AGENCY & REPRESENTATION
The practice of intentional communication with prospects over time until they are ready to transact.
What is "Nurturing"?
The estimated amount a seller will net after paying commission, closing costs, and loan payoff is shown on this document.
What is a net sheet?
The legal doctrine requiring that contracts include something of value exchanged between parties.
What is consideration?
The process of selecting comparable sales slightly superior and inferior to the subject property.
What is bracketing?
The percentage of a property’s value that a buyer is borrowing from a lender.
What is Loan-to-Value ratio (LTV)?
A consumer who has not signed a brokerage agreement but is working with an agent is legally considered this.
What is a customer?
The price at which a property actually transfers ownership.
What is sale price?
A clause stating that time deadlines in a contract are strictly enforceable.
What is a time-is-of-the-essence clause?
The appraisal approach that estimates value based on the cost to rebuild the property minus depreciation.
What is the cost approach?
The ratio lenders use to compare a borrower’s total monthly debt payments to their gross monthly income.
What is Debt-to-Income ratio (DTI)?
A brokerage relationship created without a written agreement through the actions of the parties.
What is implied agency?
The number of months it would take to sell current inventory at the present rate of sales.
What is months of inventory (or absorption rate)?
A clause requiring disputes to be resolved outside of court.
What is an arbitration clause?
A reduction in value due to outdated floor plan, or layout inefficiencies.
What is functional obsolescence?
The fee paid to a lender at closing in exchange for a reduced interest rate.
What are discount points?
An agency relationship in which two affiliated licensees within the same brokerage each represent different parties in the same transaction.
What is designated agency?
The method by which an appraiser reconciles differences between a subject property and its comparable sales to determine indicated value.
What are adjustments?
A contract clause allowing the seller to continue marketing the property while under contract with contingencies.
What is a kick-out clause?
The difference between the contract price and appraised value when the appraisal comes in low.
What is an appraisal gap?
The ratio lenders use to evaluate overall borrower risk by measuring total monthly debt payments against gross income.
What is the back-end ratio?
Information that would influence a reasonable person’s decision to buy or sell property is considered this.
What is a material fact?
The legally permissible, physically possible, and financially feasible use of a property that results in the highest value.
What is highest and best use?
A written notice that one party has failed to perform under the terms of the contract.
What is a notice of default?
A permanent improvement that increases property value is known as this.
What is a capital improvement?
A loan program designed for non-owner-occupied investment properties that qualifies the borrower based on the property’s income rather than personal income.
What is a Debt Service Coverage Ratio (DSCR) loan?