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Real Estate Glossary and Terms

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Realty Terms beginning with C

Capital Gains
The profit made by the seller when real estate or other capital assets are sold. Capital gains are taxed more favourably than earned income. However, this can be dependent on your tax bracket and the length of time you owned the asset before it was sold. You could pay approximately one-third to one-half less tax than you would pay on the same amount of earned salary. See also "Capital Asset."

Capital Gains Tax
A tax on the profits from the sale of real estate or investments.

Caveat
A charge or instrument placed on land title. A caveat is also a formal notice filed with a court or officer to suspend a proceeding until the person who filed the caveat is given a hearing.

Certificate of Sale
After legal confirmation, an affidavit is issued at a judicial or tax sale to the buyer of a property. The buyer is then entitled to the deed of the property.

Certificate of Title
A written document which validates the title to a property. This means the property is legally vested in the present owner.

Chain of Title
Legal records that track the ownership of a property from the most recent owner to the original owner.

Change Frequency
The scheduled time period in which an adjustable-rate mortgage changes.

Chattel
Articles of personal property such as household goods, furnishings, and fixtures that are not permanently affixed to the house. Chattel MortgageA loan that is certified by movable personal property such as a mobile or trailer home.

Classified Property Tax
A municipal government's levy on real estate that varies depending on the use of the property. Commercial property is typically taxed more heavily than residential property where a classified property tax exists.

Clear Title
A title that is not burdened by liens or legal questions is considered to be clear.

Closed Mortgage
The restriction or denial of repayment rights until the end of the mortgage term.

Closely Held
Schedule II banks may be closely held meaning that one party or owner can hold more than 10% of the outstanding shares. Schedule I banks are prohibited from this type of ownership. CLOSING
The meeting (usually in a lawyer's office) at which the transfer of title of property passes from the seller to the buyer.

Closing Costs
Closing costs are charges that are attached to the closing ceremony. These one-time fees include charges for title search and insurance, attorney's fee, lender and/or broker fee(s).

C.M.H.C.
Canada Mortgage and Housing Corporation, a Crown Corporation which administers the National Housing Act. C.M.H.C. INSURANCE If your down payment is less than 25% , you must have mortgage insurance. It insures the lender against the possibility of you defaulting on your mortgage. Canada Mortgage and Housing Corporation is the principal source of mortgage insurance. G.E. Capital also provides mortgage insurance to many of Canada's financial institutions.

Co-maker
An individual who co-signs a promissory note. In doing so, the co-maker is responsible for the loan if any of the other co-signers back out or renege on their promise to repay the loan.

Co-signer
An individual who signs a promissory note in conjunction with one or more additional parties. All parties are responsible for the debt repayment once the papers are signed. This means that any one party could be responsible for repaying the entire debt if any of the other parties back out or renege on the repayment.

Commitment Letter
A letter outlining the amount, terms and conditions under which a lender is willing to offer a mortgage.

Common Area Assessment
A levy against individual unit owners in a condominium or planned unit development to pay for upkeep, repairs, and improvements to the property's common areas, such as hallways, elevators, parkades, swimming pools, and gym facilities.

Common Areas
Lands or improvements on land that are designated for common use and enjoyment by all occupants, tenants or owners. The lobby, a pool, tennis court or common hallways would all be Common Areas in a condominium or townhouse complex.

Common-interest Development
A housing area where the owners belong to a homeowner's association that owns and maintains all common areas.

Comparative Market Analysis
An approach for estimating the value of a property by comparing the sales prices of similar properties that have recently sold.

Condominium (Condo)
A structure containing two or more housing units. The interior space of each unit is individually owned while the remaining property (land, building, and other amenities) is owned in common by all the owners of the individual units.

Condominium Conversion
When an existing building such as a rental project changes to the condominium form of ownership.

Contiguous Lots
Parcels or pieces of property that are located next to each other.

Contingency
A condition that must be met before a property sale can be completed, such as a home inspection or mortgage approval.

Contract
An agreement between two or more parties, especially one that is written and enforceable by law. 2. In real estate parlance, the contract is the legal document by which buyer and seller make offers and counteroffers for a piece of property. The real estate contract describes the property, includes or excludes items in the property, names the price, apportions the closing costs between the parties and sets forth a closing date. When buyer and seller agree on terms and sign the same document, the property is said to be "under contract." More formally known as agreement for sale, purchase agreement or earnest money contract.

Contract for Deed
An agreement for the sale of property where the buyer takes possession while making payments, but the seller holds title until full payment is received. Also called a land contract.

Contract to Purchase
A document used by a property buyer and seller to approve the price and other terms of the transfer of title. Also known as an agreement of sale, a purchase contract, or a sale contract.

Contractual Lien
A legal claim against property as a result of a voluntary contract, such as a mortgage.

Conventional Mortgage
A first mortgage granted by an institutional lender such as a bank or trust company, where the amount of the loan does not exceed 75% of the lending value of the property.

Convertible ARM
An adjustable rate mortgage (ARM) that can be converted to a fixed-rate mortgage under certain conditions.

Convertable Mortgage
A short term mortgage, usually 6 months or 1 year, that allows a borrower to lock in to a longer term at any time without penalty.

Conveyance
Transfer of ownership of real estate property from one individual to another.

Conveyance Tax
A tax placed on the transfer of property in a real estate transaction.

Cooperative Mortgage
A mortgage loan that enables the borrower to buy shares of a co-op.

Cooperative or Co-op
A type of ownership where a corporation owns property (usually an apartment building) and the occupants own shares in the corporation equal to their portion of the building.

Corrective Work
Repairs (or maintenance) that are requested by a buyer that must be completed before closing the sale.

Counteroffer
A step in the negotiation process where a seller rejects a purchase offer from a buyer, but then submits another offer with different terms (such as price or closing date) for the buyer to consider.

Creative Financing
An innovative or unusual way of structuring a mortgage loan to allow the buyer to purchase the property.

Credit Bureau Report

A report by a credit reporting agency that maintains a history of timely, or untimely, repayment of debt. The lender's primary source of information regarding the credit history of a borrower

Credit History
A record of an individual's or company's past borrowing patterns and whether or not debts were repaid on time.

Credit Rating
A judgment of a person's ability to repay debts. The rating is often based on a person's current and projected income and past debt payment history. Also called a credit score.

Credit Report
A report on past behavior regarding a borrower's willingness and ability to repay debt in a timely manner. This report is provided to the bank by an outside agency.

Credit Score
A number, roughly between 300 and 800, that reflects a person's credit history. Lenders calculate this number using a computer systems as part of the process for assigning rates and terms to the loans they grant.

Cul-de-sac
A dead-end street, often with a broad circle at the end.

Curable Defect
A problem with a property that can be fixed. Peeling paint is a curable defect whereas being located in a crime-ridden neighborhood is not.

Curb Appeal
The look or appeal of a house when viewed from the street or sidewalk.