< '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

Trump Diplomacy Fails to Revive Oil Prices
Posted on Wednesday April 01, 2020

Oil was rooted near $20 a barrel as President Donald Trump's pledge to meet with feuding producers Saudi Arabia and Russia to support the market failed to bolster prices.

Oil Posts Worst Quarter Ever as Physical Market Cratered
Posted on Tuesday March 31, 2020

Oil posted the worst quarter on record after the coronavirus crushed demand and raised fears about overflowing storage tanks.

Some Refiners Benefiting From Crude-Price Drop
Posted on Tuesday March 31, 2020

America's biggest fuel makers are taking advantage of low oil prices to capture profits while slowing fuel production.

US LNG Giant Signaling It May Curb Production
Posted on Tuesday March 31, 2020

Cheniere Energy has tendered to buy six shipments for delivery to Europe later this year, rare for a company that's a seller of the fuel.

Saudis Make Good on Oil Wave Promise
Posted on Tuesday March 31, 2020

The first wave of crude oil is already on its way toward Europe and the US.

Putin, Trump Agree Sinking Oil Prices Not In Mutual Interest
Posted on Tuesday March 31, 2020

Vladimir Putin and Donald Trump agreed in a phone call Monday that "current oil prices aren't in the interests of our countries."

Ineos Producing Sanitizer to Help Combat Virus
Posted on Tuesday March 31, 2020

Ineos revealed Tuesday that it has started producing one million hand sanitizers per month to help combat the coronavirus outbreak.

BP Issues AGM Warning
Posted on Tuesday March 31, 2020

BP has outlined that it may not be possible to conduct its annual general meeting as usual this year due to the Covid-19 pandemic.

Neptune Prepared for Prices to be Lower for Longer
Posted on Tuesday March 31, 2020

Neptune Energy is prepared for prices to be lower for longer, its executive chairman and founder Sam Laidlaw has revealed.

Oil CEOs Back Plan to Cut Texas Output
Posted on Tuesday March 31, 2020

Two of the biggest drillers in America's largest oil-producing state have asked Texas regulators to consider a cut to crude output after a historic price crash.

Wall Street Journal
Commercial News


WSJ.com: US Business

Xerox Is Ending Hostile Takeover Bid for HP
Xerox is pulling the plug on its hostile bid to buy larger rival HP after the coronavirus pandemic undermined the copier maker?s ability to pull off the debt-laden merger.

Workers Return to China's Factories, but Coronavirus Hurts Global Demand
Chinese factory activity expanded in March, following sharp contractions in January and February, but sluggish demand, dampened hopes for a speedy recovery.

Apple Commits to Paying Contractors
The tech giant said it plans to pay its hourly contract workers after some janitors at their Silicon Valley campus were told their jobs were being suspended without pay.

Airlines Seeking Federal Aid Can't Share Flights
Initial rules governing airlines? access to federal aid require carriers to maintain certain levels of service and won?t allow any coordination that would violate antitrust strictures.

Amazon Struggles to Find Its Coronavirus Footing. 'It's a Time of Great Stress.'
The tech giant is dealing with mass absences and a restive workforce as it labors to keep up with a surge in demand. ?This isn?t business as usual,? said Jeff Bezos.

Fed Launches New Lending Facility for Foreign Central Banks
The central bank launched its latest lending program to alleviate market strains by allowing foreign central banks to convert their holdings of Treasurys into dollars.

Trump Calls for New $2 Trillion Infrastructure Bill
President Trump called for infrastructure investment to be a part of a fourth congressional coronavirus relief package, citing low interest rates.

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