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Real Estate Dictionary


F

FAIR MARKET VALUE - The highest monetary price which a property would bring, if offered for sale for a reasonable period of time in a competitive market, to a seller who is willing but not compelled to sell, from a buyer, willing but not compelled to buy, both parties being fully informed of all the purposes to which the property is best adapted and is capable of being used.

FARM AREA - A selected geographical area or one specific building to which a real estate salesperson devotes special attention and study.

FEASIBILITY STUDY - An analysis of a proposed project with emphasis on the attainable income, probable expenses, and most advantageous use and design.

FEDERAL HOUSING ADMINISTRATION (FHA) - The FHA was set up in1934 under the National Housing Act to encourage improvement in housing standards and conditions, to provide an adequate home financing system by insurance of housing mortgages and credit, and to exert a stabilizing influence on the mortgage market.

FEDERAL TAX LIEN - A federal lien which attaches to real property, either if the federal estate tax is not paid, or if the taxpayer has violated the federal income tax or payroll tax laws.

FEDERAL TRADE COMMISSION (FTC) - A federal agency created to investigate and eliminate unfair and deceptive trade practices in business.

FEE SIMPLE - The largest estate one can possess in real property. A fee simple estate is the least limited interest and the most complete and absolute ownership in land: it is of indefinite duration, freely transferable and inheritable. Fee simple title is sometimes referred to as "the fee.

FIDUCIARY - A relationship which implies a position of trust or confidence wherein one is usually entrusted to hold or manage property or money for another. Among the obligations a fiduciary owes to the principal are duties of loyalty; obedience; full disclosure; the duty to use skill, care and diligence; and the duty to account for all monies.

FINAL PLAT - The detailed map on which a subdivision plan is submitted for approval to the Municipality and eventually recorded with the county clerk. In the case of a planned Unit Development, the final plat is know as the Final Plan.

FILLED LAND - An area where the grade has been raised by depositing or dumping dirt, gravel or lava rock.

FINANCE CHARGE - The total of all costs imposed directly or indirectly by the creditor and payable either directly or indirectly by the customer, as defined under the federal Truth-in-Lending Law.

FINANCE FEE - A mortgage brokerage fee to cover the expenses incurred in placing the mortgage with a lending institution; a mortgage service charge or origination fee.

FINANCIAL STATEMENT - A formal statement of the financial status and net worth of a person or company, setting forth and classifying assets and liabilities as of a specified date.

FINDER'S FEE - A fee paid to someone for producing a buyer to purchase or a seller to list property; also called a referral fee.

FIRM COMMITMENT - A definite undertaking by a lender to loan a set amount of money at a specified interest rate for a certain term.

FIRST REFUSAL, RIGHT OF - The right of a person to have the first opportunity either to purchase or lease real property.

FISCAL YEAR - A business year used for tax, corporate or accounting purposes, as opposed to a calendar year.

FIXTURE - An article which was once personal property but has been so affixed to the real estate that it has become real property (e.g. stoves, bookcases, plumbing, etc.). If determined to be a fixture, then the article passes with the property even though it is not mentioned in the deed.

FLAG LOT - A land parcel having the configuration of an extended flag and pole. The pole represents access to the site which is usually located to the rear of another lot fronting a main street.

FLOODPLAIN - Land, typically adjacent to a body of water, with an elevation at or below the base elevation of the 100 year flood frequency.

FLOOR AREA RATIO - The ratio of floor area to land area expressed as a percent or decimal, which is determined by dividing the total floor area on a zoning lot by the lot area.

FLOOR DUTY - A frequent practice in real estate brokerage offices of assigning one sales agent the responsibility for handling all telephone calls and office visitors for a specified period of time.

FORECLOSURE - A legal procedure whereby property used as security for debt is sold to satisfy the debt in the event of default in payment of the mortgage note or default of other terms in the mortgage document.

FRAUD - Any form of deceit, trickery, breach of confidence or misrepresentation by which one party attempts to gain some unfair or dishonest advantage over another.

FREE AND CLEAR TITLE - Title to real property which is absolute and unencumbered by any liens, mortgages, clouds or other encumbrances.

FRONTAGE - The length of a property abutting a street or body of water; that is, the number of feet that "front" the street or water.

FUNCTIONAL OBSOLESCENCE - A loss in value of an improvement due to functional inadequacies, often caused by age or poor design.

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