LAND The surface of the earth; any part of the surface of the earth.

LAND BANKING The activity of purchasing land that is not presently needed for use at a later time.

LAND/BUILDING RATIO A ratio of relative values of the land to improvements. Contrast with improvement ratio.

LAND CONTRACT An installment contract for the sale of land whereby the seller has legal title until paid in full. The buyer has equitable title during the contract term.

LAND ECONOMICS The branch of economics that concentrates upon the economic attributes of land and the economics of agriculture.

LAND LEASE Only the ground is covered by the lease.

LANDLOCKED The condition of a lot that has no access to a public thoroughfare except through an adjacent lot. Compare with easement, right-of-way.

LANDLORD One who rents property to another; a lessor. A property owner who surrenders the right to use property for a specific time in exchange for the receipt of rent.

LANDLORD'S LIEN Several types of landlord?s liens are created by contract or by statute. Some examples are (1) A contractual landlord?s lien; (2) Statutory landlord?s lien; and (3) Landlord?s remedy of distress (or right of distraint), which is not truly a lien but has a similar effect.

LANDLORD'S WARRANT A warrant enabling a landlord to levy upon a tenant?s personal property (e.g., furniture, etc.) and to sell this property at a public sale to collect delinquent rent.

LANDMARK A fixed object serving as a boundary mark for a tract of land. Same as monument.

LAND RESIDUAL TECHNIQUE In appraisal, a method of estimating the value of land when given the net operating income (NOI) and value of improvements. Used for feasibility analysis and highest and best use.

LAND SALE-LEASEBACK The sale of land and simultaneous leasing of it by the seller, who becomes the tenant.

LANDSCAPE ARCHITECT A professional who designs building sites, subdivisions, and other projects which require work on drainage, grading, vegetation, installation of utilities and site improvements.

LAND, TENANTS AND HEREDITAMENTS Originally used to describe freehold estates only. The terms have come to mean the most technical and all-inclusive description of real estate.

LATCHES Undue delay or negligence in asserting one's legal rights, possibly leading to estoppel of negligent party suit

LAND USE INTENSITY A measure of the extent to which a land parcel is developed in conformity with zoning ordinances.

LAND USE PLANNING An activity, generally conducted by a local government, that provides public and private land use recommendations consistent with community policies. Generally used to guide decisions on zoning.

LAND USE REGULATION Government ordinances, codes, and permit requirements intended to make the private use of land and natural resources conform to policy standards.

LAND USE SUCCESSION A change in the predominant use of a neighborhood or area over time.

LATENT DEFECTS Flaws that are hidden but are apt to surface later.

LATE PAYMENTS A fee added to a bill after the expiration of a specific grace period. Such payments are intended to encourage timely payment of the bill.

LEASE An agreement whereby the owner of real property (i.e., landlord) gives the right of possession to another (i.e., tenant) for a specified period of time (i.e., term) and for a specified consideration (i.e., rent).

LEASE COMMENCEMENT DATE The date on which beneficial occupancy commences and the legal terms of the lease go into effect.

LEASED FEE The landlord's ownership interest of a property that is under lease.

LEASEHOLD The interest or estate on which a lessee (tenant) of real estate has a lease.

LEASEHOLD IMPROVEMENTS Improvements made to leased premises by a tenant. See also TENANT IMPROVEMENTS and WORKLETTER.

LEASEHOLD MORTGAGE A lien on the tenant's interest in real estate.

LEASEHOLD VALUE The value of a tenant's interest in a lease, especially when the rent is below market and the lease has a long remaining term.

LEASE WITH OPTION TO PURCHASE A lease that gives the lessee (tenant) the right to purchase the property at an agreed-upon price under certain conditions.

LEGAL AGE The official standard of maturity upon which one is held legally responsible for one's acts. Contracts for the sale or lease of real estate by a minor are voidable by the minor.

LEGAL DESCRIPTION A method of geographically identifying a parcel of land that is acceptable in a court of law

LEGAL NAME The name one has for official purposes.

LEGAL NOTICE Notification of others using the method required by law.

LEGAL OWNER The term is used to distinguish the legal owner from the equitable owner and not as opposed to an illegal owner. The legal owner has title to the property, although the title may actually carry no rights to the property other than to act as a lien.

LEGAL RESIDENCE Generally one's permanent home.

LEGAL TITLE Usually title without ownership rights, such as the title place in a trustee under a deed of trust, or the title in a vendor under a land contract.

LEGATEE One who receives property by will.

LESSEE A person to whom property is rented under a lease. A tenant. Compare with lessor.

LESSOR One who rents property to another under a lease. A landlord. Compare with lessee.

LESS THAN FREEHOLD ESTATE An estate in land that has a predetermined time span; most commonly a leasehold.

LET To rent a property to a tenant.

LETTER OF ATTORNMENT A letter from a grantor to a tenant, stating that a property has been sold, and directing rent to be paid to the grantee (i.e., the new owner). See also ATTORN.

LETTER OF COMMITMENT Official notification to a borrower of the lender's intent to grant a loan. Generally specifies the terms of the loan and sets a date for the closing.

LETTER OF CREDIT An engagement, pledge or commitment by a bank or person, made at the request of a customer, stating that the issuer will honor drafts or other demands for payment upon full compliance with the conditions specified in the letter of credit.

LETTER OF INTENT A formal method through which a prospective developer, buyer or tenant expresses his/her interest in property. Depending on the language, a legal obligation may be created.

LEVEL-PAYMENT MORTGAGE Requires the same payment each month (or other period) for full amortization.

LEVERAGE Use of borrowed funds to increase purchasing power and, ideally, to increase the profitability of an investment by financing a portion of it.

LEVY To legally impose or collect that which is due.

LIABILITY (1) A debt or financial obligation. Contrast with asset. (2) A potential loss.

LIABILITY INSURANCE Protection for a property owner from claims arising from injuries or damage to other people or property.

LIABLE Responsible or obligated. Contrast with exculpatory clause and non-recourse.

LIBOR London Interbank Offered Rate. The rate that international banks dealing in Eurodollars charge each other for large loans. Some domestic banks use this rate as an index for adjustable rate mortgages.

LICENSE (1) Permission. (2) A right granted by a state to an individual to operate as a real estate broker or salesperson.

LICENSED APPRAISER Generally an appraiser who meets certain state requirements, but lacks the experience or expertise of a certified appraiser.

LICENSEE One who holds a real estate license; a licensed salesperson or broker.

LICENSE LAWS Laws that govern the activities of real estate salespersons.

LICENSINRG EXAMINATION A written test given to a prospective real estate broker or salesperson to determine ability to represent the public in a real estate transaction. Most states offer examinations on at least 5 dates each year.

LIEN An encumbrance against property for money, either voluntary or involuntary. All liens are encumbrances but all encumbrances are not liens.

LIENHOLDER A mortgagee or other creditor who has a lien against the property of another.

LIEN, JUNIOR A lien that will be paid after earlier liens have been paid.

LIEN-THEORY STATES States whose laws give a lien on property to secure debt. Contrasted with title theory states in which the lender becomes the title owner. In either case the borrower has the right to use and enjoy the property in the absence of default; in the event of default, lenders may foreclose.

LIEN WAIVER (WAIVER OF LIENS) Generally, a waiver of mechanic?s lien rights signed by a general contractor and his subcontractors.

LIFE ESTATE A freehold interest (in real property) that expires upon the death of the owner or some other specified person (pur autre vie).

LIFE OF LOAN CAP A contractual limitation on the maximum interest rate that can be applied to an adjustable rate mortgage during the term of the loan.

LIFE TENANT One who is allowed to use property for life or the lifetime of another designated person.

LIKE-KIND PROPERTY A tax term used in certain real property exchanges. Property must be exchanged for like kind property and for tax consequences postponed pursuant to Section 1031 of the Internal Revenue Code.

LIMITED LIABILITY The restriction of one's potential losses to the amount invested. The absence of personal liability.

LIMITED PARTNERSHIP A partnership created under state law which consists of one or more general partners who conduct the business and are responsible for any losses, and one or more special or limited partners who contribute capital and are liable only up to the amount contributed.

LINEAL FOOT A measure of one foot, in a straight line, along the ground.

LINE OF CREDIT An agreement whereby a financial institution promises to lend up to a certain amount without the need to file another application.

LIQUIDATE (1) To dissolve a business. (2) To retire debts.

LIQUIDATED DAMAGES An amount agreed upon in a contract that one party will pay the other in the event of a breach of the contract.

LIQUIDATION VALUE The likely price that a property would bring in a forced sale (foreclosure or tax sale) or when marketed in less the normal exposure time or under other conditions which might depress the price obtained.

LIQUIDITY The ability to convert an investment into cash quickly without loss of principal.

LIS PENDENS Latin: "suit pending." Recorded notice of the filing of a suit, the outcome of which may affect title to a certain land.

LIST To obtain a listing.

LISTING AGREEMENT An agreement between a real estate broker and the property owner which authorizes the broker to assist in the sale or lease of that property in return for a fee, commission or other form of compensation. See also EXCLUSIVE LISTING AGREEMENT.

LISTING BROKER (AGENT) The licensed real estate broker (agent) who secures a listing of the property. Contrast with selling broker (agent).

LITIGATION The act of carrying on a lawsuit.

LITTORAL Part of the shore zone of a large body of water. Compare with riparian rights.

LOAN APPLICATION Document required by a lender prior to issuing a loan commitment. The application generally includes the following information: I - name of the borrower 2. amount and terms of the loan 3. description of the subject property to be mortgaged 4. borrower's financial and employment data.

LOAN APPLICATION FEE A charge required by a loan originator to be paid by the borrower to cover the credit report, property appraisal and other incidental expenses associated with underwriting the loan. The fee is generally not refundable.

LOAN COMMITMENT An agreement to lend money, generally of a specified amount, at specified terms at some time in the future.

LOAN CONSTANT Same as mortgage constant.

LOAN COVERAGE RATIO Same as debt coverage ratio.

LOAN OR MORTGAGE VALUE That portion of the value of the real property recognized by the lender when used to secure a loan.

LOAN PACKAGE The collection of documents associated with a specific loan application.

LOAN POINT A charge prepaid by the borrower upon the origination of the loan. One point equals 1% of the loan amount.

LOAN-TO-VALUE RATIO (LTV) The amount of money borrowed in relation to the total market value of the property. Expressed as the loan amount divided by the property value.

LOCATION, LOCATION, LOCATION The "three most important things about real estate"; a popular statement that emphasizes the importance of location with respect to the value of urban real estate.

LOCKED-IN INTEREST RATE The rate promised by a lender at the time of loan application. The promise is a legal commitment of the lender, though there may be qualifications or contingencies that allow the lender to charge a higher rate. On home loans, the lock-in is customarily provided for 1% of the amount borrowed, though often it is free-e of charge. On income property loans, a lock-in generally requires a commitment fee from the loan applicant.

LONG-TERM CAPITAL GAIN For income tax purposes, the gain on a capital asset held long enough to qualify for special tax considerations. Note: The highest rate for individuals in 1991 and thereafter for long-term capital gains was 28%. Check with your accountant for current rates.

LONG-TERM FINANCING Same as permanent mortgage.

LONG-TERM LEASE A lease whose term exceeds ten years from initial signing until the date of expiration or renewal option.

LOT A parcel of land, generally part of a series of parcels which make up a subdivision, the boundaries of which are created by and shown on a PLAT.

LOT AND BLOCK A method of locating a parcel of land.

LOT LINE A line bounding a lot as described in a property survey.

LOW-BALL OFFER An offer from a prospective property buyer that is much lower than the listing price. Such an offer may indicate the buyer's belief that the property will not attract many good offers and the asking price is unrealistic.

LOW-INCOME HOUSING (QUALIFIED) Housing that is eligible for special tax credits of up to 9% of their cost (4% in certain situations) under the 1986 tax act - Strict rules must be followed concerning tenant qualification, certification, and project financing.

LOW RISE A building with fewer than seven stories above ground level.

LTV Loan-to-value ratio.

LUMP SUM CONTRACT A construction contract requiring the contractor to complete a building for a specified amount, usually established by competitive bidding. The contractor absorbs any loss or retains any profit.

L/V Loan-to-value ratio.