ARE 144

internal rate of return

aka the interest rate evaluating investments

lien

an interest on real property that serves as security for loan obligation

annuity due

assume deposits are made at the beginning of the period

ordinary annuities

assume deposits are made at the end of the period

mortgagor

borrower

mortgage

borrowing funds from a lender then using these funds to purchase property

time value of money

decision between receiving $1 today or receiving it in the future

what are the three premiums/risks?

default risk prepayment risk interest rate risk

promissory note

document which serves as evidence that debt exists between a borrower and a lender

mortgagee

lender

nonrecourse

lender may only bring a an action to force the sale of the property serving as security of the loan

amortization

loan repayment over time

fee simple absolute

most complete bundle of rights most valuable

title

ownership

fee simple conditional

ownership is under a certain condition

broker

people who bring together the buyer and the seller

title insurance

protection for homeowner

types of professions in real estate

real estate broker broker dealer

property rights

right of a person to use & enjoy land/property as she/he wishes

easement

right to use land that is owned for a special purpose

present value of annuity

series of annual income receipts the investments produces over time

appraisal services

set value for property buyers and sellers end up setting price

future value of annuity

sum of all deposits compounded at an annual rate

real estate

tangible asset

property

that which can be owned or possessed