Oscar Castillo
"Residential" Real Estate


    - Glossary





Uncollected rent   the actual uncollected rent or vacancy is subtracted from gross scheduled income. Uncollected rent is an estimate expressed as a percentage then converted to dollars.

Unconscionable contracts    an agreement that is so unfair and one-sided that the courts will refuse to honor it.

Underground storage tanks (USTs)    USTs are commonly used for storing petroleum products, chemicals or process wastes. Sites which use USTs include airports, gas stations, industrial locations and military bases. Over time neglected tanks may leak hazardous substances into the environment, contaminating groundwater. State and federal laws impose strict requirements on landowners where USTs are located to detect and correct leaks to protect groundwater.

Under Water  (home)   term used for a distressed home where the homeowner owes more than market value of the house.(see upside down)

Underwriter  The most important person in the mortgage approval process is the person you will never see or meet. That person is the underwriter. No lender will fund or close on a loan without the approval of an underwriter.  Think of the underwriter as a gatekeeper. The underwriter won’t let you in the front door unless you can thoroughly demonstrate your creditworthiness.  Underwriters are like real estate detectives. It’s their job to make sure you have represented yourself and your finances truthfully, and that you haven’t made any false or misleading claims on your loan application. Their standards are much higher than that of a Loan pre-approval and/or pre-qualification requirements.  Underwriters will check your credit score with the three major credit bureaus: Experian, Equifax and TransUnion. If there’s a red flag on your credit report—from such things as bankruptcies, late payments and collections—you will have to provide a letter of explanation with valid reasons for your past mistakes and the steps you have taken to correct the credit blemish. You may be able to overcome past credit problems if you have a solid employment history or agree to make a large down payment. Your income and the amount of money you owe will be factored in during the underwriting process. Generally, your total monthly debt obligation, including mortgage payments, should not exceed 43 percent of your pretax monthly income.  The higher your debt or lack of a sufficient income can increase your Debt-to-Income (DTI) and your perceived risk.  Also know that an "investigator" for the underwriter will contact your employer to verify the job and salary you listed on your loan application. If there is a question concerning your job history, credit report or personal finances, the underwriter will ask for additional information. It is the job of underwriters to make sure all of the following factors meet particular LOAN GUIDELINES. They make sure that all of the tax, title, insurance and closing documentation is in place.  Another aspect of the underwriting process is that the underwriter will review the APPRAISAL of your prospective home to make sure its value matches the size of the loan you are requesting.
The best thing you (the prospective buyer/s) can do to improve the chance of Loan approval is to respond to underwriter requests with prompt, complete and factual information.  Without an underwriter's approval, loans do not get funded which will result as escrow not being able to close. 

Underwriting   the process of the underwriter to evaluate a mortgage loan applicant's credit, collateral value and the risks in making a loan.

Undisclosed dual agency    A broker may not intend to create a dual agency.  However, like any other agency, it may occur unintentionally or inadvertently. Sometimes the cause is carelessness, and other times a salesperson does not fully understand his or her fiduciary responsibilities. Some salespersons lose sight of other responsibilities when they focus intensely on bringing buyers and sellers together. For instance, a salesperson representing the seller might suggest to a buyer that the seller will accept less than the listing price, or that same salesperson might promise to persuade the seller to accept an offer that is in the buyer's best interests. Giving a buyer any specific advice on how much to offer can lead him or her to believe that the salesperson represents the buyer's interests and is acting as the buyer's advocate.

Undue influence   strong enough persuasion to completely overpower the free will of another and prevent him or her from acting intelligently and voluntarily, as in a case where a broker guilty of blockbusting has induced someone to sell in fear of a change in the racial character of the community. Undue influence usually requires a close or confidential relationship like parent-child, broker-seller, attorney-client, or trustee-beneficiary. When a person has been unduly influenced to sign a contract, that person can void the contract.

Unenforceable contract   a contract which is considered unenforceable either because it cannot be proven or will not be enforced by a court. In addition to being considered void or illegal, other reasons for unenforceable contracts may be because they were not presented in writing which may have been a requirement under state statutes of frauds or the statutes of limitations period has elapsed.

Unequivocal   unambiguous; clear; having only one possible meaning or interpretation.

Uniform Building Code   a national building code published by the International Conference of Building Officials. It has been adopted in part by municipalities throughout the United States, but used mostly in the western states

Uniform Commercial Code   a codification of commercial law, adopted in most states, that attempts to make uniform all laws relating to commercial transactions, including chattel mortgages and bulk transfers. Security interests in chattels are created by an instrument known as a security agreement. To give notice of the security interest, a financing statement must be recorded. Article 6 of the code regulates bulk transfers--the sale of a business as a whole, including all fixtures, chattels and merchandise.

Uniform Condominium Act (UCA)    many states have adopted the Uniform Condominium Act (UCA). Under its provisions, a condominium is created and established when the owner of an existing building (or developer of unimproved property) executes and records a declaration of condominium.

Uniform Partnership Act (UPA)   most states have adopted the "Uniform Partnership Act" (UPA), which permits real estate to be held in the partnership name. The "Uniform Limited Partnership Act" (ULPA) has also been widely adopted. It establishes the legality of the limited partnership entity and provides that realty may be held in the limited partnership's name. Profits and losses are passed through the partnership to each partner, whose individual tax situation determines the tax consequences.

Uniform Residential Landlord and Tenant Act (URLTA)   a uniform act intended to provide some consistency in regulating the relationship of landlord and tenant in residential leases. A number of states have adopted all or parts of the URLTA, or have enacted similar legislation.

Uniform residential loan application   a loan application form required by Freddie Mac and Fannie Mae.

Uniform Settlement Statement   the standard HUD Form 1 required to be given to the borrower, lender and seller at the time or before settlement by the settlement agent in a transaction covered under the Real Estate Settlement Procedures Act. The lender must retain its copy for at least two years.

Unilateral contract   a one-sided contract wherein one party makes a promise so as to induce a second party to do something. The second party is not legally bound to perform; however, if the second party does comply, the first party is obligated to keep the promise.

Unit-in-place method   the appraisal method of estimating building costs by calculating the costs of all of the physical components in the structure with the cost of each item including its proper installation, connection, etc. Also called the segregated cost method.

Unity of ownership   the four unities that are traditionally needed to create a joint tenancy-unity of title, time, interest and possession.

Unity of possession   one of the four "unities" required to create a joint tenancy. All joint tenants hold an undivided right to possession.

Unlawful detainer action   a legal action that provides a method of evicting a tenant who is in default under the terms of the lease; a summary proceeding to recover possession of property.

Universal agent   a person empowered to do anything the principal could do personally. The universal agent's authority to act on behalf of the principal is virtually unlimited.

Unruh Civil Rights Act   forbids discrimination as to sex, race, color, religion, ancestry or national origin in accommodations and business establishments. Under this law there can be no arbitrary eviction, rent increase or withholding of services by virtually any landlord, including the owner of a nonowner-occupied single-family dwelling that is sold or leased for income or gain. Example: Bob (lessor) brings an action to evict Adam (lessee) from one of his rental properties because Adam has long hair, associates with black people and homosexuals, receives public assistance and is a student.  Len will not be successful because all of those "reasons" are arbitrary and fail to establish good cause for an eviction.

Unsecured   describes a debt instrument, such as a debenture, that is backed only by the debtor's promise to pay.

Upside down (home)   term used for a distressed home where the homeowner owes more than market value of the house.(see underwater)

Urea-formaldehyde   first used in building materials, particularly insulation, in the 1970s. Gases leak out of the urea-formaldehyde foam insulation (UFFI) as it hardens and become trapped in the interior of a building. Once used to conserve energy by sealing crawl spaces and attics, it is no longer used because emissions were found to be a health hazard

Usury    charging interest at a higher rate than the maximum rate established by state law.

Utility liens    municipalities often have the right to impose a specific, equitable, involuntary lien on the property of an owner who refuses to pay bills for municipal utility services.

Utility value   the value in use to an owner-user, which includes a value of amenities attaching to a property; also known as subjective value.

U-value   a measure used to indicate the insulating value of a window. The U-value measures the heat flow. The smaller the U-value, the better a material can stop heat flow.


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