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Welcome > Resources > Real Estate Dictionary - A
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Majority |
The age at which an individual is legally
entitled to handle his or her own affairs |
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Margin |
The amount added to the index on an
adjustable-rate mortgage (ARM) that establishes the adjusted interest rate at a
given time |
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Market value, or Fair market
value |
The most likely price that a piece of property
or home can realistically be sold for, and is dependent on the selling price of
similar real estate in the area |
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Marketable title |
A clear, unencumbered title, reasonably
acceptable without the threat of the risk of litigation |
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Maturity |
The date on which the principal balance of a
loan, bond, or other financial commitment is due and payable |
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Mechanic's lien |
A lien created by statute to allow unpaid
contractors, laborers or suppliers who have performed work on or furnished
materials for the construction of a building to recover the value of their
work |
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Metes and Bounds |
Means for describing property by a set of
directions and distances, when there isn't identification based on a surveyed
lot number |
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Minor |
An individual below the age at which he or she
is legally entitled to handle his or her own affairs |
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Monument of Survey |
le indications made on natural or man-made
objects that indicate the boundaries of a survey |
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Mortgage |
A legal document that pledges a property to the
lender as security for the payment of a loan or debt |
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Mortgage broker |
An individual or company that acts as an agent
between borrowers and lenders for the purpose of arranging and negotiating
mortgage contracts; who is paid a fee for such service |
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Mortgage insurance |
A contract that guarantees the lender against
loss caused by a mortgagor's default on a government or conventional mortgage;
such insurance can be issued by a private company or by a government agency,
and covers either only a percentage, or the total, of the mortgage
loan |
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Mortgagee |
The lender in a mortgage
transaction |
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Mortgagor |
The borrower in a mortgage
transaction |
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Multiple-listing service
(MLS) |
An organization of brokers who share their
listing agreements with one another in order to find buyers for their
properties more effectively than they could individually |
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First Time Buyers >Your Principal Residence
The Federal Tax Code allows married taxpayers to exclude from capital gains taxes up to $500,000 in profits from selling a home (singles can exclude $250,000). In order to qualify for this exemption, you must prove that that the home has been your principal residence for at least two out of the last five years. The establishment of the home as a principal residence depends on the facts of each homeowner's circumstance. Here are two cases to consider.
Homeowner A has lived at 25 Pine Drive for 12 years. Although he stays at his vacation cottage in another town for up to three months out of each year (sometimes more), 25 Pine Drive is his principal residence, where he lives most of the time. When he sells the home, Homeowner A (filing as a single individual) can keep up to $250,000 in tax-free profit.
Homeowner B buys 108 Maple Street, intending to live there. He rents it out while waiting to sell his current home, where he has lived for six years. His principal residence sells at the end of two years. Homeowner B moves into his new house, lives there for three months, and then decides to travel. After a six-month trip, he regrets buying 108 Maple Street and sells it. Even though he has owned the house on Maple Street for over two years, it won't qualify as "owner-occupied", because he only lived in it for a few months. Thus Homeowner B is not eligible to claim the tax exemption when he sells the house on Maple Street.
Consult your tax advisor for advice about your particular circumstance.
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| Q |
What 70-room East Coast mansion was built as a summer home and is known as a "Gilded Age cottage"?
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| A |
Cornelius Vanderbilt's "Breakers" Mansion in Newport, Rhode Island, named for the waves crashing along the cliff that separates the property from the ocean. |
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