1031 exchange
The properties exchanged must be considered _______ by the IRS. This means they must be used for the same purpose, such as business or investment. For example, a seller of raw land can exchange it for a rental home
Like-kind
Ammount of money pocketed by an investment each month
Cash Flow
Loan costa associated with owning the property
Carrying Costs
A person or entity who is named in a will or trust to receive assets
Beneficiary
are the expenses that buyers incur when purchasing a property. These include appraisal fees, title insurance, surveys
Closing costs
Joe exchanged a property into a cheaper property. The left over proceeds are called
Boot
Money spent on improvements that extend the life of the investment
Capital Expenditure
Value of the property once work is complete
ARV- After Repair Value
This takes place marking the value of the home when the owner dies
Time Of Death Appraisal
is the amount of money you'd have if you paid off the mortgage and sold the home
Equity
the cost or value of an asset – used to determine equity or ownership for the purpose of tax assessment, exchange, or sale
Tax Basis or Basis
NOI/ Purchase price
Cap Rate
Net profit between costs and sold price
Margin
is the legal process that takes place after someone dies to transfer property and distribute assets to beneficiaries
Probate
efers to the increase in the value of a property over time, usually due to factors such as market conditions, demand, inflation
Appreciation
An exchange where the exchange property is purchased first, then the primary property is sold
Reverse 1031 Exchange
Annual pre tax cash flow / Cash invested
Cash on Cash return
Pay escrow up front during purchase and it will save escrow fees when you re-list with that escrow company
Binder
A person or entity designated in a will and appointed by the court to manage and settle the estate of a deceased person
Executor
refers to a type of interest rate that can change over time, typically in relation to a specific financial index
Adjustable Rate
the property you are relinquishing is called the ____, while the property you are acquiring is called the upleg
downleg
Gross Revenue - Operating Expenses
NOI or Net Operating Income
Short term loans that can cover acquisition and remodel costs. Usually a much higher rate.
Hard Money or Private Lending
an individual person or member of a board given control or powers of administration of property in trust with a legal obligation to administer it solely for the purposes specified
Trustee
in real estate refers to the gradual repayment of a loan through regular installments, which include both principal and interest.
Amortization