Core real estate vocabulary tested on state licensing exams.
115 cards · basic cards · AI-written, checked twice. Edit anything.
- Define earnest money.
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Funds deposited by the buyer to demonstrate intent to purchase, typically held in escrow and credited toward the purchase price at closing.- What does fee simple mean?
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Complete ownership of real property with no restrictions or limitations on transfer or use, except those imposed by law.- What is leasehold interest?
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The right to possess and use property for a fixed period, as granted by a lease, with ownership reverting to the landlord at lease end.- Define encumbrance.
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A claim, lien, or restriction on a property that affects its title, value, or use.- What is an easement?
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The right to use another's property for a specific purpose, such as a utility company accessing land to maintain power lines.- Define lien.
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A legal claim against a property as security for payment of a debt, giving the lienholder the right to foreclose if the debt is unpaid.- What is a mortgage?
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A legal instrument that pledges property as security for repayment of a loan, allowing the lender to foreclose if the borrower defaults.- What is a deed of trust?
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A three-party security instrument where a borrower transfers title to a trustee who holds it as security for the lender, used in some states instead of a mortgage.- Define promissory note.
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A written promise by a borrower to repay a specific debt on stated terms, often accompanying a mortgage or deed of trust.- In a loan, what is principal?
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The original amount borrowed, distinct from the interest charged on that amount.- What is interest in a loan context?
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The charge imposed by the lender for the use of borrowed money, usually expressed as an annual percentage rate.- What is property tax?
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An annual tax levied by local governments on the assessed value of real property, used to fund schools and services.- What does HOA stand for?
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Homeowners Association, an organization in a community that sets rules and collects fees from residents to maintain common areas.- What is homeowners insurance?
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Insurance covering damage to a dwelling and contents from hazards like fire, theft, or weather, typically required by lenders.- What does PMI stand for?
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Private Mortgage Insurance, required when a borrower puts down less than 20 percent, protecting the lender if the borrower defaults.
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