Business / Real Estate Glossary

Controlled Business Arrangements: As defined under the Real Estate Settlement Procedures Act (RESPA), an arrangement or combination in which an individual or a firm has more than a 1 percent interest in a company to which th . . . View Full Definition

Conventional Life Estate: A conventional life estate is created intentionally by the owner. It may be established either by deed at the time the ownership is transferred during the owners life or by a provision of th . . . View Full Definition

Conventional Loan: A loan made with real estate as security and not involving government participation in the form of insuring (FHA) or guaranteeing (VA) the loan. The mortgagee can be an institutional lender . . . View Full Definition

Conversion: The appropriation of property belonging to another. The conversion may be illegal (as when a broker misappropriates client funds), or it may be legal (as when the government condemns propert . . . View Full Definition

Converted-Use Properties: Factories, warehouses, office buildings, hotels, schools, churches and other structures that have been converted to residential use. Developers often find renovation of such properties more . . . View Full Definition

Convertible Loan: An adjustable-rate loan that the borrower can convert to fixed-rate at any time during the life of the loan.

Conveyance: A term used to refer to any document that transfers title to real property. The term is also used in describing the act of transferring.

Cooperating Broker: A broker who assists another broker in the sale of real property. Usually the cooperating broker is the selling broker who found a buyer for the listing broker.

Cooperating Broker Fee Agreement: An agreement between brokers specifying the commission split should the cooperating broker sell a property listed by the listing broker.

Cooperative: A residential multiunit building whose title is held by a trust or corporation that is owned by and operated for the benefit of persons living within the building, who are the beneficial own . . . View Full Definition

Coping: 1. The tile around the outer edge of a swimming pool at the water line. 2. The flat portion at the top of a parapet wall rising above the roof line of a building.

Corporation: An entity or organization, created by operation of law, whose rights of doing business are essentially the same as those of an individual. The entity has continuous existence until it is dis . . . View Full Definition

Corporation Franchise Tax Lien: State governments generally levy a corporation franchise tax on corporations as a condition of allowing them to do business in the state. Such a tax is a general statutory involuntary lien o . . . View Full Definition

Correction Lines: Provisions in the rectangular survey (government survey) system made to compensate for the curvature of the earths surface. Every fourth township line (at 24-mile intervals) is used as a cor . . . View Full Definition

Correlative Water Rights: A modern law in some states that holds that a riparian owner who has rights in a common water source is entitled to take only a reasonable amount of the total supply for the beneficial use o . . . View Full Definition

Correspondent: A mortgage banker.

Corrosion: The dissolving and wearing away of metal caused by a chemical reaction such as between water and the lead pipes or solder in a homes plumbing.

Corrosive: A substance that eats or wears away materials gradually by chemical action.

Cosigners: Additional signers of a financial agreement that add their personal guarantees to that of the borrower.

Cost Approach: The process of estimating the value of a property by adding to the estimated land value. The appraisers estimate of the reproduction or replacement cost of the building, less depreciation.

Cost Basis: A cost basis of real property is usually based on the purchase price of the property plus the buyers capitalized closing costs.

Cost Recovery: An Internal Revenue Service term for depreciation.

Cost-Plus: A method of paying construction contractors when the contractor is paid the actual costs of the job plus a percentage for profit.

Counteroffer: A new offer made in response to an offer received. It has the effect of rejecting the original offer, which cannot be accepted thereafter, unless revived by the offeror.

Covenant: A written agreement between two or more parties in which a party or parties pledge to perform or not perform specified acts with regard to property, usually found in such real estate documen . . . View Full Definition

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