Real Estate Terms - F

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fair credit reporting act

A consumer protection law that regulates the disclosure of consumer credit reports by credit reporting agencies and establishes procedures for correcting mistakes on one's credit record.

fair market value

The highest price that a buyer, willing but not compelled to buy, would pay and the lowest a seller, willing but not compelled to sell, would accept.

Fannie Mae (FNMA)

A New York Stock Exchange company and the largest non-bank financial services company in the world. It operates pursuant to a federal charter and is the nation's largest source of financing for home mortgages.

Farmer's Home Administratcion (FmHA)

U. S. Department of Agriculture agency providing financing for farmers, residents of rural areas, etc.

Federal Home Loan Mortgage Corporation (FHLMC)

see Freddie Mac

Federal Housing Administration (FHA)

An agency of the U.S. Department of Housing and Urban Development (HUD). Its main activity is the insuring of residential mortgage loans made by private lenders. The FHA sets standards for construction and underwriting but does not lend money.

fee simple

The greatest possible interest a person can have in real estate.

fee simple estate

An unconditional, unlimited estate of inheritance that represents the greatest estate and most extensive interest in land that can be enjoyed. It is of perpetual duration. When the real estate is in a condominium project, the unit owner is the exclusive owner only of the air space within his or her portion of the building (the unit) and is an owner in common with respect to the land and other common portions of the property.

FHA mortgage

A mortgage that is insured by the Federal Housing Administration (FHA).

fiduciary

A person charged by law and equity with a higher duty of care for another person. A person who, as a result of a relationship with another person, is required by law to place the other person's interests equal to or ahead of his own in all dealings involving that other person. The relationship is often created when the other person approaches the fiduciary to use the fiduciary's special skills and knowledge, for a fee, to benefit the other person. Real estate agents, lawyers, trustees, investment brokers etc. are often fiduciaries.

first mortgage

A mortgage that is the primary lien against a property.

fixed-rate mortgage

A mortgage in which the interest rate does not change during the entire term of the loan.

fixture

Personal property that becomes real property when attached in a permanent manner to real estate.

flood zone

follow this link for local flood zone information

flood insurance

Insurance that compensates for physical property damage resulting from flooding. It is required for properties located in federally designated flood areas.

foreclosure

The legal process by which a borrower in default under a mortgage is deprived of his or her interest in the mortgaged property. This usually involves a forced sale of the property at public auction with the proceeds of the sale being applied to the mortgage debt.

Freddie Mac (FHLMC)

Federal Home Loan Mortgage Corporation. A US agency which purchases first mortgages on residences.

freehold estate

As opposed to leasehold. A right to or interest in property.

front-end ratio

A comparison of a borrower's monthly cost of housing with that borrower's monthly gross income.