Real estate abstract
A process for the full disclosure of potential detrimental conditions
affecting property transactions organizes the spectrum of disclosure
issues that are important to lenders and prospective buyers. The
real estate disclosure reporting method includes the compilation
of a comprehensive list of items of disclosure based upon federal,
state, lender and market requirements. These items of disclosure
are classified according to condition categories that provide a
systematic procedure for researching and a logical organization
for reporting known conditions. A disclosure form provides a listing
of the items of disclosure according to these categories. A particular
form lists over one hundred items of disclosure under ten separate
categories. The disclosure form is completed through a process of
researching primary, secondary and third-party sources for information
regarding a particular property. Primary sources of information
include a property walk-through and an owner interview. Secondary
sources of information include government and police records, Internet
databases and a property profile. Third-party sources include an
appraisal report, escrow documents, termite reports, loan documents,
title policies and similar studies, documents and reports. This
researched information is used to complete the disclosure form,
which, along with supplemental forms providing further comments,
legal disclaimers and signatures, constitutes a comprehensive real
estate disclosure report.
Real estate claims
What is claimed is:
1. A real estate disclosure reporting method comprising the steps
of: compiling a plurality of items of disclosure that are indicative
of conditions that might impact property values and purchasing decisions;
defining a plurality of condition categories that are generally
descriptive of real estate conditions; researching a particular
property to determine a plurality of known ones of said items of
disclosure; and generating a disclosure report that displays said
known ones according to said condition categories.
2. The real estate disclosure reporting method according to claim
1 further comprising the steps of: classifying said items of disclosure
so that particular ones of said items of disclosure are associated
with particular ones of said condition categories to create a plurality
of categorized items of disclosure; and creating a disclosure form
listing said categorized items according to said condition categories,
said disclosure form providing for an area proximate said categorized
items of disclosure to indicate if particular ones of said categorized
items are said known ones.
3. The real estate disclosure reporting method according to claim
1 wherein said compiling step comprises the substeps of: identifying
a plurality of potential items of disclosure based upon a plurality
of disclosure requirements; testing a characteristic of said potential
items so as to generate a master set of items of disclosure; and
determining a priority subset of said master set by comparing said
master set with said disclosure requirements.
4. The real estate disclosure reporting method according to claim
3 wherein said characteristic is selected from the group of comprehensiveness
with respect to said disclosure requirements, narrowness in scope
and mutual exclusiveness.
5. The real estate disclosure reporting method according to claim
1 wherein said defining step comprises the substeps of: identifying
a set of commonalities of said items of disclosure; defining a plurality
of initial categories based upon said set of commonalities; and
testing a characteristic of said initial categories to derive said
6. The real estate disclosure reporting method according to claim
5 wherein said characteristic is selected from the group of comprehensiveness
with respect to said items of disclosure, breadth of scope, and
logical association of said items of disclosure.
7. The real estate disclosure reporting method according to claim
1 wherein said researching step utilizes information from at least
one of a primary source directly related to said property, a publicly
available record and a third-party compiled document.
8. The real estate disclosure reporting method according to claim
7 wherein: said primary source comprises at least one of a researcher's
personal knowledge of said property, a researcher's observations
of said property and a researcher's interview of an owner of said
property; said publicly available record comprises at least one
of an online database, a government office record, and a law enforcement
record; and said third-party compiled document comprises at least
one of a report, study, plan, survey, loan document, escrow document,
insurance policy, lease, contract, and aerial photo.
9. The real estate disclosure reporting method according to claim
1 wherein said reporting step comprises the substeps of: indicating
on a primary form a priority set of said known ones so as to create
a real estate disclosure report; and commenting on a supplemental
form regarding a non-priority set of said known ones so as to create
a supplemental disclosure report.
10. The real estate disclosure reporting method according to claim
9 further comprising the substep of providing on said primary form
a general indication of said non-priority set of said known ones.
11. The real estate disclosure reporting method according to claim
2 wherein said classifying step comprises the substep of performing
a predetermined sequence of condition category tests on said items
12. The real estate disclosure reporting method according to claim
11 wherein said predetermined sequence comprises testing an item
for at least one of an impact on all property, a one time issue
for a buyer, an environment-related condition, a conservation-related
condition, a site-related condition, a natural condition, a building-related
condition, an external condition, and a legal condition.
13. The real estate disclosure reporting method according to claim
2 wherein said creating step comprises the substeps of: obtaining
a blank media; dividing said media into a plurality of partitions;
and labeling said partitions according to said condition categories.
14. The real estate disclosure reporting method according to claim
2 comprising the further step of creating a supplemental disclosure
form having a comment section, a legal notices section and a signature
15. A real estate disclosure reporting method comprising the steps
of: identifying a plurality of items of disclosure; performing primary
research to determine a first set of known ones of said items; accessing
publicly available information to determine a second set of known
ones of said items; and reporting said first set and said second
sets according to a plurality of categories, said categories being
generally descriptive of a class of real estate conditions.
16. The real estate disclosure reporting method according to claim
15 wherein said performing step comprises the substeps of walking-through
a property and interviewing an owner or mortgagor of said property.
17. The real estate disclosure reporting method according to claim
15 further comprising the steps of: reviewing third-party research
to determine a third set of known ones of said items; and reporting
said third set according to specific ones of said categories.
18. A real estate disclosure reporting method comprising the steps
of: creating a disclosure form having a plurality of partitions;
labeling said partitions according to corresponding ones of a plurality
of categories, said categories being generally descriptive of a
class of real estate conditions; identifying a plurality of items
of disclosure; determining a known one of said items of disclosure
for a specific property; and listing said items of disclosure within
said partitions according to said categories.
19. The real estate disclosure reporting method according to claim
18 further comprising the step of providing an indication proximate
a particular one of said items of disclosure corresponding to said
20. The real estate disclosure reporting method of claim 18 comprising
the further steps of: creating a supplemental disclosure form having
a second plurality of partitions; lining at least a first one of
said partitions for comments; printing legal notices in at least
a second one of said partitions; and providing a signature block
in at least a third one of said partitions.
Real estate description
BACKGROUND OF THE INVENTION
The disclosure of real estate conditions is a critical element
in any property transaction and plays an increasingly important
role for property owners and their attorneys, agents, brokers, appraisers,
inspectors and other consultants. Federal and state laws, lender
policies and regulations, as well as demands by prospective buyers
create a considerable demand for the full disclosure of any potential
detrimental conditions. Notwithstanding government requirements,
there are several reasons that a full real estate disclosure is
beneficial. Buyers obtain better knowledge of what they are purchasing,
and a full disclosure helps shield sellers, brokers and appraisers
from future liability. Also, lenders obtain a better understanding
of their collateral asserts. Real estate disclosure does not put
any dollar figure on any conditions. Rather, a proper disclosure
report simply informs the user of the report that certain conditions
are known or believed to exist.
SUMMARY OF THE INVENTION
Historically, the disclosure of conditions that might impact property
values or purchase decisions has been a fragmented topic. There
does not exist a single, universal disclosure report. Some states
require disclosure and others do not. Appraisers and property inspectors
disclose some conditions but not all of them. Most real estate professionals
issue reports with long boilerplate disclaimers specifically citing
that they did not investigate a variety of issues, even though these
issues could have a material impact on the property's value or the
decision to buy or lend.
The real estate disclosure reporting method according to the present
invention provides a complete disclosure of all property-relevant
issues based upon three important sources: the personal knowledge
of the real estate professional; public records and agency databases;
and an interview with a party to the transaction, typically the
property owner. In addition, an itemized disclosure is made of specific
aspects of other reports, such as soil, termite and title reports
so that the user of the disclosure data has a clear picture of the
entire disclosure process.
One aspect of the real estate disclosure reporting method according
to the present invention has the steps of compiling items of disclosure
that are indicative of conditions that might impact property values
and purchasing decisions, defining condition categories that are
generally descriptive of real estate conditions and researching
a particular property to determine known items of disclosure. The
reporting method also has the step of generating a disclosure report
that displays the known items of disclosure according to the condition
categories. The reporting method may also have the steps of classifying
the items of disclosure so that particular ones are associated with
particular condition categories to create categorized items of disclosure
and creating a disclosure form listing the categorized items according
to the condition categories, where the disclosure form provides
for an area near the categorized items of disclosure to indicate
if particular items of disclosure are known.
In one embodiment of the real estate disclosure reporting method
described above, the compiling step has the substeps of identifying
potential items of disclosure based upon disclosure requirements,
testing a characteristic of the potential items so as to generate
a master set of items of disclosure, and determining a priority
subset of the master set by comparing the master set with the disclosure
requirements. The characteristic may be comprehensiveness with respect
to the disclosure requirements, narrowness in scope or mutual exclusiveness.
In another embodiment, the defining step has the substeps of identifying
a set of commonalities of the items of disclosure, defining initial
categories based upon the set of commonalities, and testing a characteristic
of the initial categories to derive the condition categories. The
characteristic may be comprehensiveness with respect to the items
of disclosure, breadth of scope, or logical association of the items
In yet another embodiment, the researching step utilizes information
from a primary source directly related to the property, a publicly
available record or a third-party compiled document. The primary
source is a researcher's personal knowledge of the property, observations
of the property or interview of an owner of the property. The publicly
available record is an online database, a government office record,
or a law enforcement record. The third-party compiled document is
a report, study, plan, survey, loan document, escrow document, insurance
policy, lease, contract or aerial photo.
In a further embodiment of the real estate disclosure reporting
method described above, the reporting step has the substeps of indicating
on a primary form a priority set of the known items of disclosure
so as to create a real estate disclosure report, and commenting
on a supplemental form regarding a non-priority set of the known
items of disclosure so as to create a supplemental disclosure report.
A further substep may be providing on the primary form a general
indication of the non-priority set of known items of disclosure.
In yet a further embodiment, the classifying step has the substep
of performing a predetermined sequence of condition category tests
on the items of disclosure. The predetermined sequence may comprise
testing an item for an impact on all property, a one time issue
for a buyer, an environment-related condition, a conservation-related
condition, a site-related condition, a natural condition, a building-related
condition, an external condition, or a legal obligation.
In another embodiment, the creating step has the substeps of obtaining
a blank media, dividing the media into partitions, and labeling
the partitions according to the condition categories. A further
step may be creating a supplemental disclosure form having a comment
section, a legal notices section and a signature section.
Another aspect of the disclosure reporting method according to
the present invention has the steps of identifying items of disclosure,
performing primary research to determine a first set of known items,
accessing publicly available information to determine a second set
of known items, and reporting the first set and the second sets
according to categories that are generally descriptive of a class
of real estate conditions. In one embodiment, the performing step
has the substeps of walking-through a property and interviewing
an owner of the property. In another embodiment are the further
steps of reviewing third-party research to determine a third set
of known items, and reporting the third set according to specific
Yet another aspect of the real estate disclosure reporting method
according to the present invention has the steps of creating a disclosure
form having partitions and labeling the partitions according to
corresponding categories that are generally descriptive of a class
of real estate conditions. Further steps include identifying items
of disclosure and listing the items of disclosure within the partitions
according to the categories. In one embodiment, additional steps
are determining a known item of disclosure for a specific property
and providing an indication near a particular item of disclosure
corresponding to the known item. In another embodiment are the further
steps of creating a supplemental disclosure form having partitions,
lining at least one partition for comments, printing legal notices
in at least one other of the partitions, and providing a signature
block in at least another one of the partitions.
BRIEF DESCRIPTION OF THE DRAWINGS
FIGS. 1A-B are a general block diagram of a real estate disclosure
reporting method according to the present invention;
FIG. 2 is a detailed block diagram of information sources for researching
FIGS. 3A-B are a real estate disclosure form and a supplemental
disclosure form, respectively;
FIGS. 4A-B are a flowchart of the ID (item of disclosure) compiling
FIGS. 5A-B are a flowchart of the category defining process;
FIGS. 6A-B are a flowchart of the ID classifying process;
FIGS. 7A-B are a flowchart of the form creating process;
FIGS. 8A-C are a flowchart of the property researching process;
FIG. 9 is a flowchart of the report generating process;
FIGS. 10A-J are tables of ID categories and associated priority
FIG. 10A is a table listing IDs associated with general conditions;
FIG. 10B is a table listing IDs associated with transactional conditions;
FIG. 10C is a table listing IDs associated with distress conditions;
FIG. 10D is a table listing IDs associated with legal conditions;
FIG. 10E is a table listing IDs associated with external conditions;
FIG. 10F is a table listing IDs associated with building conditions;
FIG. 10G is a table listing IDs associated with soil conditions;
FIG. 10H is a table listing IDs associated with environmental conditions;
FIG. 10I is a table listing IDs associated with conservation conditions;
FIG. 10J is a table listing IDs associated with natural conditions;
FIGS. 11A-E are tables listing IDs that can be determined from
researching particular types of secondary information sources;
FIG. 11A is a table listing IDs from government records;
FIG. 11B is a table listing IDs from police records;
FIG. 11C is a table listing IDs from Internet databases;
FIG. 11D is a table listing IDs from property profiles; and
FIG. 11E is a table listing IDs from other secondary information
DETAILED DESCRIPTION OF THE PREFERRED EMBODIMENTS
Real Estate Disclosure Reporting
FIGS. 1A-B illustrate an embodiment of the real estate disclosure
reporting method according to the present invention. The reporting
method 100 has an ID compiling process 110, a category defining
process 120, an ID classifying process 130, a form creating process
140, a property researching process 150, and a report generating
process 160. The compiling process 110 has as inputs various disclosure
requirements 170 and outputs a master compilation of items of disclosure
(IDs) 116. The disclosure requirements 170 provide the legal and
ethical framework for a variety of conditions that real estate professionals
should disclose to parties that purchase or lend on a property.
These disclosure requirements 170 include conditions that should
be disclosed under federal law 172 and various state laws 174, conditions
that lenders typically consider when deciding to provide a loan
secured by property 176 and conditions that otherwise might impact
the market value of property 178. The ID compiling process 110 utilizes
these federal 172, state 174, lender 176 and market disclosure requirements
178 to identify various real estate related conditions and to determine
those conditions which should be disclosed. These master IDs 116
include priority IDs 112, non-priority IDs 114, and associated definitions
118. The priority IDs 112 determined by a particular application
of the ID compiling process 110 include over one hundred conditions,
listed in FIGS. 10A-J and described in the Priority ID Glossary,
Appendix A. Additional IDs are described in the Non-Priority ID
Glossary, Appendix B. The ID compiling process 110, the priority
IDs 112 and the non-priority IDs 114 are described in further detail
with respect to FIGS. 4A-B, below.
As shown in FIG. 1A, the ID classifying process 130 has condition
categories 122 and the priority IDs 112 as inputs and categorized
IDs 132 as an output. The category defining process 120 generates
the condition categories 122, which are general descriptions of
various real estate conditions. The ID classifying process 130 associates
various subsets of the priority IDs 112 with each of the condition
categories 122, resulting in the categorized IDs 132. Advantageously,
the categorized IDs 132 provide a tool for systematically performing
the property researching process 150. In one embodiment of the present
invention, there are ten condition categories 122. The IDs can be
classified according to these ten categories 122 as described with
respect to FIGS. 10A-J, below. The category defining process 120
is described in further detail with respect to FIGS. 5A-B, below.
The ID classifying process 130 is described in further detail with
respect to FIGS. 6A-B, below.
Also shown in FIGS. 1A-B, the property researching process 150
utilizes various information sources 180 and the categorized IDs
132 as inputs, applies these inputs to research a particular property
of interest and outputs known IDs 152 for that property. The information
sources 180 are characterized as primary sources 182, secondary
sources 184 and third-party sources 188. Primary information sources
182 are the property itself and the property owner. Secondary information
sources 184 comprise various publicly available records, databases
and documents, which can be accessed for free or for a fee through
an agency. Third-party information sources 188 comprise various
reports, studies, plans, surveys and other documents that have been
compiled by third-parties. The property researching process 150
utilizes the information sources 180 to determine if any of the
IDs are known to exist and to garner associated details with respect
to those IDs. The resulting known IDs 152 are the collective information
gathered for disclosure of a property's condition. The information
sources 180 are described in further detail with respect to FIG.
2 and FIGS. 11A-E, below. The property researching process 150 is
described in further detail with respect to FIGS. 8A-C, below.
FIG. 1A further shows that the report generating process 160 has
disclosure forms 142, 144 and known IDs 152 as inputs and outputs
disclosure reports 162, 164. The form creating process 140 generates
a primary disclosure form 142 and a supplemental disclosure form
144. The primary disclosure form 142 displays priority IDs 112 according
to condition categories 122 along with a convenient way of indicating
known IDs 152. The supplemental disclosure form 144 provides blank
areas for entering disclosure details, provides pre-printed legal
disclaimers and provides signature lines. The disclosure forms 142,
144 are advantageous tools for systematically performing the report
generating process 160. The report generating process 160 involves
documenting information regarding the known IDs 152 into a primary
disclosure report 162 and supplemental reports 164. The primary
disclosure report 162 provides a logical organization and presentation
of a property's condition based upon the known IDs 152. The supplemental
reports 164 document details associated with particular ones of
the known IDs 152, provide notice of legal disclaimers, and are
signed to acknowledge the disclosed conditions. The report generating
process 160 could be partially or wholly incorporated within the
property researching process 150 if the disclosure forms 142, 144
are completed as the information sources 180 are consulted. In that
case, completed disclosure forms 142, 144 incorporating the known
IDs 152 become partially or wholly completed disclosure reports
162, 164. Particular embodiments of the disclosure forms 142, 144
are described with respect to FIGS. 3A-B, below. The form creating
process 140 is described in further detail with respect to FIGS.
7A-B, below. The report generating process 160 is described in further
detail with respect to FIG. 9, below.
FIG. 2 illustrates the information sources 180 used in the researching
process 150 (FIG. 1A). As shown in FIG. 2, primary information sources
182 are utilized to determine if any IDs are known for a specific
property. In particular, a researcher, typically a real estate professional,
conducts a property walk-through 201, obtaining personal knowledge
of any IDs through direct observation of the property itself and
the area surrounding the property. Also, the researcher conducts
an interview 203 of the property owner, obtaining the owner's personal
knowledge of any IDs for the property and the surrounding area.
These primary sources are applicable to any of the categories of
known IDs 152.
Shown in FIG. 2, secondary information sources 184 are also utilized
to determine if any IDs are known for a specific property. In a
particular embodiment, these secondary sources 184 include government
records 210, police records 220, Internet-searchable databases 230,
property profiles 240 and other secondary information 250 that is
publicly available and relevant to the property, such as association
dues, CC&R's, maps and MLS information. As examples, a researcher
might visit a city planning department to access government records
regarding zoning, building permits and similar IDs. Also, the researcher
could contact a title company for a property profile to determine
assessments, bonds, building and land area, title ownership and
similar IDs. Further, the researcher could visit the local police
depart to request information under Megan's Law, records of crime
activity on or near the property, and similar IDs. In addition,
the researcher could utilize the services of a real-estate-based
Internet information provider, for a fee, to access a database of
location-specific real estate information. These secondary sources
184 are applicable to any of the categories of the known IDs 152.
IDs that can be researched utilizing each of these secondary sources
184 are described with respect to FIGS. 11A-E, below.
FIG. 2 further shows that various third-party information sources
188 are used to determine if any IDs are known for a specific property.
In a particular embodiment, these third-party sources 188 include
site surveys, architectural plans and appraisal reports that can
determine known IDs categorized as general conditions 205. Loan
documents and escrow documents can determine known IDs categorized
as transactional conditions 215. Police reports can determine known
IDs categorized as distress conditions 225. Insurance policies,
leases and contracts and title reports can determine known IDs categorized
as legal conditions 235. Aerial photos can determine known IDs categorized
as external conditions 245. Property inspection reports and termite
reports can determine known IDs categorized as building conditions
255. In addition, property inspection reports along with soil reports
can determine known IDs categorized as site conditions 265. Phase
I-II-III reports and environmental reports can determine known IDs
categorized as environmental conditions 275. Environmental impact
reports can determine known IDs categorized as conservation conditions
285, and special studies can determine known IDs categorized as
natural conditions 295.
FIGS. 3A-B illustrate disclosure forms 300, 350, which can be used
for specifying known IDs 152 (FIG. 1A) and providing a disclosure
report 162, 164 (FIG. 1A), as described above. FIG. 3A illustrates
a primary disclosure form 300, which is partitioned into an introduction
section 301 and multiple categorized sections 303. The introduction
section 301 has a background portion 310 and an information source
portion 320. The background portion 310 provides information regarding
the report user, the disclosure date, property location and the
property type, such as commercial or residential. The information
source portion 320 has a list of the primary sources 182, secondary
sources 184 and third-party sources 188, as described with respect
to FIG. 2, above. Proximate to each of the listed sources 182, 184,
188 is an indicator area 307 for specifying that a particular source
was utilized for determining known IDs. The indicator area 307 may
be a check box for placing a checkmark or an "x."
As shown in FIG. 3A, each of the categorized sections 303 correspond
to one of the condition categories 122 (FIG. 1A) described above.
Accordingly, each of the categorized sections 303 has a label 305
that identifies the particular condition category 122 (FIG. 1A)
to which the categorized section 303 corresponds. Listed within
each of the categorized sections 303 are categorized IDs 132 corresponding
to the section label 305. Thus, each of the categorized sections
303 provide a listing of associated categorized IDs 132. Proximate
to each of the categorized IDs 132 is either an indicator area 307
for specifying that a categorized ID 132 is known or a comment area
308 for entering a note regarding a categorized ID 132. The indicator
area 307 may be a check box for placing a checkmark or an "x,"
and the comment area 308 may be one or more underlines. Also provided
in most of the categorized sections 303 are global indicators 309
for specifying that none of the listed IDs in a categorized section
303 are known or are as noted. Each categorized section 303 also
provides a general indicator marked "Other" for noting
known non-priority IDs, which would not be listed. Comments specifying
such generally indicated IDs can be provided on a supplemental disclosure
form 350 (FIG. 3B), described below.
FIG. 3B illustrates a secondary disclosure form 350, which is partitioned
into a comments section 351, a notices section 353 and a signatures
section 355. The comments section 351 provides a lined space 360
for noting specifics regarding a non-priority ID 114 (FIG. 1A) or
other condition that is flagged on the primary disclosure form 300
under "Items as noted." The comments section 351 could
also be used to provide commentary regarding a flagged priority
ID 112 (FIG. 1A). The notices section 353 contains preprinted legal
disclaimers 370. The signatures section 355 contains a "conditions
accepted" signature block 380 for a party's acknowledgement
that they have been given notice of the listed conditions. The signatures
section 355 also contains "prepared by" and "supervisor"
signature blocks 390 for professional acknowledgement of property
inspection and associated research in conjunction with completion
of the disclosure forms 300 (FIG. 3A), 350.
FIG. 4A illustrates the first part of the ID compiling process
110. Initially, disclosure requirements 170 are input 402. Potential
IDs are identified 404, for example using tentative ID labels and
descriptions based upon the real estate conditions the IDs disclose.
Comprehensiveness is tested 410 to determine if the IDs meet all
of the disclosure requirements 170. If not, additional IDs are identified
412 and the IDs are retested 410 to determine if all disclosure
requirements 170 are met. If so, ID breadth is tested 420 to determine
if the identified IDs are sufficiently narrow in scope to adequately
describe a real estate condition to an interested party. If not,
then each overly-broad ID is recharacterized 422 as two or more
IDs of narrower scope, and comprehensiveness is retested 410. If
so, mutual exclusiveness is tested 430 to insure that the IDs are
not overlapping or redundant in scope. If any IDs are not mutually
exclusive, then overlapping IDs are recharacterized 432, for example
using new tentative labels and descriptions as necessary, redundant
IDs are eliminated 434, and comprehensiveness is retested 410.
FIG. 4B illustrates the last part of the ID compiling process 110,
continuing from FIG. 4A. If the IDs are all mutually exclusive,
the IDs are named and defined 440, which generates a compilation
or list of master IDs 116 and associated definitions 118. Each of
the master IDs 116 is compared 450 with the disclosure requirements
170 (FIG. 4A). If an ID relates to Federal or state requirements
452, the ID is identified as a priority ID 460. If not, it is determined
if the ID relates to common lender or market requirements 454. If
so, the ID is identified as a priority ID 460, otherwise, it is
not. It is then determined 470, if all of the master IDs 116 have
been compared with the disclosure requirements 170 (FIG. 4A). If
not, a different ID is compared 450 with the disclosure requirements
170 and the above described process continues. Otherwise, the ID
compiling process is complete.
FIG. 5A illustrates the first part of the category defining process
120. Initially, priority IDs are inputted 502 from a compilation
or list of priority IDs 112. Commonalities are identified 504 among
the priority IDs 112 from a review of priority ID names and definitions.
Then, initial categories are defined 508, providing tentative descriptions
or descriptive labels, for example. Comprehensiveness is tested
510 to determine if the defined categories have sufficient scope
to include or cover all of the priority IDs 112. If not, additional
categories are defined 512 and category comprehensiveness is retested
510 to determine if all priority IDs 112 are included or covered.
If the defined categories are comprehensive, then breadth is tested
520, 530 to determine if the defined categories are sufficiently
broad or narrow in scope to adequately classify the priority IDs
into categories. This may require an iteration of the ID classifying
process 130, described with respect to FIGS. 6A-B, below. For example,
if there are dozens of categories with only a few IDs being classified
into each category or if there are only a few categories with many
IDs being classified into each category, the resulting forms and
the associated research and disclosure processes described herein
may be less useful. Broadness is tested 520 to determine if there
are too many categories or if the category definitions are too narrow
in scope. If so, categories are combined or redefined into broader
categories 522 and the comprehensiveness test 510 is repeated. Otherwise,
narrowness is tested 530, to determine if there are too few categories
or if the category definitions are too broad in scope. If so, categories
are split or redefined into narrower categories and the comprehensiveness
test 510 is repeated.
FIG. 5B illustrates the last part of the category defining process
120, continuing from FIG. 5A. After comprehensiveness is tested
510 (FIG. 5A) and breadth is tested 520, 530 (FIG. 5A), category
logic is tested 540 to determine if all the priority IDs can be
rationally or sensibly associated with the defined categories. This
may also require an iteration of the ID classifying process 130,
described with respect to FIGS. 6A-B, below. If the defined categories
do not allow logical ID classification, the categories are redefined
542 and the comprehensiveness test 510 (FIG. 5A) and breadth tests
520, 530 (FIG. 5A) are repeated. If the defined categories are logical,
the categories are given generally descriptive names 550, generating
a compilation or list of condition categories 122 to complete the
category defining process 120. As noted above, the category defining
process 120 may be iterative with the ID classifying process 130,
described with respect to FIGS. 6A-B, immediately below.
FIGS. 6A-B illustrate an embodiment of the ID classifying process
130 for a particular set of condition categories 122 (FIG. 1A).
As shown in FIG. 6A, initially, condition categories and priority
IDs are inputted 602 from a compilation or list of priority IDs
112 and a compilation or list of condition categories 122. Then,
priority IDs are tested to determine if any impact all property
610. If so, these IDs are assigned to the general category 612.
Next, priority IDs are tested to determine if any are a one time
issue for a buyer 620. If so, these IDs are assigned to the transactional
category 622. Following that, priority IDs are tested to determine
if any are environment related 630. If so, these IDs are assigned
to the environmental category 632. Next, priority IDs are tested
to determine if any are conservation related 640. If so, these IDs
are assigned to the conservation category 642. Then, priority IDs
are tested to determine if any are related to the site 650. If so,
these IDs are assigned to the site category 652.
As shown in FIG. 6B, continuing the ID classifying process 130,
priority IDs are tested to determine if any are related to natural
conditions 660. If so, these IDs are assigned to the natural category
662. Following that, priority IDs are tested to determine if any
are related to building conditions 670. If so, these IDs are assigned
to the building category 662. Next, priority IDs are tested to determine
if any are related to conditions external to the property 680. If
so, these IDs are assigned to the external category 682. Then, priority
IDs are tested to determine if any are related to legal obligations
690. If so, these IDs are assigned to the legal category 692. Finally,
all remaining, i.e. unclassified priority IDs, are assigned to the
distress category 694.
As shown in FIGS. 6A-B, the ID classifying process 130 advantageously
assigns the priority IDs 112 to condition categories 122 in a predetermined
sequence. In this manner, IDs that can be classified within any
of several condition categories are resolved into a single condition
category. In the particular embodiment shown, the general category
test 610 is performed first, the transactional category test 620
is performed second and so on until assignment to the distress category
694 is performed last by default. As such, an ID that might be classified,
for example, as either environmental or external, such as a nuclear
plant, would be classified as environmental because the process
performs the environmental category test 630 before the external
category test 680. That is, assignment of IDs 112 to condition categories
122 is prioritized according to this predetermined sequence.
FIGS. 7A-B illustrate the form creating process 140. FIG. 7A illustrates
the creation of a primary real estate disclosure form 142, and FIG.
7B illustrates the creation of a supplemental real estate disclosure
form 144. As shown in FIG. 7A, blank media is obtained 702, which
may be, for example, physical paper, magnetic or other storage media
or electronic media, such as a web page formatted with HTML or any
other markup language for downloading to a browser over the Internet.
In addition, categorized IDs are inputted 704 from a compilation
or list of categorized IDs 132. Further, the media is partitioned
710, and the partitions are labeled 720 according to the condition
categories corresponding to the categorized IDs 132. Also, the categorized
IDs are listed within the partitions according to assigned categories
730. Categories are assigned according to the ID classifying process
130 (FIGS. 6A-B), described above. Prompts are provided proximate
the categorized IDs 740. A prompt may be, for example, a blank box
for placing an "x" or checkmark to indicate a known ID.
Finally, the primary real estate disclosure form is stored and/or
printed 750. Copies of the resulting primary disclosure form 142
are then available for the report generating process 160 (FIG. 9),
described below and to assist in conducting all or part of the property
researching process 150 (FIGS. 8A-C), also described below.
As shown in FIG. 7B, initially blank media is obtained 706, and
the media is partitioned 708. As described above, the media may
be physical paper, magnetic or other storage media, or electronic
media, for example. Further, one or more of the partitions are labeled
for comments 760, one or more of the partitions are labeled for
legal notices and disclaimers 770, and one or more of the partitions
are labeled for signatures 780. Finally, the supplemental real estate
disclosure form is stored and/or printed 790. Copies of the resulting
supplemental disclosure form 144 are then available for the report
generating process 160 (FIG. 9).
FIGS. 8A-C illustrate the property researching process 150. As
shown in FIG. 8A, initially, categorized IDs are inputted 802 from
a compilation or list of categorized IDs 132. Primary research is
performed 810, described with respect to FIG. 8B, below. Also, secondary
research is performed 830, described with respect to FIG. 8C, below.
Further, any available third-party sources are accessed 850. Finally,
any known IDs are documented 870, as determined from the primary
810, secondary 830 and third-party 850 research, to generate a compilation
or list of known IDs 152 and associated comments or notes.
FIG. 8B illustrates the primary research portion 810 of the property
researching process 150 (FIG. 8A). The researcher notes any personal
knowledge they have of IDs 812. A property walk-through is performed
814, where the researcher notes any obvious IDs. Further, the researcher
interviews the property owner and notes the owner's knowledge of
any IDs 818.
FIG. 8C illustrates the secondary research portion 830 of the property
researching process 150 (FIG. 8A). The researcher accesses property
profile databases 832, which may be available over the Internet,
and downloads a property profile 834. The researcher also accesses
any other databases available over the Internet 836 and downloads
any property-related data 838 accordingly. The researcher also visits
local, state or Federal government offices 842 to review any property-related
records that may be available. Also, the researcher visits local
law enforcement offices 844 to review, for example, their records
of any property-related incidents. Finally, the researcher accesses
any other property-related data 846, such as maps, market studies,
homeowner association records and multiple-listing service (MLS)
FIG. 9 illustrates the report generating process 160. Initially,
known IDs are inputted 902. These known IDs 152 are compiled during
the property researching process 150 (FIGS. 8A-C) and may include,
for example, records and other printed data, notes and recollections
of a researcher, and checkmarks or other indications and comments
that a researcher has made on the primary and supplemental real
estate disclosure forms 142, 144. Also, the primary and supplemental
real estate disclosure forms are inputted 904, 906. The primary
and supplemental real estate disclosure forms 142, 144 are generated
from the form creating process 140 (FIGS. 7A-B), described above.
Known priority IDs are indicated on the primary disclosure form
910. Further, known non-priority IDs are generally indicated on
the primary disclosure form 920, such as marking "Other,"
and comments regarding these known non-priority IDs are made on
the supplemental disclosure form 930. The completed primary disclosure
form the completed supplemental disclosure forms are provided 940,
950 as a primary real estate disclosure report 162 and associated
supplemental real estate disclosure reports 164, along with other
relevant attachments, e.g. maps. Real estate professionals can then
present these generated reports 162, 164 to various interested parties
for signature and satisfaction of the requirements, obligations
or needs to disclose the condition of a particular property.
FIGS. 10A-J illustrate categorized IDs 132, described generally
with respect to FIG. 1A, above. In one embodiment of the present
invention, ten condition categories 122 (FIG. 1A) are determined.
These are (I) general; (II) transactional; (III) distress; (IV)
legal; (V) external; (VI) building; (VII) site; (VIII) environmental;
(IX) conservation; and (X) natural conditions. The general condition
category encompasses conditions that impact all property. FIG. 10A
illustrates general categorized IDs 1005. The transactional condition
category encompasses one-time issues for a buyer. FIG. 10B illustrates
transactional categorized IDs 1015. The distress condition category
encompasses any tragedy or perceived future potential tragedy associated
with a property. FIG. 10C illustrates distress categorized IDs 1025.
The legal condition category encompasses legal obligations on the
part of a property owner. FIG. 10D illustrates legal categorized
IDs 1035. The external conditions category encompasses "externalities"
that may have an influence on a property. FIG. 10E illustrates external
categorized IDs 1045. The building condition category encompasses
the design, construction or condition of a building or a building's
improvements. FIG. 10F illustrates building categorized IDs 1055.
The site condition category encompasses the geotechnical condition
of a property. FIG. 10G illustrates site categorized IDs 1065. The
environmental condition category encompasses actual or potential
contamination issues. FIG. 10H illustrates environmental categorized
IDs 1075. The conservation condition category encompasses wildlife
or habitat issues. FIG. 10I illustrates conservation categorized
IDs 1085. Natural conditions encompass any force of nature. FIG.
10J illustrates nature categorized IDs 1095.
FIGS. 11A-E illustrate IDs 112 that can be researched by accessing
secondary research sources 184 (FIG. 1B), which are described with
respect to FIGS. 1B and 2, above. In one embodiment of the present
invention, there are five types of secondary information sources
184 (FIG. 1B). These are government records 210, police records
220, Internet databases 230, property profiles 240 and other sources
250. FIG. 11A illustrates those IDs that can be researched by accessing
government records 210. FIG. 11B illustrates those IDs that can
be researched by accessing police records 220. FIG. 11C illustrates
those IDs that can be researched by accessing Internet databases
230. FIG. 11D illustrates those IDs that can be researched by reviewing
property profiles 240. FIG. 11E illustrates those IDs that can be
researched by accessing other secondary information sources 250.
The real estate disclosure reporting method has been disclosed
in detail in connection with various embodiments of the present
invention. These embodiments are disclosed by way of examples only
and are not to limit the scope of the present invention, which is
defined by the claims that follow. One of ordinary skill in the
art will appreciate many variations and modifications within the
scope of this invention.
Priority ID Glossary ADA. Americans with Disabilities Act, which
places restrictions on the use of buildings that, are used by the
public to facilitate easier access by people with disabilities.
airport. Any airport, such as municipal, national, international
or military, that creates noise contours over other properties.
arenas. A large stadium for hosting sporting or other events. arson.
The act of deliberately setting fire to a property. asbestos. Natural
mineral mined from rock and used in construction. Properties include
noncombustibility, corrosion resistance, high tensile strength,
and both thermal and electrical insulating capability. assemblage.
A collection of two or more parcels by one property owner. The buyer
may (but not always) pay a premium over the market value because
of the buyer's special motivations associated with the buyer's use
of the combined parcels. assessments. An property tax or bond encumbrance.
association dues. The requirements to pay dues to an association
that is a legal obligation of the property owner. auction. The sale
of property by sale to the highest bidder. avalanche. The sudden
and swift flow of a mass of ice, snow, soil, rock, or other material
down a hillside or mountainside. bankruptcy. A sale of property
due to the financial involvency of it's owner who has filed for
bankruptcy protection. basin. A low-lying area used to collect water
or other fluids. bonds. A loan where the payments are a legal obligation
of the property owner. building area. The square footage of the
improvements as defined by various real estate organizations. build
to suit. Improvements that are constructed to the specifications
of a specific buyer or tenant. burglary. A property where there
has been a history of robbery or burglary. CC&Rs. The conditions,
convenent and restrictions of a community association. cell am/fin
tower. A communications tower that is used to transmit radio and
cell telephone calls. cemetery. Proximity or view of a cemetery
or burial site. CERCLA. Comprehensive Environmental Response, Compensation,
and Liability Act of 1980. Often referred to as the Superfund Act.
This are further delineated between active (still in use) and inactive
(no longer in use) sites. college. A university or other campus
for high learning. conservation area. An area designated as being
sensitive in terms of its natural resourses. construction defect.
Improvements that have been improperly constructed. cracking. Any
cracking to the floors or other improvements. criminal activity.
Any behavior on a property that is illegal. creek/pond. The existence
of a pool of water or small water tributary on a property. crime
scene. A property that has been the scene of criminal activity.
cultural resource. Any site or improvements on a property that have
a cultural significance, such as ancient burial grounds. dam. Proximity
to a dam or a dam inundation risk area. daycare. A registered facility
to provide daytime care to pre-school age children. death on property.
A property that was the scene of a human death. deed restriction.
A recorded restriction on the use of the property. double escrow.
An escrow to a buyer who immediately transfers the property to a
second buyer. drainage. The sheet water flow and ability of a site
to divert and drain excess water. drug activity. Any illegal drug
dealing or use on a property. earthquake fault. The area along which
the ground or subsurface areas move, creating earthquakes. easement.
The non-fee simple estate ownership to utilize a site, or a portion
of a site, in some defined manner. EIFS. Exterior Insulation and
Finishing Systems, which are pre-formed stucco-textured sheets.
eminent domain. The taking of property, as allowed under the U.S.
Constitution, for the public good and upon payment of just compensation.
encroachment. An improvement that is constructed in such a manner
that it crosses the property line or otherwise encroaches upon an
adjacent property. endangered species. A plant or animal that inhabits
a property, where it appears on a governmental list because of its
venerability to extinction. entitlements. The development process
and corresponding approvals for land development. estate sale. The
sale of property upon the death of it's owner. expansion. The enlargement
of soils due to moisture inundation or another natural event. FDIC
sale. A sale by the Federal Deposit and Insurance Corporation. Federal
historic site. A property that has been designated as a historic
site. This designation may restrict the use of the property. Federal
superfund. Sites that have been designated as having particularly
large environmental contamination issues. feng shui. An ancient
Asian belief, in part relating to the orientation and planning of
a property site and the improvement layout. fill soil. Soils that
are used to fill in low-lying areas. fire hazard. Areas or zones
that are prone to fires. fire sprinklers. Typically ceiling-mounted
water sprinklers that are activated in the event of a fire. flood.
An event where there is an excessive accumulation of water on a
property. ground lease. The rental of a site for a specified period
and at specified terms. habitat area. A property that has been designated
as a special conservation area due to it's habitat. historic site.
A property that has been designated as a historic site by a governmental
entity. homicide. A murder that occurred on a property. hurricane.
A violent storm that is capable of destroying real estate improvements.
infestation. An invasion of insects, plants, or animals that disrupts
a property's use or value. insurance claim. A property where an
insurance claim has been filed. jail or prison. Proximity to a jail,
prison or other detention facility. land area. The square footage
or acreage of a parcel of land. landslide. A sudden or creeping
movement of earth downslope. lead-based paint. Paint that has lead
added as one of its ingredients. Considered hazardous if ingested.
leakage. An unintended seepage of fluids, such as water or gasoline,
that requires repairs or remediation. lease. A property that is
encumbered by a lease. legal action. A property where there is or
has been a legal claim that impacts the property. legal non-conforming.
A property that was legally constructed but where the zoning or
other use restrictions have subsequently changed and would not allow
the current improvement to be built if the current structure was
removed or destroyed. liquefaction. The amalgamation or settlement
of soils, such as resulting from a seismic event. loans. Funds that
have been borrowed where a property is used to secure the debt.
LUST. Leaking underground storage tank. Megan's Law. A federal law
that requires states to facilitate the disclosure of the location
of convicted sexual molesters. metals. A classification of possible
contaminants such as mercury or lead. military airport. Proximity
to a military base with an airport. molds. A growth of fungus or
other molds on a property, typically in cold or damp areas. moratorium.
A stop or restriction of development. movement. The movement or
shifting of soils. national parks. A open recreational area that
has been designated for park use by federal authorities. natural
resources. Amenities or attributes of a property that naturally
occur, such as trees, wildlife, etc. nonconforming use. Improvements
that are not in line with surrounding uses, such as a jail in the
middle of a residential neighborhood. non-permit. Building or grading
that was completed without a building permit. nuclear plants. Proximity
to a nuclear-powered electric generating facility. occupancy. The
occupants of a property, such as owner-occupied, tenant, vacant,
etc. odors. Any foul or unusual odors that can be detected. options.
The right to purchase or lease a property. owner of title. The property
owner, according to the title documents or deeds. pesticide. A substance
that controls agricultural pests, such as demeton, guthion, malathion,
mirex, methoxychlor, and parathion. places of worship. Churches,
synagogues, temples or other houses of worship. ponding. The puddling
of water on a site or its improvements due to improper water sheet
flow. power lines. Electrical power lines or power line corridors
that may emit Electro-magnetic fields. probate. The sale of real
estate during the probate period following the owner's death. radioactive.
Having unstable atoms that decay or break down to another kind of
atom. The process emits high-energy particles. For example, radium
decays to form radon. Radiation includes high-energy particles,
which include alpha and beta particles and gamma rays. radon. A
colorless and odorless gas that is emitted from decaying uranium
deposits. The gas may enter improvements through cracks and create
a health hazard if inhaled. railway. The right for the construction,
maintenance, and operation of a train on a property. REO Sale. The
sale of foreclosed real estate by the lender. repairs needed. Any
deferred maintenance or repairs that are required but uncompleted
on a property. right of refusal. The proprietary right to be offered
a property for sale or lease before it can be another offer can
be accepted. sales history. The previous sales date and price of
a property, if available. sale-leaseback. A transaction where the
property owner sells the property and immediately leases back the
same property. schools. Elementary, middle or high schools. septic
tanks. An on-site system or cesspool to process wastes. settlement.
The sinking of soils, such as those that have not been adequately
compacted. sewage plant. Proximity to a sewage treatment facility.
shoreland. A site that is located by a body of water. short sale.
The sale of a property where the proceeds come short of the outstanding
loan balance. sinkhole. An opening in the earth created by either
natural or man-made subterranean activities. For example, if a tunnel
fails, it may create a sinkhole. slide. The sliding or slippage
of soils. slope creep. A natural landslide that occurs at a very
slow rate. soil contamination. The introduction of a hazardous material
into the ground. soils subsidence. Soils that are unstable and sink.
solid waste. Proximity to a facility that treats non-liquid trash
or other disposed materials. special motivation. A motivation that
is unique to a specific buyer, tenant or owner. state superfund.
A property that has been placed on a specific state list of environmentally
contaminated properties. suicide. A property where there has been
a suicide on the premises. tenant purchase. A transaction where
the tenant purchases the property that they are leasing. termites.
A small insect that feeds on wood. An infestation of termites can
damage or destroy a wood-frame structure. title issue. Any concern
or dispute over the ownership or title of a property. tornado. A
violent storm where various natural forces cause a strong circular
wind that can reach over 300 miles per hour. Like some natural disasters,
they are unpredictable and unpreventable, and they cause indiscriminate
damage, so they tend to not cause a diminution in value to a particular
property or neighborhood but rather impact a large region. tower
fall zone. The area that may be impacted in the event of a tower
falling. traffic noise. A property that is impacted by the noise
generated by street or freeway traffic. transactional conditions.
Any one-time special motivations of the buyer, tenant or seller.
treatment-storage. A facility that stores or treats environmentally
contaminated materials. tidal wave.
A large wave usually caused by an earthquake or an underwater landslide.
While unpredictable and unpreventable, they tend to impact certain
zones or areas. tunneling. Drilling or trenching for the placement
of underground passages for utility lines, subways, trains, roads,
or other uses. Tunnels can cause a diminution in value if the market
perceives that they may not be structurally sound or may fail in
the event of a seismic event, such as an earthquake. U.S. Marshall
Sale. A sale by court order by the U.S. Marshall office. UST Underground
storage tank. volcano. A mountain that historically has erupted,
or can erupt in the future, and can cause landslides or other destruction.
Like some natural disasters, they are unpredictable, unpreventable,
and cause indiscriminate damage, so they tend to not cause a diminution
in value to a particular property or neighborhood but rather impact
a large region. water contamination. The introduction of hazardous
materials into the water or ground water. watershed. The drainage
or collection of water on a site. wetlands. Areas that are inundated
or saturated by surface or groundwater, such as lakes, swamps, marshes,
bogs, sloughs, quagmire, wet meadows, river overflows, mud flats,
lagoons, and ponds. zoning. The constitution right of government
to restrict the use of a property through regulations.
Non-Priority ID Glossary abatement. Removal or the controlled release
of contaminants. Includes operations and maintenance (O&M),
encapsulation, enclosure, and removal. above-ground release. Any
release of gasoline or other contaminants to the surface of the
land or surface water, such as from the above-ground portion of
a UST system or overfills. above-ground tank. A storage reservoir
device that is situated above grade so that the entire surface area,
including the bottom, can be visually inspected. ACM. Asbestos containing
material. aeration. The introduction of oxygen into a contaminated
liquid, which creates gases that are then released. air and light
diminution. The loss of natural sunlight or air space due to the
construction of improvements. air sample clearance test. Air monitoring
at the completion of a contamination abatement or remediation project.
air stripping. An in situ groundwater remediation process. Contaminated
groundwater is pumped to the surface and processed in an air stripping
tower. The water flows over packing materials. The contaminated
water comes in contact with air and the contaminants mix with the
air. The contaminated air is released or filtered. amended water.
Mixture of water and surfactant. aquatic flora. Any plant life associated
with the aquatic ecosystem, such as algae, seaweed, etc. aquifer.
A subterranean geological formation that is capable of supplying
a significant amount of water to a well or spring. below-ground
release. Any release of contaminants to the subsurface or the groundwater,
such as from an underground storage tank. benign condition. Any
condition that occurs but has no impact on the real estate associated
with the event. benzene. A fuel additive that is 2% to 4% of gasoline;
a known carcinogen. blast zone. The area impacted by the explosion
of a bomb, volcano, or other situation. blight. A disease or injury
of plants resulting in withering, cessation of growth, and death
of parts without rotting. Also, a term to describe older neighborhoods
with high crime rates. blowdown. The discharge of recirculating
water for the purpose of discharging materials within the system.
This eliminates the buildup of materials that could cause damages.
brackish marsh. A marsh, bog, or swamp that receives an influx of
both salt and fresh water. brownfield. A large site that has been
contaminated from operations on the site. Upon remediation, it may
be referred to as a greenfield. BTEX. Benzene, toluene, ethylbenzene,
and xylene--primary toxins of soils and groundwater associated with
petroleum products. carcinogen. A cancer-causing substance. casing.
A pipe or tubing lowered into a borehole in order to support the
sides of the hole, or to prevent water or gas from entering or exiting
the hole. catastrophic collapse. The disastrous, sudden, and utter
failure of support structures or soils. cementing. The injection
of cement slurry into a drilled hole or behind the casing. condemnation.
The right, as stated within the U.S. Constitution, of the government
to take property for the public good and upon the payment of just
compensation to the property owner. confining bed. A mass of impermeable
or less permeable material stratigraphically adjacent to an aquifer.
confining zone. A geological formation that limits the movement
of water or other fluids. connection with identified uses. The association
of a property with contaminants or prior uses that lead to contamination.
contaminant. Any physical, chemical, biological, or radiological
substance in the soil, water, or air. contamination. The polluting
of air, soils, improvements, or groundwater by the introduction
of a hazardous substance into the environment. continuous discharge.
An emission that occurs without interruption except for maintenance
or other infrequent activity. contraction. Expansion of soils. corrosion
inhibitor. A substance that is designed to form a protective film
against rust or other corrosion. cost issues. All costs related
to the assessment, repair, and ongoing stages of a detrimental condition
analysis. covenant. A promise to use or not use a property in a
specific way. current or past uses in the surrounding area. The
external obsolescence created by a historical or ongoing undesirable
use nearby. current use(s) of the property. The operations or applications
to which a property is being put. current uses of adjoining properties.
The operations or applications to which contiguous properties are
being put. cut and fill. The removal (cut) of soil or the addition
(fill) of soil. daily discharge. The emission or discharge, in terms
of mass, of a pollutant in a 24-hour period. debris compost. The
decay of debris and the resulting soils subsidence it causes. deed.
A document that records a loan that is secured with the property.
deferred maintenance. Routine property upkeep that has been neglected.
degraded wetlands. Swamps, bogs, marshes, etc., that have been negatively
altered by man. deluge. A sudden flooding or inundation of water.
diatomaceous earth filtration. A water filtering process whereby
a coat or "cake" of diatomaceous earth filter media is
deposited over a membrane (septum) and water is passed through.
differential settlement. Soils with differing compaction or materials
that settle to unequal levels. diminution in value. The lost value
of real estate before (as if impaired) and after (or upon discovery
of) a detrimental condition. direct condemnation. The physical taking
of property through the process of eminent domain. discharge. The
spillage, leakage, pouring, emitting, or dumping of hazardous materials
into land, air, or water. disinfectant. Any oxidant, such as chlorine,
used to kill microorganisms. disintermediation. A period when long-term
interest rates are lower than short-term interest rates. disposal.
The discharge, deposit, injection, dumping, spilling, leaking, or
placing of any solid waste or hazardous waste into the air, water,
ground, or groundwater. disposal system. A system of man-made or
natural barriers that isolate spent nuclear fuel or radioactive
waste or other contaminants. distillation. A water purification
technique that purifies water by heating the water and condensing
the steam. The process reduces salt concentration but is ineffective
in removing pesticides and volatile organic contaminants such as
benzene or chloroform. drought. The prolonged lack of rain or availability
of an adequate water supply. earthquake retrofit. Additional structural
support added to the improvements to provide the support necessary
to withstand earthquake destruction or to bring the property into
conformity with current earthquake building regulations. economic
depreciation. A decline in the economy that negatively impacts real
estate values. economic disaster. A large-scale event that negatively
impacts the overall economy, which in turn impact real estate values.
economic obsolescence. The loss incurred when the depreciated value
of the improvements, from a cost perspective, is more than the market
value. effluent. Treated liquid waste. egress diminution. The partial
or total loss of the ability to exit or leave a site. electromagnetic
fields (EMFs). The electric forces emitted by power lines or other
electrical devices. encapsulant. Liquid substances that are applied
to contaminants to prevent their escape. Bridging encapsulants form
a coating over the contaminant's surface. Penetrating encapsulants
soak into the contaminants to bind its components together. Both
types are frequently used together. encapsulation. A contamination
remediation process that encapsulates the contaminants to prevent
leaching and surface seepage of contamination into either the air,
groundwater, or storm drainage system. enclosure. Construction of
an air or watertight structure that surrounds the contaminant. end
removal. The removal of contaminants when the property is eventually
demolished. environmental impact report. A study required by governmental
agencies to determine the impact that a proposed development will
have on the surrounding areas. environmental lien. A restriction
placed on a property for environmental reasons. environmentally
sensitive area. An area where the plant or animal life or their
habitat are either rare or particularly vulnerable. equipment decontamination
enclosure system. A washroom, holding area, and uncontaminated area
for handling materials and equipment. ex situ. A remediation process
that involves excavation. expansive soil. Soils that expand when
moist. exposure. Contact with a contaminant through skin absorption,
inhalation, or ingestion. external depreciation. Any event or development
located off-site that negatively impacts the subject property. external
obsolescence. See external depreciation. feasibility. The capability
of a project or development to be accomplished in a successful manner
within a reasonable time. filtration. Water purification by screening
out contaminants using a sediment process, a filter, or a sieve.
flash floods. Sudden-moving flood waters that are generally caused
by heavy rains over soils that are not capable of absorbing the
moisture. floodplain. The lowland and flat areas adjoining rivers,
canyons, lakes, and ocean waters that are prone to flooding. formaldehyde.
A liquid that is used to preserve woods and other materials and
sometimes used in construction processes. fresh water marshes. Marshes
where the water has concentrations of salt less than five parts
per 1,000. friable. Building materials, such as asbestos, that may
be crumbled by hand pressure. functional depreciation. See functional
obsolescence. functional obsolescence. All losses to a property's
value except for external influences and physical depreciation--e.g.,
an outdated and undesirable floor plan or design. general plan.
A proposed outline for the overall development of a city or other
municipality that is written and issued by that municipality. Also
known as a master plan. generator. A site where the hazardous waste
is produced. gentrification economics. Improvement and fixing-up
of older neighborhoods. geotechnical issues. Matters relating to
soils or soils engineering. government incentives. A city's or other
governmental entity's enticement to develop or use a property in
a particular manner, which may alter the highest and best use of
the property. government mandates. A city's or other governmental
entity's decree or order to develop or use a property in a specific
manner. grading. Earth moving for the purposes of property development.
groundwater. Water below the land surface or subsurface soils that
are saturated with water. groundwater contamination. The introduction
of hazardous or toxic material into the underground water supply
or aquifers. groundwater seepage. Saturated soils that flow up to
the surface. hazardous materials. A material that is determined
by qualified engineers to be poisonous, reactive, flammable, corrosive,
toxic, or that has been designed as such by a governmental or regulatory
agency. heavy metal. Uranium, plutonium, or thorium placed in a
nuclear reactor. HEPA. High-efficiency particulate air--e.g., HEPA
filter or HEPA vacuum--that filters asbestos fibers. hydric soils.
Soils that are saturated with water at or near the surface and are
oxygen-deficient long enough to disrupt the growing season. hydrophytic
plants. Plants that grow in or near water, in wet habitats, or in
hydric soils. illegal use. Improvements that have been constructed
without the proper building permits. impaired value. The indicated
value of a property upon the application of one or more of the three
detrimental conditions to value. imposed condition. An act or forced
event that affects value. Includes long-term and permanent external
depreciation. in-ground tank. A storage device where any portion
is located below grade, thereby preventing a visual inspection of
the external bottom surface. in situ. In place, referring to an
on-site remediation process without excavation. incurable condition.
A detrimental condition that cannot be economically or physically
remedied. indoor air quality problem. A mechanical issue or construction
defect that results in inadequate air circulation, or a use within
a property that results in a nuisance or health risk to its occupants.
ingress diminution. The entire or partial loss of the ability to
enter or access a site. initial removal. The up-front and immediate
removal of contaminants. inner liner. A protective layer of material
placed inside a tank or container that helps prevent corrosion.
inverse condemnation. The damages caused by an external issue or
use that does not physically impact the property. kangaroo rat.
A rodent that has been designated as endangered by some governmental
agencies and thereby may create development constraints. land contract.
A contract to transfer property upon the payment of the terms of
a contract. land disposal. The placement of waste or contaminants
on the land, such as a landfill, surface impoundment, waste pile,
injection well, land treatment facility, salt dome or salt bed formation,
underground mine, cave, bunker, or vault. landfill. A site that
is used for trash disposal. May cause environmental problems or
neighborhood nuisances. leach. To dissolve contaminants by percolating
liquid in order to separate the soluble components. leachate. A
liquid, such as suspended compounds in liquid, that has percolated
through or drained from hazardous materials. lead. A chemical element
that is considered environmentally hazardous in some situation where
it may be ingested. leased fee. The interests of the landlord. The
rate specified in the lease may differ from the market over time.
A provision within the lease to extend the lease, generally at
the tenant's option, at a specified rate and for a specified term.
leasehold. The interests of the tenant. The terms of the lease may
differ from the market over time. levees. Embankments to protect
flooding along rivers or other bodies of water. lithology. The description
of rocks, based on their physical and chemical characteristics.
lithosphere. The solid part of the earth below the surface, including
groundwater. littoral zone. The area between the low tide water
mark and the high tide water mark. loading capacity. The maximum
level of contaminant discharge that water can receive without violating
water quality standards. Malibu effect. A slang term used to describe
the resilience of many waterfront property values when repeatedly
damaged by natural forces. market resistance. The risk, if any,
associated with the ongoing stage of a detrimental condition analysis;
includes the reluctance on the part of the real estate market to
buy a property that has historically been damaged or tainted. Sometimes
called stigma. matrix. Hard, non-friable material (e.g., concrete)
that contains asbestos. maximum contaminant level (MCL). The maximum
level of contaminant discharge without violating regulatory standards,
usually mandated by state requirements and referencing maximum levels
of toxins in drinking water. monitoring facility. Equipment installed
to monitor groundwater below or near an encapsulated site. Used
to test if seepage or leaching is occurring on an encapsulated site.
monsoon. A violent storm with the characteristics of heavy rains
and strong winds. mortgage. Debt financing where the property is
used as collateral. MRI release. The escape of magnetic fields from
a medical diagnostics device. MTBE. Methyl tertiary butyl ether,
a gasoline additive. nature preserve. An area designated by governmental
agencies to remain in its natural condition, thereby preventing
or restricting its development. neighborhood blight. Urban decay
within a community. May be an imposed condition that is ongoing
or may be cured and considered a temporary condition. neighborhood
nuisance. Any annoying or irritating external condition or influence.
May be permanent or temporary. no discharge of free oil. A discharge
that does not cause a film, sheen, or discoloration on the surface
of the water or cause a sludge or emulsion beneath the water surface.
non-market motivation. Any special influence whereby a buyer, seller,
or tenant acts in a way that is not typical for the market. For
example, a property owner who is in financial distress may sell
the property for less that what he or she would have received under
normal circumstances. non-source property. A property that is contaminated,
although the discharge of the contaminant occurred on another property--i.e.,
not the responsible party. normal property value. The market value
of a property in an undamaged condition and without consideration
of any detrimental condition. NPPL. National Priority Pollutants
List, a list of common pollutants caused by underground storage
tank facilities. obstruction. The placement of an improvement in
such a manner that it interferes with the normal use of a property.
A tree planted in front of a gate would be considered an obstruction.
oil-fuel tanks. Any tanks, both subterranean or above-grade, used
for the storage of any oil or fuel. oil seepage. The leakage of
oil, possibly from natural underground deposits or from leaking
containers or plumbing. oil spill. The accidental release of oil,
often crude oil, into the environment. ongoing stage. The third
stage in a detrimental condition analysis. It includes all costs
associated with a damaged property after all repairs or remediation
have been completed--e.g., additional financing or insurance costs,
use, and market resistance. operations and maintenance (O&M).
An ongoing maintenance program for contaminated properties. For
example, for asbestos it could include training, HEPA vacuuming,
wet cleaning, and air monitoring. This is also termed end removal,
as the contaminants remain until the eventual demolition of the
building. PCBs. Polychlorinated biphenyls. Sometimes found in electrical
or hydraulic equipment. PCE. Perchloroethylene or tetrachloroethylene,
nicknamed perk. A solvent often used for dry cleaning and other
uses. permeability. A measure of a material's ability to transmit
water. pickleweed. A salt marsh vegetation. permit issues. Any issue
were a question exists as to the proper use of building or other
construction permits as relating to the improvements to a property.
This includes improvements that were constructed without a permit.
pipeline easement. The right or privilege to install and maintain
a pipeline on a property. Can be considered a potential detrimental
condition if the market reacts negatively towards the risks associated
with a pipeline explosion or leak. plume. The areas that are saturated
or impacted by underground contaminants. prescriptive easement.
The securing of easement rights through adverse possession. PRG.
Nonofficial preliminary risk goals set forth by the U.S. Environmental
Protection Agency regarding soil contamination. pollutant. A contaminant,
such as dredged soil, solid waste, incinerator residue, filter backwash,
sewage, garbage, sewage sludge, munitions, chemical wastes, biological
materials, or radioactive materials. potable water supply. A water
supply that is fit for human consumption. private REO. Property
that has been foreclosed and owned by a private lender. process
wastes. Any designated pollutant resulting from a manufacturing
process. project incentive. The risk, if any, associated with the
repair stage of a detrimental condition analysis. protected species
or vegetation. Any plant or animal that has been designated by a
governmental agency to be safeguarded. This designation may limit
or restrict development. quicksand. A soil type that creates a mire
whereby a person or animal walking over the area will sink. May
both create a hazard and limit the developability of a site. recharge.
Any process whereby water is added to the saturated zone of an aquifer.
reciprocal parking easement. The contractual right of two adjacent
parties to share parking with the other. release. A spill, leak,
emission, discharge, escape, leach, or disposal from an underground
storage tank into the soils, ground, or surface water. repair stage.
The second stage in detrimental condition analysis. It includes
all the costs of repairs or remediation resulting from a detrimental
condition, including the repair and incidental costs, contingencies,
use issues, and the project incentive. retaining slope. A mound
of soil that is designed to hold back the ground behind it. retaining
wall. A wall that is designed to hold back the ground behind it.
retrofit. The renovation of a property to a higher standard. For
example, an old brick building may be retrofitted to withstand an
earthquake. reverse osmosis. A water purification process used to
remove salts, such as for sea water. The process yields drinking
water and salt residues. riparian habitats. Areas in water courses
that are the home of associated animal and plant life. risk issues.
All risks associated with a detrimental condition analysis, specifically
within the assessment stage (uncertainty factor), the repair stage
(project incentive), and ongoing stage (market resistance). rolling
option. An option to lease or purchase a property that continues
or "rolls over" based upon specified conditions. salt
flat. A site with poor drainage where the water evaporates, leaving
salt behind. RTC Sale. The sale of property by the Resolution Trust
Corporation. Santa Claus factor. A slang term used to describe a
situation where the repaired property is better than the improvements
that were damaged or destroyed. saturated zone or zone of saturation.
Soils in which all voids are filled with water. sea water percolation.
Underground sea water that passes through soils and seeps to ground
level. sedimentation. A prefiltering process for removal of solids
by gravity or separation. shear strength. An engineering term used
to describe a soil or structure to resist applied forces that causes
or tends to cause two contiguous parts of a body to slide relative
to each other. sheen. A glistening appearance on the water surface
from oil residue. Sick Building Syndrome. See indoor air quality
problem. site grading. The leveling of land for development. slow
sand filtration. A process whereby water is drained through a bed
of sand at low velocity, removing particles by physical and biological
mechanisms. sludge. A solid, semisolid, or liquid waste generated
from a waste water treatment plant, less the treated effluent. soft
water. Water that contains low levels of dissolved minerals, such
as salts, calcium, or magnesium. soil. All unconsolidated materials
naturally found at the surface of the earth, such as clays, silts,
sands, and small rocks. soil compaction. Fill soils that have been
pressed to avoid subsidence. soil excavation. A type of remediation
process that involves the digging of contaminated soil from the
subsurface, where it is treated or disposed of. solder. A metal
compound used to seal plumbing joints. Solder compounds containing
lead are now banned. stigma. See market resistance, project incentive,
or uncertainty factor. storage tanks. Aboveground or underground
tanks that are used for storing fluids, such as gasoline or propane.
stratum. A sedimentary bed or layer that generally consists of the
same kind of soils or rock material. stressed vegetation. Plants
that have been damaged. sulfates. A potentially corrosive, and naturally
forming, substance found within certain soils. May cause concrete
foundations to erode. super-surface construction defect. The failure
to properly construct some component of the improvements. surface
water. All water that is open to atmosphere. surfactant. Wetting
agent that enhances the penetration of water. surging soil. Soils
that are upheaving. SVOC. Semi-volatile organic compounds. TCA.
Trichloroethane, a solvent. TCE. Trichloroethylene, or trichloroethene,
a solvent. takedown. The purchase of property, often large tracts
of land, in phases. temporary construction easement. The incidental
and interim use of a property or a is portion of a property, through
eminent domain, to use the property while construction is underway.
tidal influence. An oceanfront area that is affected by tides. torrent.
A downpour of rain that may cause flooding. toxic waste. The disposal
of a hazardous material in such a way that it threatens plants,
animals, or humans. toxicity. The level to which a substance is
toxic. TPH. Total petroleum hydrocarbons, typically measured by
levels of BTXE. traffic diminution. The loss of vehicular or pedestrian
traffic. Can be either a permanent or temporary issue. treatment
zone. A soil area of the unsaturated zone of a land treatment unit
within which hazardous constituents are degraded, transformed, or
immobilized. TRPH. Total recoverable petroleum hydrocarbons. uncertainty
factor. The risks, if any, associated with the assessment stage
of a detrimental condition analysis. unchlorinated solvents. Cleaning
solutions to which no chlorine has been added. unidentified substance
containers. A drum or other container holding unidentified substances
suspected of being hazardous or containing petroleum products. unimpaired
value. The value as if no detrimental condition exists. unsaturated
zone or zone of aeration. The area between the land surface and
the groundwater table. uplands. An area above and adjacent to the
high tide level. urban decay. The deterioration of infrastructure
and improvements within a metropolitan area. use issues. All losses
associated with the use of the property during the assessment, repair,
and ongoing stages of a detrimental condition analysis. USDW. Underground
source of drinking water. utility disruption. The temporary interruption
of utilities, such as water, electricity, gas, etc. utility easement.
The rights granted to use a portion of a property for utility lines.
vacuum extraction. A type of remediation process that removes the
majority of contaminants through the use of one or more suction
wells, or a series of air injection and suction wells. The method
is typically less disruptive than soil excavation and may be less
expensive than other techniques involving excavation. vandalism.
The intentional defacing or destruction of property. variance. The
right granted by a city or municipality to develop or use a property
in a way that varies from the typical or stated requirements. view
diminution. The partial or entire loss of a view amenity. violent
crime. A property where a violent crime was committed on the premises.
VOC. Volatile organic compounds. waste water. A liquid (including
storm water) that discharges into a tunnel, drain, ditch, or stream.
water intrusion. The undesired influx of water onto a site or into
improvements. water table. The upper level of the saturated zone
of groundwater. worker decontamination enclosure system. A series
of three temporary rooms for entering or exiting a contaminated
work site. They are the clean room (adjacent to the outside or uncontaminated
area), the shower room, and the equipment room (dirty room). woodrot.
A situation where a wood structure has become moist and decayed.
x-ray release. The undesired discharge of radiograms.