Useful terms-

Turnkey Cost- Costs and expenditures that must be covered before a product or service is ready to be sold and used. A turnkey cost may be a direct cost, such as materials, or an indirect cost, such as administrative expenses and product engineering. Turnkey costs are often quoted by manufacturers and real estate developers to describe the costs required to complete a particular project.

Real Estate Investment Trust -REIT-A security that sells like a stock on the major exchanges and invests in real estate directly, either through properties or mortgages. REITs receive special tax considerations and typically offer investors high yields, as well as a highly liquid method of investing in real estate.

Underwater Mortgage -A home purchase loan with a higher balance than the free-market value of the home. This situation prevents the homeowner from selling the home unless s/he has cash to pay the loss out of pocket. It also prevents the homeowner from refinancing in most cases. Thus, if the homeowner wants to sell the home because s/he can't afford the mortgage payments anymore, perhaps because of a job loss, the home will fall into foreclosure unless the borrower is able to renegotiate the loan.

Gazunder -A colloquial term used in the United Kingdom for the practice of a buyer lowering his real estate purchase offer below his previous offer when the transaction is already well under way. A gazunder typically happens when the market is weak and/or when the seller is coming from a position of weakness. "Gazundering" is not illegal, but many people consider it unethical. The seller may be forced to accept the lower price if it is a better option than continuing to pay the carrying costs on the property or continuing to hold it in a declining market.

Tenants By Entirety (TBE) -A method in some states by which married couples can hold the title to a property. In order for one spouse to modify his or her interest in the property in any way, the consent of both spouses is required by tenants by entirety. It also provides that when one spouse passes away, the surviving spouse gains full ownership of the property.

Oligopoly:

When a few FIRMS dominate a market. Often they can together behave as if they were a single MONOPOLY, perhaps by forming a CARTEL. Or they may collude informally, by preferring gentle NON-PRICE COMPETITION to a bloody PRICE war. Because what one firm can do depends on what the other firms do, the behaviour of oligopolists is hard to predict. When they do compete on price, they may produce as much and charge as little as if they were in a market with PERFECT COMPETITION.

Financiaal Terms-4

What is foreclosure?
Foreclosure is a legal procedure whereby property pledged as security for a debt is sold by the lender to pay the debt in the event of default in repayment.

What is VAR?
VAR, Value Added Risk is a single number (currency amount) which estimates the maximum expected loss of a portfolio over a given time horizon (the holding period) and at a given confidence level.

What is Securitization?
A process by which a single assets are transferred from the balance sheet of the originator (bank) to a bankruptcy remote SVP (trust) in return for an immediate cash payment.

Financial Terms-3

Absolute advantage

This is the simplest yardstick of economic performance. If one person, firm or country can produce more of something with the same amount of effort and resources, they have an absolute advantage over other producers. Being the best at something does not mean that doing that thing is the best way to use your scarce economic resources. The question of what to specialise in--and how to maximise the benefits from international trade--is best decided according to comparative advantage. Both absolute and comparative advantage may change significantly over time.

Finacial Terms-2

Arbitrage pricing theory

This is one of two influential economic theories of how assets are priced in the financial markets. The other is the capital asset pricing model. The arbitrage pricing theory says that the price of a financial asset reflects a few key risk factors, such as the expected rate of interest, and how the price of the asset changes relative to the price of a portfolio of assets. If the price of an asset happens to diverge from what the theory says it should be, arbitrage by investors should bring it back into line.