< 'O' glossary of mortgage and real estate terms
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OAKUM - fiber used as a caulking, made by pulling apart hemp or rope.

OATH - attestation by a person which binds him or her legally and morally. Usually attesting to the truth of something, as an affidavit, or the validity of one's signature. A promise to tell the truth. Also, a promise to carry out a duty with high morality (oath of office). An oath has religious connotations and usually involves the word "swear", and may contain the phrase "so help me God", or require the one taking the oath to put his or her hand on a bible. An affirmation (see which) is still legally binding.

OBLIGATION BOND - bond secured by a mortgage but over the mortgage amount. It creates a personal obligation on the part of the mortgagor.

OBLIGEE - One to whom an obligation (promise) is owed. See also: Obligor.

OBLIGOR - One who legally binds (obligates) oneself, such as the maker of a promissory note.

OBSOLESCENCE - appraisal term meaning that the age of a structure may cause it to become undesirable in use or appearance (old fashioned) and consequently lose income and value.

OCCUPANCY - With reference to land, the word has become synonymous with possession.

OCCUPANCY RATE - percentage of space or units rented. Opposite of Vacancy Rate.

OFF-SITE - Not on the property to be sold. For example: The developer of a housing tract sells only the house and lot, but must build the streets, sewers, etc., not on the lot.

OFF-SITE COSTS - cost of off-site improvements.

OFF-SITE IMPROVEMENTS - Development of land to make adjacent property suitable for construction. Includes sidewalks, curbs, streets, sewers, streetlights, etc.

OFFER - presentation or proposal for acceptance, in order to form a contract. To be legally binding, an offer must be definite as to price and terms.

OFFER AND ACCEPTANCE - Necessary elements of a contract to sell real estate. See also: Offer; Acceptance.

OFFER TO PURCHASE - written proposal to buy a piece of real estate that becomes binding when accepted by the seller. Also called a sales contract. Also See: Purchase Agreement.

OFFEREE - One to whom an offer is made.

OFFEROR - One making an offer.

OFFICE - zoning designation allowing businesses to carry on their paperwork rather than manufacturing or sale of inventory to the public on the site. Some businesses may be conducted entirely out of such space, when only paperwork is involved, such as insurance companies, law firms, accounting firms, etc.

OFFICE OF THRIFT SUPERVISION - federal bureau formed in 1989 as a branch of the Treasury Department as part of a major reorganization of the thrift (savings and loan) industry. OTS regulates, examines, and supervises both thrifts and their holding companies. The office director coordinates with other federal bureaus which regulate the nation's financial institutions by serving on the boards of the Federal Deposit Insurance Corporation, the Resolution Trust Corporation, and others. The purpose of this office is to ensure a sound operation of savings institutions and compliance with federal laws.

OFFSET - (1) ledge across a wall (usually brick or masonry) formed by reducing the thickness of the wall above the ledge. (2) To balance, as claims in a law suit. Commonly called set-off (when a counter- claim is made to offset damages, the counterclaim being made concerning different subject matter).

OFFSET STATEMENT - (1) statement given to a buyer of rental property by a tenant, setting forth the amount of rent and terms of the rental agreement. (2) A statement by an owner or lienholder to a buyer, setting forth the balance due on existing liens against the property being purchased.

OHM - electrical measure of resistance of the dissipating of one watt when one ampere passes through it.

OIL AND GAS LEASE - lease giving the lessee the right to extract oil and gas from land. More like a mining lease than a land lease, in that the lessee has ownership interest in a portion of the property (the oil and gas) rather than just the use of the property. The lessor is generally paid based on the oil and gas taken. See also: Slant Drilling; Profit a Prendre.

OMNIBUS CLAUSE - Clause in a will or decree of distribution passing all property not specifically mentioned.

ON CENTER - construction term referring to a measurement of distance from the center of one structural member to another, such as a stud, joist, etc. Abbreviated on construction drawings as O.C.

ON RAIL - Refers to property (usually industrial) which is served by a railroad.

ON-SITE COSTS - cost of on-site improvements.

ON-SITE IMPROVEMENTS - Structures erected permanently for use on a site, such as buildings, fences, etc.

ON-SITE MANAGER - property manager who lives on the property being managed. The law in most areas requires an on-site manager for apartments over a specified number of units.

ON-SITE OFFICE - real estate branch office specifically for a particular development, and located at said development. May be a sales or leasing office.

ONE HOUR DOOR - fire resistant door; one which will hold back a fire for a minimum of one hour.

ONE HOUR WALL - fire resistant wall; one which will hold back a fire for a minimum of one hour.

ONE, TWO, THREE FINANCING - method of "creative" financing by which the buyer (1) assumes an existing loan, (2) secures a second loan from a third party lender, (3) takes a third loan from the seller.

ONE-HUNDRED PERCENT LOCATION - best location in the area. The term is most commonly used to describe a location in a city ideal for retail sales.

OPEN AND NOTORIOUS POSSESSION - (Also See: Notorious Possession).

OPEN BEAM CONSTRUCTION - design using heavy roof beams as interior finish, exposed to give a roomy, heavy, rugged appearance to a room.

OPEN END MORTGAGE - mortgage loan allowing the borrower to increase the amount borrowed during the term of the loan.

OPEN HOUSE - house which is open without an appointment to prospective buyers (or tenants) for inspection, during certain hours and days of the week.

OPEN HOUSING - Housing made available to persons without regard to race, religion, sex, color, or national origin.

OPEN LISTING - written authorization to a real estate agent by a property owner, stating that a commission will be paid to the agent upon presentation of an offer which meets a specified price and terms. However, the agent has no exclusive right to sell and must bring in his offer before any other offer is presented or accepted.

OPEN MORTGAGE - mortgage that can be prepaid without penalty. Also See: Or More Clause.

OPEN SPACE LAND - Land used for agriculture, recreation, scenic beauty, natural resources, water shed, or wild life, and so designed on a map.

OPEN SPACE RATIO - Ratio of land area to floor area of an apartment building. Used in zoning requirements.

OPERATING EXPENSE RATIO (OER) - ratio of operating expenses to effective gross income. The percentage derived from the ratio can be used by an appraiser to determine if the operating expenses are appropriate for the property.

OPERATING EXPENSES - cost of operating an income producing property, such as management, utilities, and similar day to day expenses, as well as taxes, insurance, and a reserve for replacement of items which periodically wear out.

OPERATION OF LAW - fixing of rights and duties by law rather than by agreement of the parties involved. Examples would include Intestate Succession, certain types of Warranties, and Quasi Contract.

OPINION OF TITLE - Also See: Abstract of Title.

OPTION - right, which acts as a continuing offer, given for consideration, to purchase or lease property at an agreed upon price and terms, within a specified time.

OPTION CONTRACT - Also See: Option.

OPTION FOR ADDITIONAL SPACE - option given to a tenant to rent additional space at a specified rental amount and terms.

OPTION TERM - time during which an option may be exercised.

OPTIONEE - One who, for consideration, receives an option.

OPTIONOR - One who, for consideration, gives an option.

OR MORE CLAUSE - clause in a note, mortgage, or deed of trust, allowing for additional payments to be made without penalty. The words "or more" come after the specified payment.

ORAL APPRAISAL - verbal appraisal report. The conclusions must be based on the same methods as would be used in a written appraisal.

ORAL CONTRACT - contract, partly written and partly spoken, or not at all reduced to writing.

ORDER CONFIRMING SALE - Court order confirming the terms of a sale of property out of an estate.

ORDINANCE - law of statute. The term used to designate the enactments of the legislative body of a municipal corporation or a county.

ORDINARY INCOME - term having meaning only in relation to income tax. The regular graduated scale of tax is paid on income which is called "ordinary", as opposed to capital gains or any other income taxed differently.

ORDINARY REPAIRS - Repairs necessary to keep a property in good condition, against ordinary wear and tear, decay, etc.

ORDINATE - point along the vertical axis of a curve. When in conjunction with a point on the horizontal axis (abscissas), the point is called the "co-ordinates".

ORIEL WINDOW - window projecting outward, similar to a bay window. However, an oriel window is supported by brackets or a cantilever, as opposed to a bay window which is supported by the foundation.

ORIENTATION - Planning the most advantageous place on a parcel of land for an improvement to be located.

ORIGINAL COST - purchase price of property, paid by the present owner. The present owner may or may not be the first owner.

ORIGINAL FACE VALUE - principal amount of a note or mortgage before any payments or default.

ORIGINAL PAYEE - person or entity to which a check or promissory note is originally payable.

ORIGINAL PRINCIPAL BALANCE - amount, not including interest, that the borrower owes on a new loan.

ORIGINATION FEE - fee charged for the work involved in the evaluation preparation and submission of a proposed mortgage loan.

OSTENSIBLE AGENCY - agency created by law when a principal acts (intentionally or negligently) as if one is an agent who in fact is not. See also: Apparent Authority.

OSTENSIBLE AUTHORITY - Also See: Apparent Authority.

OTS - Also See: Office of Thrift Supervision.

OUTBUILDING - freestanding structure that is not the main building on the property. An example would be a barn or storage shed.

OVER IMPROVEMENT - improvement, excessive in cost or size in relation to land value or value of surrounding improvements.

OVERAGE INCOME - Rental which exceed the base rate. May be from a percentage of the tenant's income (Also See: percentage) or some other formula (e.g. for a gasoline service station, a common overage would be x cents per gallon over x gallons per month, but nothing on repairs and the sale of other products such as oil, tires, etc.).

OVERAGE RENT - Also See: Overage Income.

OVERALL CAPITALIZATION RATE (R0) - rate (expressed as a percentage) which is used to show the relationship between annual net operating income (N.O.I.) and estimated value (v). N.O.I. ÷ R0 = v. The overall capitalization rate includes both the rate of return of investment and rate of return on investment. Also See: Return of Investment; Return on Investment.

OVERBUILDING - Construction of an excessive number of similar properties (houses, apartments, etc.) so as to cause a surplus of supply over demands.

OVERHANG - extension of a roof beyond the exterior walls, used as a shading or protection from rain, for a walkway.

OVERHEAD - expenses of a business or property. Commonly referred to as the "nut".

OVERPASS - bridge or road elevated to avoid intersecting with a roadway, railway, or other traffic carrier.

OVERRIDE - rental amount paid due to sales of the tenant. For example: A lease for a service station may contain a provision for a certain addition to the rent for every gallon of gasoline over a certain amount sold each month. The amount over is called the override, such as two cents per gallon for every gallon over fifty thousand sold each month.

OVERRIDING ROYALTY - Common in oil and gas leases. A retained royalty by a lessee when the property is subleased.

OVERT - Open, manifest, public; action as distinguished from mere intention.

OWELTY OF EXCHANGE - Money necessary to equalize the value of the properties being exchanged. See also: Boot.

OWELTY OF PARTITION - Money paid by one co-tenant to another when property is split, but the result is properties of unequal value.

OWNER - One who has the rights of ownership.Also See: Ownership.

OWNER FINANCING - purchase in which the seller provides all or part of the financing.

OWNER OCCUPIED - Property physically occupied by the owner.

OWNER OF RECORD - owner of property according to the records of the county recorder.

OWNER WILL CARRY MORTGAGE - term used to indicate that the seller is willing to take back a purchase money mortgage. Also See: Purchase Money Mortgage (1).

OWNER'S POLICY - Title insurance for the owner of property, rather than a lienholder.

OWNERSHIP - Rights to the use, enjoyment, and alienation of property, to the exclusion of others. Concerning real property, absolute rights are rare, being restricted by zoning laws, restrictions, liens, etc.

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Daily Oil & Gas and Wall Street Journal News

Crude Oil and Natural Gas Down for the Week
Posted on Thursday December 13, 2018

Crude oil futures post week-on-week losses, and natural gas posts an even bigger decline.

Suncor Works with Alberta Govt to Mitigate 'Unintended Consequences'
Posted on Thursday December 13, 2018

Suncor is working with Alberta's government to help mitigate the 'unintended consequences' of mandated oil production cuts.

Occidental Wants to Keep Rigs Running amid Oil Price Drop
Posted on Thursday December 13, 2018

Occidental Petroleum will look for ways to cut costs other than dropping rigs, CEO Vicki Hollub says.

US Oil Rig Count Drops for Second Week in a Row
Posted on Thursday December 13, 2018

US drillers cut four rigs this week.

Complex Oil Refiner Margins Squeezed
Posted on Thursday December 13, 2018

Returns at sophisticated refinery units that companies built at great expense are now almost on a par with those at relatively inexpensive and simple plants.

Unite Members to be Balloted on New OCA Offer
Posted on Thursday December 13, 2018

UK union Unite says its 2,500 members covered by the Offshore Contractors Association are to be balloted on a new pay offer.

Oil God Forecasts Price Move
Posted on Thursday December 13, 2018

If you want to place a bet on oil right now, you're probably better off betting on it going up than going down.

Oil Steadies Below $53
Posted on Thursday December 13, 2018

Oil traded below $53 a barrel in New York, little changed a week after OPEC and its allies announced substantial output cuts.

Crude Oil Up Two-plus Percent
Posted on Wednesday December 12, 2018

WTI crude oil rose by nearly 3% while the Brent contract price edged upward by more than 2%.

Saudi Arabia Plans to Slash Exports to US
Posted on Wednesday December 12, 2018

Saudi Arabia plans to slash exports to the world's largest oil market in the coming weeks in an effort to dampen visible build-ups in crude inventories.

Wall Street Journal
Commercial News


WSJ.com: Commercial Real Estate

CBRE Global Investors Buys Stake in Three GGP Malls
One of the world?s largest real-estate asset managers has purchased a 49% stake in three malls in a deal that values them at more than $1 billion and shows that investors still have an appetite for top-tier retail property.

FAO Schwarz Is Returning to New York
A dominant presence in Midtown Manhattan for decades before its closure in 2015, the toy store is coming to life again with a new, 20,000-square-foot Rockefeller Center location.

Sportswear-Maker Puma to Open New York Flagship
Germany?s Puma has signed a lease deal to creating a marquee location on Fifth Avenue that will be the first of its kind for the company in North America.

Kushner Cos., Brookfield Near a Deal for Stake in 666 Fifth Ave.
The real estate arm of Brookfield Asset Management is in advanced talks with Kushner Cos. to buy roughly a 50% stake in 666 Fifth Ave. and invest hundreds of millions of dollars in the Manhattan office tower, which has been at the center of a controversy over possible conflicts of interest involving Jared Kushner, President Donald Trump?s son-in-law and adviser.

Sign of the Times: New Office Space Created in Retail's Tumult
Normandy Real Estate Partners? $133 million deal for the upper portion of ABC Carpet?s flagship store is an example of office space edging into territory that once was retail?s domain.

Want to Buy a Luxury Hotel in the U.S.? Try China's Insurance Regulator
When Chinese regulators seized control of Anbang Insurance, they took ownership of more than a dozen luxury U.S. hotels. Now, as the government looks to sell, it faces a problem: The buildings likely are worth less than what Anbang paid only a couple of years ago.

New York's Commercial Property Slump Shows Signs of Slowing
After a two-year plunge, brokers are optimistic that more deals will take place in 2018.

BRE #:00619059
Charles Elfsten, President
Charles A. Elfsten
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