Delivery and Acceptance to Descent

 

Delivery and Acceptance

Delivery and acceptance is a legal real estate term referring to the actual time that a title to property is fully conveyed: when the grantor delivers and the grantee accepts the title. Silence by the grantee or the proper recording of the deed is legally considered acceptance. With escrow closings, the actual time of delivery and acceptance reverts to the time when the grantor delivers the title to the escrowee.

Demand Feature

The demand feature is the mortgage and promissory note clause that allows the lender to accelerate the loan and demand immediate, full repayment of the loan principal balance. The typical fixed-rate and adjustable-rate mortgage loan provides for a demand feature if the borrower defaults on the loan or the ownership of the property is ever altered or transferred. Balloon loans do have demand features at the end of the balloon term.

Demised Property

The term demised property is a legal term referring to leased properties. This legal term applies to premises or any portion of a real estate property whose interests or rights are temporarily transferred by the owner to another party.

Demising Clause

The demising clause is the formal provision in the lease through which the property owner (or agent) leases the property to the tenant, and by which the tenant takes the property.

Demising Wall

The demising wall refers to the barrier or wall that officially separates one leased space from a neighboring leased space.

Demolition Clause

The demolition clause is a provision in a lease indicating that when the ground lease expires, the building and its leased premises will be demolished.  Many commercial properties are built on leased land, especially if land prices are extremely expensive.

Density

In real estate, density refers to the average number of persons or units in a particular space. Zoning laws typically impose specific density limits, depending on the type of property. These density requirements, for example, will limit the number of houses in a typical block or the occupancy capacity of a proposed development.

Density Test

The density test is a soil test used to determine whether the ground is compact and dense enough to support the proposed building’s foundation.

Dentil

Dentils are rectangular blocks or bricks that protrude from the exterior wall face. They are usually found near the roof lines, under cornices or along corners. They sometimes mimic the protruding ends of wooden beams of older European homes.

Depository Institutions Deregulation and Monetary Control Act

Also called the Garn-St. Germain bill, the Depository Institutions Deregulation and Money Control Act is a federal legislation has been blamed by many as the initial cause of the S&L disaster. Savings and loans traditionally have been a conservatively regulated system. In 1980, this legislation was enacted and deregulated the thrift industry. It allowed thrifts to begin offering credit cards, money market accounts and checking accounts; moreover, it allowed S&Ls to invest up to 50% of their assets in real estate, even allowing them to own real estate development companies. This huge infusion of S&L cash fed a real estate boom that, when it eventually crashed, took down many S&Ls. Because these thrifts are insured by the government, it had to step in, cover depositor’s losses and liquidate the remaining assets through the Resolution Trust Corporation.

Depreciable Basis

The amount in a property’s fair market value that may be depreciated. This is generally the basis less the value of the land.

Depreciable Life

A property’s depreciable life is a tax-related term that refers to the number of years for which a property owner can depreciate the value of the property’s improvements. Currently, residential properties can depreciate the value of all improvements (buildings, landscaping, utilities, etc.) over 27.5 years. Commercial properties have a longer depreciable life. Note that land cannot be depreciated; only the improvements to that land can be depreciated.

Depreciation

Depreciation refers to the loss or decrease in property value because of obsolescence, wear and tear, economic factors or age. Depreciation has functional, economic and tax elements. In appraisals, the three classes of depreciation used in the cost approach are physical deterioration, functional obsolescence and economic obsolescence. Such depreciation can be further labeled curable or incurable. Under standard actual cash value coverage, insurance policies will deduct depreciation from the original cost when calculating reimbursements. For tax deduction purposes, however, depreciation can only be taken on property used in a business, trade or income generation. Personal residences cannot claim depreciation deductions. Depreciation deductions can be calculated with either the straight line method or accelerated cost recovery system.

Derivative Securities

A derivative security is any security instrument that is derived from another financial instrument. For example, an interest-only strip can be derived from a commercial mortgage-backed security.

Derogatory Credit Entries

Sometimes referred to as “derogatories,” these are any negative items-such as late payments, collections, judgments or inquiries-on a credit report.

Descent

The legal term descent refers to a situation in which the property owner dies without the subject property being included in a will. The property is then acquired, usually by the government or a court-appointed administrator, through descent.