Real Estate Glossary

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Fair Housing Act:
Pursuant to the federal Fair Housing Act, any offer to sell, rent, buy, or exchange property shall not contain any preference, limitation, or discrimination based on race, color, religion, sex, national origin, handicap, familial status, or an intention to make such preference, limitation or discrimination. (See Civil Rights Act of 1968, federal fair housing law)
HUD—Fair Housing Reading Room
Fair Housing Amendment Act of 1988:
Extends the Civil Rights Act of 1968 to cover handicapped persons and families with children. (See Fair Housing Act, federal fair housing law, Civil Rights Act of 1968)
familial status:
Familial status is defined as one or more individuals who have not obtained the age of eighteen (18) years, being domiciled with a parent or other person having custody, or anyone who is pregnant. It is therefore unlawful to refuse housing to anyone with children under the age of 18 or anyone who is pregnant, except when such housing meets the definition of housing for older persons. Fannie Mae:
See Federal National Mortgage Association (FNMA)
Farm Credit System:
A national banking system for financing the activities of farmers and ranchers.
farming:
Prospecting an area for buyers or sellers. (See geographic farming, nongeographic farming, prospecting)
Farm Service Agency (FSA):
Formerly the Federal Agricultural Mortgage Corporation (FAMC or Farmer MAC), the FSA is a federal agency of the Department of Agriculture. FSA offers programs to help families purchase or operate family farms. It also provides loans to help families purchase and improve single-family homes in rural areas. The FSA provides assistance to rural and agricultural businesses and industry through the Rural Business and Cooperative Development Service. Loan programs fall into two categories: guaranteed loans, made and serviced by private lenders and guaranteed for a specific percentage by FSA, and loans made directly by the FSA.
Federal Deposit Insurance Corporation (FDIC):
An independent federal agency that insures the deposits in commercial banks.
federal fair housing law:
In 1968, Congress enacted Title VIII of the Civil Rights Act, called the Federal Fair Housing Act, which declared a national policy of providing fair housing throughout the United States (reference Sections 3601-3631 of Title 42, United States Code). This law makes discrimination based on race, color, sex, familial status, handicap, religion or national origin illegal in connection with the sale or rental of most dwellings and any vacant land offered for residential construction or use. The law does not prohibit discrimination in other types of real estate transactions, such as those involving commercial or industrial properties. The law is administered by the Office of Equal Opportunity (OEO) under the direction of the Secretary of the Department of Housing and Urban Development (HUD). (See Civil Rights Act of 1968, Fair Housing Act, HUD)
As amended in 1972, the law instituted the use of equal opportunity posters (11" x 14") for display at brokerage houses, model home sites, mortgage lenders' offices and other related locations. Failure to display the poster constitutes prima facie evidence of discrimination if a broker who does not display the sign is investigated by HUD on charges of discrimination. The poster must show the equal housing opportunity slogan: Equal Housing Opportunity. It must also carry the equal housing opportunity statement:
"We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. We encourage and support an affirmative advertising and marketing program in which there are no barriers to obtaining housing because of race, color, religion, sex, familial status, handicap or national origin."
The fair housing law provides protection against the following acts of discrimination, if they are based on race, color, sex, familial status, handicap, religion or national origin:
Refusing to sell, rent, deal or negotiate with any person.
Misrepresenting terms or conditions for buying or renting housing.
Advertising that housing is available only to persons of a certain race, color, sex, familial status, handicap, religion or national origin (such as placing sold signs when the property in fact is not sold).
Denying that housing is available for inspection, sale or rent when it really is available. (This includes a practice called steering, whereby certain brokers may direct members of certain minority groups away from some of their listings in racially unmixed areas.)
Blockbusting, a practice whereby a broker hopes to profit through persuading owners to sell or rent housing by telling them that minority groups are moving into the neighborhood; also called panic peddling.
Denying or requiring different terms or conditions for home loans made by commercial lenders such as banks, savings and loan associations and insurance companies.
Denying to anyone the use of, or participation in, any real estate service such as broker's organizations, multiple-listing services or other facilities related to the selling or renting of housing.
The Fair Housing Act applies to the following:
Single-family housing owned by private individuals and sold through a broker or other person who is in the business of selling or renting dwellings is employed (includes use of MLS) and has used discriminatory advertising is used.
Single-family housing not owned by private individuals, such as those owned by development corporations.
Single-family housing owned by a private individual who owns more than three such dwellings or who, in any two-year period, sells more than one dwelling in which he or she was not the most recent resident.
Multifamily dwellings of five or more units.
Multifamily dwellings containing four or fewer units, if the owner does not reside in one of the units.
Exception: The following situations are exempt from the Fair Housing Act (but covered by the post-Civil War 1866 antidiscrimination civil rights law, if based on race):
The sale or rental of single-family housing if neither a broker nor discriminatory advertising is used, and no more than one dwelling in which the owner was not the most recent resident is sold during any two-year period.
The rental of rooms or units in owner-occupied multiple dwellings for two to four families, if discriminatory advertising is not used (the "Mrs. Murphy exemption" in which Mrs. Murphy represents the small investor struggling to earn a living by taking in roomers in a small rooming house).
The sale, rental or occupancy of dwellings owned and operated by a religious organization for other than commercial purposes to persons of the same religion, if membership in that religion is not restricted on account of race, color, sex or national origin; the religious organization can give preference to its members (e.g., it could levy a surcharge on nonmembers).
The restriction of lodgings owned or operated by a private club for other than a commercial purpose for rental or occupancy by its own members.
The 1988 amendments to the federal Fair Housing Act bar discrimination based on handicap or familial status of the buyer or renter or anyone associated with the buyer or renter. "Handicap" means a physical or mental impairment, including cancer, AIDS, alcoholism, or a speech, visual or hearing impairment (but not including illegal drug use). The landlord must allow the tenants to make reasonable modifications of existing premises at the tenant's expense. Discrimination also includes the failure to make reasonable accommodation in rules, policies, practices or services to allow a disabled person an equal opportunity to use or enjoy a dwelling.
The law bars discrimination in the sale and rental of housing based on the presence of children (under 18 years of age) in the family, including pregnancy or a pending adoption. The law still permits reasonable limitations on the number of occupants per unit under state and private regulation. Housing for older persons is exempt from the familial status prohibitions if 1. the building is occupied solely by those 62 years of age or older or 2. the housing is specially designed for occupancy by older persons, and at least 80 percent of the dwellings are occupied by at least one person 55 years of age or older.
Two remedial avenues, one administrative and one judicial, are available. An aggrieved person may complain directly to a U.S. District Court within one year of the alleged discriminatory practice, whether or not a verified complaint has been filed with the Secretary of HUD. However, in states with equivalent antidiscrimination judicial rights and remedies, such a suit would have to be brought to the state court. The burden of proof is on the complainant. The court can grant permanent or temporary injunctions, temporary restraining orders or other appropriate relief and may award actual damages and not more than $1,000 in punitive damages. The parties can agree to have the case decided by an administrative law judge.
Criminal penalties are provided for those who coerce, intimidate, threaten or interfere with a person's buying, renting or selling housing; making a complaint of discrimination or exercising any rights in connection with this law. Licensees should keep detailed records of all transactions and rentals in order to defend themselves against possible discrimination complaints. Violations are frequently proved through the use of cases, "testers" and the courts have ruled that there is no requirement that the testers actually be bona fide purchasers or renters. (See blockbusting, familial status, handicap, steering)
Under 1980 regulations, HUD identified certain words that should be avoided because they may tend to convey discriminatory intent. Examples are White, Black, Colored, Catholic, Jew, Protestant, Chinese, Chicano, Irish, restricted, ghetto, disadvantaged, private, membership approval.
Advertising should never state or imply that the rental of separate units in a dwelling is restricted to persons of only one sex unless the sharing of living areas is involved. Even directions to the real estate for sale may be discriminatory, such as references to synagogues or "near Martin Luther King memorial," or close to a specific country club or a private school that caters to particular racial, religious or ethnic groups.
The selective use of advertising media or content based on ethnic considerations could be considered as violating the intent of the law. An example might be the sole use of an English-language newspaper in an area like Miami, Florida, where there are many Hispanic publications. Although an advertiser cannot be forced to advertise in a minority media, such failure will be a consideration in a discrimination hearing, as would be a policy of using as human models members of only one sex, race or other group (it is not necessary, however, to have an exact percentage of the various groups in the local population).
Discrimination in federally subsidized housing projects is prohibited under Title VI, Civil Rights Act of 1964, which states, "No person in the United States shall, on the ground of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be subject to discrimination under any program or activity receiving federal financial assistance."
Jones vs. Alfred H. Mayer CO.— On June 17, 1968, the United States Supreme Court handed down its opinion in the case of Joseph Lee Jones, et ux., Petitioners v. Alfred H. Mayer Co. et al. On September 2, 1965, the petitioners filed a complaint in the District court for the Eastern District of Missouri, alleging that "the respondents had refused to sell them a home in the Paddock Woods community of St. Louis County for the sole reason that the petitioner, Joseph Lee Jones, is a Negro. From this landmark case, we now have a whole new all-encompassing set of rules prohibiting discrimination on the part of owners of property and their agents.
In Jones vs. Mayer, the Supreme Court interpreted and applied an Act of Congress, first enacted in 1866 (now U.S. Code, para 1982), and rested its constitutionality on the Thirteenth Amendment of the Constitution of the United States, the amendment prohibiting slavery. As so interpreted, Section 1982 applies everywhere, to everyone in the United States. (See Civil Rights Act of 1866)
Jones v. Mayer—full text of the court decision
To react to changing social and economic patterns in America, Congress adopted Title VIII in 1968. That law prohibits discrimination based on race, color, national origin, religion and sex. It is the major basis for most current federal fair housing activities. The passage of this statute was a watershed mark in the nation's commitment to equal housing opportunity.
federal funds rate:
The interest rate the Federal Reserve charges its member banks on uncollateralized loans.
Federal Housing Administration (FHA):
A federal agency established in 1934 under the National Housing Act to encourage improvement in housing standards and conditions, to provide an adequate home-financing system through the insurance of housing mortgages and credit and to exert a stabilizing influence on the mortgage market. FHA was the government's response to a lack of quality housing, excessive foreclosures and a building industry that collapsed during the depression.

Federal Home Loan Bank System (FHLB):
Regulates the nation's savings and loan associations, much like the Federal Reserve governs the commercial banking industry.
Federal Home Loan Mortgage Corporation (FHLMC):
Commonly known as "Freddie Mac," a federally chartered corporation established in 1970 for the purpose of purchasing mortgages in the secondary market. Freddie Mac was created as a part of the savings association system and, while it is not so limited, its loan purchase policies are designed to accommodate savings association needs. It functions with an independent board of directors but is subject to oversight by HUD.
Federal National Mortgage Association (FNMA):
Popularly known as "Fannie Mae," an active participant in the secondary mortgage market. Fannie Mae was established as a federal agency in 1938 for the purpose of purchasing FHA loans from loan originators to provide some liquidity for government-insured loans in a depression-wracked economy when few lending institutions would undertake this type of loan.
Federal Reserve System ("the Fed"):
The nation's central bank created by the Federal Reserve Act of 1913. Its purpose is to help stabilize the economy through the judicious handling of the money supply and credit available in this country. The system functions through a seven-member Board of Governors (appointed by the President) and 12 Federal Reserve District Banks, each with its own president. The system sets policies and works with the privately owned commercial banks.
Federal Water Pollution Control Act:
Enacted by Congress in 1972, this federal law administered by the EPA regulates the release of pollutants into navigable waters.
Federal Water Pollution Control Act of 1972
fee appraiser:
A non-salaried appraiser who is paid a fee for the appraisal assignments performed.
fee simple:
The maximum possible 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." (See fee title)
fee simple absolute:
The maximum possible estate or right of ownership of real property, continuing forever.
fee simple defeasible:
An estate in land in which the holder has a fee simple title subject to being divested upon the happening of a specified condition; also called a qualified fee or a defeasible fee. There are two categories of fee defeasible estates--fee simple determinable and fee simple subject to a condition subsequent. The term fee simple determinable implies that the duration of the estate can be determined from the deed itself. This is not true of a fee simple subject to a condition subsequent, in which case the estate's duration depends on the grantor's independent choice of whether to terminate the estate. (See fee simple determinable, fee simple subject to a condition subsequent)
fee simple determinable:
A fee simple determinable is an estate in real property that exists "so long as," "while" or "during the period" that a certain prescribed use continues. Such use is described in the grant of conveyance. For example, a conveyance to the University of Knowitall "so long as" the real estate is used for educational purposes would give the university title, provided the granted land is used as prescribed. If, at some future time, the university were to stop using the property for educational purposes, title would revert to the original grantor, if living, or to his or her heirs if the grantor is deceased. A fee simple determinable automatically ends when the purpose for which it has been prescribed terminates. Upon the grant of a fee simple determinable, there remains in the grantor a possibility of reverter.
fee simple subject to a condition subsequent:
A fee simple subject to a condition subsequent is an estate conveyed "provided that," "on the condition that" or "if" it is used for a specific purpose. If it is no longer used for that purpose, it reverts to the original grantor or his heirs. This type of estate is much the same as a fee determinable, except that in a fee determinable conveyance, the words are of duration while a fee condition subsequent refers strictly to a specific condition. In addition, unlike a fee determinable, when fee condition subsequent property is no longer used for its prescribed purpose, the original grantor (or heirs) must physically retake possession of the property within a reasonable period of time after the breach (i.e., the grantor must exercise his or her right of reentry). Any transaction involving a fee simple defeasible estate should be referred to an attorney for a professional opinion.
fee title:
The maximum possible estate one can possess in real property. A fee title estate is the least limited interest and the most complete and absolute ownership in land; it is of indefinite duration, freely transferable and inheritable. A "fee title" is sometimes referred to as "the fee." (See fee simple)
feudal system:
A system of ownership usually associated with precolonial England, in which the king or other sovereign is the source of all rights. The right to possess real property was granted by the sovereign to an individual as a life estate only. Upon the death of the individual title passed back to the sovereign, not to the decedent's heirs.
fictitious business (company) name:
A business name other than that of the person under whom the business is registered. Most state license laws require such brokerage offices operating under an assumed name be jointly registered under the supervising broker's name and the fictitious business name.
FICO:
Acronym for "Fair, Isaac & Company." FICO is the most commonly used scoring system used by lenders to derive credit scores for borrowers. (See credit score)
Fair, Isaac and Company Website
fictitious business name statement (California):
A fictitious business name statement must be filed with the county clerk in the county of the broker's principal business address, and a copy sent to the Real Estate Commissioner. The commissioner may refuse to allow the use of a name that may be inappropriate or misleading. (See fictitious business name)
fictitious deed of trust:
Comprehensive master deeds of trust are established by lenders to cover all areas of trust deed finance. (See deed of trust)
fiduciary:
A relationship that implies a position of trust or confidence wherein one person is usually entrusted to hold or manage property or money for another. The term fiduciary describes the faithful relationship owed by an attorney to a client or by a broker (and salesperson) to a principal. The fiduciary owes complete allegiance to the client. Among the obligations that a fiduciary owes to his or her principal ane the duties of loyalty, obedience and full disclosure; the duty to use skill, care and diligence; and the duty to account for all monies. (See law of agency, principal)
filled land:
An area of a property where the grade has been raised by depositing dirt, gravel or rock. Under most circumstances a seller (broker) has a duty to disclose to a buyer the fact that a property is on filled land.
final escrow instructions:
Statements prepared by the escrow agent which reflect the final figures and instructions required to close escrow. (See escrow instructions)
financing statement:
Security interests in chattels (personal property) are created by an instrument known as a security agreement. To give notice of a security interest, a financing statement must be recorded. (See personal property, Uniform Commercial Code)
Financial Institutions Reform, Recovery and Enforcement Act (FIRREA):
Legislation that abolished the FSLIC and established a new deposit insurance fund, SAIF, for savings institutions; appropriated funds and created the Resolution Trust Corporation to dispose of failed thrifts; imposed wide-ranging changes in savings institution investment activities and operations; and created the Office of Thrift Supervision as part of a restructuring of the federal thrift regulatory and supervisory systems. (See Office of Thrift Supervision, Resolution Trust Corporation)
financial intermediaries:
A financial institution that accepts deposits and makes loans.
Financial Management Rate of Return (FMRR):
A multi-year analysis of rate of return. Used by investors in medium and large properties (occasionally on small properties). Multi-year cash flows and net sale proceeds are analyzed using discounted cash flow techniques to solve for the Financial Management Rate of Return (FMRR).
FMRRs are the best rate of return indicator, because they require an analysis of the investor's entire holding period, not just a single year. The discounting process takes into consideration the time value of money, and thereby produces a more realistic rate of return.
financial statement:
A brief summary of a person's assets, liabilities and earnings records.
finder's fee:
A fee paid to someone for "finding" either the buyer to purchase or the seller to list a property.
fire insurance requirement form:
A statement signed by the "borrower" agreeing to comply with the lender's requirements for fire insurance coverage.
fire rating:
A rating of the length of time it takes a fire to penetrate a barrier. Designates the ability of a material to contain a fire in a carefully controlled test setting for a specified period of time. A material tested in a laboratory that adequately contains a fire for two hours and meets other requirements during the laboratory fire test, is given a two-hour fire resistance rating. Fire-resistance ratings are based on full-scale tests under controlled conditions and are generally recognized by building code authorities and fire insurance rating bureaus. Requirements for fire-resistance ratings are usually set by local building code officials based on the expected occupancy of the building.
fiscal policy:
The government's policy in regarding to taxation and spending programs. The difference between these two areas determines the amount of money the government will withdraw from or feed into the economy, which can stimulate or restrain economic growth.
fixed expenses:
Those recurring expenses that have to be paid regardless of whether the property is occupied; for example, real property taxes, hazard insurance and debt service. These expenses contrast with operating expenses necessary to maintain the production of income from the operation of a property. (See operating expenses)
fixed-fee:
A contractor submits a bid proposing a fixed amount to do a job. Most construction bids are made on this basis. (See cost-plus)
fixed-rate loan:
A loan with the same rate of interest for the life of the loan.
fixtures:
An article that was once personal property but has been so affixed to real estate that it has become real property. Whether an article is a fixture depends on the intention of the parties and may be determined by the manner in which the item is attached, its type and adaptability to the real property, the purpose it serves, and the relationship of the parties.
flashing:
Sheet metal or other impervious material used in roof and wall construction as a barrier to water seepage.
flat fee:
A property management fee expressed as a dollor amount per year or month. (See percentage fees)
flood hazard areas:
Locations specified on Federal Emergency Management Agency (FEMA) maps indicating areas that are subject to flooding. The seller's agent is required to inform potential buyers if the agent has knowledge that a property is located in such an area.
flue:
The pipe or conduit that allows combustion gasses to exit the house. (See combustion gasses)
flush:
To open a cold-water tap to clear out all the water that may have been sitting for a long time in the pipes. In new homes, to flush a system means to send large volumes of water gushing through the unused pipes to remove loose particles of solder and flux.
forbearance:
The act of refraining from taking legal action despite the fact that payment of a promissory note in a mortgage or deed of trust is in arrears. It is usually granted only when a borrower makes a satisfactory arrangement by which the arrears will be paid at a future date.
formaldehyde:
A colorless, pungent, and irritating gas, used chiefly as a disinfectant and preservative and in synthesizing other compounds like resins. (See urea-formaldehyde)
National Safety Council on Formaldehyde
For Sale By Owner (FSBO):
Some owners choose to sell their own property without the aid of a real estate broker. "For Sale By Owner" properties are often a source of listings when the owner is unsuccessful finding qualified buyers.
Foreign Investment in Real Property Tax Act (FIRPTA):
Enacted by the United States Congress in 1985, the act requires buyers to withhold estimated taxes equal to 10% of the sale price of a property sold or exchanged by a foreign person. The withholdings must be reported and paid to the Internal Revenue Service within 10 days of closing. The act applies to sales of personal residences with prices of $300,000 or more.
foreclosure:
A legal procedure whereby property used as security for a 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. The foreclosure procedure brings the rights of all parties to a conclusion and passes the title in the mortgage property to either the holder of the mortgage or a third party who may purchase the realty at the foreclosure sale, free of all encumbrances affecting the property subsequent to the mortgage. There are three general types of foreclosure proceedings: judicial foreclosure, nonjudicial foreclosure and strict foreclosure.
form appraisal report:
Any of the relatively brief standard forms prepared by agencies such as the Federal Home Loan Mortgage Corporation and Federal National Mortgage Association and others for routine property appraisals. Narrative appraisal report: A detailed written presentation of the facts and reasoning behind an appraiser's estimate of value.
four unities:
Four "unities" are required to create a joint tenancy:
Unity of possession - all joint tenants holding an undivided right to possession.
Unity of interest - all joint tenants holding equal ownership interests.
Unity of time - all joint tenants acquiring their interests at the same time.
Unity of title - all joint tenants acquiring their interests by the same document.
The four unities are present when the following requirements are met:
Title is acquired by one deed.
The deed is executed and delivered at one time.
The deed conveys equal interests to all of the parties.
The parties hold undivided possession of the property as joint tenants.
Because the unities must be satisfied, many states require the use of an intermediary when a sole owner wishes to create a joint tenancy with another party(ies). The owner conveys the property to a nominee, or straw man. Then the nominee conveys it back, naming all the parties as joint tenants in the deed. As a result, all the joint tenants acquire title at the same time by one deed.
fractional basis:
Each property in the improvement district is charged a prorated share of the total amount of the special tax assessment. The share is determined either on a fractional basis (four houses may equally share the cost of one streetlight) or on a cost-per-front-foot basis (wider lots incur a greater cost than narrower lots for street paving and curb and sidewalk installation).
fractional section:
A parcel of land less than 160 acres, usually found at the edge of a rectangular survey. Undersized or oversized sections are classified as fractional sections. Fractional sections may occur for a number of reasons. In some areas, for instance, the rectangular survey may have been made by separate crews and gaps less than a section wide remained when the surveys met. Other errors may have resulted from the physical difficulties encountered in the actual survey. For example, part of a section may be submerged in water.
franchise:
1. A privilege granted to conduct certain service businesses, such as a franchise real estate brokerage.
2. The private contractual right to operate a business using a designated trade name and the operating procedures of the parent company (the franchisor). Such firms as Century 21 and Coldwell Banker operate national franchise brokerages.
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. Unlike negligence, fraud is a deceitful practice or material misstatement of a material fact, known to be false, and done with intent to deceive, or with reckless indifference as to its truth, and relied on by the injured party to his or her damage.
Freddie Mac:
See Federal Home Loan Mortgage Corporation (FHLMC)
freehold estate:
An estate in land in which ownership is for an indeterminate length of time, in contrast to a leasehold estate.
friable:
The breaking down of a substance into tiny filaments and particles. Asbestos is harmful only if it is disturbed or exposed, as often occurs during renovation or remodeling. Asbestos is highly friable. This means that as it ages, asbestos fibers break down easily into tiny filaments and particles. When these particles become airborne, they pose a risk to humans.
friable asbestos:
Any material containing more than one-percent asbestos, and that can be crumbled or reduced to powder by hand pressure. (See asbestos, friable)
frivolous:
Void of significance or reason; of little or no worth, or importance; not worthy of serious notice; trivial; unimportant.
front-end zero:
Under a conventional loan, a borrower may elect to finance all of the mortgage insurance premium, thus incurring no cash obligation for this charge at closing. (See mortgage insurance premium)
front-end qualification:
When qualifying a prospective buyer for financing, the ratio of the borrower's income to monthly debt obligation is a primary consideration. (See back-end qualification, prequalify)
front-end ratio:
The ratio of monthly housing cost (PITI) to gross monthly income. (See back-end ratio, PITI)
front footage:
The measurement of a parcel of land by the number of feet of street or road frontage.
fructus industriales:
Corn, wheat and other crops that are produced annually by labor and industry, and not spontaneously. They are referred to in Latin as "fructus industriales." (See emblements)
fully amortized:
Fully amortized mortgages are paid in equal monthly installments, which include interest and amortization of principal, paid over a period of years. The interest is set at a predetermined rate and is charged only on the loan balance. As payments are made, the amount allocated to interest decreases while the amount allocated to principal increases. At the end of the term the mortgage will be paid in full, including interest. No balloon payment is required. (See amortization, balloon payment)
functional obsolescence:
A loss of value to an improvement to real estate arising from functional problems, often caused by age or poor design.
funding fee:
A percentage of the loan amount charged on VA loans to provide for administrative costs. The fee has increased over time and is higher for subsequent use by veterans, reservists and National Guard.
funding letter:
Cover letter prepared by the escrow agent to the lender detailing the documents being forwarded to the lender to complete the borrower's loan and release the loan proceeds to escrow.
future interest:
A person's present right to an interest in real property that will not result in possession or enjoyment until some time in the future, such as a reversion or right of reentry.
future worth:
The compounding increase in the value of money over time.

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