Real Estate Glossary

This list is provided for reference only. Each state has it's own real estate laws, terms and regulations for Realtors. In Arizona, your Realtor and Title Company handle most real estate transaction activities that involve attorneys in many other states. However, you have the right to seek the advice of an attorney or other professional counsel in any real estate transaction.

Package Mortgage - Mortgage covering both real and personal property.

Paper - A mortgage, Deed_of_Trust, or land contract, which is given instead of cash.

Panic Peddling - The illegal practice of inducing panic selling in a neighborhood by making representations of the entry, or prospective entry, of members of a minority group, Blockbusting - . See Fair Housing - .

Parish - In Louisiana, a division encompassing one or more cities or towns. In other states this division is known as a County - .

Partial Release - A release of a portion of property covered by a mortgage.

Participating Agent - A real estate agent who sells a property. The selling agent may be (1) the subagent or listing agent of the seller; (2) a buyer's agent; or (3) a dual agent. Also called a selling agent - or cooperating agent - .

Party Wall - Wall erected on line between adjoining properties for the use of both properties.

Percentage Lease - Lease in which all or part of rental is a specified percentage of gross income from total sales made upon the premises.

Permanent Mortgage - A mortgage on completed construction on the same property under one mortgage or trust deed.

Person - An individual, a partnership, or a corporation, foreign or domestic.

Personal Property - Property which is tangible, movable, and not fixed to the land. Also called chattel and personalty. Also see Real Property - .

Personalty - Personal property; chattel - . Also see Realty - .

Physical Deterioration - The loss of value to real property from all causes due to the action of the elements and old age. Physical deterioration can be either curable or incurable.

PITI - Principal, Interest,Taxes and Insurance. The amount of the monthly payment including principal, interest, and an amount to be placed into the escrow (impound) account.

Plat Book - A record of recorded subdivisions of land.

PMI - Private Mortgage Insurance - Insurance similar to FHA or VA insurance, insuring part of the first mortgage or Deed_of_Trust, enabling a lender to make a conventional loan of a higher percentage of the property value.

Pocket Listing - Slang term used in the real estate business. An agent lists a property for sale and does not enter it into the MLS system for several days, keeping it in his "pocket" so other agents will not know the property is for sale. This allows him to show the listing to his customers without competition from other buyers. The seller is unaware that the property is not being offered to ALL buyers and may accept a lower offer than they would have gotten if the property had been exposed to ALL buyers. This can be avoided by specifying that the Listing Agent provide you the MLS identification number within 24 hours of listing the property.

Points - Fees paid to induce lenders to make mortgage loans at a particular interest rate. Each point is equal to one percent (1%) of the loan principal. Same as Discount Points - .

Police Power - The authority of a government to adopt and enforce law governing the use of real estate based on the need to promote public safety, health, and general welfare.

Power of Attorney - A written document authorizing another to act on his behalf as an attorney in fact. One does not need to be a licensed attorney to act as an attorney in fact but, power of attorney forms are powerful legal documents that should be used only under advice of a licensed attorney at law.

Prepayment - Paying off all or part of the mortgage before the scheduled date.

Prepayment Clause - in a Mortgage Statement of the terms upon which the mortgagor (borrower) may pay the entire or stated amount on the mortgage principal at some time prior to the due date.

Prepayment Penalty - A fee paid to the lending institution for paying a loan prior to the scheduled maturity date.

Primary Mortgage Market - Lenders who originate loans and makes funds available directly to the borrowers. Also see Secondary Mortgage Market - .

Prime Rate - The interest, or discount rate charged by a commercial bank to its largest and strongest customers.

Principal (Finance) - The basic element _ of the loan as distinguished from interest and mortgage insurance premium. The original amount of money borrowed or the amount of the original money borrowed that has not been repaid.

Principal (Legal) - A person or other entity who employs an agent to represent them in a transaction.

Principle of Conformity - An appraisal principle which holds that the maximum value is realized when a reasonable degree of homogeneity (sameness) exists in a neighborhood.

Private Mortgage Insurance (PMI) - Default insurance on conventional loans, normally insuring the top 20% of the loan and not the whole loan.

Property Tax - Generally, tax levied on both real and personal property.

Pro-Rate - To divide or distribute proportionally. At closing, various expenses such as taxes, insurance, interest, rents, etc. are prorated between the seller and buyer.

Puffing - Non-factual or extravagant statements and opinions made to enhance the perceived desirability of a property. The is a fine line between legal puffing and illegal misrepresentation, and puffing is best avoided. An example of puffing would be, "This home has the best view in the city".

Purchase Money Mortgage - A Mortgage given by the buyer to the seller as part of the purchase consideration, as opposed to a 'hard money' mortgage.

Purchase Agreement - See Agreement of Sale -

Purchase Offer - A document that lists the price, terms and conditions under which a buyer is willing to purchase a property.