Texas Real Estate License Glossary

T
TAKE-OUT FINANCING – Long-term permanent financing.

TAX LIEN – A general statutory lien imposed against real property for failure to pay taxes. There are federal tax liens and state tax liens.

TAX SHELTER – A phrase often used to describe some of the tax advantages of real estate investment, such as deductions for depreciation, interest, taxes, etc., which may offset the investor’s other ordinary income to reduce the investor’s overall tax payment.

TENANCY AT SUFFERANCE – A tenancy which exists when a tenant wrongfully holds over after the expiration of a lease, without the landlord’s consent, as where the tenant fails to surrender possession after termination of the lease.

TENANCY AT WILL – A tenancy in which a person is in possession of real estate with the permission of the owner, for a term of unspecified or uncertain duration, as when an owner permits a tenant to occupy a property until it is sold.

TENANCY BY THE ENTIRETY – A special joint tenancy between a lawfully married husband and wife, which places all title to the property into the marital unit, with both spouses having an equal, undivided interest in the whole property.

TENANCY FOR YEARS – A less-than-freehold estate in which the property is leased for a definite, fixed period of time, be it for 60 days or any fraction of a year, a year, ten years, etc.

TENANCY IN COMMON – A form of concurrent ownership of property between two or more persons, in which each has an undivided interest in the whole property; frequently found when the parties acquire title by descent or by will.

TENANCY IN SEVERALTY – Ownership of property vested in one person alone, and not held jointly with another; also called Several Tenancy or Sole Tenancy.

TENANT – In general, one who holds or possesses property, such as a life tenant or a tenant for years; commonly used to refer to a lessee under a lease.

TIME IS OF THE ESSENCE – The clause in a contract which emphasizes that punctual performance is an essential requirement of the contract.

TIME SHARING – A modern approach to communal ownership and use of real estate which permits multiple purchasers to buy undivided interests in real property (which is usually in a resort condominium or hotel) with a right to use the facility for a fixed or variable time period.

TITLE INSURANCE – A comprehensive contract of indemnity under which the title company agrees to reimburse the insured for any loss if title is not as represented in the policy.

TITLE SEARCH – An examination of the public records to determine what, if any, defects there are in the chain of title.

TOWNHOUSE – A type of dwelling unit normally having two floors, with the living area and kitchen on the base floor and the bedrooms located on the second floor.

TOWNSHIP – A piece of property, used in the government survey system of land description, which is 6 miles square, and contains36 sections, each 1 mile square; and consists of 23,040 acres.

TRADE FIXTURES – Articles of personal property annexed to leased premises by the tenant, as a necessary part of the tenant’s trade or business.

TRIPLE NET LEASE – A net, net, net lease, where in addition to the stipulated rent, the lessee assumes payment of all expenses associated with the operation of the property.

TRUST DEED – A real property security device (also called a deed of trust) very similar to a mortgage, except that there are three parties, the trustor, the trustee, and the beneficiary (the lender).

TRUST FUND ACCOUNT – An account set up by a broker at a bank or other recognized depository, into which the broker deposits all funds entrusted to him by his principal or others.

TURNKEY PROJECT – A development term meaning the complete construction package from ground breaking to the completion of the building. All that is left undone is to turn over the keys to the buyer.

U
UNILATERAL CONTRACT – A contract in which one party makes an obligation to perform without receiving in return any express promise of performance from the other party, such as an open listing contract, where the seller agrees to pay a commission to the first broker who brings in a ready, willing and able buyer.

UPSET PRICE – A minimum price set by a court in a judicial foreclosure, below which the property may not be sold by a court appointed commissioner at public auction; the minimum price which can be accepted for the property after the court has had the property appraised.

USEFUL LIFE – That period of time over which an asset, such as a building, is expected to remain economically feasible to the owner.

USURY – Charging a rate of interest in excess of that permitted by law.

V
VACANCY FACTOR – An allowance or discount for estimated vacancies(unrented units) in a rental project. The vacancy rate is the ratio between the number of vacant units and the total number of units in a specified project or area.

VALUE – The power of a good or service to command other goods in exchange for the present worth of future rights to income or amenities; the present worth to typical users and investors of future benefits arising out of ownership of a property.

VARIANCE – Permission obtained from governmental zoning authorities to build a structure or conduct a use which is expressly prohibited by the current zoning laws; an exception from the zoning laws.

VENDEE – The purchaser of realty; the buyer. The buyer under an agreement of sale.

VENDOR – The seller of realty. The seller under an agreement of sale.

VOID – Having no legal force or binding effect; a nullity; not enforceable. A contract for an illegal purpose (i.e. gambling)is void.

VOIDABLE – A contract which appears valid and enforceable on its face, but is subject to rescission by one of the parties who acted under a disability, such as being a minor or being under duress or undue influence; that which may be avoided or adjudged void but which is not, in itself, void.