Direct Capitalization
A capitalization method, which divides a property's first year net operating income by an estimated general capitalization rate to develop a total property estimate. If an income property produces a first year net operating income of $30,000 and the market indicates a general capitalization rate of 10% for comparable properties, the direct capitalization estimate of the value of the total property would be ($30,000/.10) or $300,000.

Direct Costs
Costs in erecting a new building involved with either site preparation or building construction, including fixtures, in contrast to indirect costs which include building permits, land survey, and overhead costs such as insurance and payroll.

Direct Current
DC. Electric current that flows in one direction as opposed to alternating. Car batteries have direct current

Direct Expansion Cooling System Evaporator
Heat exchanger, which cools air directly using a refrigerant, which is expanded into the evaporator coil. The refrigerant is cooled by the expansion and air passage over the outside of the coil is cooled by the heat transfer through the coil.

Direct Lighting
Light which shines directly onto a surface without intervening reflection between the light source and the surface.

Direct Nailing
Nails that are hammered at right angles (perpendicular) to the work surface. Also called face nailing.

Direct Overhead
Cost of doing business that is related on one specific job.

Direct Tap
Clamping device, which when used on a main service line, allows a branch line to be drilled and tapped off. A connection can be made to a main line, without taking the main line out of service, by using this drill and tap to cut into the line and then installment of a corporation stop in the tapped hole, which provides control of the flow of fluid.

Direct Reduction Mortgage (DRM)
A fully amortized mortgage necessitating periodic payments of both interest and principal. In the early years of the loan, he share of principal is smaller and the interest larger. This gradually reverses toward the end of the period.

Direct Steam System
Heating system dependent upon radiators in each room of a structure. The steam goes from the boiler through pipes to the radiators with a two-pipe system being better for larger structures.

Direction of Least Resistance
Tendency to go to the party offering the lowest level of opposition.

Directional Growth
The direction in which a community is growing, which is measured over time. Its path strongly influences current and future market values of properties clearly in its path.

Directional Tee Plumbing
Tee fitting, which directs flow in one direction by use of an internal baffle.

Directory Board
Commercial building listing of the occupants and their locations.

Disability Insurance
Insurance policy that covers an individual's ability to produce income.

Discharge
Removing a debt by making payment.

Discharge of Bankruptcy
Court order whereby the bankrupt debtor is forgiven of his or her debts. A bankruptcy remains on a credit report for 10 years.

Discharge of Lien
Order to withdraw a property lien after a claim is paid by other means.

Discharging Arch
Also called a Relieving Arch or Safety Arch, this arch is built over another arch or a lintel for the distribution of the weight of the load over the opening.

Disclaimer
Renunciation of a claim to real estate ownership.

Disclosed Principal
A principal-agent transaction or contract where a third party knows the name of the principal the agent represents. In this arrangement, the agent is not legally bound under the written or oral agreement.

Disclosure
See full disclosure

Disclosure Statement
A written statement of a borrower's rights under the Truth-in-Lending Law or a statement of all financing charges, which must be disclosed by a lender. Also, a statement that lists information relevant to a piece of property, such as the presence of radon or lead paint.

Discontinuity
1. A gap or break.
2. Lack of logical sequence.
3. Lack of uniformity.

Discount
The difference between future (or face) value and present value of a payment or a reduction in the amount due for early payment. Alternately, the taking into account of all available good or bad news in evaluating a subject.

Discount Points
Fees paid by a borrower to a lending institution, to obtain a lower interest rate.

Discounted Cash Flow
A method to estimate the value of a real estate investment, which emphasizes after-tax cash flows and the return on the invested dollars discounted over time to reflect a discounted yield. The value of the real estate investment is the present worth of the future after-tax cash flows from the investment, discounted at the investor's desired rate of return.

Discount Loan
Loan in which the entire financing charge is subtracted from the initial loan proceeds. The total amount of funds received is the face value of the loan less this deduction. For example, a $50,000 one-year loan borrowed at a discount rate of 12% would result in $44,000 being disbursed at the loan closing. The effective interest rate would be 13.6%, not the 12% discount rate (since only $44,000 is received).

Discount Points
An additional fee on home mortgages, payable in cash at the time of closing.

Discount Rate
The interest rate charged by the Federal Reserve Bank to its member banks for loans. Changes in this rate will have a significant impact on the real estate market.

Discrimination
Unequal treatment and denial of opportunity to individuals based on race, color, creed, nationality, age or sex. Civil Rights Acts passed by congress, included those of 1866, 1870, 1871, 1875, 1964 and 1968.

Discriminatory
Inducement Real estate property incentive offered for reasons other than individual merit, such as an effort to get an individual to buy/sell through the unfair use of bias.

Disinflation
A lessening in the rate of inflation that may occur during a recession.

Disintegration
The transformation of a racially integrated neighborhood housing pattern into segregated housing. Alternately, deterioration, destruction or decay.

Disk Sander
Sander with an abrasive disk that rotates.

Disperse
1. To break up and scatter.
2. To spread about or distribute widely.

Dispersing Force
The factors, such as need for increased space, high rentals, crime, etc., that cause the movement of people from the central city to the suburbs or small cities.

Disposable Income
Personal income minus personal income tax payments and other governmental deductions, it is the money available for people to spend or save.

Dispossess Proceedings
Legal action by the owner of property to oust or exclude an individual or business from using the property.

Disrepair
State of neglect and deterioration.

Dissipate
1. To break up and scatter; to dispel or disperse.
2. To spread thinly as to make disappear.

Dissolve
1. To liquefy or to melt.
2. To merge with a liquid, which absorbs the addition.

Distill
1. Heating a mixture to separate the more volatile from the less volatile parts, then cooling an condensing the resulting vapor, to produce a more nearly pure or refined substance.
2. To draw out or obtain the part that is essential, pure, etc.

Distraint
Landlord's act of seizing a tenant's property to satisfy defaulted rent payments.

Distressed Property
Property in poor financial or physical condition; foreclosed real estate or property in a bankruptcy; Income property which is making an inadequate return.

Distributee
Heir to an individual who died in testate and is entitled, under the distribution statute, to a portion of the proceeds of the estate. After all claims against the estate are satisfied, the distributee receives his/her share.

Distribution
Process by which products or commodities get to the final and correct location.

Distribution Approach
The apportioning, disbursing, dividing or parceling out of property among individuals. Probate: Court approval to divide and distribute the contents of an estate after all claims against it are satisfied. The estate is then divided between all distributees. Statutes of Distribution: State laws controlling the distribution of the estate of an individual who dies in testate. Securities Offering: A public securities offering by an insurer or underwriter.

Distribution Panel
Electrical service box, where wires enter and are routed to the proper area, is the heart of the electrical system. Service entrance conductors are secured to heavy copper bars called Busbars and individual circuits are routed from them.

Distribution Tile
Pipes that are used when constructed a septic tank system.

Distribution Title
Probate court approved title issued to the distributee of the estate of one who dies in testate.

District
1. A geographical division made for a specific purpose.
2. Any region; part of a city or county, etc.

Ditch
A long narrow channel dug into the earth, as a trough for drainage or irrigation.

Ditch Stake
Survey stake used to identify the location of a potential ditch.

Diverge
1. To go in or change different directions from a common point.
2. Spreading out from a certain place.

Diversion
Drainage ditch to direct the flow of water runoff.

Divert
1. To turn a thing aside from a certain direction.
2. To distract the attention of someone or something.
3. To amuse or entertain.

Divestiture
The surrender, voluntarily or involuntarily, of ownership of property or an interest, therein. Alternately, a court order to give up possession or the right to property such as in the case of an antitrust action.

Divide
1. To separate into parts or groups.
2. To split up or sever.
3. To give out in shares or to apportion.

Divider Strips
Used to control cracking in concrete or tiled floors, these strips may be made of metal, plastic or other material.

Dividers
Tool used to measure, compare and transfer dimensions. Similar to a compass, except with two pointed legs.

Dividing Head
Milling machine device used to divide work into increments of equal amounts.

Division Fence
Fence constructed, at a property line or other point, to mark the point of separation between two separate properties.