Real Estate Dictionary

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LAISSEZ-FAIRE - Leave alone, let proceed, French expression made used to describe a theory that free trade promotes a better business climate that government controls.

LALLY COLUMNS - Load-bearing steel columns, which are filled with concrete (lally).

LAND - A general term which includes the ground and those things of a permanent nature such as trees, crops, oil and minerals in the ground, unless specifically excepted.

LAND CONTRACT - A contract used in a real property sale where the seller keeps the title to the property until the sales price has been paid.

LANDLOCKED PARCEL - A parcel of land surrounded entirely by privately owned land, with no access to a public right of way (road). Condemnation for a limited access highway is a major cause of such parcels.

LANDSCAPING - Act of modifying a landscape, or features used in such modification, such as trees, lawns, grade changes, etc.

LAND USE MAP - A map of a given area, showing the different land uses in the area.

LATENT DEFECT - A hidden or concealed defect. One which could not be discovered by inspection, using reasonable care.

LEACHING - Removal of liquid waste material from sewage by filtration (gravel, sand, etc.) or in which filtration materials are placed to remove the liquid waste from sewage.

LEASEHOLD - An estate in realty held under a lease; an estate for a fixed term. Considered in many states to be personal property.

LEASE WITH OPTION TO PURCHASE - A lease under which the lessee has the right but not the obligation to purchase the property.

LEGAL DESCRIPTION - A method of geographically identifying a parcel of land, which is acceptable in a court of law.

LEGAL RATE OF INTEREST - A rate of interest established by law, rather than by agreement.

LEGAL TITLE - Usually title without ownership rights, such as the title placed in a trustee under a deed of trust, or the title in a vendor under a land contract.

LENDER - A general term encompassing all mortgages, and beneficiaries under deeds of trust.

LETTER OF ATONEMENT - A letter from a grantor to a tenant, stating that the property has been sold, and directing rent to be paid to the grantee (new owner).

LETTER OF INTENT - A formal method of stating that a prospective developer, buyer, or lessee, is interested in property. Not an offer and creates no obligation. A builder may use letters of intent to justify a loan to construct a property.

LEVERAGE - Use of debt financing to purchase a property.

LEVY - A collection, seizure, assessment, etc. such as a tax levy.

LIABILITY - A general term used to describe all types of debts and obligations.

LIEN - A encumbrance (legal hold) against the property as security for the payment of debt, mortgages, judgments or taxes.

LIFE - The length of time an improvement will last, either in relation to its physical utility or as an accounting procedure.

LIFE ESTATE - An estate in real property for the life of a living person. The estate then reverts back to the grantor or to a third party.

LISTING - An agreement between an owner of real property and a real estate agent, whereby the agent agrees to secure a buyer or tenant for specific property at a certain price and terms in return for a fee or commission.

LISTING AGENT - A real estate agent obtaining a listing. The opposite of the selling agent.

LOAN - A lending of a principal sum of money to one who promises to repay said sum, plus interest.

LOAN PACKAGE - The file of all items necessary for the lender to decide to give or not give a loan. Items would include the information of the prospective borrower (loan application, credit report, financial statement, employment letters, etc.) and information on the property (appraisal, survey, etc.). There may be a charge for "packaging" the loan.

LOAN POLICY - A title insurance policy insuring a mortgagee, or beneficiary under a deed of trust, against loss caused by invalid title in the borrower, or loss of priority of the mortgage or deed of trust.

LOAN TO VALUE RATION - Ration reflecting the mortgage loan amount to the appraised value or purchase price of a home.

LOCK-IN - The prohibition of prepayment of a loan secured by mortgage or deed of trust, so that the borrower is "locked in" to the loan for a specific time period.

LOT - Generally, any portion or parcel of real property. Usually refers to a portion of a subdivision.

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