Real estate glossary of terms Australia

A
ABA	(Australian Bankers’ Association)
acceptance	to agree to the terms of an offer or contract.
accrued	interest you have earned or incurred that is yet to be paid or charged.
adjustments	the process of allocating expenses (Council, electricity, phone, water rates) on settlement day that the seller has paid for but not used, and which the buyer has not used but will be billed for.
agent	person or body authorised to act on behalf of a client in the sale, purchase or management of property.
allotment	a block of land created out of a larger area.
amortisation period	the period of time one has to repay a loan at the arranged terms.
application fees	fees charged to cover or partially cover the lender’s internal costs of setting up a loan approval for a home buyer.
appraised value	estimate of the value of a property being used as security for a loan.
appreciation	an increase in value, for reasons such as heavy demand, of an asset, such as an exisiting property or a block of land.
annual percentage rate	(APR) the annual effective rate of the mortgage which is made up of the interest rate, fees and charges that incur during the contract period.
arrears	an overdue account yet to be paid.
assets	money, property or goods owned.
at call	a bank account from which money can be withdrawn immediately.
ATM	(Automatic Teller Machine)
auction	public sale of property with ownership going to the highest bidder, subject to a reserve price being reached.
B
BAD	(Bank Account Debits tax) State or Territory government tax (except ACT) on withdrawals from accounts on which a cheque may be drawn.
bad debt	a debt with little chance of being recovered and written off as a loss.
balance sheet	a statement of assets, liabilities and net equity for an enterprise at a point of time.
balloon payment	a large loan repayment to clear a debt.
bank cheque	a cheque that draws money specifically from funds you own held in a bank.
banker’s opinion	enquiries made from one bank to another to check on a customer’s reliability or credit worthiness.
bankruptcy	when a debtor has his/her estate placed into the hands of a receiver who has the responsibility for its distribution.
bearer	person presenting a cheque to a bank.
bill of sale	a written agreement whereby ownership is transferred but the original owner is allowed to retain possession.
body corporate	a corporation of the owners of units within a strata building. They form a self-elected council for the management of the building and common areas.
bond	money, paid by a tenant, held as "insurance’ against that tenant damaging a property, or not paying the rent.
boundary	the "fence", real or on paper only, which separates two adjoining properties
bridging finance	a short-term loan that covers a financial gap between the purchase of a new property and the sale of an old property.
building regulations	the standards formulated by local councils to control the quality of buildings.
C
capital	the current value of your long-term assets - house, property or business.
capital gain	the monetary gain obtained when you sell an asset for more than you paid for it.
Capital gains tax	a Federal tax on the monetary gain made on the sale of an asset bought and sold after September 1985.
capped loan	a loan where the interest rate is not allowed to exceed a set level for a period of time, but unlike fixed rate loans, is allowed to drop.
caveat	the Latin for ‘beware’. Usually it is in the form of a contract clause that stipulates a particular requirement.
Caveat emptor	Latin for ‘let the buyer beware’, or in Australian ‘you pays your money and you takes your chances’....
Certificate of Title	this document details the land dimensions and ownership details, and whether there are any encumbrances on it.
chattels	chattels are personal property. There are two types. Real chattels are buildings and fixtures. Personal chattels are clothes and furniture.
cluster housing	group of houses that share common space.
cooling off	the period of time after contracts have been exchanged during which a contract may be cancelled. Usually five working days.
commission	a fee payable to the real estate agent, by the vendor, for the sale of property.
Common Law Title	see Old System Title
common property	an area used by many, not an individual. Owned by the tenants in common.
Community Title	this form of title gives a purchaser shared ownership of common facilities as well as Torrens Title over a specific lot.
company title	a property title that applies when owners of units in a block form a company.
comparison rate	a nominal rate per annum together with the compounding frequency as outlined in the Consumer Credit Code.
compound interest	interest that is paid on both the accumulated interest as well as on the original principal.
Consumer Credit Code	an act of Parliament governing the relationship between borrowers and lenders.
contract of sale	a written agreement outlining the terms and conditions for the purchase or sale of property.
conveyancing	the legal process for the transferral of ownership of real estate.
countersigned	additional signature or signatures to guarantee the validity of a document.
covenant	terms and conditions that specify the usage of a block of land or the buildings on it.
cover note	a note of temporary property insurance before the implementation of a formal policy.
CRAA	(Credit Reference Association of Australia) the body which holds credit details on all of us!
credit	borrowed money to be paid back under an arrangement with a lender. Also, a sum of money paid into an account.
credit limit	maximum amount the borrower can use at any one time.
creditor	a party to whom money is owed.
crossed cheque	a cheque with two parallel vertical lines across it to specify that the cheque must be paid into an account and cannot be cashed.
D
daily interest	interest calculated on a daily basis - therefore varies according to daily account balance.
debit	an account entry to charge a withdrawal to a specified account.
debtor	someone who owes money to someone else.
deed	a legal document that states an agreement or obligation regarding a property.
default	failure to meet debt payment on a due date.
deposit	the amount paid by a buyer when contracts are exchanged. It is usually ten per cent of the agreed selling price.
E
early termination payment	the cost of winding up a loan early.
easement	a right to use a corridor or passage of land which is owned by another.
EFT	(Electronic Funds Transfer) electronic transfer of funds from one account to another.
encumbrance	an outstanding liability or charge on a property.
endorse	to sign the back of a cheque to confirm or transfer its ownership to someone else.
equity	the amount of an asset actually owned.
equity loan	a loan usually secured by the proportion of the value of your house which you own.
equity mortgage	a loan secured by the part of the value of an asset (usually house) which you own.
ERIC	(Effective Rate of Interest plus Costs)