Real Estate Glossary - Letter F

Face value

The exact amount of money as shown by words or numbers in a document.

Fair market value

The amount in which both buyer and seller agreed upon as the selling price of a property.

Fannie Mae

A Federal National Mortgage Association-issued security obtained from pools of conventional and other federally-insured mortgages in the secondary mortgage market.

Federal Housing Administration

A federal government agency that acts as an insurance agency of private lenders to finance loans on new and existing homes.

Fee simple

Pertains to absolute ownership of a real estate property obtained through an inheritance.

Financial statement

A written report summarizing the over-all financial state or health of a company.

Financing

The purchase of a real property by borrowing money from a third party, usually a lending institution; lender and borrower works out a schedule to repay the principal loan and interest accrued.

Financing process

A very systematic process strictly implemented by lending institutions before a mortgage or financing application is approved.

Finder’s fee

A commission paid to a person by a licensed broker for finding a purchaser of a listed property.

First mortgage

A housing loan taken on a property for the first time.

Fiscal year

A 12-month accounting period that a company uses instead of a regular calendar year.

Fixed payment loan

A loan in which the amount to be paid remains fixed for the whole term of the loan.

Fixed rate loan

A loan in which the interest rate is fixed for the whole life of the loan despite changes in prevailing market interest rates.

Flexible payment mortgage

A housing loan that allow borrowers to start with small monthly payments gradually increasing the amount throughout the loan term.

Flip

A selling technique in which properties are bought and sold very quickly for instant profit.

Forbearance

A request made by a borrower to the lender to allow him to delay payment of amount due.

Force majeure

Any event considered as an “Act of God”, such as natural disasters that will deem any person incapacitated from performing his contractual duties.

For Sale By Owner

A real estate term referring to properties in which owners directly sells to a buyer without any real estate agent involved.

Forced sale

The selling of a property by an owner under duress at a selling price that is not influenced by prevailing market prices.

Foreclosure

A legal action wherein properties are re-possessed by the lender because of the failure of the borrower to comply with the terms and conditions of a mortgage.

Forfeiture of title

A penalty imposed for non-fulfillment of a particular contractual obligation in a deed reverting the title of the property to the person who imposed the condition.

Freddie Mac

Popular name for the Federal Home Loan Mortgage Corporation that purchases conventional mortgages and turning them into securities which now provides better access and lower housing costs to homeowners and renters.

Free and clear sale

Any real estate property sale in which the title is free from any liens, claims or encumbrances.

Front money

An amount of money that is required to begin a real estate transaction.

Full disclosure

A provision requiring the seller to detail all relevant information and facts pertaining to the property’s condition.