Real Estate Dictionary Terms - O

Obligee

A promisor; a person to whom another is bound by a promise or another obligation.



Obsolescence

Loss in value due to reduced desirability and usefulness of a structure because its design and construction become obsolete; loss because of becoming old-fashioned and not in keeping with modern needs. The loss of value due to factors that are outmoded or less useful. Obsolescence may be functional or economic.



Occupancy Permit

A permit issued by the appropriate local governing body to establish that the property is suitable for habitation by meeting certain safety and health standards.



Offer

A proposal to create a contract, which signifies the present intent of the offeror to be legally bound by his proposal.



Offer And Acceptance

Two essential components of a valid contract; a "meeting of the minds."



Offeree

A person to whom an offer is made. A person who makes an offer.



Office Of Thrift Supervision (Ots)

Monitors and regulates the savings and loan industry. OTS was created by FIRREA.



Offset Statement

Statement by owner of a deed of trust or mortgage against the property, setting forth the present status of the debt and lien. Also called a beneficiary statement.



Open House

Is an opportunity for a licensee tomeet potential buyers and sellers, and therefore is considered to be in the best interest of the licensee and not the seller. This is NOT the most effective way to method to advertise a peiie of rental property.



Open Listing

An authorization given by a property-owner to a real estate agent in which the agent is given the nonexclusive right to secure a purchaser. Open listings may be given to any number of agents without liability to compensate any except the one who first secures a buyer ready, willing, and able to meet the terms of the listing or who secures the acceptance by the seller of a satisfactory offer. A listing contract under which the broker's commission is contingent on the broker's producing a ready, willing and able buyer before the property is sold by the seller or another broker.



Open-End Loan

A mortgage loan that is expandable by increments up to a maximum dollar amount, the full loan being secured by the same original mortgage.



Open-End Mortgage Or Deed Of Trust

A mortgage containing a clause that permits the mortgagor or trustor to borrow additional money without rewriting the mortgage or deed of trust.



Option

A right to have an act performed in the future; a right given for a consideration to purchase or lease a property upon specified terms within a specified time; a contract to keep an offer open for a particular period of time. The right of a person to buy or lease property at a set price at any time during the life of a contract. An agreement to keep open for a set period an offer to sell or purchase property.



Option Listing

A listing that also includes an option, permitting the broker to buy the property at the stated price at any time during the listing period. Listing with a provision that gives the listing broker the right to purchase the listed property.



Oral Contract

A verbal agreement, one not reduced to writing.



Ordinance

A law passed by a political subdivision of the state (such as a town, city, or county).



Orientation

Placement of a house on its lot with regard to its exposure to the rays of the sun, prevailing winds, privacy from the street, and protection from outside noises.



Original Principal Balance

The total amount of principal owed on a mortgage before any payments are made.



Origination Fee

On a government loan the loan origination fee is one percent of the loan amount, but additional points may be charged which are called "discount points." One point equals one percent of the loan amount. On a conventional loan, the loan origination fee refers to the total number of points a borrower pays.



Or-More Clause

A simple prepayment clause that permits the borrower to make a normal payment or any larger amount, up to and including the entire outstanding balance, without a prepayment penalty.



Ostensible Agency

An agency implied by law because the pricipal intentionally or inadvertently caused a third person to believe someone to be his agent, and that third person acted as if that other person was in fact the principal's agent. A form of implied agency relationship created by the actions of the parties involved rather than by written agreement or document.



Over Improvement

An improvement that is not the highest and best use for the site on which it is placed, by reason of excessive size or cost.



Overages In Trust Account

Any unexplained overages in the trust account must be held in trust by the licesee and must be maintained in a seperate record.


Overhang

The part of the roof that extends beyond the walls and that shades buildings and covers walks.



Owner Financing

A property purchase transaction in which the property seller provides all or part of the financing.



Ownership

The right of a person to use and possess property to the exclusion of others.