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Frequently
Asked Questions
Glossary
of Real Estate Terms
Glossary for "P"
Parcel
An officially described piece of land.
Partition
An interior wall.
Partnership
There are several partnership options for unmarried individuals
to buy a piece of property, such as live-in partnerships (in which
both buyers share the residence) or a shared-equity partnership
(in which one buyer lives in the home and the other is an investor
in the property).
Passive loss
A tax term that refers to any loss from a passive activity, such
as the ownership but not the operation of a piece of rental real
estate.
Passive
solar system
A system that supplies solar heat without the use of electric fans
or pumps.
Patent
defect
A visible deficiency in a piece of property, such as a cracked basement
slab or a sagging porch.
Payment cap
A legal limit on the amount a monthly payment can increase on an
adjustable-rate mortgage.
Percolation
test
A test used to determine the ability of soil to accommodate a septic
system.
Per-diem
interest
Interest charged or accrued daily.
Panel
A section or division of a wall, ceiling or a flat piece of building
material that forms the part of the surface of a wall, door or cabinet.
Paneling
Strips of wood or wood material applied as a finish to a wall.
Parking
strip
The strip of grass between the sidewalk and the street in front
of a house.
Partition
Any kind of structure dividing one room or space from another.
Patio
An interior courtyard or a paved backyard area.
Perennial
Any plant that produces leaves, flowers and seeds from year to year,
such as irises or peonies.
Pergola
An arbor with an open roof of rafters supported by posts or columns.
Personal
property
Any moveable property in a house such as furniture or appliances.
Pest-control
inspection
A common pest-control inspection is a termite inspection, which
is required in some states, such as California.
Pier
A rectangular masonry support column.
PITI
(Principal, Interest, Taxes, Insurance)
When a buyer applies for a loan, the lender will calculate the principal,
interest, taxes and insurance. The figure is designed to represent
the borrower's actual monthly mortgage-related expenses.
Planned
communities
The concept began in the 19th century and describes any town or
neighborhood built with certain guidelines and goals.
Planned-unit
development
Residents own the home and the land, and share the use and financial
responsibility for common areas.
Plaster
A labor-intensive and more costly wall finish.
Pocket
door
A sliding door that retreats into the wall when opened.
Point
Fees charged by lenders at the time a loan is originated. A point
is equal to 1 percent of the total loan amount.
Porch
The structure can be a simple covered entrance to a home or a fully
enclosed room on the outside of a residence.
Porte cochere
A porch-like roof extending over a driveway.
Portfolio
lender
A lender who makes loans with its own funds and keeps the loans
on the company's books--in other words, inside the institution's
"portfolio"--rather than selling the loan on the secondary
market.
Portico
A porch supported by a row of columns.
Possession
When a buyer signs the papers and receives the keys to the house,
the buyer officially takes possession.
Power
of attorney
A document that authorizes an individual to act on behalf of someone
else.
Pre-approval
letter
A letter from a lender that informs a seller about the amount of
money that a potential buyer can obtain.
Prepaid expenses
The costs for taxes, insurance and assessments paid before the due
date.
Prepaid
interest
Interest paid before it is due. For example, at the close of a real
estate transaction borrowers usually pay for the interest on their
loan that falls between the closing period and the first monthly
payment.
Prepayment
penalty
Lenders can impose a penalty on a borrower who pays a loan off before
its expected end date.
Prequalification
Many lenders will prequalify a borrower who is shopping for a loan
by completing a preliminary assessment of the buyer's ability to
pay for a home.
Pre-sold
home
Homes that are sold before they are built.
Pressure
relief valve
A safety vent that relieves excess pressure in a water heater.
Price
range
The range of how much a buyer is willing to pay for a home.
Primer
The initial coat of paint that is applied before the final topcoat.
Principal
The amount of money that the borrower owes on a mortgage.
Principle
of conformity
The idea that a house will more likely appreciate in value if its
size, age, condition and style are similar to, or conform to, other
houses in the neighborhood.
Principle
of progression
An appraisal term which states that real estate of lower value is
enhanced by the proximity of higher-end properties.
Principle
of regression
An appraisal term which states that the value of higher-end real
estate can be brought down by the proximity of too many lower-end
properties.
Privacy
fence
A structure erected between two pieces of property.
Private
mortgage insurance (PMI)
A special type of loan insurance that many lenders require borrowers
to purchase if the borrower's down payment is less than 20 percent
of the home's purchase price.
Probate
sale
A real estate sale triggered by the death of the owner, with proceeds
to be divided among heirs or creditors.
Production
home
Homes that are mass-produced by one builder in a project.
Programming
A written summation by an architect of a project's design objectives,
constraints and criteria.
Project
budget
A fiscal outline that includes the construction budget and all costs
for land, furniture, equipment, financing, professional services,
contingencies and owner-furnished goods and services.
Property
line
The official dividing line between properties.
Property
report
A disclosure issued by the state when a time-share project is located
or sold.
Property tax
Property taxes are calculated at about 1.5 percent of the current
market value.
Property
tax deduction
The U.S. tax code allows homeowners to deduct the amount they have
paid in property taxes.
Property
value
The value of a piece of property is based on the price a buyer will
pay at a certain time.
Proration
Agreed-upon percentages of certain expenses associated with a piece
of property that must be paid by the buyer or the seller at the
time of closing.
Punch
list
Buyers compile a punch list during the final walk-through detailing
items to be fixed before closing.
Purchase
agreement
A document which details the purchase price and conditions of the
transaction.
Purchase-money
mortgage
A mortgage that a borrower obtains to acquire a property.
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