NZ Buyers Guide Buyers Guide - Ray White_2019_NZ - single page no | Page 29

F
Fee Simple (or Freehold)
The exclusive ownership of the land and any associated buildings, subject to any interests
registered on the title.
Fiduciary
A person who essentially holds the character of a trustee. Real Estate agents and
salespersons are considered by law to be fiduciaries, thus they have a duty to act primarily
for the benefit of the principal (the person who employed them) and not their own.
A fiduciary must act with the highest degree of care and good faith in relations with the
principal and on the principal’s business. Penalties for failing in fiduciary duties may be
quite severe.
First Mortgage
A mortgage that is the primary lien against a property.
Fixed Rate Mortgage
A mortgage in which the interest rate does not change during the term of the loan.
Fixtures
Fixed items that cannot be removed without damaging either the property or the fixture
itself, i.e.: built-in cupboards.
Freehold
An estate in real property which continues for an indefinite period of time. Freehold estates
may be inheritable or non-inheritable. Inheritable estates include the fee simple absolute,
the qualified fee, and the fee tail. Non-inheritable estates include various life estates which
are created by acts of parties, such as an ordinary life estate, or by operation of law.
G
Guarantor
A person who agrees to indemnify the holder of a loan all or a portion of the unpaid
principal balance in case of default by the borrower.
H
Home Inspection
A thorough inspection that evaluates the structural and mechanical condition of a property.