Mortgage and Real Estate Glossary
Alberta Equity's glossary contains hundreds of terms. With this tool, you can click or search through the largest real estate and mortgage glossary in Canada!
- Back Title Letter
- A document that a title insurance company gives to an attorney specifying condition of the title.
- Backup Offer
- A bid for a property that the owner will consider if the current transaction falls through.
- Bad Debts
- Money you can't collect. Businesses are allowed to deduct bad debts under certain circumstances. If a bad debt is personal, it may be deducted in some cases as a short-term capital loss. Loans between family members generally are classified as non-business.
- Balance
- The amount of money in your account.
- Balance Sheet
- A report of financial condition, including assets, liabilities and net worth.
- Balance Transfer
- The process of moving an unpaid credit card debt from one issuer to another. Card issuers sometimes offer teaser rates to encourage balance transfers coming in and balance transfer fees to discourage them from going out.
- Balance Transfer Fee
- Fee charged customers for transferring an outstanding balance from one card to another.
- Balloon Loan
- A loan in which the payments aren't set up to repay the loan in full by the end of the term. At the end comes the balloon payment — one that is larger than the other, periodic payments and pays off the remaining principal.
- Balloon Mortgage
- A loan that has regular monthly payments which amortize over a stated term but call for a final lump sum (balloon payment) at the end of a specified term, or maturity date, such as 10 years.
- Balloon Payment
- A loan installment that is larger than the other, periodic payments and pays off the remaining principal.
- Bank
- An institution that acts as a financial intermediary by receiving money from depositors and lenders and also lending to borrowers.
- Bank Holding Company
- A company that owns or controls one or more banks or companies associated with banking such as leasing companies, credit companies, etc. It is usually identified by the word Bancorp or Bancshares in the name. The Federal Reserve Board of Governors regulates all bank holding companies.
- Bank Spread
- The difference between the interest rate a bank charges a borrower and the interest rate a bank pays a depositor.
- Bank Wire
- An electronic payment system for the transfer of money between banks.
- Bankruptcy
- A court action under the Federal Bankruptcy Code by which a debtor's debts may be discharged, usually by transferring assets to a trustee, or rescheduled.
- Bankruptcy Trustee
- A private individual or corporation appointed to undertake bankruptcy proceedings for a individual or corporation.
- Bargain Sale
- Transfer of property or an item for less than market value.
- Base Price
- The cost of a car without options. This price includes standard equipment and the manufacturer's warranty.
- Basis
- Also referred to as cost basis, this is the amount assigned to an asset from which a taxpayer determines capital gain or loss. For assets purchased, the basis is the price paid. Special rules apply to assets acquired through gift or inheritance, as well as to the value of stock funds held for a period during which earnings are reinvested.
- Basis Point
- A unit of measure: 1/100th of one percent. For example, the difference between a 9.0% loan and a 9.5% loan is 50 basis points.
- Bearing Wall
- A side of a structure that supports a roof or other parts of the structure.
- Bedroom Community
- A suburb in which most residents commute to the city to work.
- Before-tax Income
- Earnings before income taxes are paid.
- Beneficiary
- One who benefits from an insurance policy, will or deed or trust.
- Betterment
- An improvement or replacement that increases a property's value.
- Bidding War
- Multiple, competing offers for a piece of property or item that escalate the price. Usually results in a happy seller.
- Bilateral Contract
- A legal agreement in which both parties promise to give each other something. A purchase agreement in which the buyer promises to give money and the seller promises to transfer property is a bilateral contract.
- Bill of Sale
- A written document that serves as evidence of the transfer of title to personal property.
- Bill Presentment
- An online system that allows customers to receive and view the bill on a computer, and then pay the bill electronically. Users can pay their bills immediately and the money is transferred from the account.
- Billing Cycle
- The number of days between the last statement date and the current statement date.
- Billing Statement
- The monthly bill sent by a credit card issuer to the customer. It gives a summary of activity on an account, including balance, purchases, payments, credits and finance charges. Important changes to a credit card account are often included in small-print fliers that are sent with the statement.
- Binder
- An agreement to consider the purchase of real estate. The agreement is secured and backed by a cash deposit as evidence of good faith on the part of the purchaser.
- Biweekly Mortgage
- A mortgage that schedules payments every two weeks instead of the standard monthly payment. The 26 biweekly payments are each equal to one-half of the monthly payment. The result for the borrower is a substantial reduction in interest payments because the mortgage is paid off sooner.
- Blank Cheque
- A cheque that does not have a dollar amount written on it.
- Blanket Insurance
- A policy that covers common areas of a co-op, condominium or a neighborhood governed by a homeowners association. Such a policy doesn't cover dwellings or contents of dwellings, but areas owned in common.
- Blanket Mortgage
- A mortgage that covers more than one parcel of real estate owned by the same buyer.
- Blighted Area
- An ugly, run-down neighborhood.
- Blue Book
- Formally, it refers to the Kelley Blue Book, an industry guide dealers use to estimate wholesale and retail vehicle pricing. In common parlance, "the blue book price" can actually refer to a price looked up in one of the many guides to pricing. The books now come in a variety of hues, are issued by many organizations, and are commonly available online or in the reference sections of public libraries.
- Blueprint
- The drawing of a structure by an architect or designer, used for construction and getting permits.
- Board Foot
- A measurement of lumber equivalent to 1 inch thick, 1 foot long, 1 foot wide.
- Boilerplate
- Standard, routine language in legal documents.
- Bona Fide
- In good faith. In real estate, a bona fide purchaser or seller has the legal right to give or receive title.
- Bond
- A debt instrument, issued for a period of at least one year that pays a fixed rate of interest for a specific period. A bond is an IOU from a corporation or government entity. Corporations and governments borrow money from investors by issuing bonds. Bonds represent debt, as opposed to stocks, which represent ownership in a company. Usually, the principal is repaid at the maturity date.
- Book Value
- The value of a property, item or company as a capital asset based on its cost plus any additions, subtracting depreciation.
- Boot
- Cash or other property used in an exchange to make the values of property traded equal. For instance, if you trade in a delivery truck on a new model, the cash you pay in addition to your old truck is boot.
- Borrow
- 1. To get a loan of money. 2. Sand, gravel or other material used for grading.
- Borrow Pit
- A hole from which topsoil, gravel or other material has been removed for use in a construction project.
- Borrower
- One who gets a loan.
- Boundary
- The line dividing adjacent properties.
- Breach of Contract
- Failure to abide by terms of a legal agreement without a legal excuse.
- Breach of Covenant
- Violation of a promise made in a contract or property deed.
- Breach of Warranty
- A determination that a seller cannot pass clear title of property to a buyer.
- Break-even Point
- The point at which expenses meet income or savings. In home finance, the break-even point often refers to the time it takes to recoup the costs of refinancing a loan or paying discount points.
- Bridge Loan
- A loan that "bridges" the gap between the purchase of a new home and the sale of the borrower's current home. The borrower's current home is used as collateral and the money is used to close on the new home before the current home is sold. Some are structured so they completely pay off the old home's first mortgage at the bridge loan's closing, while others pile the new debt on top of the old. They usually run for a term of six months.
- Broker
- A person or firm who acts on behalf of another.
- Broom Clean
- Ready to be cleaned and painted. The term does not mean immaculate or spotless or even necessarily clean.
- Browser
- A computer software program used for accessing and viewing Internet Web sites.
- Buffer Strip
- 1. A strip of grass or legumes between a parcel and a stream, to protect the stream from runoff, especially runoff containing fertilizer. 2. Land separating two pieces of property.
- Builder Upgrades
- Refined features or materials that a builder offers for an extra charge.
- Building and Loan Association
- A financial institution designed to help members finance real-estate transactions.
- Building Code
- Regulations that govern design and materials used in construction.
- Building Inspector
- A local government employee who enforces the building code and makes sure construction and renovation work is done properly.
- Building Moratorium
- A temporary or permanent halt on construction.
- Building Permit
- Authorization by a local government to construct or repair a structure.
- Building Restrictions
- Local regulations that limit the size, height, materials, colours, uses, locations, placement and other characteristics of houses.
- Built-ins
- Items, such as appliances and cabinets, that are permanently attached to a building.
- Bull and Bear Markets
- When stock prices are increasing and it's a healthy market, this is known as a bull market. When stock prices are decreasing, it's a bear market.
- Bundle of Rights
- A set of legal rights that an owner has regarding a property.
- Burden of Proof
- The legal requirement to provide enough evidence to win a lawsuit. In civil cases, such as tax court, the burden is decided by the preponderance — the most — evidence. Except in cases of tax fraud, the burden of proof in a tax case generally is on the taxpayer.
- Business Bankruptcy
- A bankruptcy case in which the debtor is a business or an individual involved in business and the debts are for business purposes.
- Business Interest Expense
- Interest incurred in the operation of your business. It is deductible as a business expense.
- Buy-down Mortgage
- A home loan in which the lender charges below-market interest in exchange for discount points.
- Buy-down or Buydown
- The process of trading money for a lower mortgage rate. The borrower "buys down" the interest rate on a mortgage by paying discount points up front. It can also be a mortgage in which an initial lump-sum payment is made to temporarily reduce a borrower's monthly payments during the first few years of a mortgage.
- Buyer Broker
- One who earns a commission from the buyer of a property in exchange for finding a seller and assisting in negotiation.
- Bylaws
- The written rules governing an organization such as a homeowners association.
