Chapter 3: Concepts of Home Ownership
Terms
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- Cooperative
- Multitenant building owned by trust or corporation; tenants own share of stock and proprietary lease
- Liability Coverage
- Insurance protecting property owner in case of damage to a person or another's property due to owner's negligence
- National Flood Insurance Act
- Requires flood insurance when financing with federally related loans on properties located in flood-prone areas
- Condominiums
- Ownership of the airspace of a unit, plus undivided interest in common elements
- Mixed Unit Developments (MUD)
- Often self contained, combine variety of uses from commercial to retail to residential
- Time Shares
- Buy or lease the use of the property for a certain time frame - often used in resort areas
- Equity
- The interest an owner has in a property over and above any outstanding loans (Market Value - Loans = Equity)
- Coinsurance Clause
- Requires policyholder to maintain fire insurance, coverage equal to at least 80% of property's actual replacement value
- Standard Homeowners Insurance
- Insurance package that covers residential property owner against financial loss from fire, theft, public liability, etc.
- Capital Gain
- Profit earned from the sale of an asset
- Planned Unit Developments (PUD)
- Planned combination of diverse land uses, such as housing, recreation and shipping, in one contained development or subdivision.
- Replacement Cost
- Current cost to reconstruct a building to serve the same function but not an exact duplicate of the original