Ameraco

CANCELLATION CLAUSE:
Provision in a contract that gives one or more parties the right to terminate the contract if a specific event occurs.

CAPITAL IMPROVEMENT:
Value enhancing work carried out on a capital property.

CAPITAL:
The working money in a business venture.

CARRYING CHARGES (COSTS):
The expense required to maintain a property over a given period of time, including property taxes, maintenance, insurance payments, interest charges on financing, etc.

CASH FLOW:
Description of the net income from a property after all expenses of holding and carrying the property are paid.

CAVEAT EMPTOR:
Latin, meaning ‘Let the Buyer beware’. Maxim which applies to real estate transactions where the onus is on the Purchaser to satisfy herself as to the suitability and condition of the property she is considering for purchase. Vendor is not responsible to the Purchaser for the condition of the property and, unless he is specifically asked, does not generally have and obligation to reveal problems to the Purchaser (except where the defect is hidden, serious and could not be discovered by the Purchaser after reasonably prudent inquiries and investiga­tions).

CC&R’S:
Short form for ‘covenants, conditions, and restrictions’, which are the rules of general application governing the relations between land owners in a specific subdivision, development, condominium development or cooperative housing facility. May be registered on title.

CERTIFICATE OF INSURANCE:
A document, issued by the insurance company, setting out the particulars of the insurance coverage for a particular property

CERTIFICATE OF TITLE:
A written opinion of the quality of a person’s ownership of property, issued by a lawyer or a title insurance company after a search of the title records has been conducted. May contain qualifications to the certification regarding defects found or potential defects not investi­gated.

CERTIFIED COPY:
A copy of a document which bears some form of declaration (usually by the holder of the original document) that it is a true copy of the original.

CERTIFIED HOME INSPECTOR:
A person who has met the requirements to be ‘certified’ to inspect the physical condition of homes. Qualification requirements may vary from one jurisdiction to the next.

CHAIN OF TITLE:
A part of a title search. A listing, in chronological order, of successive legal owners of a property, often listing as well the registration particulars of the document by which title is transferred from each owner to his successor in title.

CHATTEL:
An item of personal property which is not affixed to the land or building (as opposed to a fixture, an item which is a part of the land or building). Chattels are generally not included in the sale of property unless specifically included in the Agreement of Purchase and Sale

CLEAR TITLE:
Ownership of land which is marketable and free of competing claims, liens, mortgages or other encumbrances.

CLAIM:
A right asserted against another party. One might register a claim on title to the property to which the claim applies, file a claim under an insurance policy or file a Statement of Claim in court to assert one’s rights.

CLOSING:
The culmination of any transaction in which the interested parties (or their representatives) meet to exchange documents, funds, and property and, if necessary, to register the transfer of title.

CLOSING COSTS:
Moneys expended by a party in completing a transaction, over and above the purchase price, including: legal fees, taxes, mortgage application charges, interest adjustments, registration fees, appraisal fees, etc.

CLOSING DATE:
Also known a Completion Date. The date set in the Agreement of Purchase and Sale upon which the transaction is to be completed, the purchase price paid and the transfer of title registered.

CLOUD (ON TITLE):
Any unresolved claim against ownership of all or part of a property, affecting the owner’s title to the property and marketability of that title.

COLLATERAL MORTGAGE:
A loan which is secured by some sort of written note of indebtedness (such as a Promissory Note) which is secondarily secured by a mortgage registered against a property.

COMMON LAW:
As opposed to statute law. Laws or legal principles that have been established by courts over the years. May be codified into a statute or overruled by a statute passed by the government.

COMPARABLES:
Used in assessing or establishing the fair market value of a property, a property which has been sold recently that is similar in size, condition, location and amenities to the subject property.

CONCESSIONS:
1) In the early surveying of land in Ontario, concession roads were plotted and laid out at a distance of 100 chains (6,600 feet or 1.25 miles) from each other) across the width of the township. Some properties are still legally described as Lots or part of Lots on a particular Concession. 2) Sacrifices made by a party to convince another party to enter a contract.

CONDITION(S):
Clauses in the Agreement which must be fulfilled before the Agreement becomes firm and binding. If the condition is not fulfilled, the Agreement will usually become null and void and any deposit paid returned to the Purchaser.

CONDITIONAL OFFER:
An offer to purchase a property which is contingent on the fulfillment of certain conditions before it becomes firm and binding. Also known as ‘Conditional Sales Contract’.

CONSIDERATION:
The value, asset, service, information etc. which is offered to another party in a contract in exchange for that party’s agreeing to enter the contract. A contract is not binding if each party does not offer at least some consideration to the other party(ies).

CONTINGENCY:
An event which may (or may not) happen in the future, a condition that must be fulfilled before a contract becomes firm and binding.

CONTRACT:
A legally binding agreement (oral or written) between two or more persons regarding an exchange of some sort. A legally binding contract must include consideration passing between the parties, an intention on the part of all parties to be bound to the contract, a meeting of the minds of the parties as to the contents of the contract, and an element of clarity such that the terms of the contract may be interpreted, understood and enforced by a court.

CONVEY:
To transfer title to (or any other interest in) a property to someone else.

CONVEYANCE:
The act of transferring an interest in property to someone else or the document which effects the transfer.

COOPERATING BROKER:
A Broker who is involved in a real estate transaction and is, therefore, entitled to share in the commission from the transaction.

CORRECTING DEED:
A legal instrument registered specifically to amend an earlier deed by correcting errors in that earlier deed.

COST APPROACH:
Appraisal method where a property value is estimated using the cost of the property plus cost of all improvements, minus depreciation.

COST PLUS CONTRACT:
procedure ; {-} begin {} end; {} An agreement with a contractor or builder which sets the contractor’s compensation for the project as a percentage of the total cost of all labor and materials

CO-TENANCY:
When more than one person owns a piece of property. Title will be held by the owners as Joint Tenants (each owns the land equally and, in the event of the death of one of the owners, the survivors continue to share title equally by right of survivorship) or as Tenants in Common (each owner has title to a specific percentage of the land and may sell, mortgage, or bequeath her interest to a third party without consent of the other owners).

COUNTEROFFER:
An answer to an offer. If a prospective Purchaser presents an offer to purchase a property to the owner of the property, that owner may accept the offer as it stands, reject it outright or respond with a ‘counteroffer’ which changes certain terms of the original offer. Making a counteroffer, at law, entails rejection of the original offer. The Purchaser may then counteroffer back, making changes to the owner’s counteroffer. Sometimes, the process of counter offering is referred to as ‘signing back’ the offer.

COVENANT:
A promise contained in a contract or agreement.

CREATIVE FINANCING:
An arrangement for the financing of the purchase of a property which is outside the normal practice of residential financing.

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