Real estate definitions differ greatly from state to state and country to country. For example, in Canada there is no confusion over whether a tenant is an occupant or merely a lessee. Likewise, in the United States, all tenants and non-tenants are considering owners regardless of whether they actually occupy the property. It is this broad range of terminology that makes it so difficult to get a lease or any real estate transaction worked out correctly.

The first question that must be answered is “Who is the tenant?” In a typical lease, the property owner (or his representative) is the tenant. This person signs the document known as a Lease, which legally binds the property and the tenant for a fixed term of years called the “term” of the lease. The lease may be one page or multi-page, per lessee, and can be either a simple lease or a complicated legal document containing sections defining various rights, duties, restrictions, and so on. The document becomes legally binding once signed by both parties.

Another key issue in a real estate transaction is who is the “taker” of the property after the closing. A taker is the person, other than the property owner or his representative, who takes the property upon completion of the mortgage loan and who remains in control of the property after the term of the mortgage loan expires.

This party may be the buyer of the property, a seller, or a third party who has an interest in making improvements to the property. Common examples of third-party purchasers are contractors who come in and make necessary improvements to the property before the buyers purchase it, investors who purchase property to use as a rental property or to sell later, and sometimes real estate agents who purchase property to make improvements on behalf of their clients.

A lienor is another party with an interest in the property that can legally attach a lien on it. He can be a person occupying the property as a tenant, a person leasing it under a lease agreement, or even a bank.

In all three cases, the lienor may have the lawful right to haul the tenant out of the property and take the property itself. Conversely, the property owner has the right to have the lienor evicted from the property. Eviction is one of the more common terms associated with foreclosure.

There are also three other major parties involved in the transaction. The buyer is the person who makes the contract to buy the property, but he does not actually own it. The seller is the person who holds the real estate as tenant improvements and is responsible for paying the taxes on the property.

A third party may have an interest in improving the property – either to sell it, to make it more marketable, or to do any of a number of things. These include the inspection of the property to determine whether it meets the zoning ordinances required for the building, or whether the buyer and seller have properly executed a deed of trust or similar agreement that transfers the property to the buyer.

There are also two major parties involved in rental-under-lease transactions. These are the tenant or his representative, and the lessor or his representative. The tenant’s representative is responsible for making sure the property meets all of the legal requirements necessary for tenants.

If there are any special issues, such as owning the building instead of renting it, the tenant representative must mediate the issue and report it to the lessee. If there are any zoning issues that must be resolved, these are also handled by the tenant representative. The lessor, on the other hand, must follow local and state laws that regulate the amount of money he can collect from the tenant.

Operating expenses, which include repair and maintenance expenses and insurance premiums, are a major part of a real estate lease. When a tenant signs the lease, he is typically responsible for paying the property taxes, insurance premiums, utilities and maintenance. Operating expenses are deducted at the end of the year by the owner of the property, which is why the tenant pays them.

If the tenant is unable to continue paying the property taxes, insurance premiums or repairs, he has the option to sign a deed of default where he agrees to pay these debts along with all the other debts that the property has incurred during the year.

A property owner who has failed to pay the lease may not be able to renew his lease. If the owner has already defaulted on his property tax, insurance premiums or other obligations, he must pay these amounts to the county sheriff before he can apply for a new property tax certificate.

He must also pay off any outstanding fines, court costs and other debt that the sheriff has collected on the delinquent property. Failure to pay these amounts, plus the default amount, result in immediate foreclosure and eviction from the property.