Agency By Necessity to Air Lot

 

Agency By Necessity

The agency by necessity is a type of agency relationship created in an emergency situation, when it may be unnecessary to obtain the principal’s consent to expand or create an agency.

For example, a Florida real estate broker is trying to sell an absentee client’s vacation home in. The broker notices that the filter to the seller’s backyard swimming pool was never turned on and that algae has started to form. The broker has potential buyers scheduled to view the property the next day.

The broker makes a dozen calls to the seller, but only gets voice mail. With time running out, the broker calls a pool cleaner to clean the pool immediately–even without the seller’s explicit permission.

Agency by necessity allows the broker to then claim for reimbursement for the pool cleaning expenses.

Of course, this is a far cry from the original intent of this agency type. Agency by necessity is based on the centuries-old doctrine of necessary intervention. This doctrine gave ship captains and couriers the authority to act on behalf of the property owners, during emergency situations. When it was too impractical to communicate with with property owners directly, the law and the courts gave agents the authority to act.

For example, the Great Northern Railway Company delivered horses for a client. When the train got to the station, the client’s representatives were nowhere to be found. The railroad put up the horses at a local stable and paid for the charges for several months.

The railroad then charged the owner of the horses for reimbursement. The defendant refused, and the case landed in court. The courts ruled in favor of the Great Northern Railway Company, on the grounds of agency by necessity.

In order to qualify for an agency by necessity, certain conditions must be met:

• There must be real and factual need for action by the agent
• The situation makes it impractical or impossible to communicate with the property owner.
• The agent has the best interest of the property owner in mind when acting.

Also, with real estate, there typically must be previous or pre-existing agency relationship between the agent and the property owner.

Agency Closing

The agency closing is a common type of real estate settlement (closing), in which the lender uses an agent — such as a title or escrow company — to execute a loan closing. The closer typically acts as the local agent for the mortgage lender. As the lender’s agent, the closing agent must go through a checklist of requirements before he or she releases any of the loan funds.

Agency Guidelines

In the mortgage industry, Fannie Mae, Freddie Mac and Ginnie Mae are considered agencies because they were established by the government to develop the secondary mortgage market.

Their guidelines establish the type of loans they will insure, guarantee or purchase from wholesale lenders. Loans that satisfy these agency guidelines and are purchased by Fannie, Freddie or Ginnie are considered conforming loans.

Age-Segregated Community

The age-segregated community is a development or community that limits buyers and residency to people of a certain minimum age, usually 50 or 55. Younger adults and children are allowed only as short-term guests of the owner.

Aging in Place

The term aging in place refers to a concept in the senior housing and care community that stresses allowing residents to choose to stay in their current living environment as they face the physical and mental decline associated with aging.

Aggregation Risk

The aggregation risk is the exposure to loss or risk that wholesale and conduit lenders face while they warehouse mortgage loans they have made and wait until they build up their required pool of loans.

The loan pool is then securitized as mortgage-backed securities (MBS) or collateralized debt obligations (CDOs). If interest rates rise dramatically or if the loans are paid off before they can be securitized, these lenders and investors may have to sell at a loss.

Agreed Boundary

The agreed boundary is the one established by negotiation or agreement, typically to settle a dispute about real property.

Agreement of Sale

Known by various names, such as contract of purchase, purchase agreement, or sales agreement, depending on location or jurisdiction, the agreement of sale is a contract in which a seller agrees to sell and a buyer agrees to buy, under certain specific terms and conditions spelled out in writing and signed by both parties.

Agricultural Land (AG)

The agricultural land zoning designation allows farms, orchards and ranches, to cultivate crops or produce livestock. Minimal residential and recreational use is allowed on agricultural land.

Agricultural Lease

The agricultural lease is a special type of lease arrangement that gives a tenant farmer the right to farm a property he or she doesn’t own. The agricultural lease may or may not have a provision for the tenant to occupy the land.

In exchange for leasing the land, the landowner receives either cash rents or a share of the produce. When the landowner receives a portion of the tenant’s harvest as part of the lease payments, it is typically called sharecropping.

Air Change Per Hour (ACH)

The number of times that the volume of air in an enclosed space is replaced with fresh or filtered air is the air change per hour (ACH). If a property’s HVAC system has little or no air movement, the ACH may be a percentage amount.

Air Lot

With regard to air rights, the air lot is the space that begins 23 feet above the earth’s surface and continues into the atmosphere. By comparison, the first 23 feet above the earth’s surface is sometimes called the column lot.