California License Real Estate Terms Glossary

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SAFETY CLAUSE

In a listing agreement, a provision that if anyone found by the broker during his listing period purchases the property within a specified time after the expiration of the listing, the broker receives his full commission.

SALE-LEASEBACK

A situation in which the owner of a piece of property sells it and retains occupancy be leasing it from the buyer.

SALES CONTRACT

A contract between buyer and seller setting out the terms of sale.

SALESPERSON

An individual licensed to sell property, but who must at all times be under the supervision and direction of a broker.

SANDWICH LEASE

A leasehold interest that lies between the primary lease and the operating lease. Example: A leases to B; B subleases to C; C subleases to D. C's lease is a sandwich lease.

SASH

A wood or metal frame containing one or more windowpanes.

SATISFACTION

Discharge of a mortgage or deed of trust lien from the records upon payment of the secured debt. Dischange of an obligation or indebtedness by paying what is due.

SAVINGS ACCOUNT

An investor should not place money in a savings account if he wants to have financial freedom.

SEAL

An impression mark or stamp made to attest to the execution of an instrument.

SECONDARY FINANCING

A loan secured by a second mortgage or a second deed of trust.

SECONDARY MONEY MARKET

Where loans are purchased and sold.

SECTION

A square mile of land, as established by government survey, containing 640 acres.

SECURED DEBT

An obligation that includes property held as security for the payment of that debt; upon default, the property may be sold to satisfy the debt.

SECURED PARTY

The party having the security interest in personal property. The mortgagee, conditional seller, or pledgee is referred to as the secured party.

SECURITY AGREEMENT

An agreement between the secured party and the debtor that creates a?security interest in personal property. It replaced such terms as chattel mortgage, pledge, trust receipt, chattel trust, equipment trust, conditional sale, and inventory lien.

SECURITY DEPOSIT

A deposit made to assure performance of an obligation, usually by a tenant. A sum of cash given as collateral to ensure faithful performance of specified obligations.

SECURITY INTEREST

A term designating the interest of a secured creditor in the personal property of the debtor.

SEIZIN

The possession of land under a claim of freehold.

SENIOR LIEN

A lien that is superior to or has priority over another lien. Also, the first deed of trust or lein on a property.

SEPARATE PROPERTY

Property that is owned by a husband or wife and that is not community property. It is property acquired by either spouse prior to marriage or by gift or inheritance after marriage; also, in California, it is the income from separate property after marriage. Property held by a married person that is not community property; it includes property owned before marriage and property acquired after marriage by gift or inheritance.

SEPTIC TANK

An underground tank in which sewage from the house is reduced to liquid by bacterial action and drained off.

SERVIENT ESTATE

That parcel of property which is burdened by and encumbered with an easement.

SERVIENT TENEMENT

An estate burdened by an easement.

SET-BACK ORDINANCE

An ordinance prohibiting the erection of a building or structure between the curb and the set-back line. (see Building Line)

SEVERALTY

Sole ownership of property. Ownership by one person.

SEVERALTY OWNERSHIP

Ownership by only one person; sole ownership.

SHAKE

A hand-split shingle, usually edge-grained.

SHEATHING

Structural covering, such as boards, plywood, or wallboard, placed over the exterior studding or rafters of a house.

SHERIFF'S DEED

A deed given by court order in connection with the sale of property to satisfy a judgement.

SILL

The board or piece of metal forming the lower side of an opening, such as a door sill or window sill.

SINKING FUND

1. A fund set aside from the income from property that, with accrued interest, will eventually pay for replacement of the improvements.
2. A similar fund set aside to pay a debt.

SMALL CLAIMS COURT

A branch of the Municipal Court. The rules of this court forbid parties to be assisted by attorneys, dispense with most formal rules of evidence, and have all trials heard by judges. The monetary limit of cases before the court is $1,500.

SOIL PIPE

Pipe carrying waste from the house to the main sewer line.

SOLD TO THE STATE

A bookkeeping entry on the county tax rolls indicating that the property?taxes are delinquent. The entry begins the five-year redemption period, after which the property may be physically sold to the public for back taxes.

SOLE OR SOLE PLATE

A structural member, usually two-by-four, on which wall and partition studs rest.

SPAN

The distance between structural supports, such as walls, columns, piers, beams, and girders.

SPECIAL ASSESSMENT

Legal charge against real estate by a public authority to pay the cost of public improvement, as distinguished from taxes levied for the general support of government.

SPECIFIC PERFORMANCE

A legal action to compel performance of a contract; for example a contract for the sale of land. A contract remedy by which one party is ordered by the court to comply with the terms of the agreement.

SPOUSE

A person's husband or wife.

SQUARE FOOTAGE OF BUILDING

An appraiser always uses the exterior dimensions to calculate the square footage of a building.

SRA

The Society of Real Estate Appraisers.

STARE DECISIS

A fundamental principle of law, which holds that courts should follow prior decisions on a point of law. A proper decision is a binding precedent on equal or lower courts having the same facts in controversy.

STATUTE

A written law.

STATUTE OF FRAUDS

The state law that provides that certain contracts must be in writing in order to be enforceable in the courts. Examples: real property leased for more than one year or an agent's authorization to sell real estate. A law that requires certain contracts (including most real estate contracts) to be in writing to be enforceable.

STATUTE OF LIMITATIONS

A statute that requires lawsuits to be brought within a certain time to be enforceable. The basic periods are one year for personal injury, two years for oral contracts, three years for damages to real or personal property, four years for written contracts, and three years from date of discovery for fraud.

STEERING

An illegal procedure where individual buyers, who are usually minorities, are only shown properties in specific neighborhoods.

STEPPED-UP BASIS

A higher, increased tax value of property given as the result of most sales or taxable transfers. The tax basis is used in computing capital gains and losses on the transfer of property.

STOP NOTICE

A notice served on the owner of property or custodian of funds. It requests, with certain penalties for noncompliance, that any funds due to a general contractor be paid to the claimant, laborer, or materialman.

STRAIGHT MORTGAGE OR DEED OF TRUST

A mortgage or deed of trust in which there is no reduction of the principal during the term of the instrument. Payments to interest are?usually made on an annual, semiannual, or quarterly basis.

STRAIGHT NOTE

A promissory note that is unamortized. The principal is paid at the end of the term of the note.

STRAIGHT-LINE DEPRECIATION

An accounting procedure that sets the rate of depreciation as a fixed percentage of the amount to be depreciated; the percentage stays the same each year.

STRING, STRINGER

1. A timber or other support for cross-members.
2. In stairs, the support on which the stair treads rest.

STUDS OR STUDDING

Vertical supporting timbers in walls and partitions.

SUBCHAPTER-S CORPORATION

A corporation that, for federal tax purposes only, is taxed similarly to a partnership. The corporate entity is disregarded for most federal tax purposes, and the shareholders are generally taxed as individual partners.

SUBJACENT SUPPORT

Support that the soil below the surface gives to the surface of the land.

SUBJECT TO

1. Burdened by and liable for an obligation.
2. A method of taking over a loan without becoming personally liable for its payment

"SUBJECT TO" MORTGAGE OR DEED OF TRUST

When a grantee takes a title to real property subject to a mortgage or deed of trust, he or she is not responsible to the holder of the promissory note for the payment of any portion of the amout due. The most that he or she can lose in the event of a foreclosure is his or her equity in the property. In neither case is the original maker of the note released from his or her responsibility. (See also Assumption of Mortgage or Deed of Trust.)

SUBLEASE

A lease given by a tenant.

SUBORDINATE

To make subject or junior to.

SUBORDINATION AGREEMENT

In a mortgage or deed of trust, a provision that a later lien shall have a priority interest over the existing lien. It makes the existing lien inferior to a later lien, in effect exchanging priorities with that later lien.

SUBORDINATION CLAUSE

Senior lien that makes it inferior to what would otherwise be a junior lien.

SUBROGATE

To substitute one person for another's legal rights to a claim or debt.

SUBROGATION

The substitution of another person in place of the creditor with regard to an obligation.

SUBSTANTATIVE LAW

The laws describing rights and duties. Differs from procedural law, which only describes how to enforce and protect rights.

SUCCESSION

The inheritance of property.

SUCCESSOR IN INTEREST

The next succeeding owner of an interest in property. The transferee or recipient of a property interest.

SUPERIOR COURT

The principal trial court of the state; a court of unlimited monetary and subject matter jurisdiction, and an appeal court for decisions of municipal courts and small claims courts.

SUPREME COURT

The highest court in the California and the federal court structure. This court is almost exclusively an appeals court, accepting (by certiorari) only those cases that, in the court's descretion, involve issues of significant magnitude and social importance.

SURETY

One who guarantees the performance by another, a guarantor.

SURVEY

The process by which a parcel of land is located on the ground and measured.

SWING LOAN

This is a short term equity loan.

SYNDICATION

A group of individuals pooling their resources to purchase property through the holding vehicle of a partnership, corporation, or other association. Each individual owns share in the legal entity formed to acquire and hold title to the property. This is an alternitive method to finance and purchase real estate. This allows an investment in real estate with out having to do any of the work.

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