Real Estate Glossary: L

Land Contract
A legal contract or agreement for the sale of property where the buyer takes possession while making payments, but the seller holds the title until full payment is received.

Land Title
The legal document conveying title to a property.

Land Titles System
A system used for the registration of land. Under this system, the registrar or master of titles passes on the validity of the instrument and determines its legal effect with the Government’s guarantee of the title.

Land transfer tax
A provincial tax payable on any property that changes hands. First time buyers may be eligible for a rebate.

Latent Defect
A deficiency or fault within a property that is not easy to see or visibly detectable, such as termite damage or traces of radon above safe levels. Read more

Real Estate Glossary: J

Joint Credit
Credit that is issued to two people based their credit reports and their combined assets and incomes. The repayment of joint credit is the responsibility of both parties.

Joint Liability
When two or more people are responsible for repaying a single debt.

Joint Tenancy
When two people (typically spouses) both own an undivided interest in a property. If one joint tenant passes away, the other receives the title to the entire property. Read more

Real Estate Glossary: G

Gable
A triangular wall enclosed by the sloping ends of a ridged roof or a triangular decorative feature

Gable roof
A ridged roof that forms a triangle at each end

General contractor
The person who hires all of the subcontractors and suppliers for a project.

GDS Ratio
Gross Debt Service Ratio. Lender’s allowable ratio of gross monthly payment to gross monthly income of mortgage applicant.

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Real Estate Glossary: F

Financing
Means used by a buyer to acquire an immovable. Financial resource, often in the form of a mortgage loan provided to the buyer by a financial institution for the purchase of an immovable (see Mortgage loan).

Fonds d’indemnisation du courtage immobilier
Body created under the Real Estate Brokerage Act, to which all real estate brokers and agents in Québec contribute to indemnify consumers who are victims of fraud, dishonest transaction or misappropriation of funds or other goods by a real estate broker or agent, which, under the Real Estate Brokerage Act, must be deposited in a trust account.

Real Estate Glossary: E

Easement
Restriction of the right of ownership for reasons of private interest, general interest or public use. Right of access or use of land by others, for a defined purpose (passage, parking, public utilities, etc.).

Equity
The difference between the price for which a home could be sold and the total debts registered against it. Equity usually increases as the mortgage is reduced through regular payments. Market values and improvements to the property may also affect equity.

Evaluation
Process which consists in estimating the market value of an immovable based on the general condition of its components and its specific features. The evaluation is often the result of a comparison with similar immovables up for sale or having recently been sold in the same area.

Real Estate Glossary: D

Deposit
A sum of money that accompanies a promise to purchase an immovable. The deposit must be placed in a trust account and will be deducted from the balance payable at the signing of the act of sale, or it will be returned to the proposer if the sale does not go through.

Description sheet
Document on which a real estate broker or agent has presented the features (construction year, taxes, measurements, etc.) of an immovable covered by a real estate brokerage contract.

Depreciation
The decrease in value of something because it is now worth less than when you bought it.

Down payment
Personal contribution of the buyer to the financing of an immovable. Cash portion deducted from the selling price, which determines the amount of financing required to complete the purchase.

Note: If the deposit for the purchase of the immovable is less than 20% of the purchase price, the loan must be insured by the Canadian Mortgage and Housing Corporation (CMHC), Genworth, AIG United Guaranty or PMI.

Real Estate Glossary: C

Cadastral designation
Information concerning an immovable (location, area, value, etc.), contained in the cadastre for a given region.

Cadastre
Public register containing the technical data on each immovable in a given region (lot).
A lot number used to publish the applicable rights is assigned to each property indexed in the cadastre.

Certificate of location
Document containing a report and a plan, in which the land surveyor expresses his opinion on the location and condition of an immovable compared to the titles and the cadastre as well as laws and regulations governing the immovable.

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Real Estate Glossary: B

Brokerage Contract
Agreement under which a person authorizes real estate broker to act for a given period of time, as intermediary in the purchase, sale, rental or exchange of immovable property.
The brokerage contract officializes the rights and obligations of the broker and his client by mutual consent.
In an exclusive brokerage contract the client agrees, for the term of the contract, not to use the services of a broker other than the one with whom he signed the contract. Usually, the exclusive brokerage contract also states that the client who is party to the contract cannot sell or buy the immovable himself.

Building Inspection
General verifi cation of the state of the main components of an immovable (foundation, structure, roof, heating system, electrical system, etc.) to assess condition. Csystem, etc.) to assess condition.

Real Estate Glossary: A

Act of sale
A contract, usually drawn up by a notary, usedto officialize the sale of an immovable to a buyer.

Amortization
Period required to pay back a mortgage loan in full through regular payments. The amortization is usually based on fixed terms of 10, 15, 20 or 25 years.

Appraisal
A process for estimating the market value of a particular property.

Appreciation
The increase in value of something because it is worth more now than when you bought it.

Approved Lender
A lending institution authorized by the Government of Canada through CMHC to make loans under the terms of the National Housing Act. Only Approved Lenders can negotiate mortgages that require mortgage loan insurance.

Assumption Agreement
A legal document signed by a homebuyer that requires the buyer to assume responsibility for the obligations of a mortgage by the builder or the previous owner.

Association des courtiers et agents immobiliers du Québec
Organization created under the Real Estate Brokerage Act whose main mission is to protect the public by overseeing the activities of all real estate brokerage professionals practicing in Québec.