adequate to pay for all aspects of construction that are anticipated.   Construction documents   Construction documents are drawings and specifications provided by an architect to a home builder that provide detailed requirements for the construction of a building project.  At the time construction documents are drafted, all specifications regarding the project will have been finalized; the purpose is to ensure that all information in the construction documents is a complete and accurate representation of what the homeowner expects and requires, so that the process of soliciting bids for construction can begin.  Specifications in the construction documents must be adhered to during the process of construction; any changes made during construction by a homeowner who previously approved the content of the documents can result in delays or increased costs.   Construction loan   A construction loan is a short-term loan made by a lending institution to a borrower for the purpose of construction by the borrower of homes and buildings. The funds are disbursed by the lending institution in stages during the process of construction as needed for costs associated with the construction.  Construction loans are usually set up so as to require the borrower to pay interest only during construction, and to pay the balance of the principal due on the loan upon completion of the project.  In some cases, construction loans can be set up to convert to mortgages once the project is complete, a loan referred to as a construction to permanent loan.   Construction to permanent loan   A construction to permanent loan that is converted from a construction loan to a longer-term traditional mortgage after construction of a property has been completed.  A major advantage of construction to permanent loan approaches to financing is that the borrower only has a single application and a single closing for both loans.  In addition, dealing with a single lending institution throughout a construction process and afterwards as the holder of one´s home mortgage on the property erected during the construction streamlines records and payments, as well as establishing a relationship between the lender and the borrower that is longer-term and thus often more beneficial to the borrower.   Consumer Credit Counseling Service (CCCS)   The Consumer Credit Counseling Service, or CCCS, is a nationwide, nonprofit organization that helps consumers who are in debt to get out of debt and to improve their credit profile, which can be crucial to securing financing for a home or other assets.  The CCCS offers free advice to consumers and establishes free debt management plans to help individuals manage and control their debt.  The CCCS also offers educational opportunities for consumers, including on-site and online courses related to financial literacy, readiness and preparation for home ownership, banking, credit, saving, and shopping.    Contemporary style   Contemporary style refers to a style of design that features simple, streamlined shapes; straight lines; and bold but simple color schemes.  Characteristic of the style are large, usually unadorned windows; sculpture and other artwork; and a proliferation of industrial materials.  Design in the contemporary style aims to be unique and pared down, clean, and uncluttered.  Contemporary style follows a "less is more" mentality, and colors are usually neutrals, such as white, black, or beige, accented by popping statement pieces of bold color on walls, in artwork, or in specific pieces of furniture or decorative accents.          Contiguous lots   Contiguous lots are parcels of real property that are adjoined.  Two home sites, for example, belonging to immediate neighbors are considered contiguous lots, as are two lots accommodating commercial purposes that share a boundary.  Contiguous lots are sometimes sold in tandem at a lower combined price than each would be offered for on the market individually, and may be attractive to real estate investors, to homeowners who wish to utilize one lot for residential purposes and the other for business purposes, or to purchasers who desire more acreage for their home or other property use.   Contingency   A contingency is a condition specified in a contract.  In the real estate context, a contingency is a condition regarding the planned real estate transaction, which usually states that the purchase or sale of a parcel of property will not occur unless the condition or conditions specified are met.  For example, a common contingency in real estate purchase agreements is a satisfactory home inspection; if a home inspection provides to the buyer some information that makes the purchase of the home in its present condition unacceptable to him or her, a contingency to this effect would allow the buyer to refuse to follow through with the purchase of the property until the issues are remedied.   Contingency listing   A contingency listing is a real property listing with a special condition attached.  The property being offered for sale may have certain limitations of rights associated with it pursuant to government regulations or rules established by a community homeowners´ association.  A contingency listing condition may also specify that a buyer of the property cannot move in until a specified date in the future in order to accommodate the special needs of the seller, or that the buyer must move in immediately and pay the purchase price to the seller under specific terms.   Contingent fee   A contingent fee is a fee that must be paid if a certain specified event occurs; the fee to be paid is said to be contingent on the occurrence of the event.  For example, there may be a late fee associated with a delay in the construction of a real estate project or a fee imposed if a closing does not occur between the parties to a real estate transaction within by a particular specified closing date.  A real estate agent may impose a contingent fee on a client, specified in the contract between the agent and the client, that requires payment of a commission in the event that a final transaction does not occur.  Contingent fees are enforceable only if they are specified in writing in a contract and signed competently by the person to whom the fee will be charged upon occurrence of the condition.         Contract   A contract is an agreement between two or more parties that creates or modifies an existing relationship.  Contracts are legal documents that, when fairly negotiated as to their specific terms, are legally binding upon all parties involved.  Some contracts may be oral, but real estate transactions require contracts to be in writing and signed by the parties to the transaction.  Contracts lay out rights and obligations of the parties, and the terms under which any promises from one party to another must be realized.  Real estate contracts may be modified only by mutual agreement of the parties and the modifications must be in writing and signed to be legally enforceable.   Contract for deed   A contract for deed is a contract in which the seller of a parcel of real property agrees to defer all or part of the purchase price for the property for a specified period of time.  A contract for deed may also be called a contract sale.  With a contract for deed, the legal title to a property is transferred to the buyer only after the buyer makes a certain number of monthly installment payments toward the full purchase price of the property.     Contract to purchase   A contract to purchase is a contract initiated by the buyer in a real estate transaction which details the mutually agreed-upon purchase price and attendant conditions of the transaction, and which is accepted by the seller. A contract to purchase may also be referred to a sale contract, a purchase contract, or an agreement of sale.  To be valid and legally enforceable, the contract must be specific with respect to how much the buyer will pay and what exactly the seller is required to provide in return, and the document must be in writing and signed by both parties voluntarily.   Contractor   A contractor is the individual who contracts for the construction of a home or project.  Contractors fall into one of two categories: general contractors and sub-contractors.  A general contractor is responsible for the hiring of all of subcontractors and suppliers for the construction project, as well as for overseeing the building process generally.  Sub-contractors are workers who are employed by the general contractor to provide various specified tasks; for example, different sub-contractors may be utilized to install plumbing, electricity, landscaping, appliances, flooring, and so on.  General contractors may or may not be responsible for the performance of sub-contractors on a given project, depending upon the terms of the contract between the contractor and the buyer.             Contractual lien   A contractual lien is a voluntary obligation, such as a mortgage or trust deed.  The terms of the lien are specified in a contract between the parties, and the lien grants a security interest over some property belonging to the person voluntarily succumbing to the lien obligation, usually a borrower of loan money, to the person making the loan to ensure that the lender will have recourse in the event that the borrower defaults on the loan.  The person who voluntarily grants the lien is called a lienor, and the person or entity that benefits from the lien in the event of default, usually the lender, is called a lienee.   Controlled growth   Controlled growth refers to any restrictions imposed by a governing body regarding what amount or what type of new development is permissible in a given area.  Controlled growth is often utilized in urban planning schemes, in municipalities where rapid population growth causes problems.  Problems that controlled growth is designed to alleviate include inability of an area to accommodate all area residents with services, increases in noise or pollution, limited resources such as water, limited availability of employment opportunities or schools, or increases in traffic congestion.  Controlled growth outlines how many new residential or commercial units can be developed in an area over a specified period of time.   Conventional loan   A conventional loan is long-term loan that a lending institution makes to a borrower to allow the borrower to purchase a home.  A conventional loan is secured by a government sponsored entity, abbreviated GSE, such as Fannie Mae or Freddie Mac.  Conventional Loans can be made for purposes of purchasing a home, or for refinancing an existing mortgage to secure a more favorable rate of interest.  Conventional loans are associated with prescribed limits for how much a home buyer can borrow.  Amounts borrowed in excess of the set limits are referred to as "jumbo loans," and because they present a higher risk to the lending institution, are normally associated with higher interest rates.   Convertible adjustable-rate mortgage   A convertible adjustable-rate mortgage (or ARM) is a mortgage which starts out as an adjustable-rate loan, but which subsequently allows the borrower to convert the loan to a fixed-rate mortgage during a specified period of time and/or under specified circumstances.  A convertible ARM is a type of hybrid loan; the other type of hybrid loan works in reverse, with a mortgage that is initially repaid at a fixed rate subsequently converting into an adjustable-rate mortgage at some specified time or upon the occurrence of certain events or circumstances.  For the benefit of the conversion, the borrower of the loan is usually subject to a fee at the time the loan is converted, as well as somewhat higher interest rates after conversion than the going rate for a fixed loan.     Conveyance   Conveyance refers to the transfer of title from a seller to a purchaser of real property.  A formal conveyance typically occurs at the closing on the real estate, when a check for the purchase price has been offered by the property purchaser and the keys to the physical property handed over to the purchaser by the seller of the property.  Legal conveyance ensures that the buyer of the property gets complete title to the land in question and all attendant rights, and that he or she is notified of any restrictions or encumbrances upon the property title prior to the completion of the purchase.   Conveyance tax   A conveyance tax is a tax that is imposed on the transfer of real property from a seller to a buyer.  Almost every conveyance of real property in the United States is subject to two conveyance taxes: a state tax, which is paid to the state, and a municipal tax, payable to the city or town in which the property that is the subject of the real estate transaction is located.  In limited circumstances, most commonly transfers of real property to charitable or non-profit entities, one or both conveyance taxes may be waived (that is, the conveyance is said to be exempt from taxation).    Cooperating broker   A cooperating broker is a real estate broker who finds a buyer for a property that another broker, who represents the seller of the property, has listed.  A cooperative broker finds a buyer whose stated needs and desires in a new home seem to fit a particular listed property; the broker then registers the prospective buyer with an auction company, which sells real property in a public forum through open, competitive bidding.  The cooperating broker is paid a commission if the buyer he or she has thus listed is the highest bidder on the property at auction and that buyer follows through with a complete purchase and successful closing.  A cooperating broker is also sometimes referred to as a participating broker.   Cooperative corporation   A cooperative corporation holds the title, as an entity, to a cooperative residential building and that grants occupancy rights to shareholders in the corporation.  A cooperative corporation is set up as a business trust, which is an unincorporated business organization, created by a legal document called a declaration of trust, that is a substitute for a traditional corporation, and which allows for transacting business with limited liability.  The trustees of a cooperative corporation have a fiduciary duty to protect their shareholders´ investments, as do trustees of any other type of trust, and it is the role of the trustees to maximize profits on investments and to oversee the management of the corporation.       Cooperative mortgages   Cooperative mortgages are any loans that are related to a cooperative residential project, which is a mechanism for ownership of residences through which residents pool resources for the purchase of real estate and are then entitled to shares of ownership, usually in discrete residential units, of the real property.  A cooperative mortgage is a mortgage issued in the name of the cooperative residential project, or in the name of one of the shareholders on behalf of the others, or in the name of a trustee representing the interests of all members of the cooperative, and is used for the initial purchase of the real estate or any subsequent modifications or additions that require a loan.   Cooperative project   A cooperative project is a project in which a corporation or a trust, rather than individual residents, holds title to a parcel of real property and sells shares representing individual units to buyers, who then receive a proprietary lease as their evidence of title, and who are entitled to ownership of their respective individual units.  Unites may be residential or for business purposes, or of mixed uses within a single cooperative project.  A cooperative project usually involves a fee paid by individual unit owners to the corporation or the trustee of the trust that secures the title for the privilege of taking advantage of a portion of the cooperative real estate offering.   Corner bead   A corner bead is a reinforcement that is placed at a corner of a structure, where two walls intersect.  Corner bead reinforcements are usually made of metal or practice, and are very durable, as well as giving a professional, polished, finished look to the angles of a home or other structure.  Installation of a corner bead at the corners of a building helps to prevent drywall edges, which can become damaged easily, from deteriorating or crumbling.  Corner beads also help to make the seam where two walls come together smooth.  Corner beads may be self-installed, following the installation of drywall and before joints are taped.   Corner influence   Corner influence refers to the effect on the value of a property due to its location, situated on a corner or near a corner.  The value of a specific property because of its corner situation may be increased or decreased.  Increases in property value of a corner property may occur as a result of ease of access and more access points to the property and, often, larger lot size.  On the other hand, if a property is located on a lot that is at a corner of two busy thoroughfares, its value may be decreased due to the increased effect of noise and traffic.  Corner lots may also negatively influence a property value if they entail more frequent maintenance to a property.       Cornice   A cornice is a horizontal molding that projects from the top of a structure or wall.  The useful function of a cornice is to divert rainwater away from the walls of a building (which may also be done by projecting gables, roof eaves, and gutters), but a cornice may also be added to a structure as a decorative architectural element, although modern styles of architecture rarely include cornice details.  A cornice molding is a decorative horizontal molding on a building or on furniture, such as a cornice situated over a door or window or around the edge of a chair or pedestal.   Corporate relocation   Corporate relocation is an arrangement by which corporate employers pay to transfer their employees to other locations and the attendant moving costs incurred by the employees and their families.  In addition to paying for travel from the location of an employee´s previous employment to the new location for an employee and his or her family and the costs of transporting furnishings, vehicles, and other personal property, corporate relocation frequently offers assistance with the sale of the employee´s former home and with the finding and purchase of his or her new home.  Some corporate relocation arrangements also help employees develop social networks and find medical centers, places of worship, and schools for children.   Corrective work   Corrective work refers to any necessary or desired repairs needed to remedy problems uncovered by a home or specialized inspection during the home buying process.  A home inspection report may reveal major or minor defects or issues that are not yet problematic but which are likely to become so in the future.  The buyer in a real estate transaction may be compensated for the cost of repairing defects or of preventative maintenance by a direct payment from the seller or a reduction in the home purchase price, or the corrective work may be done by the seller prior to closing as a precondition to closing and finalization of the transaction.   Cost-plus contract   A cost-plus contract is a construction contract that determines the profit due to a builder based on a percentage of the total cost of labor and construction materials.  The profit is paid to the builder in addition to his or her costs incurred during the construction process, usually as a single sum that may be payable in one lump payment, or in installments at various stages of the construction project.  Even if the cost of a project overruns the anticipated cost at its outset, the builder is still guaranteed his or her profit because the percentage is based on total costs, rather than payment at a flat, agreed-upon compensation.       Cottage   A cottage is a small, one-story house.  Cottages are most commonly located in non-urban areas, although some cottage-style dwellings can be found in cities.  Traditional cottages are associated with rural, country areas.  A true "cottage" is small in size, and is intended to be an intimate and cozy home.  Cottages are used regularly in North America as second homes, weekend or summer getaways that are frequently located at or near rural areas that provide opportunities for relaxing recreational activities such as water sports, horseback riding, walking, or hiking.  Cottage-style housing units that are used for such purposes is also regularly referred to cabins.   Counteroffer   A counteroffer is a response to an offer.  In the context of a real estate transaction, a counteroffer is made by the seller after the initial offer of a purchase price by a prospective buyer of the property.  A negotiation for purchase price of a home may include several counteroffers, as each party attempts to finalize the price at some number that is of benefit to them to which the other is still willing to agree.  The counteroffer will be somewhere between the seller´s original asking price for the property and the buyer´s offer; the final mutually agreed-upon purchase price will be the final compromise between a buyer´s and seller´s respective offers and counteroffers.   Covenant   A covenant is a legal assurance or promise, usually found in a contract, a deed, or some other written document, or implied by the law.  A covenant is a one-way promise; the party making the assurance, called the covenantor, is the only party who is legally bound.  Deeds of sale for real estate transactions normally include covenants as part of a group of conditions attached to a contract of sale, usually called "CC&Rs" or covenants, conditions, and restrictions.  These covenants specify what a homeowner is obligated to do or refrain from doing with respect to his or her home, and the promise is generally governed and enforced by a community homeowners´ association or a condominium association.   Covenants, conditions and restrictions (CC&Rs)   Covenants, conditions, and restrictions, abbreviated as CC&Rs, are rules and regulations that apply to a housing or a condominium development, and which are legally enforceable promises made by a homeowner or shareowner in such a development (a covenantor) for what he or she can and cannot do with respect to his or her property.  Common CC&Rs include specifications for what constitutes acceptable landscaping, what additions or improvements are permitted to be made to individual residential units, and how each individual property must be maintained (for example, with limitations on the use of holiday decorations).  CC&Rs are usually governed and enforced by a community homeowners´ association or a condominium association.   Craftsman style   Craftsman style is an architectural style that evolved as part of the late 19th century and early 20th century design movement known as the Arts and Craft movement.  Perhaps the most famous American architect practicing in the craftsman style was Frank Lloyd Wright.  Architecture in the craftsman style involves wood, glass, and metal work that is simple and uncluttered, intended to be elegant without being opulent.  Common features of the craftsman style are clean lines, natural materials, overhanging eaves, exposed rafters, and hand-crafted stone or woodwork.  Craftsman style homes are characterized by airy, open rooms, breakfast nooks, and built-ins, all designed to allow the proliferation of natural light from the outside into the home.   Crawl space   A crawl space is the space between the ground and the first floor of a home.  A crawl space is usually no higher than four feet, and the name is a result of the fact that an adult would likely be required to crawl, rather than stand up straight, to gain access to the space.  Crawl spaces are found in homes that have no basement, as they often are the only, or at least the most convenient, way to access plumbing, electrical, mechanical, and heating and cooling systems in the event they need maintenance.  Crawl spaces should be insulated, waterproof, and sealed in order to reduce the possibility that moisture, insects, or pollution will enter the home.    Creative financing   Creative financing refers to innovative home-financing arrangements that help a seller and his or her real estate agent sell a parcel of real property.  Because not everybody is in a position to purchase real estate using traditional financing options, often because of income limitations or a  poor credit score, creative financing alternatives open the door to home purchase by a broader range of potential homeowners.  Popular creative financing options include paying little or no money down for the purchase of a home, and can attract more potential buyers to a property than if a seller requires a minimum down payment.     Credit   Credit is the money that a lending institution extends to a borrower in exchange for a commitment to repay the loan within a certain time frame.  In real estate transactions, the purchaser of real property will usually receive a credit line from a lender, and in exchange will sign a written agreement obligating him or her to repay the money over a specified time period in specific installment payment amounts, as well as to pay interest on the loan; interest is usually paid as a portion of each installment payment on the principal of the loan, although the percentage rate may vary over time, depending upon the terms of the loan.     Credit history   An individual´s credit history is a record of his or her record of his or her current and past debt, timeliness and completeness of payments on that debt, and signs of financial stability and responsibility, such as continued employment and regularity of income.  Credit history is also sometimes referred to as "credit score" or "credit reputation."  The information is used most commonly by lending institutions, such as those entities that may issue home mortgages, to determine a person´s ability and willingness to repay debt, which affects the lender´s decision of whether or not to issue a loan to the individual.   Credit life insurance   Credit life insurance is insurance that pays off an outstanding mortgage in the event of  the death of the borrower.  As with any insurance plan, the borrower of a mortgage for the purpose of buying a home or other real property pays regular premiums into a credit life insurance policy, usually on a monthly, annual, or biannual basis.  This money is kept by the insurance policy and, if the homeowner dies prior to having paid the outstanding balance remaining on his or her home mortgage, including the amount of the principal and interest payments, the insurance company pays up to the amount still owed on the mortgage back to the lender.   Credit rating   A credit rating is the degree of credit worthiness, or how trustworthy an individual is to repay a loan, assigned to a person based on credit history and financial status.  Credit rating is the information gleaned by lending institutions, when making a decision of whether or not to make a loan to a given person, from that person´s credit report, which reveals his or her current and past debt, timeliness and completeness of payments on that debt, and signs of financial stability and responsibility, such as continued employment and regularity of income.    Credit report A credit report is a report by a credit bureau that shows the credit history for a loan applicant, including the loan applicant´s current and past debt, timeliness and completeness of payments on that debt, and signs of financial stability and responsibility, such as continued employment and regularity of income.  Several companies issue credit reports.  The three largest and most widely used are Trans Union Corporation, Equifax, and Experian.  Every person is entitled to one free copy of their credit report once per year from each of the three credit recording companies; it is also possible to get a free report that includes all information from all three sources in a single document.             Credit repository   A credit repository is a large company, such as Trans Union Corporation, Equifax, or Experian, that gathers financial and credit information from various sources about individuals who have applied for credit.  This information is then collated, referenced, updated, and stored by the company, and is provided upon request to financial institutions who are considering lending money to an individual based on his or her loan application, to help the lending institution determine the applicant´s credit worthiness and whether or not he or she is a justifiable risk for the issuance of a loan.  A credit repository may also called a credit bureau or consumer reporting agency.    Credit union   A credit union is a non-profit cooperative organization that provides banking and financial services to its members.  Common services provided by a credit union are similar in scope to those provided by a traditional bank, including mortgages, home improvement loans, and home equity loans.  A credit union, because of its cooperative nature, is owned and controlled by its members, and only members can deposit money into or borrow money from the credit union.  Members have control over the actions of the credit union by their ability to elect a Board of Directors, composed of members, to handle daily operations and make decisions that affect the credit union and its members.   Creditor   A creditor is an individual or an institution to whom a debt is owed by a borrower.  In the case of a home mortgage, the borrower homeowner owes repayment of the loan to the lending institution, the creditor.  The provision of any money, goods, or service to another makes a person or entity a creditor, and he, she, or it remains a creditor until the borrower of the loan repays it in full, with interest if applicable.  In the event that a borrower is unable to pay of his or her loan or loans, he or she may file a bankruptcy claim; when a borrower is deemed bankrupt, creditors are able to recover only in the order of priority in which their debt is legally situated, and only to the extent determined in bankruptcy proceedings, which may be less than what the creditor is fullyowed.   Cross-bridging   Cross-bridging refers to the strengthening of a structure by bracing cross members between beams.  Beams are used in a structure to provide support, usually either for a floor, a roof, or a wall.  Cross-bridging is the process of adding to strength to those support beams by adding beams and attaching them to the regular support beams in a perpendicular configuration.  This added support increases the amount of pressure a floor, roof, or wall can encounter and the weight of the load it can bear, providing the overall structure with more stability and structural integrity.       Cul de sac   A cul de sac is a street or alley that is closed at one end.  Cul de sac home sites are popular among home buyers, and are marketed by sellers as attractive amenities that many times increase the listing price of a parcel of real estate.  The attractiveness of a cul de sac location is due to the privacy and relative safety such a home site provides.  In addition, the dead-end location of a cul de sac lot may be adjacent to a desirable amenity, such as a park or greenway.  In master-planned communities, cul de sacs are commonly added in order to limit the amount of through-traffic in residential areas, and to limit or eliminate traffic´s attendant noise and pollution.   Cupola   A cupola is a dome-like structure that is located on top of the roof or a structure.  Cupolas are today primarily decorative elements, although they were once popular architectural features that were useful as lookouts, or to admit increased natural light into a building´s exterior and to provide improved ventilation due to the wide open shape of the interior  ceiling beneath a cupola feature.  Small cupolas may be architectural details added to a home for aesthetic purposes; larger cupolas are frequently found in buildings such as older courthouses and cathedrals, mosques, or other religious buildings.  Cupolas also are a fixture in older European buildings, particularly in long-standing structures in Italy.   Curable defect   A curable defect is some deficiency in a parcel of real property that is easy or inexpensive to fix.  Curable defects that are discovered during the home inspection process preceding the closing of a real estate transaction are rarely of sufficient concern to necessitate action by the seller of the property, because they are minor and simple issues which the buyer of the property can cheaply take car of on his or her own.  Examples of curable defects include chipping paint, minor scratches on fixtures or appliances, carpeting that needs to be re-glued or re-stapled, paint colors or wallpaper that can be changed by the buyer with minimal effort and expense, or minor landscaping issues.   Curb appeal   Curb appeal refers to the first impression of a house by a potential buyer as seen from the street.  Curb appeal can increase the number of home buyers who decide it is worthwhile to see a home beyond its exterior and can enhance buyers´ impressions of a house, increasing in turn the value of a home and the listing price at which a seller can offer it.  Curb appeal can be improved by cleaning a yard of garden implements and children´s toys; cleaning windows, doors, and gutters; taking care of a yard, or hiring a landscaping service to do so, by mowing, hedging, raking, weeding, and trimming trees and shrubs; refinishing a driveway; and giving a home´s exterior a power wash and/or a fresh coat of paint.     Curtain wall   A curtain wall is an exterior wall of a home that encloses a yard or other area, but which does not provide any structural support to a home.  Curtain walls are designed and installed in order to resist infiltration of water, rain, and wind.  They usually are made of aluminum frames which may be filled in with materials such as glass, stone, metal panels, louvers, windows, or vents.  Curtain walls bear no structural load, and their own load is transferred to and borne by the main structure from which they protrude.  Over their useful life, curtain walls require regular maintenance, including replacement of any infill material and corrosion prevention and repainting of aluminum support frames.   Custom builder   A custom builder is a builder who constructs a home or building based on plans created by the owner.  The owner, who pays the builder for the construction, may have plans for a home of his or her own, may work with a professional architect to design the home, or may work with the builder directly to establish the owner´s wants and needs in the completed product.  Custom builders often charge more for their services of home construction than what are called "production builders," builders who build homes based on an existing set of architectural plans.  However, custom builders offer greater flexibility and a more unique, owner-specific home than do production builders.   Custom home   A custom home is a structure designed by a home owner, by an architect hired by the home owner, or by the home owner in conjunction with a professional architect, and constructed by a custom home builder according to the home owner´s unique specifications.  A custom home is likely to include features that are not included in standard production homes, which are built from a builder´s own set of established home designs and which offer limited flexibility and specification options.  Because of the ability of a home owner to dictate the architectural design of a custom home and to select potentially more expensive materials to be used and features to be included, custom homes often are more expensive than are production homes.