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The process by which a government or municipal quasi-public
body raises monies to fund its operation. The impact an investment
has on the investor's liability for the payment of federal,
state, and local taxes.
tax bill
A property owner's tax bill is computed by applying the tax
rate to the assessed valuation of the property.
tax credit
An amount by which tax owed is reduced directly.
tax deed
An instrument, similar to a certificate of sale, given to
a purchaser at a tax sale.
tax levy
The amount to be raised from the general real estate tax is
then imposed on property owners through a tax levy. A tax
levy is the formal action taken to impose the tax, usually
a vote of the taxing district's governing body.
TAX LIEN
A general statutory lien imposed against real property for
failure to pay taxes. There are federal tax liens and state
tax liens.
tax rate
The tax rate for each taxing body is computed separately.
To arrive at a tax rate, the total monies needed for the coming
fiscal year are divided by the total assessments of all real
estate located within the taxing body's jurisdiction.
Tax sale
A sale of real property ordered by the court in order to raise
money to cover delinquent taxes.
TAX SHELTER
A phrase often used to describe some of the tax advantages
of real estate investment, such as deductions for depreciation,
interest, taxes, etc., which may offset the investor's other
ordinary income to reduce the investor's overall tax payment.
TENANCY AT SUFFERANCE
A tenancy which exists when a tenant wrongfully holds over
after the expiration of a lease, without the landlord's consent,
as where the tenant fails to surrender possession after termination
of the lease.
TENANCY AT WILL
A tenancy in which a person is in possession of real estate
with the permission of the owner, for a term of unspecified
or uncertain duration, as when an owner permits a tenant to
occupy a property until it is sold.
TENANCY BY THE ENTIRETY
A special joint tenancy between a lawfully married husband
and wife, which places all title to the property into the
marital unit, with both spouses having an equal, undivided
interest in the whole property.
TENANCY FOR YEARS
A less-than-freehold estate in which the property is leased
for a definite, fixed period of time, be it for 60 days or
any fraction of a year, a year, ten years, etc.
TENANCY IN COMMON
A form of concurrent ownership of property between two or
more persons, in which each has an undivided interest in the
whole property; frequently found when the parties acquire
title by descent or by will.
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TENANCY IN SEVERALTY
Ownership of property vested in one person alone, and not
held jointly with another; also called Several Tenancy or
Sole Tenancy.
TENANT
In general, one who holds or possesses property, such as a
life tenant or a tenant for years; commonly used to refer
to a lessee under a lease.
tenants in common
A form of concurrent ownership of property between two
or more persons, in which each has an undivided interest in
the whole property. This form is frequently found when the parties
acquire title by descent or by will. Each cotenant is entitled
to the undivided possession of the property, according to his
or her proportionate share and subject to the rights of possession
of the other tenants. No cotenant can exclude another cotenant,
or claim ownership of a specific portion of the property. Each
cotenant holds an estate in land by separate and distinct titles,
but with unity of possession. Their interests may be equal,
as in joint tenancy, or unequal. Where the conveyance document
does not specify the extent of interest of each cotenant, there
is a rebuttable presumption that the shares are equal. Unlike
a joint tenancy, there is no right of survivorship in a tenancy
in common. Therefore when one of the cotenants dies, the interest
passes to his or her heirs or beneficiaries and not to the surviving
tenants in common. The property interest of a tenant in common
is thus subject to probate. Also, unlike joint tenancy, dower
rights may exist in property held in common.
Testate
To die having prepared and left a valid will.
TIME IS OF THE ESSENCE
The clause in a contract which emphasizes that punctual performance
is an essential requirement of the contract.
TIME SHARING
A modern approach to communal ownership and use of real estate
which permits multiple purchasers to buy undivided interests
in real property (which is usually in a resort condominium
or hotel) with a right to use the facility for a fixed or
variable time period.
TITLE INSURANCE
A comprehensive contract of indemnity under which the title
company agrees to reimburse the insured for any loss if title
is not as represented in the policy.
TITLE SEARCH
An examination of the public records to determine what, if
any, defects there are in the chain of title.
TOWNHOUSE
A type of dwelling unit normally having two floors, with the
living area and kitchen on the base floor and the bedrooms
located on the second floor.
TOWNSHIP
A piece of property, used in the government survey system
of land description, which is 6 miles square, and contains36
sections, each 1 mile square; and consists of 23,040 acres.
TRADE FIXTURES
Articles of personal property annexed to leased premises by
the tenant, as a necessary part of the tenant's trade or business.
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transaction broker
A transaction broker (also referred to as a nonagent,
facilitator, coordinator or contract broker) is not an agent
of either party. A transactional broker's job is simply to
help both the buyer and the seller with the necessary paperwork
and formalities involved in transferring ownership of real
property. The buyer and the seller negotiate the sale without
representation.
Transfer of ownership
Any circumstance in which the ownership of a property changes
hands, e.g., via outright, titled purchase, or the assumption
of an existing on a property, or possession of the property
via a land sales trust, even any transfer of a beneficial
interest in the trust.
transfer tax
A state tax imposed on the transfer or conveyance of realty
or any realty interest by means of deed, lease, sublease,
assignment, contract for deed or similar instrument. One purpose
of the tax is to acquire reliable data on the fair market
value of the property to help establish more accurate real
property tax assessments.
TRIPLE NET LEASE
A net, net, net lease, where in addition to the stipulated
rent, the lessee assumes payment of all expenses associated
with the operation of the property.
triplex
A building comprised of three dwelling units, each having
a front and rear (or side) door and yard; similar to row houses.
trust
An arrangement whereby legal title to property is transferred
by the grantor (or trustor) to a person called a trustee,
to be held and managed by that person for the benefit of another,
called a beneficiary.
TRUST DEED
A real property security device (also called a deed of trust)
very similar to a mortgage, except that there are three parties,
the trustor, the trustee, and the beneficiary (the lender).
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Trustee
A party who holds property for the benefit of another.
TRUST FUND ACCOUNT
An account set up by a broker at a bank or other recognized
depository, into which the broker deposits all funds entrusted
to him by his principal or others.
Truth-in-Lending
A federal law that requires disclosure by a credit institution
or lender of the terms and conditions of a loan or mortgage,
including the annual percentage rate and any other charges,
to the borrower when they apply for the loan.
TURNKEY PROJECT
A development term meaning the complete construction package
from ground breaking to the completion of the building. All
that is left undone is to turn over the keys to the buyer.
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Two-step mortgage
An adjustable-rate mortgage that charges an interest rate
which is below-market for a designated number of years (usually
5 or 7) after which the interest rate is adjusted to the current
market conditions.
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