Real Estate Glossary D - F

DBA (Doing Business As): Aliases of business names.

Debt Service: Also referred to as ‘mortgage payment’ or the total mount of debt which you must pay.

Deed: A written instrument by which title to land is conveyed.

Default: The failure to meet an obligation, including lease clauses (i.e. timely rent payment, tenant use of premises, etc) and mortgages (i.e. timely ortgage payments, timely payoff upon due date).

Demising Walls: The dividing wall separating one space from another; or from the buildings common area such as a public corridor.

Depreciation: A loss in value.

Disclosure: The relaying of all facts previously unknown.

Down Payment: An amount of money the buyer pays which is the difference between the purchase price and the mortgage amount.

Earnest Money: A currency deposit made by the buyer as evidence of good faith in offering to purchase real estate and to secure performance of the contract. Earnest money is typically held in an escrow account during the period between acceptance of the contract and the closing.

Easement: The right to use another person's real estate for a specific purpose. The most common type of easement is the right to travel over another person's land.

Effective Rent: The actual rental rate to be achieved by the landlord after deducting the value of concessions from the base rental rate paid by the tenant, usually expressed as an average rate over the term of the lease.

Eminent Domain: The right of the government to take private property for public use, through court action known as condemnation.

Encroachment: The intrusion of a structure which extends, without permission over a property line, easement boundary, or building setback line.

Encumbrance: A burden or charge upon an estate or property, so that it cannot be disposed of without being subject to it.

Environmental Impact Study: Documents required by federal and state laws to accompany proposals for major projects and programs that will likely have an impact on the surrounding area.

Escalation Clause: A clause in a lease which provides for the rent to be increased to reflect changes in expenses paid by the landlord such as real estate taxes, operating costs, etc.

Escrow Account: An account held by an escrow agent (an individual or escrow company or title company,) into which is deposited the documents and funds in a transfer of real property, including money, a mortgage deed of trust, an existing promissory note secured by the real property.

Estoppel Certificate: An executed document certifying that certain statements of fact are correct as of the date of the statement and can be relied upon by a third party, including a prospective lender or purchaser.

Fair Market Value: The price a willing buyer will pay a willing seller for a property. With both under no compulsion to either buy or sell.

Financial Statements: Accounting statements that provide specific information about a company's financial position including the Profit and Loss Statement, also known as the Income Statement, the Balance Sheet, and the Statement of Cash Flows.

Fixture: Personal property which has been attached to real estate so as to become a part of the real property. The article must meet one of three conditions: 1) attached in a permanent manner 2) specially adapted to the property or 3) intentionally made part of the real property.

Flex Space: A building providing its occupants the flexibility of utilizing the space. Usually configuration allowing a flexible amount of office or showroom space in combination with manufacturing, laboratory, warehouse etc.

Force Majeure: A force that cannot be controlled by the parties to a contract and prevents said parties from complying with the provisions of the contract, (i.e. Natural Disasters.)

Foreclosure: A procedure by which the mortgagee (lender) either takes title to or forces the sale of the mortgagor's (borrower's) property in satisfaction of a debt.

Full Service Rent: All-inclusive rental rate which includes operating expenses and real estate taxes for the first year. The tenant is generally still responsible for any increase in operating expenses over the base year amount.