Real Estate Terminology

Backup Contract: An Agreement of Purchase and Sale for a particular property which is conditional (becomes binding) upon the failure of another Agreement for the same property.

Balance: Often as in "balance due", the amount of principal on a loan remaining to be paid at any given time.

Balloon Payment: The single, large payment which pays out the balance due on a balloon mortgage.

Bankrupt: A person or business which has made an assignment in bankruptcy or has been petitioned into bankruptcy, or simply, owing more money than you have assets or income to repay.

Bankruptcy: The state of being unable to pay your debts such that you submit yourself to the protection of the state. A person or business may voluntarily assign himself into bankruptcy or may be petitioned into bankruptcy by his creditors. Once in bankruptcy, the person surrenders his assets to a trustee in bankruptcy who sells the assets for the benefit of the bankrupt's creditors, first secured creditors then unsecured creditors. Once a person is discharged from bankruptcy, none of his former creditors may pursue him for his former debts.

Beneficiary: A person or corporate entity entitled to receive money or assets from a trust or an estate under a will.

Bequeath: To leave an item of personal property to a certain person in a will (see "Devise", which refers to gifts of land in this context).

Bid: An offer of a certain amount of consideration.

Bill of Sale: Documentary evidence that title to personal property (chattels) has passed to the Purchaser for valuable consideration.

Boiler Plate: A standard clause or provision in a contract which appears in all similar contracts.

Borrower (or Mortgagor): The person or company that receives money from a lender (often a bank, credit union or trust company) in exchange for a written promise to pay and a registered lien on property.

Breach of Contract: A failure to meet one's obligations. A breach of contract allows the innocent party to enforce the contract, rescind the contract or sue for damages.

Broker: An intermediary who brings parties together for specific purposes. A mortgage broker brings borrowers together with lenders; a real estate broker brings purchasers together with vendors. Often charges a percentage of the contract price as a fee. Specific training required to become a Real Estate Broker, a professional designation.

Build to Suit: An offer by a landowner to develop the land in a manner dictated by a potential tenant, in return for a long-term lease from the tenant for the developed land.

Builder Warranty: An enforceable guarantee of the quality of construction given by a builder or developer.

Built-Ins: Items which could be chattels but which are installed so as to form part of a building.

Business Day: A day in which normal business is transacted. Generally, Monday to Friday but not weekends or holidays.

Buyer's Broker: A real estate broker who contracts to represent the interests of a person wishing to purchase a home.

Buyer's Market: A condition of the real estate market where there are more properties for sale than people interested in buying them. Buyer's have more choice and less competition for the available properties, resulting in lower prices.

Bylaws: Rules enacted by a governing body of general application.