CANTILEVER - A projecting beam or overhanging portion supported at one end only.
CAPITAL GAIN - The taxable profit derived from the sale of a capital asset.
CAPITAL IMPROVEMENT - Any structure which is erected as a permanent improvement to real property; any improvement which is made to extend the useful life of a property, or to add to the value of the property. CAPITALIZATION - A mathematical process for converting net income into an indication of value, commonly used in the income approach to appraisal.
CAP RATE (CAPITALIZATION RATE) - The percentage selected for use in the income approach to valuation of improved property. The cap rate is designed to reflect the recapture of the original investment over the economic life of the improvement, to give the investor an acceptable rate of return (yield) on the original investment, and to provide for the return on borrowed capital.
CERTIFICATE OF REASONABLE VALUE (CRV) - A certificate issued by the Veterans Administration setting forth a property's current market value estimate, based upon a VA approved appraisal.
CERTIFIED CHECK - A check which the bank guarantees to be good, and against which a stop payment is ineffective.
CERTIFIED PROPERTY MANAGER - A professional property manager who has qualified for membership in and is a member of the Institute of Real Estate Management, and is designated a CPM.
CHAIN OF TITLE - The recorded history of matters which affect the title to a specific parcel of real property, such as ownership, encumbrances and liens, usually beginning with the original recorded source of the title.
CHATTEL - Personal property which is tangible and moveable.
CLEAR TITLE - Title to property that is free from liens, defects or other encumbrances, except those which the buyer has agreed to accept, such as mortgage to be assumed, the ground lease of record, and the like; established title; title without clouds.
CLIENT TRUST ACCOUNT - An account set up by a broker to keep client's monies segregated from the broker's general funds.
CLOSING - The final stage of consummating a real estate transaction when the seller delivers title to the buyer, in exchange for the purchase price.
CLOSING COSTS - Expenses of the sale which must be paid in addition to the purchase price (in the case of the buyer's expenses), or be deducted from the proceeds of the sale (in the case of the seller's expenses). CLOSING STATEMENT - A detailed cash accounting of a real estate transaction prepared by an escrow officer or other person designated to process the mechanics of the sale, showing all cash that was received, all charges and credits which were made, and all cash that was paid out in the transaction; also called a settlement statement.
CLOUD ON TITLE - Any document, claim, unreleased lien or encumbrance which many impair or injure the title to property or make the title doubtful because of its apparent or possible validity.
CLUSTER DEVELOPMENT - The grouping of housing units on less than normal size homesites, with the remaining land being devoted to common areas.
CODE OF ETHICS - A written system of standards of ethical conduct. The Code of Ethics of the National Association of Realtors, first written in 1913, establishes the high standards of conduct for members of the Realtor community.
COLLATERAL - Something of value given or pledged as security for a debt or obligation. The collateral for a real estate mortgage loan is the mortgaged property itself, which has been hypothecated.
COLOR OF TITLE - A condition which has the appearance of good title, but which in fact is not valid title, as where title is founded on some written document which on its face appears valid and effective, but which is actually invalid.
COMMERCIAL PROPERTY - A classification of real estate which includes income producing property such as office buildings, gasoline stations, restaurants, shopping centers, hotels and motels, parking lots and stores, and other similar uses.
COMMINGLING - To mingle or mix; for example, to deposit client funds in the broker's personal or general account. A licensee found guilty of commingling can have the license suspended or revoked by the Real Estate Commission.