Real Estate Glossary – S

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

S corporation
Business owned by no more than 35 shareholders and incorporated following requirements of Subchapter S of the Internal Revenue Code, which then allows income to flow directly to shareholders, avoiding double taxation.

Safe Drinking Water Act
Enacted by Congress in 1974, this federal law administered by the EPA and equivalent state regulators to establish and enforce drinking water standards.
  Safe Drinking Water Act

SAFE Mortgage Licensing Act
The Secure and Fair Enforcement for Mortgage Licensing Act of 2008, commonly referred to as the “Safe Act,” is designed to enhance consumer protection and reduce fraud through the setting of minimum standards for the licensing and registration of mortgage loan originators. Full text of the SAFE Mortgage Licensing Act of 2008

safe yield
The long-term balancing of groundwater withdrawals with the amount of water naturally and artificially recharged to AMA (active groundwater management area) aquifers. See The AMA fact Sheet for further information.

safety clause
A safety clause may be contained in a listing. It provides that a broker is still entitled to a commission for a set period of time after the listing has expired if the property is sold to a prospect, who was introduced to the property by the broker, during the period of the listing.

salable loans
Loans that are intended to be sold to investors such as Fannie Mae and Freddie Mac in the secondary mortgage market place. (See secondary mortgage market)

sale-leaseback
A transaction in which an owner sells his or her improved property and, as part of the same transaction, signs a long term lease to remain in possession of the premises.

sale-leaseback-buyback

A sale-leaseback-buyback arrangement is a financial transaction involving three primary steps: a sale, a leaseback, and a potential buyback:

• For the sale, the owner of an asset (often real estate or expensive equipment) sells the asset to another party. This transaction provides the original owner, now the seller, with an immediate influx of cash, which can be critical for improving liquidity or investing in business operations.
• The leaseback happens simulataneously with the sale. The seller leases the asset back from the buyer for a predetermined period and at agreed-upon terms. This allows the seller to continue using the asset without owning it.
• The buyback is a condition in the initial agreement for the original seller to buy the asset back at a future date or under certain conditions.

sales associate
A sales associate is a broker or salesperson who is employed by or in an independent contractor relationship with a real estate broker.

sales comparison approach
The process of estimating the value of a property by examining and comparing actual sales of comparable properties. (See appraisal)

sales price
The actual price that a buyer pays for a property.

sales tax
A tax imposed by the government at the point of sale on retail goods and services. It is collected by the retailer and passed on to the state.

sample
Some of the units, or variates, of a population that accurately represents the population.

Sample Key Exchange Verbiage
Listing agent shall place keys in an envelope with Buyer’s name on it and place it at the front desk of [name of brokerage] no later than [DATE]. Buyer’s agent shall thereafter retrieve keys from the front desk of [name of brokerage].

Sample Key Exchange Verbiage
Listing agent shall place keys in an envelope with Buyer’s name on it and place it at the front desk of [name of brokerage] no later than [DATE]. Buyer’s agent shall thereafter retrieve keys from the front desk of [name of brokerage].

Sample Net Listing Terminology
The net sales price to the seller shall be $ ______ or any other sum the seller shall agree to accept. Seller agrees to pay the broker, as compensation for services, any amount over the net sales price mentioned above. Any expenses payable by the seller are to be deducted from the net sales price. The seller acknowledges that the broker has made no warranties or guarantees to induce the seller to enter into this net listing.

sandwich lease
A leasing arrangement in which an entity leases property from one party and leases that same property to another party. In this arrangement, the entity is both a lessee and a lessor, so it both pays and collects rent on the same property. Another term used is “sublease.”

satisfaction of debt/mortgage
Discharge of an obligation before the end of its term by payment of the total debt owed. When all mortgage loan payments or payments on a judgement have been made. When a note has been paid in full. Satisfaction of mortgage (also known as a release of mortgage or mortgage discharge) returns to the mortgagor all interest in the real estate, which was conveyed to the mortgagee by the original recorded mortgage document. It is an instrument given by the mortgagee to the mortgagor that releases the mortgage lien when recorded.

savings and loan association (S&L)
A financial institution whose principal function is to promote thrift and home ownership. Depositors earn interest on their deposits, often at a higher rate than is offered at commercial banks. The S&L invests some of these deposits in residential mortgage loans, enabling more people to purchase and/or repair their homes. Savings and loan associations are active participants in the home loan mortgage market. (See thrift)

scannable resume
Resume designed so that computers can easily scan information from your resume; used by job seekers who are applying for positions with large corporations, educational, and government institutions.

SCANS Report
Secretary’s Commission on Achieving Necessary Skills (SCANS) Report for employability (June, 1991) U.S. Department of Labor. wdr.doleta.gov/SCANS/. This report describes skills needed by adults to be successful in their work.

scarcity
1. One of the four basic elements of market value. Demand, Utility, Scarcity and Transferability (DUST) 2. Insufficiency of amount or supply; shortage: a scarcity of food that was caused by drought. 3. Rarity of appearance or occurrence: antiques that are valued for their scarcity.

Schedule A form
This form records all one’s potential itemized deductions from the Mortgage Interest Deduction and property taxes, job related expenses, certain medical and dental expenses, gifts to charity and might roll up to the Standard or Itemized Deduction line on the 1040 Form if it is a larger amount than the Standard Deduction. (See 1040 Form, mortgage interest deduction (MID))

Schedule E form
This form records all a person’s income and expenses from real estate rental property activity in his or her rental property business and rolls up to Line 17 on the 1040 Form. (See 1040 Form, depreciation deduction)

scheduled long-term monthly debt payments
Scheduled long-term monthly debt payments are the monthly payments of all installment debts, revolving charge accounts, open accounts, and lines of credit that would be used to determine a borrower’s ability to repay per the current underwriting guidelines of the FHA, Fannie Mae, the Federal Home Loan Mortgage Corporation, or the DVA.

scheduled monthly payments
Scheduled monthly payments means minimum sums required to be paid with respect to all of the borrower’s debts that are reported on any loan application completed by the borrower and a nationally recognized consumer credit bureau report and the monthly mortgage payment due under the high-cost home loan (ignoring any reduction arising from a lower introductory rate) plus 1/12 of the annualized cost of real estate tax and insurance premium payments during the immediately preceding 12 months. Scheduled monthly payments does not include any debts that are consolidated with, or paid off by, the high-cost home loan.

scheduled rent
Rent paid by agreement between lessor and lessee; also called contract rent.

scheme to defraud
A scheme to defraud is a plan a person employs that uses a statement, promise, misrepresentation, deception, or any other kind of falsehood designed to deprive a victim of something of value. For example, if a person offered to sell someone land that was not his/hers to sell in order to get the offeree to give him/her money is a scheme to defraud.

science
Possession of knowledge as distinguished from ignorance or misunderstanding; knowledge attained through study or practice; knowledge covering general truths or the operation of general laws especially as obtained and tested through scientific method.

scientific method
The systematic apporach of observation, hypothesis formation, hypothesis testing and hypothesis evaluation that forms the basis for modern science.

scientific method
Principles and procedures for the systematic pursuit of knowledge involving the recognition and formulation of a problem, collection of data through observation and experiment, and the formulation and testing of hypothesis.

scope of work
The amount and type of information researched and the analysis applied in an appraisal assignment.

Score report (AZ)
All candidates who pass the state administered licensing exam will be issued a passing score report by the testing center personnel. This report must be provided to the Arizona Department of Real Estate in the licensing application package.

search consultants/recruiters
Companies that arrange interviews for professional-level job seekers, generically referred to as “headhunters.”

search engine
A program that systematically searches documents for specified keywords; A program that systematically searches the Internet for documents in response to specific inquiry by a user; A website where users can make specific inquiries and receive links to websites that are specifically relevant to those inquiries.

seasonal fluctuations
Short-term changes in business and economic activity that occur during the year resulting from weather or custom.

second mortgage
A mortgage (or trust deed) that is junior or subordinate to a first mortgage; typically, an additional loan imposed on top of the first mortgage, taken out when the borrower needs more money. Because the risk involved to the lender is greater with the second mortgage, the lender’s conditions are usually more stringent, the term is shorter and the interest rate is higher than for the first mortgage. (See mortgage)

secondary financing
A loan taken out in addition to a first loan, usually obtained from an individual lender.

secondary mortgage market
A market for the purchase and sale of real estate promissory notes.

secret profit
Refers to a broker making an undisclosed profit at the seller’s expense; for example, when the broker has an undisclosed relative buy the listed property and then resell it to a buyer whose earlier offer was never presented to the seller.

section 202
Section 202 is the Supportive Housing for the Elderly Program. This program provides federal funding to facilitate the development and operation of supportive rental housing for very low-income persons aged 62 years and older. Through capital advances and project rental assistance, the program enables elderly residents to live independently in an environment that offers supportive services such as cleaning, cooking, and transportation.

Section 265-a
Section 265-a provides homeowners with information and disclosures so they can make informed decisions when approached by persons deemed equity purchasers who are seeking a sale or transfer of the homeowner’s property. When applicable, the law provides remedies for homeowners in transactions that involve deceit, lack of fair dealing, misleading representations, and unfair contract terms.

Section 595-a(1) of the Banking Law
Section 595-a(1) of the Banking Law was amended to prohibit mortgage bankers, mortgage brokers, and exempt organizations from making or arranging a loan to an equity purchaser if the mortgage banker, mortgage broker, or exempt organization (for example, banks, thrifts, and their consolidated subsidiaries) had knowledge that the equity purchaser was not complying with the provisions of Section 265-a of the Real Property Law with respect to such transactions.

section 8
Federally subsidized housing administered by HUD where the tenant pays up to thirty percent of his or her adjusted monthly income and HUD pays the difference between that amount and the market rent. Property owners are not required to participate. (See section 202)

section and township system
Sections and townships are part of the rectangular (government) survey system of land description. A township is a division of territory that is six miles square, and contains 36 sections, each of which is one square mile. A township consists of 23,040 acres. (See rectangular (government) survey system, section)

section(s)
As used in the government survey method, a section of land is the area of one square mile, or 640 acres. A section is 1/36 of a township, or each township contains 36 sections. Sections are numbered 1 through 36. Section 1 is always in the northeast, or upper right-hand, corner. The numbering proceeds right to left to the upper left-hand corner. From there, the numbers drop down to the next tier and continue from left to right, then back from right to left (See township)

Securities and Exchange Commission
The mission of the U.S. Securities and Exchange Commission is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation.
SEC Homepage

securitization
The pooling of real estate mortgages and trust deeds to act as collateral for the sale of securities to public and private investors. (See secondary mortgage market)

security
Evidence of obligations to pay money or of rights to participate in earnings and distribution of corporate, trust or other property. A security is usually found where an investor subjects his or her money to the risks of an enterprise over which he or she exercises no managerial control.

security agreement
A real estate security agreement, also known as a mortgage or deed of trust depending on the jurisdiction, is a legal contract between a lender (the secured party) and a borrower (the debtor) that establishes a security interest in real estate (the collateral) to secure a loan or other obligation. This agreement allows the lender to have a legal claim against the property if the borrower fails to fulfill their financial obligations.

security deposit
Money deposited by or for the tenant with the landlord, to be held by the landlord for the following purposes: 1. to remedy tenant defaults for damage to the premises (be it accidental or intentional), for failure to pay rent due or for failure to return keys at the end of the tenancy; 2. to clean the dwelling so as to place it in as fit a condition as when the tenant commenced possession, considering normal wear and tear; and 3. to compensate for damages caused by a tenant who wrongfully quits the dwelling unit. (See landlord, tenant)

security instrument
A written document executed by a debtor by which the described property is made security for the underlying debt.

security interest
Security interest is an interest in personal property or fixtures.

segmentation
Consideration of a market area by division into specific categories of consumer preferences, such as the income, work, or leisure activities of the population.

seismic hazards zone
Area specified by the California Department of Conservation as being at high risk of severe earth movement.

selection panel
The selection panel could include the planning director, a planning commissioner, a council member or county supervisor, interested citizens, representatives of different departments that will be participating in plan development and non-staff individuals with planning knowledge and experience.

self-amortizing loans
Loans in which periodic payments of principal and interest are scheduled over the life of the loan. Self-amortizing loans provide more opportunity for homeownership by allowing these scheduled payments, as opposed to large balloon payments at maturity (the end of the loan term).

self-assessment
Techniques to increase self-awareness.

self-contained report
A self-contained report is a narrative report and the most comprehensive type of appraisal report, including a thorough statement of the background data supporting the opinion of value.

self-management
Being able to set goals and motivate oneself, taking charge of one’s personal and career development.

seller carryback financing
A sale of real property where the seller receives a portion of the sales price in the form of a promissory note secured by the real property purchased. An extension of credit by the seller.

seller financing
There are specific additional duties imposed upon the licensee who negotiates a sale of real property when the seller receives a portion of the sales price in the form of a promissory note secured by the real property purchased. This seller financing disclosure statement is required in a transaction for the purchase of a dwelling for not more than four families where the purchase includes an extension of credit by the seller and where the licensee is acting as an “arranger of credit.” (See arranger of credit, promissory note)

seller financing
A loan made by the owner/seller of real estate to the purchaser to cover all or part of the sales price.

seller property disclosure statement
A statement from the transferor (seller) of real estate which provides information regarding the physical condition of the property.

seller’s agent
An agent who represents the seller of real property. (See buyer’s agent)

seller’s market
A real estate marketplace where there are more buyers than sellers.

Seller’s Permission to Disclose Terms
Arizona Commissioner’s Rule R4-28-802.B: …Upon receiving permission from the seller, the salesperson or broker acting on behalf of the seller may disclose to all offerors or their agents the existence and terms of all additional offers on the listed property…

Seller’s Real Property Disclosure Form
As required by Nevada Real Estate Division Code NRS 113. 100-113.150, a transferee (buyer) of residential real property is entitled to a statement from the transferor (seller) which provides information regarding the physical condition of the property. Must be made by the seller at least 10 days before residential property is conveyed to a buyer.

senior loan
A real estate loan in the first priority position. (See junior mortgage)

sensitive information
Sensitive Information – Records or documents that contain an individual’s first and last name or first initial and last name in combination with a corresponding complete:

• social security number;
• credit card, charge card or debit card number;
• retirement account number;
• savings, checking or securities entitlement account number;
• driver license number or nonoperating identification license number.

separate property
Under community property law, property owned solely by either spouse before the marriage, acquired by gift or inheritance after the marriage or purchased with separate funds after the marriage. (See community property)

septic system
A system for collecting, treating and eliminating waste from a home waste drainage system.

sequence
A continuous or connected series; a succession of repetitions of harmonic pattern each in a new position; continuity of progression.

server
A computer on a network that supplies the network with applications, data and storage capacity.

service professionals
Lawyer, doctor, insurance agent, broker, accountant

Servicemembers Civil Relief Act (SCRA)
A law that helps alleviates some of the stress placed on a Servicemember’s family when they are called into service. It allows the Servicemember to suspend or postpone certain civil obligations so they can devote their full attention to their military duties.

servicer
A servicer, which is defined in RESPA (12 U.S.C. § 2605(i)), does not include a licensed attorney who, in the practice of law or performing as a trustee, accepts payments related to a loan closing, default, foreclosure, or settlement of a dispute or legal claim related to a loan.

servicer
A servicer is a person who collects or receives payments, including principal, interest, and trust items, such as hazard insurance, property taxes, and other amounts due, on behalf of a note holder or investor in accordance with the terms of a residential mortgage loan. This includes working with a borrower on behalf of a note holder or investor, when the borrower is in financial hardship or default, to modify, either temporarily or permanently, the terms of an existing residential mortgage loan.

services
Activities perceived to have monetary or exchange value, such as legal advice, health care, repair work, entertainment, transportation, and business services. (See goods)

services actually performed
Does not include taking consideration in exchange for referrals. Payment by a lender to a real estate broker for loan origination services actually performed by the real estate broker (or the lender’s splitting of a loan origination fee with such a real estate broker as compensation for such services actually performed) is a permitted exception under RESPA.When a person in a position to refer settlement service business, such as . . . [a] real estate broker or agent . . . receives a payment for providing additional settlement services as part of a real estate transaction, such payment must be for services that are actual, necessary and distinct from the primary services provided by such person. . . .

servicing a mortgage loan
Servicing a mortgage loan means to receive, cause to be received, or transferred for another, installment payments of principal, interest, or other payments pursuant to a mortgage loan.

servicing agreement
Signed documentation as to who will service the loan.

servicing endorsement
A servicing endorsement authorizes a mortgage lender to service a loan for more than four months.

servicing endorsement *
A servicing endorsement authorizes a mortgage lender to service a loan for more than four months.

servient tenement
Land on which an easement exists in favor of an adjacent property (called a dominant tenement or estate); also called a servient estate. If property A has a right-of-way across property B, property B is the servient tenement. The servient owner may not use the property in such a way as to interfere with the reasonable use of the dominant owner. (See dominant tenement, easement)

set-up sheet
Also know as an “Annual Property Cash Flow Statement.” Includes cash flow information about a listed rental property that is passed out to other real estate companies and/or given to prospective buyers.

setback
The amount of space local zoning regulations require between a lot line and a building line.

settlement services
Any service provided in connection with a real estate settlement including but not limited to title searches, title insurance, document preparation, property survey, appraisal, pest inspection, services rendered by a real estate agent or broker, and the origination of a federally related mortgage loan and closing services.

settlement statement
A document prepared for and presented to the borrower at the loan closing showing all disbursements to be made, such as payment to the seller.

severalty
Sole ownership of real property.

severance
Changing an item of real estate to personal property by detaching it from the land; for example, cutting down a tree.

sharecropping
In an agricultural lease, the agreement between the landowner and the tenant farmer to split the crop or the profit from its sale, actually sharing the crop. (See agricultural lease)

shared or collaborative evaluation
Employees, managers, and human resources personnel can work together in the portfolio process. Through their portfolios, employees can demonstrate the unique knowledge, skills, talents, and interests that they contribute to their workplace.

shared-appreciation mortgage (SAM)
A mortgage loan in which the lender, in exchange for a loan with a favorable interest rate, participates in the profits (if any) the borrower receives when the property is eventually sold. (See mortgage loan)

shareholder
The owners of a corporation are called shareholders.

sheathing
Sheathing is insulating and bracing material, such as plywood, applied to exterior walls of wood-frame structures, to which exterior finishing material, such as siding or masonry, is applied.

sheriff’s deed
When real property is sold at a sheriff’s sale (judicial sale) to satisfy a judgment lien, the winning bidder will eventually receive a a sheriff’s deed after the statutory redemption rights have expired. Sheriff’s deeds are bargain and sale deeds, and contain no express warranties. For the most part, sheriff’s deeds are not insurable deeds, unless a particular title company has agreed to insure the title.

sheriff’s sale
A sale that is conducted by the County sheriff and is for the purpose of selling real property which has been seized by the sheriff to satisfy judgment liens.

Sherman Anti-Trust Act
U.S. legislation enacted to curb concentrations of power that restrict trade and reduce economic competition. Prohibits price fixing, boycotting, and tie-in agreements.

shingles
Roofing material characterized by short, rectangular sections, nailed to the roof decking in an overlapping pattern. Asphalt shingles are the most common type. (See roof decking)

shopping chart
A shopping chart provides space to compare four different originators and their loan offerings.

short sale
A sale for less than is owed on a loan where the lender agrees to accept sale proceeds to extinguish the debt.

short term rate
A reduced rate for title insurance applicable in cases where the owner of a property has been insured previously or where any lender has been insured somewhat recently on the property.

short-lived items of depreciation
Depreciating building components that could be expected to be replaced at least several times over the structure’s useful life, such as roofing.

shower pan
A waterproof “pan” placed beneath the floor tiles or concrete base of a shower that prevents leaking.

sick building syndrome
The term “sick building syndrome” (SBS) is used to describe situations in which building occupants experience discomforting health conditions that appear to be linked to time spent in a building, but no specific illness or cause can be identified. EPA Sick Building Syndrome Factsheet

siding
Siding is an exterior wall finishing, applied in horizontal boards that can be made of wood, aluminum, vinyl, or a composite material.

signatory
1. having signed or joined in signing a document. 2. a signer, or one of the signers, of a document.

sill
A sill is the wood member placed directly on a foundation; in California, state law requires anchor bolts to fasten a sill to the foundation for earthquake safety. (See anchor bolts, foundation)

simple interest
Interest computed on the principal balance, and disregards previously accumulated (upaid) interest.

simulation
The imitative representation of the functioning of one system or process by means of the functioning of another.

simultaneous second-lien loan
A lending arrangement where either a closed-end second-lien or a home equity line of credit (HELOC) is originated simultaneously with the first lien mortgage loan, typically in lieu of a higher down payment.

single agency
The practice of representing either the buyer or the seller but never both in the same transaction. The single-agency broker may be compensated indirectly through an authorized commission split or directly by the principal who employed the agent to represent him or her. (See dual agency)

single-family, owner-occupied dwellings
A dwelling which will be owned and occupied by a signatory to the mortgage or deed of trust secured by such dwelling within 90 days of the execution of the mortgage or deed of trust.

sinking fund
1. A “sinking fund” is established to gradually amass enough money to satisfy a debt or to meet a specific requirement. 2. The sinking fund method of depreciation contemplates periodic investments of equal amounts of money in a compound-interest-bearing account whereby the investment plus the compound interest will be used to replace the improvement at the end of its economic life.

site value
Site value is the value of land exclusive of improvements.

situational analysis
The foundation of a business plan is a situational analysis of the past, present, and likely future. A plan is only as good as the information gathering and filtering processes in the situational analysis and the assumptions about future cause and effect. Planners must avoid underestimating the competition and overstating the company’s abilities, including revenue capacity.

situs
The personal preference of people for one area over another, not necessarily based on objective facts and knowledge.

six functions of a dollar
The six compound interest factors used in the mathematics of finance to adjust present or future payments for the time value of money.

six-month rule
Time period in which a homeowner can sell one home and move into another, less costly one, in order to pay debts that would otherwise threaten a sale of the homestead.

skeleton
The bony or cartilaginous framework supporting the soft tissue and protecting the internal organs. (See musculoskeletal)

skewness
A measure of the lack of symmetry in a distribution of the variates of a population.

skills
Methods that improve your employability

slab
A flat piece of concrete, typically used as a walking surface, but may also serve as a load bearing device as in slab homes.

Small Business Liability Relief and Brownfields Revitalization Act
The law that provides for funds to assess and clean up brownfields, clarify liability protections, and provide tax incentives toward enhancing state and tribal response programs (also known as Brownfields Law).

smoke detectors
State law requires that residential properties be equipped with smoke detectors. Local ordinances may impose more rigid requirements. The specific requirements may vary depending on the type of property, the number of units, and the number of stories of the property.

smooth muscle
Muscle tissue that lacks cross striation; made up of elongated spindle shaped cells having a central nucleus; found in structures such as the stomach and bladder; performing involuntary functions. (See muscle)

social benefits
Social benefits are those that accrue to everyone in a society. (See social costs)

social costs
The costs of producing a good or service which are borne by society as a whole. (See social benfits)

social groups
Religious groups, service organizations, fraternal organizations, sororities, sports teams, recreational groups

Social Security Disability Insurance
Social Security Disability Insurance (SSDI) pays monthly benefits to workers who are no longer able to work due to a significant illness or impairment that is expected to last at least a year or to result in death within a year. It is part of the Social Security program that also pays retirement benefits to the vast majority of older Americans. Benefits are based on the disabled worker’s past earnings and are paid to the disabled worker and to his or her dependent family members. To be eligible, a disabled worker must have worked in jobs covered by Social Security. In January 2014, 8.9 million disabled workers received benefits.

socialism
Economic system under which the ownership, management, and control of the means of production and distribution are held by the community or state; a command economy.

soffit
The finished underside of the eaves. A small ceiling like space, often out of doors, such as the underside of a roof overhang.

soft money loan
A loan where credit not cash is extended, usually by the seller carrying all or part of the financing.

soil banking
Land retired from crop cultivation and planted with soil-building crops; government subsidies are paid to farmers for their retired land.

soil moisture sensor
A soil moisture sensor is a device used to measure the amount of water present in the soil. It helps determine the moisture level by detecting changes in the electrical conductivity or resistance of the soil, which varies with water content. These sensors are crucial in precision agriculture as they provide real-time data, allowing farmers to optimize irrigation, reduce water waste, and ensure that crops receive the right amount of water for optimal growth.

solar heating
Solar heating is a system that uses the warmth of sun; passive when sunlight is allowed to warm tiles or other materials; active when water is passed through a solar collector, then recirculated.

Soldiers and Sailors Civil Relief Act
A law prohibiting foreclosures while a person is serving in the military and within three months thereafter except by court order.

sole ownership

sole proprietorship
A method of owning a business in which one person owns the entire business and reports all profits and losses directly on his or her personal income tax return, as contrasted with corporate, joint or partnership ownership. A sole or individual proprietorship is easy to organize and flexible to operate. It is frequently used in real estate brokerage. An individual proprietor may run a brokerage company if he or she has a valid broker’s license. The proprietor may use his or her own name or a fictitious name previously registered as required by state law. There is a growing tendency for sole proprietors to incorporate and thus take advantage of certain tax and fringe benefits, such as those provided by pension and profit-sharing plans.

sole tenancy
See tenancy in severalty

solemn form
The goal of the solemn form process is to ensure that the deed accurately reflects the wishes of the grantor, and that it was executed in accordance with the law.

solicitation
In contract law, there is a great difference between “solicitation of an offer” and “offer”. An offer creates a power of acceptance in the other party (offeree) and a corresponding liability on the offeror. Solicitation of an offer is merely an invitation to negotiate. There is no power of acceptance with a solicitation.

solicitation materials
“Solicitation materials intended to be the first point of contact with consumers” includes business cards, stationery, advertising fliers, and other materials designed to solicit the creation of a professional relationship between the licensee and a consumer, and excludes an advertisement in print or electronic media and “for sale” signs.

solid core door
A door where the inner material (core) is made of solid wood. This type door is usually used for doors to the outside or garage.

solid waste
As defined under Resource Conservation and Recovery Act, any solid, semi-solid, liquid, or contained gaseous materials discarded from industrial, commercial, mining, or agricultural operations, and from community activities. Solid waste includes garbage, construction debris, commercial refuse, sludge from water supply or waste treatment plants or air pollution control facilities, and other discarded materials.

SONYMA (State of New York Mortgage Agency)
SONYMA is the acronym for State of New York Mortgage Agency.

SONYMA Achieving the Dream Program
The SONYMA Achieving the Dream Program provides lower interest rates to low-income, first-time homebuyers. The program provides qualified low-income, first-time homebuyers with low down payment mortgage financing on one- and two-family dwellings (including condominiums and cooperative apartments, as well as manufactured homes permanently attached to real property) at a low fixed interest rate.

SONYMA Construction Incentive Program
The SONYMA Construction Incentive Program allows qualified buyers to obtain financing for the purchase of newly constructed or rehabilitated one- and two-family homes. SONYMA’s Construction Incentive Program was created in an effort to stimulate the construction of one- and two-family homes.

SONYMA Homes for Veterans Program
The SONYMA Homes for Veterans Program allows qualified veterans to apply for any currently available SONYMA program with more favorable terms. A change in federal law enables SONYMA to waive the first-time homebuyer requirement for any veterans (and their spouse or co-borrower) who served in active military, naval, or air service, or who have been discharged or released from their military duties under conditions other than dishonorable.

SONYMA Low Interest Rate Mortgage Program
The SONYMA Low Interest Rate Mortgage Program offers competitive interest rate mortgages to low- and moderate-income households that feature first-time homebuyers, except in target areas.

SONYMA Mortgage Insurance Fund (MIF)
The SONYMA Mortgage Insurance Fund (MIF) promotes the preservation and revitalization of communities across New York by providing insurance on mortgage loans that encourages investment of capital by commercial and public lenders.

SONYMA Remodel New York Program
The SONYMA Remodel New York Program provides competitive interest rate financing to qualified first-time homebuyers for the purchase and renovation of homes in need of improvements or repairs. Under Remodel New York, SONYMA will finance both the purchase and the renovation of the home with one mortgage.

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source reduction
The design, manufacture, purchase, or use of materials (such as packaging) that reduce the amount or toxicity of garbage. Source reduction can reduce waste disposal and handling costs because the expense of recycling, composting, combustion and landfill are avoided. Source reduction conserves resources and reduces pollution.

spatial data
Spatial data, also known as geospatial data, refers to information about the physical location and shape of objects, features, and phenomena on the Earth’s surface. This type of data is characterized by its association with geographic coordinates or other spatial identifiers.

spec building
Speculative, or “spec” buildings, are built by developers with the goal of attracting buyers during or shortly after construction. The builder acquires the funds and builds. Then when the property is sold, the builder receives the sales proceeds and hopes to make a profit.

special agent
One authorized by a principal to perform a particular act or transaction without contemplation of continuity of service as with a general agent. The real estate broker is ordinarily a special agent appointed by the seller to find a ready, willing and able buyer for a particular property. An attorney-in-fact under a limited power of attorney is a special agent.

special assessment
A tax or levy customarily imposed against only those specific parcels of realty that will benefit from a proposed public improvement, as opposed to a general tax on the entire community. Because the proposed improvement will enhance the value of the affected homes, only those affected owners must pay this special lien. Common examples of special assessments are water, sidewalk and sewer assessments, or other special improvements such as parks and recreational facilities.

special detainer action
The special detainer action is limited to residential leases and is part of the Arizona Residential Landlord and Tenant Act. After proper notice is given, a court proceeding is conducted. The result of the court hearing is either an order for the tenant to vacate the premises or a dismissal of the detainer action.

special limitation
A fee simple estate may also be qualified by a special limitation. The estate ends automatically upon the current owner’s failure to comply with the limitation. The former owner retains a possibility of reverter. If the limitation is violated, the former owner (or his or her heirs or successors) reacquires full ownership, with no need to reenter the land or go to court. A fee simple with a special limitation is also called a fee simple determinable because it may end automatically. The language used to distinguish a special limitation-the words “so long as” or “while” or “during”-is the key to creating this estate.

special power of attorney
Authorization to act for someone else for a specific purpose, such as a real estate transaction. (See power of attorney)

special studies zone
A specific area where an investigation is taking place regarding seismic or geologic considerations.

special warranty deed
A deed in which the grantor warrants or guarantees the title only against defects arising during the period of his or her tenure and ownership of the property and not against defects existing before that time. Such a deed is usually identified by the language “by, through, or under the grantor, but not otherwise.” A special warranty deed is often used when a fiduciary such as an executor or trustee conveys the property of his or her principal, because the fiduciary usually has no authority to warrant against acts of his or her predecessors in title.

special-purpose property
Hotels, resorts, nursing homes, theaters, schools, places of worship and other organizations whose specialized needs dictate the design and operation of the property.

specific denial
Any allegation not denied is deemed to be admitted. When a party intends in good faith to deny only a part of an allegation, the party shall admit so much of it as is true and shall deny the remainder.

specific field questions
Questions that you can ask about how to get a job in a specific field; i.e., branch of knowledge; “in what discipline is his doctorate?”; “teachers should be well trained in their subject”; “anthropology is the study of human beings” [syn: discipline, subject, subject area, subject field, field of study, study, branch of knowledge]

specific lien
A lien affecting or attaching only to a certain, specific parcel of land or piece of property. (See lien)

specific performance
An action brought in a court of equity in special cases to compel a party to carry out the terms of a contract. The basis for an equity court’s jurisdiction in breach of a real estate contract is the fact that land is unique and mere legal damages would not adequately compensate the buyer for the seller’s breach.

speculating
Speculating is buying real estate without doing much, if any, due diligence and simply hoping the value of the property will increase over time. It is not smart, prudent, nor likely to be a successful way to try to increase one’s long term wealth. You may win big a few times and then think you are invincible‚ but soon enough it is more likely than not that you will lose it all on your next deal(s).

splash block
A small, specially designed portable concrete pad. Oriented downhill, splash blocks direct water from rain gutter down drains or under outside hose faucets to flow away from the house.

split-entry
A one-story house constructed on an elevated foundation, with the entry between the upper and lower floors, that allows additional living space in the lower level.

split-fee financing
A form of joint venture participation where the lender purchases the fee land under the proposed development project and leases it to the developer. The lender also finances the improvements to be constructed on this leasehold. (See joint venture)

split-level
A house that has three separate levels of space, with the entry to a single level that provides access to a second story that is over a garage space.

spot zoning
Zoning of parcels not in conformance with the general zoning of an area. (See zoning)

sprinkler system
In property management, a sprinkler system is an automated fire protection system designed to detect and extinguish fires by discharging water when a fire is detected. It consists of a network of pipes and sprinkler heads installed throughout a building. The system activates individually at the site of a fire, helping to control or extinguish it before it can spread, thereby protecting property and occupants.

square footage

square-foot method
A method of estimating a building’s construction, reproduction or replacement costs; whereby the structure’s square-foot floor area is multiplied by an appropriate construction cost per square foot. (See appraisal)

staff authority
Staff authority is given to the people responsible for providing administrative support. Staff managers do not command others. They have the power to provide advice, support, and service to line departments. Examples of staff authority are found in personnel, purchasing, engineering, and finance.

staging
Put simply, staging means preparing the home for a potential buyer — or “setting the stage,”. It might involve redecorating, rearranging furniture, cleaning and other aesthetic strategies to present the home in the best possible light. The goal is to make the home as appealing as possible to the most potential buyers.

stakeholder
A person with an interest or concern in something.

Standard & Poor’s 500 Index
Standard & Poor’s 500 is an index of 500 stocks chosen for market size, liquidity and industry grouping, among other factors. The S&P 500 is designed to be a leading indicator of U.S. equities and is meant to reflect the risk/return characteristics of the large cap universe. Companies included in the index are selected by the S&P Index Committee, a team of analysts and economists at Standard & Poor’s. The S&P 500 is a market value weighted index – each stock’s weight is proportionate to its market value.

standard coverage policy
A standard coverage policy normally insures the title as it is known from the public records. In addition, the standard policy insures against such hidden defects as forged documents, conveyances by incompetent grantors, incorrect marital statements and improperly delivered deeds. (See extended coverage policy, title insurance)

standard deduction
Located on 1040 Form Line 40. This is a free deduction the government gives you take deduct against your income. This amount is compared to your Schedule A Itemized Deduction amount and the taxpayer takes the larger of the two as their deduction.

standard deviation
A measure of the difference between individual entities, called variates, and an entire population, in which the square root of the sum of the squared differences between each variate and the mean of all variates in the population is divided by the number of variates in the population.

standard of care
A statement of duties expressing the conduct expected of a professional such as a real estate Broker , Agent or Appraiser.

standard subdivision
Area of land divided into parcels intended for separate ownership, with no common (shared) ownership by all of the owners of any of the land.

standard terms/forms
1. Pre-written, pre-approved language, appropriate to various situations, that is ready to be inserted into contracts and documents. 2. Pre-written, pre-approved forms, appropriate to various situations.

standards of practice
A professional code of behavior for real estate professionals promulgated by the National Association of Realtors.

standby fee
Fee paid by builder to mortgage banker in exchange for agreement to make mortgage loans available at a stated price at a future time.

standby takeout commitment
An agreement by an interim lender to advance funds to take out a construction lender. (See interim financing)

stare decisis
The reliance of courts on previous decisions when judging disputes. (See common law)

starting time
Date on which a construction project begins (work starts or materials are provided).

state
Any state of the United States, the District of Columbia, Puerto Rico, the Northern Mariana Islands, and any territory or possession of the United States.

State Coastal Conservancy Act
The State Coastal Conservancy Act, officially known as the State Coastal Conservancy Act of 1976, is a piece of California legislation codified in Division 21 (commencing with Section 31000) of the California Public Resources Code. This act established the State Coastal Conservancy and provides its powers and responsibilities related to the preservation, restoration, and enhancement of California’s coastal resources.

State Home Foreclosure Prevention Project
The State Home Foreclosure Prevention Project was authorized by the Commissioner of Banks to seek solutions to avoid foreclosures for home loans in North Carolina.

State of New York Municipal Bond Bank Agency (MBBA)
The State of New York Municipal Bond Bank Agency (MBBA) provides access to the capital markets for special programs and purposes that benefit the municipalities of New York.

state-licensed loan originator
A state-licensed loan originator is an individual who is an MLO or engages in the activities of an MLO, not an employee of a depository institution or a subsidiary that is owned and controlled by a depository institution or regulated by a federal banking agency, licensed or required to be licensed pursuant to the Mortgage Loan Originator Licensing Act, and registered as a state-licensed loan originator with, and maintains a unique identifier through, the NMLS&R.

stated income loan
A stated income loan is a mortgage where the lender does not verify the borrower’s income. Borrowers are asked to state their income, and taken at their word. Often called the liar loan.

statement of information
Also called a “Statement of Identity.” Statements provided to the escrow agent verifying pertinent data identifying the grantor, grantee, or borrower.

statement of reasons
The Federal Equal Credit Opportunity Act (ECOA) (Title VII of the Consumer Protection Act) requires that a lender/creditor who denies an application for credit must provide the applicant with a statement of reasons, or written notification of the applicant’s right to obtain a statement of reasons, within thirty days after receipt of a completed application for credit. (See Equal Credit Opportunity Act)

static random access memory (SRAM)
A type of memory that does not need to be refreshed. (See DRAM, RAM, ROM, SDRAM)

statute of frauds
State law that requires certain contracts to be in writing and signed by the party to be charged (or held) to the agreement in order to be legally enforceable.

statute of limitations
That law pertaining to the period of time within which certain actions must be brought to court. The law is intended to protect the vigilant against stale claims by requiring the prompt assertion of claims; thus an action must be brought (i.e., the complaint filed) within a specified time of the occurrence of the cause of action. After the time period expires, the claim is said to be “outlawed” and may not be enforced in court. The theory behind the statute of limitations is that there must be some end to the possibility of litigation. It is said that stale witnesses and stale records produce little truth and result in accidental justice, if any.

statutory dedication
Dedication of an easement for public use under the provisions of the California Subdivision Map Act. (See easement)

statutory definition
A statutory definition is one that is enacted and required by statute. It requires the word (where used in any statute) to be interpreted in only one way – the statutorily mandated way.

statutory independent contractors
Federal tax law prescribes a three-part test for a salesperson to be considered a statutory independent contractor (described in the federal tax code as statutory nonemployee): (1) a properly issued real estate license; (2) a written independent contractor agreement with the company/broker; and (3) substantially all of the compensation must be based on output or production, not hours worked. Statutory nonemployee or independent contractor status is established when all three requirements are satisfied, at least for federal tax purposes.

statutory law
The laws, rules and regulations enacted by legislatures and other governing bodies. (See civil law, common law, constitutional law)

statutory lien
A lien imposed on property by statute—a tax lien, for example—in contrast to an equitable lien, which arises out of common law. (See lien)

statutory redemption
The right of a defaulted property owner to recover the property after its sale by paying the appropriate fees and charges. (See equitable redemption)

statutory time period
A required period of time legally alloted and documented for a certain procedure or situation.

stay of proceedings
The stoppage of an entire case or a specific proceeding within a case. This type of stay is issued to postpone a case until a party complies with a court order or procedure. A court may stay a proceeding for a number of reasons. One common reason is that another action is under way that may affect the case or the rights of the parties in the case.

steering
Steering is the illegal practice of showing potential buyers homes located only in certain neighborhoods. This practice makes certain homes unavailable to some buyers on the basis of race or national origin and on these grounds is prohibited by provisions of the federal fair housing act. Steering is often difficult to detect, however, because the steering tactics can be so subtle that the home buyer is unaware that his or her choice has been limited. Steering could be a licensee’s use of a word, phrase or act that is intended to influence the choice of a prospective property buyer on a discriminatory basis.

stigmatized property
A property that has acquired an undesirable reputation due to an event that occurred on or near it, such as violent crime, gang-related activity, illness or personal tragedy. Because of the potential liability to a licensee for inadequately researching and disclosing material facts concerning a property’s condition, licensees should seek competent counsel when dealing with a stigmatized property. Some states restrict the disclosure of information about stigmatized properties. In other states, the licensee’s responsibility may be difficult to define because the issue is not a physical defect, but merely a perception that a property is undesirable.

stipend
A fixed and regular payment, such as a salary for services rendered or an allowance.

stipulation
An agreement made by parties or by their attorneys in a judicial proceeding before the court or presiding entity. A stipulation is basically, an acknowledgement that the stipulating party does not intend to produce evidence to dispute a matter.

stock cooperative
Ownership of real property by a corporation where each stockholder is entitled to occupancy of a unit under a lease. (See cooperative)

stop date
Date on a term loan when the balloon payment is due. (See balloon payment)

stop notice
A notice given to a lender that a subcontractor has not been paid. Unless bond is posted, the lender must withhold moneys due a prime contractor.

storage device
A computer device designed to accept, process, store data. The storage device receives data from RAM, where it is written to a storage medium (CD, disk, tape).

storage device
A computer device designed to accept, process, store data. The storage device receives data from RAM, where it is written to a storage medium (CD, disk, tape). (See CD, RAM)

straight (term) loan
A loan in which only interest is paid during the term of the loan, with the entire principal amount due with the final interest payment.

straight note
A promissory note evidencing a loan in which payments of interest only are made periodically during the term of the note, with the principal payment due in one lump sum upon maturity. A straight note is usually a non-amortized note made for a short term, such as three to five years, and is renewable at the end of the term. (See promissory note)

straight-line method
A method of depreciation, also called the age-life method, that is computed by dividing the adjusted basis of a property by the number of years of estimated remaining useful life. The cost of the property is thus deducted in equal annual installments. For example, if the depreciable basis is $ 100,000 and the estimated useful life is 25 years, the annual depreciation deduction is $4,000 for each year during the useful life of the asset. Prior to 1986, taxpayers sometimes used a form of accelerated depreciation such as 175 percent of straight line. The IRS had rules to recapture the amount of depreciation that was in excess of the straight-line rate. (See adjusted basis, depreciation)

strategies
Strategies are plans of action or policy designed to achieve major or overall aims.

stratified marketplace
The real estate market is a marketplace that is stratified based on price.

straw borrower
A straw borrower is an individual whose identity and credit history are used to obtain loans in mortgage fraud schemes.

straw buyer
A straw buyer is a person who buys property in order to conceal the actual owner. The straw buyer does not intend to occupy the property or make payments and often deeds the property to the other individual immediately after closing. The straw buyer is usually compensated for use of his identity.

straw buyer
A straw buyer is a person who buys property in order to conceal the actual owner. The straw buyer does not intend to occupy the property or make payments and often deeds the property to the other individual immediately after closing. The straw buyer is usually compensated for use of his identity. (See equity skimming)

stress
A force exerted on a body that tends to strain or deform its shape; the intensity of such force, usually measured in pounds per square inch.

striated muscle
Muscle tissue marked by traverse dark and light bands, that is made up of elongated multinuclear fibers that is found in the muscles under voluntary control clothing the vertebrate skeleton. (See muscle)

strict foreclosure
In a strict foreclosure procedure, after a delinquent borrower has been notified and the proper papers have been filed, the court designates a specific period during which the balance of the default must be paid in full. If the payment is not made, the borrower’s equitable and statutory redemption rights are waived and the court awards full legal title to the lender. There is no deficiency judgement in strict foreclosure cases. (See foreclosure, judicial foreclosure, nonjudicial foreclosure)

strict liability
An owner of a property is responsible to an injured party without excuse. (See liability)

stripped mortgage-backed securities (SMBS)
Securities created by “stripping” or separating the principal and interest payments from the underlying pool of mortgages into two classes of securities, with each receiving a different proportion of the principal and interest payments.

structural density
Structural density refers to the concentration of buildings or structures within a specific area, typically measured in terms of floor area ratio (FAR), buildings per acre, or units per acre. This metric helps assess how intensively land is being used for development and can indicate the level of urbanization in an area. Higher structural density often correlates with more efficient land use, supporting a greater number of residences, businesses, or facilities within a given space, and can influence infrastructure planning, transportation needs, and zoning regulations.

Structural pest control clearance
Estimated cost the seller will incur for fumigation or to correct damage from an infestation or conditions supporting an infestation. (If this is not applicable, or if buyer will pay this fee as a condition of the loan, enter ‘00.00’.)

Structural pest control report
The fee a pest control operator will charge to conduct a physical inspection and submit a report on his findings. (If this is not applicable, or if buyer will pay this fee as a condition of the loan, enter ‘00.00’.)

structured query language (SQL)
A programming language for creating database queries. (See query)

stucco
Stucco is a type of plaster used for exterior wall finishing.

studs
Studs are vertical wall supports; wood studs are used in a wood-frame structure and steel studs are used in a steel-frame structure.

subagent
An agent of a person who is already acting as an agent for a principal. The original agent can delegate authority to a subagent where such delegation is either expressly authorized or customary in the trade. For example, it is customary for listing brokers to delegate certain functions of a ministerial nature to subagents, such as to show property and solicit buyers.

Subdivided Land Law
A disclosure law enacted to protect buyers of subdivided parcels. A public report is required for subdivisions of five or more parcels. This law ensures that subdivided land transactions in California are conducted transparently and with consumer protection in mind. (See public report, subdivision) Further information about the Subdivided Lands Law is available at www.ceres.ca.gov/planning/planning_guide/plan_index.html.

subdivider
One who buys undeveloped land, divides it into smaller, usable lots and sells the lots to potential users. (See subdivision)

subdivider (Arizona Definition)
A person who owns six or more lots, parcels, units or interests and has an intention to sell, lease or exchange the parcels.

subdivision
Any land that is divided or is proposed to be divided for the purpose of disposition into two or more lots, parcels, units or interests. Subdivision refers to any land, whether contiguous or not, of two or more lots, parcels, units or interests are offered as part of a common promotional plan of advertising and sale. (See subdivider)

subdivision (Arizona Definition)
Any land that is divided or is proposed to be divided for the purpose of sale lease or exchange into six or more lots, parcels, units or interests. Subdivision refers to any land, whether contiguous or not, of six or more lots, parcels, units or interests are offered as part of a common promotional plan of advertising and sale.

subdivision and development ordinances
Municipal ordinances that establish requirements for subdivisions and development.

subdivision development method
A method of valuing land to be used for subdivision development. It relies on accurate forecasting of market demand, including both forecast absorption (the rate at which properties will sell) and projected gross sales (total income that the project will produce); also called the land development method.

subdivision map
A subdivision map is a document showing a division of land into two or more parcels, required before a subdivision can be approved. (See subdivision)

Subdivision Map Act
An act providing for local control of subdivisions. Cities and counties are required by state law to adopt an ordinance to regulate subdivisions. (See subdivision) Information on subdivisions can be found at www.ceres.ca.gov/planning/planning_guide/plan_index.html.

subdivision system
A method of describing real property that identifies a parcel of land by reference to lot and block numbers within a subdivision, as specified on a recorded subdivision plat. (See subdivision)

subjacent support
The support provided to a surface property from the underlying land or structures. This concept is particularly relevant in situations involving mineral rights or underground construction such as basements, tunnels, or subsurface parking. (See also lateral support)

subject property
A reference to the real property under discussion, or the real property under appraisal. (See appraisal)

subject to
When a grantee takes title to real property “subject to” a mortgage or trust deed, the grantee makes payments on the loan, but is not personally obligated to pay the debt in full. The original maker of the note retains primary responsibility for the underlying debt.

subject to defect
When title to a property is accepted subject to a defect, the owner accepts responsibility and liability for the defect, whether the defect is an easement, encroachment, or lien(either recorded lien or potential lien).

sublease
A lease given by a lessee for a portion of the leasehold interest, while the lessee retains some reversionary interest. The sublease may be for all or part of the premises, for the whole term or part of it, as long as the lessor retains some interest in the property. Leases normally contain a clause prohibiting subletting without prior consent of the lessor. The lessee remains directly liable to the lessor for the rent, which is usually paid by the sublessee to the lessee and then from the lessee to the lessor. The sublessee does not have a contractual obligation to pay rent to the original lessor.

sublet
The partial transfer of a tenant’s right in a rental property to a third party. (See sublease)

subordination
Subordination is the act of yielding priority. In a mortgage, a clause in which the holder of a mortgage permits a subsequent mortgage to take priority. This clause provides that if a prior mortgage is paid off or renewed, the junior mortgage will continue in its subordinate position and will not automatically become a higher or first mortgage. A subordination clause is usually standard in a junior mortgage, because the junior mortgagee gets a higher interest rate and is often not concerned about the inferior mortgage position. (See junior mortgage)

subordination agreement
A written agreement between lienholders to change the priority of mortgage, judgment and other liens. Under a subordination agreement, the holder of a superior or prior lien agrees to permit a junior lienholder’s interest to move ahead of his or her lien. (See junior mortgage, lien)

subpoena duces tecum
A Latin word meaning literally, “under penalty you shall bring with you.” A writ or subpoena directing a person to appear in court and to bring some document or evidence in a person’s possession described in the writ.

subprime lending
Subprime mortgage loans are made to borrowers who have weakened credit histories and reduced repayment capacity and, therefore, are a higher risk of default than prime borrowers. Subprime lenders specialize in B, C, or D category paper. (See B, C, or D paper)

subprime statement
Used to refer to the Statement on Subprime Mortgage Lending.

subrogation
The substitution of one creditor for another, with the substituted person succeeding to the legal rights and claims of the original claimant. Subrogation is used by title insurers to acquire from the injured party rights to sue in order to recover any claims they have paid.

subscribe
1) to give, pay, or pledge (a sum of money) as a contribution, investment, etc. 2) to append one’s signature or mark to (a document), as in approval or attestation of its contents.

subsequent adjustment cap
The cap that indicates how much the interest rate can increase in the adjustment periods that follow the initial adjustment cap.

subsequent owner exemption
As a subsequent owner of lots located in a single platted subdivision for which there is a current and accurate public disclosure report ISSUED WITHIN THE PAST 5 YEARS, the subsequent owner might be able to use the public disclosure report or last amended public disclosure report if no material changes other than ownership and financing have been made.

substantial fault of the borrower
Substantial fault of the borrower occurs when the borrower fails to provide information or documentation required by the lender or broker in a timely manner; provides information in the application or elsewhere that proves to be significantly inaccurate, causing the need for review or further investigation by the lender or broker; fails to produce by the date specified by the lender all documentation required for closing; or fails to be ready, willing, or able to close the loan by the date specified by the lender or broker.

For purposes of this definition, a borrower who provides information or documentation within seven days after requested is not liable to a charge of substantial fault of the borrower. Also, the information provided by the borrower is considered significantly inaccurate if the correct information affects the borrower’s eligibility for the loan for which application is made.

substantial presence test
The Substantial Presence Test (SPT) is a criterion used by the Internal Revenue Service (IRS) in the United States to determine whether an individual who is not a citizen or lawful permanent resident in the recent past qualifies as a “resident for tax purposes” or a “nonresident for tax purposes”. For further information, see the I.R.S. website, here:

substantive policy
Substantive policy statements are written expressions which inform the general public of an agency’s current approach to rule or regulation practice. These are the ‘prescriptions’ as laid down by the agency heads. Future agency heads can choose to adopt these same policies or prescribe new ones.

substitution
An appraisal principle that states that the maximum value of a property tends to be set by the cost of purchasing an equally desirable and valuable substitute property, assuming that no costly delay is encountered in making the substitution. (See appraisal)

substitution of entitlement
Replaces one eligible veteran with another on an existing Veterans Administration loan. The entitlement is restored to the original veteran. (See Veterans Administration loan)

subsurface rights
Ownership rights in a parcel of real estate to the water, minerals, gas, oil and so forth that lie beneath the surface of the property. (See surface rights)

subterfuge
A clever trick or strategy used to evade a rule, escape a consequence, hide something, etc.

subterranean termites
A type of termite that nests underground. (See termite inspection)

succession planning
Succession planning is the identification and development of potential successors for key positions in an organization, through a systematic evaluation process and training.

successor trustee

successors
Those who succeed to or to whom the corporation’s rights in the property are transferred. (See heirs)

suit for possession
A court suit initiated by a landlord to evict a tenant from leased premises after the tenant has breached one of the terms of the lease or has held possession of the property after the lease’s expiration.

suit for specific performance
If a seller breaches a real estate contract, the buyer may sue for specific performance. The buyer asks the court to force the seller to go through with the sale and convey the property as previously agreed. The buyer may choose to sue for damages, in which case the buyer asks that the seller pay for costs and hardships suffered as a result of the seller’s breach.

suit to quiet title
A court action intended to establish or settle the title to a particular property, especially when there is a cloud on the title.

summary judgment
A judgment granted on a claim or defense upon which the movant for the summary judgment is entitled to prevail. It is basically judgment that is issued without a court hearing.

summary report
A summary report is an appraisal report using a standardized form, such as the Uniform Residential Appraisal Report (URAR) developed by Fannie Mae and Freddie Mac.

summary suspension
Summary suspension means the immediate suspension of either a real estate license the ADRE pending administrative proceedings for suspension, revocation, or other actions deemed necessary by the department. The summary suspension happens even before a hearing.

summation method
Another name for the cost approach to appraising.

summons
Writ or process commencing the plaintiff’s (complainant’s) action and requiring the defendant to appear and answer.

sump
A reservoir that collects and holds water or some other liquid, which is subsequently disposed of by using a pump.

superadequancy
A structural feature that is not fully valued by the marketplace; an item in which its cost exceeds its value.

supercomputer
A supercomputer is a computer that performs at or near the current highest operational rate for computers. A supercomputer is typically used for scientific and engineering applications that must handle very large databases or do a large amount of computation (or both).

Superfund
Popular name of the hazardous waste cleanup fund established by the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) as amended by the Superfund Amendment and Reauthorization Act of 1986 (SARA). Superfund focuses on the cleanup of releases of hazardous substances on property. It creates significant legal exposure based on strict liability for owners, landlords and, sometimes lenders.
EPA—Superfund Homepage

Superfund Amendments and Reauthorization Act (SARA)
An amendatory statute that contains stronger cleanup standards for contaminated sites, increased funding for Superfund and clarifications of lender liability and innocent landowner immunity. (See Comprehensive Environmental Response, Compensation and Liability Act)
  EPA—SARA Overview

superintendent
The chief officer of the AZDFI, who is appointed by the governor and sits on the Governor’s Executive Cabinet.

Superintendent
The chief officer of the AZDFI, who is appointed by the governor and sits on the Governor’s Executive Cabinet.

supplemental assessment
Additional “catch-up” property tax assessment following a sale or other reassessment event. (See assessment)

supplemental instructions
In a purchase transaction, the escrow holder usually prepares only instructions referred to as supplemental instructions if the purchase agreement used is one provided by the California Association of REALTORS® (CAR). The CAR form already includes joint escrow instructions (joint meaning instructions prepared on one form for both the buyer and the seller) and therefore do not need to be prepared again by the escrow holder.

supplier model
The supplier controls the selection of products and services offered in the marketplace, essentially a take-it-or-leave-it model.

supply
The amount of goods available in the market to be sold at a given price. The term is often coupled with supply and demand The appraisal principle that follows the interrelationship of the supply of and demand for real estate. As appraising is based on economic concepts, this principle recognizes that real property is subject to the influences of the marketplace just as is any other commodity. (See appraisal, demand)

supply and demand
The principle of supply and demand takes into account the effect on market value of the relationship between the number of properties on the market at a given time and the number of potential buyers.

surety bond
An agreement by an insurance or bonding company to be responsible for certain possible defaults, debts or obligations contracted for by an insured party; in essence, a policy insuring one’s personal and/or financial integrity. In the real estate business a surety bond is generally used to ensure that a particular project will be completed at a certain date or that a contract will be performed as stated.

surface rights
Ownership rights in a parcel of real estate that are limited to the surface of the property and do not include the air above it (air rights) or the minerals below the surface (subsurface rights).

surface water
Waters of all sources, flowing in streams, canyons, ravines or other natural channels, or in definite underground channels, whether perennial or intermittent, floodwaters, wastewaters, or surplus water, and of lakes, ponds and springs on the surface.

surplus productivity
Amount remaining after expenses of property ownership (capital, labor, and management) are deducted from net income, representing the investor’s return on the use of the land.

surrender
Giving up leasehold rights by a tenant in exchange for a release from future obligations under a lease.

survey
The process by which boundaries are measured and land areas are determined; the on-site measurement of lot lines, dimensions and position of a house on a lot, including the determination of any existing encroachments or easements.

Suspicious Activity Report (SAR)
A Suspicious Activity Report (SAR) is a document financial institutions must file with the Financial Crimes Enforcement Network (FinCEN) following a suspected incident of money laundering or fraud. SARs are required under the United States Bank Secrecy Act (BSA) of 1970. (See Bank Secrecy Act)

SWAP Program
A Freddie Mac program where lower yield mortgages are exchanged for Participation Certificates. (See participation certificates)

symmetry
The correspondence in size, shape, and relative positions of parts on opposite sides of a dividing line or plain or about a center of axis.

synchronous dynamic random access memory (SDRAM)
A type of DRAM that can run at a much higher clock speed than conventional computer memory. (See RAM, ROM, DRAM)

syndicate
A combination of people or firms formed to accomplish a business venture of mutual interest by pooling resources. In a real estate investment syndicate the parties own and/or develop property, with the main profit generally arising from the sale of the property.

syndication
A descriptive term for a group of two or more people united for the purpose of making and operating an investment. A syndication may operate in the form of a REIT, corporation, general partnership, limited partnership or even as tenancy in common. (See syndicate)

synthetic
Produced artificially; man made; devised or fabricated for special situations to imitate or replace reality.

system
A regularly interacting or interdependent group of items forming a unified whole; such a group under the influence of related forces (a gravitational system) or that tends to equilibrium (a thermodynamic system).

system theory
System theory is the interdisciplinary study of systems in general. Systems engineering seeks to use systems theory to combine various disciplines into an integrated whole.

systemic
Of, relating to, or common to a system as in affecting the body generally or in supplying those parts of the body that receive blood from the aorta rather than through the pulmonary artery.

Systemic bias
The inherent tendency of a particular system, process, or policy to support particular outcomes even while there is no intention to do so.

systems
The process of studying an activity; typically by mathematical means in order to define its goals and purposes and to discover operations and procedures for accomplishing them most efficiently.

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