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Real Estate Abbreviations, Terms and Phrases
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Fair
Housing Act & Fair Housing Amendments Act
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Federal laws that prohibit housing discrimination
on the basis of race or color, national origin, religion, sex, familial
status or disability. The federal Acts apply to all aspects of the landlord/tenant
relationship, from refusing to rent to members of certain groups to providing
different services during tenancy.
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Fair Housing Laws
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Federal, state, and local laws, particularly
Title VIII of the 1968 Civil Rights Act, Title VI of the Civil Rights Act
of 1964, and the Civil Rights Act of 1866, which forbid discrimination
because of race, sex, color, religion, or national origin, in the selling
or renting of homes or apartments, and in other specified transactions.
These laws have been recently been expanded to include familial status
(having children) and disabilities (Americans with Disabilities Act).
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Fannie Mae
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Created by Congress in 1938 to bolster the
housing industry during the Depression, Fannie Mae was originally part
of the Federal Housing
Administration (FHA) and authorized to buy only FHA-insured
loans to replenish lenders' supply of money. In 1968, Fannie Mae became
a private company operating with private capital on a self-sustaining basis.
Its role was expanded to buy mortgages beyond traditional government loan
limits, reaching out to a broader cross-section of Americans.
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Today, Fannie Mae operates under a congressional
charter that directs it to channel its efforts into increasing the availability
and affordability of homeownership for low-, moderate-, and middle-income
Americans. Fannie Mae receives no government funding or backing, and is
one of the nation's largest taxpayers as well as one of the most consistently
profitable corporations in America. Fannie Mae establishes strict
guidelines for mortgage loans it is willing to purchase. As the largest
buyer of mortgage loans in the US, these guidelines have become the industry
standard for the majority of home loans. Any loan that meets these
Fannie Mae guidelines is called a "conforming loan".
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FDIC
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Acronym - The
Federal Deposit Insurance Corporation.
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Federal
Deposit Insurance Corporation (FDIC)
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The Federal Deposit Insurance Corporation's
mission is to maintain the stability of and public confidence in the nation's
financial system. To achieve this goal, the FDIC has insured deposits and
promoted safe and sound banking practices since 1933. FDIC insurance
is offered at almost every US bank and savings and loan. In general, the
FDIC insures individual accounts in each financial institution for a maximum
of $100,000.00 per account. An individual or entity may only be insured
for a total of $100,000.00 for all the accounts held in any one institution,
or any of its branches.
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Federal
Emergency Management Agency (FEMA)
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FEMA is the governmental unit that has leadership
responsibilities for the Nation's emergency management system. Once the
President has declared a major disaster, FEMA coordinates not only its
own response activities but also those of as many as 28 other Federal agencies
that may participate. FEMA also works with States, territories, and
communities during non-disaster periods to help plan for disasters, develop
mitigation programs, and anticipate what will be needed when major disasters
occur. Among its many responsibilities the agency operates the Federal
Insurance Administration, which makes flood insurance available to residents
of communities that agree to adopt and enforce sound floodplain management
practices.
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Federal Home Loan Mortgage Corporation
(FHLMC)
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See Freddie Mac.
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Federal
Housing Administration
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The Federal Housing Administration (FHA),
a wholly owned government corporation, was established under the National
Housing Act of 1934 to improve housing standards and conditions; to provide
an adequate home financing system through insurance of mortgages; and to
stabilize the mortgage market. FHA was consolidated into the newly established
Department
of Housing and Urban Development (HUD) in 1965. Since 1934,
FHA has been extremely successful in achieving these goals. FHA loans
require special a appraisal/inspection that determine if a property meet
the agency's minimum property standards. While somewhat more expensive
that a conventional loan in terms of interest rates and insurance fees,
FHA loans offer slightly more liberal qualifying criteria. The current
maximum FHA loan amount in the Houston area, for a single-family home,
is $139,650.00
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fee simple estate
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The most complete form of ownership of real
property; absolute ownership. Commonly used to to denote a property where
the owner has undivided title to the land on which the property is situated.
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FHA
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The Federal Housing Administration
which insures mortgage loans made by approved lenders, in accordance with
FHA regulations.
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FHLMC
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Acronym - Federal Home Loan Mortgage Corporation.
See Freddie Mac.
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fiduciary
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The relationship of trust, honesty and confidence
between agent and principal; the faithful relationship owed by an agent
to the principal.
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finder's fee
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A fee charged by real estate brokers and apartment-finding
services in exchange for locating a rental property. These fees are permitted
by law. Some landlords, however, charge finder's fees merely for renting
a place. This type of charge is not legitimate and, in some areas, is specifically
declared illegal.
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first mortgage
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A mortgage which is in first lien position,
taking priority over all other liens (which are financial encumbrances).
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fixed rate mortgage
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A mortgage with an interest rate and monthly
payment that doesn't vary for the term of the loan.
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fixture
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Personal property which has been attached
to real estate so as to become part of the real property. The article must
meet at least one of three conditions:
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1. Attached in a permanent manner.
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2. Specially adapted to the property. or
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3. Intentionally made part of the real property.
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Flood Control District
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A special taxing district created to provide
flood control in specific areas of a county.
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flood insurance
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A special and separate type of homeowner's
insurance the provides coverage for damages resulting from flooding.
Flood insurance is required by most lenders only if the property is located
within a designated flood plain. The cost of the policy is related
to the associated flooding risk. If a property has a small section
of land located within a flood plain, but away from the residential improvements
(house), the lender will still require a policy, but its cost will be much
lower. Likewise, flood insurance policies for properties not located
within any floodplain, are fairly inexpensive.
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Most flood insurance is underwritten by the
federal government through FEMA
and the National Flood Insurance Program in cooperation with private insurance
agencies. More than 18,000 communities participate in the Federal
flood insurance program. More than 3.8 million National Flood Insurance
Program (NFIP) home and business policies are in effect. The United
States experiences flooding threats throughout all four seasons of the
year and, in fact, flooding is the most common natural disaster. There
are, on average, 1000 floods per year in the U.S. Nearly everyone
is at some risk of experiencing the effects of flooding. In the Houston
area, 25 percent of flood-insurance claims come from areas outside a designated
flood plain.
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flood plain
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Flood plains are by definition subject to
periodic flooding. They are generally characterized by relatively flat
topography and soil types that were laid down during past inundations by
flood waters. If your property is in the 100-year flood plain, there
is a 1-in-100 chance in any given year that your property will flood. If
it is in the 25-year flood plain, there is a 1-in-25 chance in any given
year that your property will flood. The statistical chance of flooding
is not changed by any one flooding event; but repeated flooding may result
in the flood plain being recalculated.
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A 100-year flood plain is always wider than
a 25-year flood plain, and the 25-year flood plain is contained within
the 100-year flood plain. The flood prone areas of the United States cover
approximately 150,000 square miles or 94 million acres of land, an area
roughly the size of the State of Montana. People living in flood plains
are 26 times more likely to experience a flooding disaster than they are
a fire disaster during the life of the 30-year mortgage on their homes.
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The changes in flood plain maps reflect changes
in land use (such as increased building activity), changes in the waterways,
and flood control improvements (such as detention ponds or other flood
control measures). As more lots are covered with more buildings and
parking lots, the amount of water that flows into creeks and lakes increases
because there is less vegetation to absorb the water when it rains. This
is one reason why buildings that were not originally built in a flood plain
are now in the 25-year or 100-year flood plain.
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FNMA
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Usually referred to as "Fannie
Mae", the acronym stands for the Federal National Mortgage
Association.
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For Sale
By Owner (FSBO)
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An individual homeowner who is attempting
to sell his property without a real estate broker. The acronym, FSBO
is pronounced "fizzbo."
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foreclosure
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A legal process instituted by a mortgagee
or lien creditor after the debtor's default.
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forfeiture
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The loss of property or a privilege due to
breaking a law. For example, a landlord may forfeit his or her property
to the federal or state government if the landlord knows it is a drug-dealing
site but fails to stop the illegal activity. Likewise, a homeowner
may lose his house to satisfy IRS debts or if the government suspects the
home was bought with money derived from criminal acts. The government
may seize and sell the property at auction, often far below its fair market
value, before the homeowner has been allowed the due process of a trial.
If the homeowner is found not guilty, the government is only required to
pay back the amount received at auction, and not the market value.
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fraud
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A misstatement of a material fact made with
intent to deceive or made with reckless disregard of the truth, and which
actually does deceive.
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Freddie Mac
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Chartered by Congress in 1970, Freddie Mac
is a publicly held corporation that purchases mortgages in the secondary
mortgage market. Freddie Mac came into being as the Federal Home
Loan Mortgage Corporation (FHLMC) with the mission to create a continuous
flow of funds to mortgage lenders. By supplying lenders with the
money to make mortgages and packaging the mortgages into marketable securities
which are sold to investors, Freddie Mac also helps to sustain a stable
mortgage credit system which in turn, reduces the mortgage rates paid by
homebuyers. Over the years, Freddie Mac has been responsible for
opening the door to homeownership for one out of six home buyers in America
who would not have qualified otherwise.
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front foot
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One linear foot (12 inches) along the street
side of a lot.
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FSBO
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Acronym - For
Sale By Owner
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functional obsolescence
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Loss of value of real property caused by modernization
or changing tastes or standards; e.g.. single bath, inadequate closet space,
etc. Contrast with economic obsolescence.
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