Business / Real Estate Glossary

Commingling: The illegal act of mixing deposits or monies belonging to a client (trust funds) with ones personal money. By law brokers are required to maintain a separate trust or escrow account for othe . . . View Full Definition

Commission: Payment to a broker for services rendered, such as in the sale or purchase of real property, usually a percentage of the selling price of the property.

Commitment: 1. A pledge to do a certain act, such as a promise by a lender to loan a certain amount of money at a specific rate of interest to a qualified borrower, provided the loan is made by a certai . . . View Full Definition

Common Areas: Land or improvements in a condominium development designated for the use and benefit of all residents, property owners and tenants. Common areas frequently include such amenities as corridor . . . View Full Definition

Common Elements: Parts of a property that are necessary or convenient to the existence, maintenance and safety of a condominium or are normally in common use by all of the condominium residents. Each condomi . . . View Full Definition

Common Interest: The percentage of undivided ownership in the common elements belonging to each condominium apartment, as established in the condominium declaration.

Common Interest Subdivision: A subdivision in which the owners own or lease a separate lot or unit together with an undivided interest in the common areas of the subdivision.

Common Law: The body of law based on custom, usage and court decisions.

Community Property: A system of property ownership based on the theory that each spouse has an equal interest in the property acquired by the efforts of either spouse during marriage. This system stemmed from g . . . View Full Definition

Community Reinvestment Act Of 1977 (CRA): Community reinvestment refers to the responsibility of financial institutions to help meet their communities needs for low- and moderate-income housing. In 1977, Congress passed the Communit . . . View Full Definition

Company Dollar: The term company dollar is the amount left over after all commissions have been paid out.

Comparables: Properties that are substantially equivalent to the subject property.

Comparative Market Analysis (CMA): This is a term often used by real estate brokers in preparing a report for prospective sellers and buyers, indicating market trends in various neighborhoods, based on computer statistics gen . . . View Full Definition

Compensating Factors: Positive factors in an individuals credit history which offset negative factors. Compensating factors increase the possiblity that a borrowers loan application will be approved.

Compensation: The source of compensation does not determine agency. An agent does not necessarily represent the person who pays his or her commission. In fact, agency can exist even if no fee is involved . . . View Full Definition

Compensatory Damages: Monetary damages paid to compensate an injured party for a loss.

Competition: The appraisal principle that states that excess profits generate competition.

Completion Bond: A surety bond posted by a landowner or developer that guarantees a proposed development will be completed according to specifications and free of mechanics liens.

Compound Interest: Interest computed on the principal sum plus accrued interest. At the beginning of the new interest period, all interest is added to the principal, forming a new principal figure on which int . . . View Full Definition

Comprehensive Environmental Response, Compensation And Liability Act (CERCLA): A federal law administered by the Environmental Protection Agency that establishes a process for identifying parties responsible for creating hazardous waste sites, forcing liable parties to . . . View Full Definition

Comprehensive Zoning: A broad zoning plan over a large area.

Computerized Loan Origination (CLO) System: An electronic network for handling loan applications through remote computer terminals linked to various lenders computers.

Concession: Discount given to prospective tenants by landlords to induce them to sign a lease. Concessions are frequently encountered in commercial leases, where landlords may give the first two months . . . View Full Definition

Concurrent Ownership: Ownership by two or more persons at the same time, such as joint tenants, tenants by the entirety, tenants in common or community property owners.

Concurrent Performance: Occurring simultaneously, real estate exchanges often must be recorded concurrently.

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