Canadian Real Estate Glossary A to D

As we noted in the Real Estate Glossary for the USA, the language of Real Estate is quite complex and unique to specific countries, regions, states or provinces.

This real estate glossary for Canada may have terms that have a modified meaning in various provinces.

Local laws, as well as custom and use in various areas or regions of the country, may modify or completely change the meanings of certain terms we've defined.

This real estate glossary of common terminology is designed simply to assist you in better understanding the language of real estate.

Caveat: (Another term often used in Real Estate meaning: Be Aware):
Although we've tried to divide this real estate glossary into two country specific pages, many of the terms appearing in the United States real estate glossary are also used in Canada and many of the terms appearing in this Canadian real estate glossary are also used in the US.

This glossary of common real estate terminology is designed simply to assist you in better understanding the language of real estate.

Real Estate Terms For Canada - E To O

Glossary of Real Estate Terms For Canada - P To Z




ABANDONMENT - The voluntary surrender or relinquishment of possession of real property with the intention of terminating one's possession or interest, but without vesting this interest in any other person.

ABATEMENT - A reduction or decrease in amount, degree, intensity or worth.

ABSORPTION BED - A leaching bed constructed on or above the existing terrain as part of a waste disposal system through the use of imported soil and/or special filters.

ABSORPTION RATE - An estimate of the rate at which a particular classification of space - such as new office space, new housing, new condominium units and the like - will be sold or occupied each year.

ABSTRACT BOOK - (also referenced as an Abstract Index) represents the central reference source within the Land Registry system.

ABSTRACT OF TITLE - A concise, summarized history of the title to a specific parcel of real property, together with a statement of all liens and encumbrances affecting the property. The abstract of title does not guarantee or assure the validity of the title of the property. It merely discloses those items about the property which are of public record, and thus does not reveal such things as encroachments, forgeries, and the like.

ACCELERATED DEPRECIATION - A method of calculating the depreciation of certain property (that property which is used in a trade or business, or which is held for the production of income) at a faster rate than would be achieved from using the straight-line method of depreciation.

ACCELERATION CLAUSE - A clause in a promissory note, agreement of sale, or mortgage which gives the lender the right to call all sums due and payable in advance of the fixed payment date upon the occurrence of a specified event, such as a sale, default, assignment or further encumbrance of the property.

ACCEPTANCE - The expression of the intention of the person receiving an offer (offeree, usually the seller) to be bound by the terms of the offer.

ACCESS - A general or specific right ingress and egress to a particular property.

ACCRUED - That which has accumulated over a period of time such as accrued depreciation, accrued interest or accrued expenses.

ACKNOWLEDGMENT - A formal declaration made before a duly authorized officer, usually a Notary Public, by a person who has signed a document.

ACRE - A measure of land equaling 43,560 square feet; 4,840 square yards; 160 square rods.

ACT OF GOD - Action occurring without the intervention of man which could include but not be limited to hurricanes, earthquakes, floods, lightening, etc.

ACTUAL AGE - The number of years which has elapsed since an original structure was built. This is sometimes referred to as historical or chronological.

ADHESION CONTRACT - A contract, which is very one-sided and favors the party who drafted the document.

ADJACENT - Lying near to, but not necessarily abutting, the property.

ADJUSTMENTS - Refers to those terms requiring apportionment as of the date of closing.

ADJUSTMENTS ON CLOSING: There are two types of adjustments for which a buyer can be charged on closing;

• Prepaid services. Where the sellers have prepaid property taxes or certain utilities, the buyers can be charged for the amount of prepayment on a pro-rata basis, depending on the date of occupancy. For example, if the sellers have paid the property taxes to the end of the year, and the sale closes on October 15th, the purchasers will be charged with an adjustment of 77/365'ths (the number of days remaining in the year) of the total paid for the year.
  
  
• Interest. This is the amount of interest required to be prepaid up to the Interest Adjustment Date (IAD). IAD is the point at which the mortgage interest starts accumulating "in arrears". In Canada all mortgage interest is calculated and paid after the period to which it applies. This differs from the way in which rental and lease payments are calculated, which is "in advance". The good news on this one is that if you prepay for say 3 weeks you won't have to make your first payment for almost two months. Also, if you take a biweekly payment term, the longest interest adjustment period is less than two weeks, by definition.

ADVERSE POSSESSION - The acquiring of title to real property owned by someone else, by means of open, notorious and continuous possession for the statutory period of time.

AEROBIC TREATMENT - A system of treating waste which involves the pumping of quantities of air into the sewage to accelerate its breakdown.

AFFIDAVIT - A sworn statement reduced to writing and made under oath before a Notary Public or other official authorized by law to administer an oath.

AGENCY - A relationship created when one person, the "principal," delegates to another, the "agent," the right to act on the principal's behalf in business transactions and to exercise some degree of discretion while so acting. An agency gives rise to a fiduciary relationship and imposes on the agent, as the fiduciary of the principal, certain duties, obligations and high standards of good faith and loyalty.

Single - Agency - Either with the seller or buyer, is that relationship between the seller or buyer and an agent wherein the agent is considered in law to represent only the principal.

Dual - Agency - Occurs when the same agent has an agency relationship with more than one party to the same real estate transaction, and both parties must give their informed consent to this form of representation. The agent must advise the seller and the purchaser of the dual aspect of representation and must provide full and timely disclosure to all parties of all pertinent information.

Sub-Agency - That relationship whereby an individual is empowered by an agent to act on his/her behalf.

Undisclosed Dual Agency - This situation arises when a professional is found to be acting in an agency role for conflicting interests without prior understanding, approval and agreement of the parties.

AGENT - One who is authorized to represent and to act on behalf of another person (called the principal). A real estate broker is the agent of his client, be it the seller or buyer, to whom he owes a fiduciary obligation. A salesman is the agent of his broker and does not have a direct personal contractual relationship with either the seller or buyer.

AGGREGATE RENT - The total or gross amount for a lease term.

AGREEMENT OF PURCHASE AND SALE - An agreement between the seller (seller) and buyer (purchaser) for the purchase of real property.

AIR RIGHTS - The rights to use space above the physical surface of the land while the surface can be used for some other purpose.

ALIENATION CLAUSE - A clause in a promissory note or mortgage which provides that the balance of the secured debt becomes immediately due and payable at the option of the mortgagee upon the sale or transfer of the property by the mortgagor.

AMENDMENT TO AGREEMENT - Formalizes any mutual agreement between purchaser and seller that affects an original contract, and which is acceptable to both parties.

AMENITIES - Features, both tangible and intangible, which enhance and add to the desirability of real estate.

AMORTIZATION - The gradual repayment of a debt by means of systematic payments of principal and interest over a set period, where at the end of the period there is a zero balance.

AMORTIZATION PERIOD - The time period required to completely retire the debt through scheduled payments of principal and interest.

ANAEROBIC TREATMENT - The use of bacteria which can survive without oxygen in the breakdown of sewage within a waste disposal system.

ANCHOR TENANT - Major department or chain stores which are strategically located at shopping centers so as to give maximum exposure to smaller satellite stores.

ANNEXATION - Refers to the attachment or incorporation of one parcel of land within an adjacent municipality.

ANNUAL PERCENTAGE RATE - The relationship of the total Finance Charge to the total amount to be financed .

APPRAISAL - The process of estimating, fixing, or setting the market value of real property. An appraisal may take the form of a lengthy report, a completed form, a simple letter, or even an oral report. An appraisal is also described as an estimate of the current value of the property for the lender (the 'subject property'), using one or both of the following techniques;

• Market value comparison approach: The majority of residential appraisals use this technique, comparing recent sales of similar properties ('comparables' or 'comps' in real estate jargon) and adding and subtracting the differences in value of the same features in the subject property. For example, if a house of the same size on the same street and in the same condition as the subject property recently sold for $200,000, but this 'comparable' had a triple garage and a finished basement and the 'subject' does not; the appraiser calculates the market value of these features (say, $12,000 in total) and deducts this amount from $200,000, giving an 'adjusted value' of $188,000. This is usually done with at least three 'comparables' and either averaged or the middle ('median') value used.
  
• Depreciated cost approach: This technique is a supporting measurement of value used by many appraisers, whereby the land value is estimated and added to an estimate of the depreciated building value. Where there are few comparables available, relatively more weight might be given to this method.

APPRAISAL REPORT - A written summary estimating the value of property and the conditions and limitations at the time of the appraisal.

APPRECIATION - An increase in the worth or value of property due to economic or related causes, which may prove to be either temporary or permanent.

APPURTENANCE - Rights that go with a property. Something, which is outside the real property itself, but belongs to the land and is joined thereto and adds to greater enjoyment of the land.

APPURTENANT - Belonging to; adjunct; appended or annexed.

ARBITRATION - The non-judicial submission of a controversy to selected third parties for their determination in the manner provided by agreement or by law.

ARM'S LENGTH - A transaction freely arrived at in the open market, unaffected by abnormal pressure or by factors limiting competitive negotiations.

ARREARS - The circumstance of being behind in payments, commonly used with respect to delinquent payments under a mortgage document.

ASKING (or list) PRICE
The price placed on the property for sale by the seller.

ASSESSED VALUATION (TAX ASSESSMENT) - The value of real property as established by the government for purposes of computing real property taxes.

ASSEMBLAGE - The combining of two or more abutting parcels of land into one ownership or use.

ASSESSMENT - A specific levy for a definite purpose, such as adding curbs or sewers in a neighborhood. Individual condominium owners are subject to special assessments benefiting the project as a whole and not funded through regular maintenance charges.

ASSIGNMENT or Assignment of Interest - The transfer of the right, title and interest in the property of one person, the assignor, to another, the assignee. In real estate, there are assignments of mortgages, contracts, agreements of sale, leases, and options, among others.

ASSIGNOR - An individual or firm who transfers or assigns rights or title to another.

ASSUMABLE MORTGAGE The A mortgage which a qualified buyer can take over from the current owner of a property upon its sale. Assuming a mortgage can provide a buyer with a below market interest rate, (if rates are now higher), as well as saving on the legal costs of creating and registering a whole new mortgage. "Assumption" entails a simple amendment to the mortgage document registered on title.

ASSUMPTION OF MORTGAGE - The act of acquiring title to property which has an existing mortgage on it and agreeing to be personally liable for the terms and conditions of the mortgage, including payments.

ATTACHMENT - The legal process of seizing the real or personal property of a defendant in a lawsuit, by levy or judicial order, and holding it in the custody of the courts as security for satisfaction of the judgment which the plaintiff may recover in any action upon a contract, express or implied.

ATTORNEY- IN -FACT - One who is authorized by another to act in his place under a power of attorney.

ATTORNMENT - The act of a tenant formally agreeing to become the tenant of a successor landlord; as in attorning to a mortgagee who has foreclosed on the leased premises.

AUCTIONEER - An individual who conducts a public sale of property and/or goods to the highest bidder subject, in some cases, to restrictions established by the seller.

AUTHORITY - The legal power or right given by a principal and accepted by the agent to act on the principal's behalf in business transactions with a third party, such as a listing agreement.

AUTOMATIC RENEWAL CLAUSE - A commercial lease provision that automatically ensures renewal of the lease unless either the tenant or the landlord notifies the other party of a desire to terminate the agreement.

BALLOON PAYMENT - The final payment of a note or obligation, which is substantially larger than the previous installment payments, and which repays the debt in full; the remaining balance which is due at the maturity of a note or obligation.

BASE LEASE - A contract stating the minimum established tenancy requirements that are applicable to all tenants and are used in both residential and IC & I properties.

BASE LINE AND MERIDIAN - An imaginary set of lines used by surveyors to locate and describe land under the Rectangular Survey Method of property description used in most mainland states.

BASE RENT - The minimum rent payable by the tenant under a commercial tenancy agreement, often referenced as net/net/net rent or alternatively a triple net lease.

BENCH MARK - A mark affixed to a permanent reference or monument, such as an iron post or a brass marker (usually embedded in a cement sidewalk), used to establish elevations and altitudes over a surveyed area.

BENEFICIARY - A person who receives the benefits from the gifts or acts of another, such as one who is designated to receive the proceeds from a will, insurance policy or trust.

BERM - Contoured landscapes areas, normally surrounding commercial or industrial properties, which act as a buffer within the overall site plan for that particular enterprise.

BILATERAL CONTRACT - A contract in which each party promises to perform an act in exchange for the other party's promise to perform.

BILL OF SALE - A written agreement by which one person sells, assigns or transfers his right to, or interest in, personal property to another.

BLANKET MORTGAGE - A mortgage, which is secured by several structures or a number of lots. A blanket mortgage is often used to finance proposed subdivisions or development projects, especially cooperatives.

BLEND AND EXTEND- A closed mortgage can often be "opened" for the purpose of extending the term. Most lenders will blend the penalty for breaking (usually an Interest Rate Differential) with the rate for the new extended term. The idea is to get a lower rate and protect against rate increases in the future

BLENDED PAYMENT - The method of repayment where periodic payments of principal and interest are made in such a way that the payments remain constant in amount, although the portions attributed to principal and interest will vary with each payment.

BOUNDARIES - The perimeters or limits of a parcel of land as fixed by legal description, which is usually a metes and bounds description.

BREACH OF CONTRACT - Violation of any of the terms or conditions of a contract without legal excuse; default, non-performance, such as failure to make payment when due.

BRICK MASONRY WALL - Is a load-bearing component of the building that transfers the weight of the roof and the floors down to the foundation and are typically constructed of brick, stone, concrete block, cinder block, clay tile or glass block.

BRICK VENEER WALL - A wood frame wall with an exterior single layer of brick and transmits the roof and floor loads down to the foundation.

BRIDGE LOAN - A form of interim financing, which in residential sales, can occur when a purchaser is committed to completing the purchase of a property on a specific date, but will not have sufficient funds until a later time.

BRIDGING/BRACING - Acts to restrain the joists from twisting and helps to transmit loads from one joist to the next thereby reducing the springiness of the floor.

BROKER - One who acts as an intermediary between parties to a transaction. A real estate broker is a properly licensed person who, for a valuable consideration, serves as an agent to others to facilitate the sale or lease of real property.

BROKERAGE - That aspect of the real estate business which is concerned with bringing together the parties and completing a real estate transaction. Brokerage involves exchanges, rentals, trade-ins, and management of property, as well as sales. Brokerage is also a name given to a company licensed to trade in real estate.

BUFFER ZONE - A strip of land separating one parcel from another.

BUILD TO SUIT - An agreement between a landlord and tenant whereby the landlord assumes the obligation of fitting up the demised space to the tenant's specification within the constraints of building standards.

BUILDING CODES - Regulations established by local governments providing for minimum acceptable structural standards for buildings.

BUILDING LINE - A line fixed at a certain distance from the front and/or sides of a lot, beyond which no building can project.

BUILDING PERMIT - A written permission granted by the Municipal Building Department and required prior to beginning the construction of a new building or other improvement (including fences, fence walls, retaining walls and swimming pools).

BUILDING RESIDUAL TECHNIQUE - A method of determining the value of an improvement normally used in appraising income property.

BUILT-UP ROOF - Commonly referenced as a tar and gravel roof and is very popular in industrial buildings. It usually consists of two, three, four or even five plies of roofing felts with a mopping of asphalt between layers. A flood coat of asphalt is then applied over the top and covered with gravel to reflect ultraviolet light and protect the roof from mechanical damage. Some roofers use roll roofing rather than gravel to protect the membrane.

BUNDLE OF RIGHTS - An ownership concept describing all those legal rights which attach to the ownership of real property, including the right to sell, lease, encumber, use, enjoy, exclude, will, etc.

BUSINESS - Any undertaking for the purpose of profit, including any interest in any such undertaking.

BUSINESS CYCLES - Is a consequence of supply and demand factors combined with a host of intrusive elements from both private and public sectors, associated with three major phases: prosperity with high employment, consumer confidence and intense market activity; recession with rising unemployment, waning consumer confidence and no real growth; and recovery denoted by economic corrections and improvement in key growth indicators.

BUSINESS DAYS - Days of week excluding Saturdays, Sundays, and holidays; normal working days.

BUSINESS OPPORTUNITIES - Any type of business which is for sale.

BUSINESS TAXES - Taxes levied and due to the appropriate municipality for the operation of a business as defined by, and located within, that municipality.

BUY-DOWN - "Paying down" the mortgage rate by paying the lender a premium at time of funding. This is often used as a marketing feature by new home builders, particularly on high ratio second mortgages.

BUYER'S AGENT - Buyer's Agent (also known as "Buyer's Broker" or "Purchaser's Agent")
A person or firm representing the buyer. A Buyer's Agent's primary allegiance is to the buyer. The buyer is the Buyer Agent's client.
A Realtor who acts contractually on behalf of the buyer.
Traditionally, and still in most cases, the Realtor is the Agent of the Sellers and is paid by them out of the proceeds of the sale.
A Buyer's Agency Agreement allows a Realtor (with full disclosure to the sellers or their agent) to negotiate on behalf of the buyer, with no legal conflict of interest.
The seller still pays the Buyer's Agent fees, but this is always spelled out and acknowledged in the Offer to Purchase.

BUYER BROKERAGE AGREEMENT - A written agreement between the buyer and the buyer's agent, outlining the agency relationship between the two parties and the manner in which the buyer's agent will be compensated. In some provinces, a buyer agency relationship evolves automatically, without a written agreement.

Canada Mortgage and Housing Corporation (CMHC) - A federal crown corporation which administers the "National Housing Act" (NHA), and through which all federal housing policies and programs are implemented.

CANCELLATION CLAUSE - A provision, commonly found in industrial or commercial leases, that confers upon one or both of the parties to a lease the right to terminate the lease upon the occurrence of the condition or contingency set forth in the said clause.

CANTILEVER - A projecting beam or overhanging portion supported at one end only.

CAPITAL COST ALLOWANCE (CCA) - Capital assets, though durable, have a limited lifetime and at some point will be replaced. CCA is the maximum rate set, under the Income Tax Act, which the taxpayer can claim for depreciation.

CAPITAL GAIN - The taxable profit derived from the sale of a capital asset.

CAPITAL IMPROVEMENT - Any structure which is erected as a permanent improvement to real property; any improvement which is made to extend the useful life of a property, or to add to the value of the property.

CAPITALIZATION - A mathematical process for converting net income into an indication of value, commonly used in the income approach to appraisal.

CAP RATE (CAPITALIZATION RATE) - The percentage selected for use in the income approach to valuation of improved property. The cap rate is designed to reflect the recapture of the original investment over the economic life of the improvement, to give to the investor an acceptable rate of return (yield) on the original investment, and to provide for the return on borrowed capital.

CASEMENT WINDOWS - Hinged at one side and can open either inwardly or outwardly. Materials may include wood, metal, vinyl, or a combination thereof.

CASH FLOW - The net operating income of a property less its debt service.

CAVEAT EMPTOR - (Let the buyer beware) A long standing legal principle based on the concept the purchaser is buying at his/her own risk. This places a responsibility on the purchaser to inspect and establish the terms for what is being purchased. The seller cannot be held responsible for the quality of a product unless express warranties have been given.

CERTIFICATE OF INSURANCE - Issued by an insurance company or its agent, verifying that a specific insurance policy is in effect for stated amounts and coverages, and sets out the names of those insured.

CERTIFICATION - To attest to something as being certain, the truth or fact.

CERTIFIED CHEQUE - A cheque which the bank guarantees to be good, and against which a stop payment is ineffective.

CERTIFIED PROPERTY MANAGER (CPM) - A professional property manager who has qualified for membership in and is a member of the Institute of Real Estate Management, and is designated a CPM.

CHAIN OF TITLE - The recorded history of matters which affect the title to a specific parcel of real property, such as ownership, encumbrances and liens, usually beginning with the original recorded source of the title.

CHANGE ORDER - An order issued any time there is a change in the specifications, price, or time set forth in the building contract as authorized by the owner, architect, and/or engineer.

CHARGE - An encumbrance on land by way of a mortgage as registered in the Land Titles System.

CHATTEL - Personal property which is tangible and moveable.

CHATTEL MORTGAGE - A mortgage given on moveable possessions (e.g., automobiles, boats, trailers, mobile homes) or personal property (e.g., appliances, televisions, and stereos), that may be removed without injury to the freehold estate.

CLEAR TITLE - Title to property that is free from liens, defects or other encumbrances, except those which the buyer has agreed to accept, such as mortgage to be assumed, the ground lease of record, and the like; established title; title without clouds.

CLIENT - A person who has an agency relationship with a brokerage. The agent owes the client the duties of utmost care, integrity, confidentiality and loyalty.

CLIENT TRUST ACCOUNT - A Trust Account set up by a broker to keep a client's monies segregated from the broker's main Trust Account.

CLOSED MORTGAGE - A mortgage that does not provide for any prepayment of principal during the term.

CLOSING - The final stage of consummating a real estate transaction when the seller delivers title to the buyer, in exchange for the purchase price.

CLOSING COSTS - Expenses of the sale which must be paid in addition to the purchase price (in case of the buyer's expense), or be deduced from the proceeds of the sale (in the case of the seller's expenses).

CLOSING DATE - The date set for the completion of a transaction in an Agreement of Purchase and Sale.

CLOSING STATEMENTS - A detailed cash accounting of a real estate transaction prepared by a lawyer or other person designated to process the mechanics of the sale, showing all cash that was received, all charges and credits which were made, and all cash that was paid out in the transaction; also called a settlement statement.

CLOUD ON TITLE - Any document, claim, unreleased lien or encumbrance which many impair or injure the title to property or make the title doubtful because of its apparent or possible validity.

CLUSTER DEVELOPMENT - The grouping of housing units on less than normal size home sites, with remaining land being devoted to common areas.

CODE OF ETHICS - A written system of standards of ethical conduct.

COLLAR TIES - Laterally placed wood members that are installed between opposing rafters approximately halfway up to the attic space.

COLLATERAL - Something of value given or pledged as security for a debt or obligation. The collateral for a real estate mortgage loan is the mortgaged property itself, which has been hypothecated.

COLLATERAL MORTGAGE - A loan backed by a promissory note and then further secured by means of a mortgage on real property.

COLLATERAL SECURITY - An additional form of security, pledged to reduce the risk to a mortgagee, which can be used to recover all or part of the debt.

COMMISSION (FEE) - Remuneration paid to a Brokerage on the sale or lease of property, usually as a percentage of the sale amount involved, but is sometimes a fixed amount.

COMMITMENT LETTER - A written commitment from a lender to lend mortgage funds to specific borrowers as long as certain conditions are met within a specified time period before closing.
A key component of the commitment, particularly in a period of volatile interest rates, is the "rate hold", where a lender may "cap" a rate for a defined period, such as 60 days or 90 days.
Commitments on financing for new homes, which usually have longer closing dates, can be negotiated between the lender and the builder and be held for as long as 6 months, and even a year.

COMMON EXPENSES - The costs of operating, managing, maintaining, and repairing a condominium's common elements and administering the Condominium Corporation.

COMMON LAW - That part of the law, formulated, developed and administered by the common law courts, mostly unwritten and founded originally on common customs.

COMPENSATION - Payment or reward for performance of service.

Competence - A degree of care and skill that might be expected from an average person in that trade or profession.

COMPETITION ACT - (formerly known as the Combines Investigation Act) is a federal statute addressing many forms of competition.

COMPOUND INTEREST - Interest charged on the initial principal for monies borrowed, and also on interest amounts accrued from previous periods, and are charged at specified intervals (e.g., monthly, daily, quarterly).

CONCURRENT OWNERSHIP - When two or more persons have a right of ownership at the same time.

CONDITION PRECEDENT - A condition in a contract, which calls for the happening of some event, or performance of some act, before the offer becomes binding on the parties.

CONDITION SUBSEQUENT - A condition in a contract referring to a future event upon the happening of which the Agreement becomes no longer binding on the parties.

CONDITIONAL SALES CONTRACT - A contract, usually involving the sale of goods, in which the property remains in the seller's name until all installments set out in the contract have been paid by the buyer.

CONDOMINIUM - Enables a person to share in the ownership and operation of a housing development while having negotiable title to his/her own unit.

CONDOMINIUM CORPORATION - A governing body, without share capital, arising from the registration of a declaration and description for a condominium, (whose members are the owners) to manage the property and assets of the corporation.

CONSIDERATION - Something of value given or promised to make an agreement legally binding.

CONTRACT - A legally binding agreement between two or more capable persons for consideration or value.

CONVECTION SYSTEM - A system in which heat is transferred through circulatory motion of air that occurs when the temperature varies. (hot water or steam radiator is one such system)

CONVENTIONAL MORTGAGE - A first mortgage granted by an institutional lender wherein the amount of the loan does not exceed 75 % of the appraised lending value of the property.

CONVEYANCE - The transfer of an interest in property from one individual to another.

COOPERATIVE - Provide affordable housing while permitting resident members the opportunity to have a say in the upkeep and management of their residence. The underlying premise of cooperatives is open, voluntary membership where members accept responsibilities of membership in return for the coop's services.

CORPORATION - A form of business organization created by statute law which is legally considered as a separate entity.

COST APPROACH - Based on the proposition that an informed purchaser would pay no more than the cost of producing a substitute property with the same utility as the subject property.

COUNTER-OFFER - An offer by a seller to sell the property, open for an acceptance for a specified period of time, and offered to particular purchasers.

COVENANT - An agreement contained in a deed, which creates a legal obligation.

CPM (CERTIFIED PROPERTY MANAGER) - Designation awarded by the Real Estate Institute of Canada to individuals involved in the management of residential, commercial or industrial properties.

CRA (CANADIAN RESIDENTIAL APPRAISER) - Designation awarded by the Appraisal Institute of Canada. The CRA denotes members who are qualified in the appraisal and valuation of individual, undeveloped residential dwelling sites and dwellings containing not more than four self-contained housing units.

CRB (CERTIFIED REAL ESTATE BROKER MANAGER) - Designation awarded by the Real Estate Brokers Managers Council of the National Association of Realtors.

CREDIT BUREAU - A central clearinghouse for all types of credit related information.

CRES (CERTIFIED REAL ESTATE SPECIALIST) - Designation awarded by the Real Estate Institute of Canada to persons involved in the sale of residential real estate.

CROWN PATENT - An original title deeded by the government.

CRS (CERTIFIED RESIDENTIAL SPECIALIST) - Awarded by the Residential Sales Council of the National Association of Realtors (US).

CUSTOMER - A person who receives services from a brokerage, but who does not have an agency relationship with the brokerage.

DAMAGES - Compensation or indemnity for loss owing to breach of contract, or a tort (civil wrong).

DAMP PROOFING - Usually involves the coating of exterior foundation walls with a one-quarter inch layer of mortar or tar, which ideally extends down to the footing. The foundation/footing joint is also covered to improve the seal and direct the water into the drainage tile.

DAMPER - A valve or plate operated mechanically or manually to regulate airflow to or from any prescribed point.

DEBT RATIO - One of several commonly used financial ratios using data found on the balance sheet, profit and loss statement, or a combination of the two.

DECLARATION - The constitution of a condominium corporation which creates the condominium and defines the responsibilities of the owners and the corporation.

DEED - A legal document, duly executed and delivered, that conveys title or an interest in real property.

DEED RESTRICTION - An imposed restriction in a deed to limit the use of the land.

DEFAULT - Failure to fulfill a promise or obligation.

DEFERRED MAINTENANCE - Ordinary maintenance that is not performed and negatively affects a property's use and value.

DELEGATION OF DUTIES - The authorization given by one party to another to carry out the specific responsibilities that party has undertaken on behalf of a client.

DEMAND LOAN/LINE OF CREDIT - An arrangement between the business customer and a financial institution respecting the maximum amount of credit allowed that business.

DEMISED PREMISES - Premises, or parts of real estate, in which an interest or estate has been transferred temporarily, such as an interest in real property conveyed in a lease.

DENSITY - References the maximum allowable usage for a given parcel of land e.g., number of people, amount of residential units, or square footage .

DEPOSIT - Payment of money or other valuable consideration as a pledge for fulfillment of a contract.

DEPRECIATION - Any decline in the value of a physical asset, usually resulting from physical (ordinary wear and tear) deterioration and functional/ locational obsolescence.

DESCRIPTION, LEGAL - A legal identification of land or premises.

DEVELOPER - One who engages in the subdivision or improvement of land.

DIFFUSER - A device for reducing the velocity of air flow from a mechanical duct system supplying air within a structure. Its shape is usually circular or square and is set in the ceiling at predetermined locations to diffuse air within a defined space. Diffusers, in residential property, are the small rectangular grates normally located at floor level.

DISBURSEMENTS - The term disbursement, for real estate purposes, normally refers to those items requiring apportionment as of the date of closing. Such disbursements include any rents, mortgage interest, realty taxes, local improvement rates, unmetered public or private utility charges, and unmetered cost of fuel. Such disbursements are apportioned and allowed to the day of completion, the day of completion itself to be charged to the purchaser.

DISCLAIMER - The repudiation or denial of a claim.

DISCLOSURE - The open and forthright discussion of relevant matters by an agent to his/her principal.

DISCOUNTING - The process of purchasing the face or remaining value of a mortgage at a lower cost to increase yield.

DISTRAIN (DISTRESS) - Right of the mortgagee or landlord to seize and suction chattels, after due notice of a public auction, in settlement of the mortgagor's or tenant's debt.

DISTRIBUTION PANEL - An electrical panel providing the interface between the service entrance wires to a structure and dispersing of power throughout that structure.

DOMINANT TENEMENT - The estate (i.e., property) which derives benefit from an easement over a servient tenement, as in right-of-way.

DOUBLE-UP - This feature (not offered by all lenders) allows you to double up your mortgage payments anytime without penalty.
This feature is often associated with the ability to "skip" an equivalent number of payments.
This can be used either to accelerate the pay-off of a mortgage (as it is an enhanced prepayment privilege) or to manage a volatile cash flow. For example, commission-based individuals such as Realtors could "double-up" with each commission cheque, and "skip" during low cash flow periods.

DOUBLE HUNG WINDOW - Made up of two movable parts, an outer part in the top half of the opening and an inner part on the bottom half of the opening. They move up and down on their guides.

DOWER - To give a widow a life interest in one-third of her husband's real estate. To convey clear title, a wife would have to release her interest or bar her dower rights if the husband was an owner and wished to sell or mortgage the property.

DOWN PAYMENT - The amount of cash paid towards the purchase transaction by the buyer of a home. This is also known as the purchaser's initial "equity" in the property.

DUAL AGENCY - Representation of two principals (usually seller and buyer) by the same agent in the same transaction.

DUPLEX - A two-family dwelling or house have two self-contained residential units. There is only one deed for the ownership of both units.

DURESS - The threat of violence, force or undue pressure to coerce a person into an action against his/her will.

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