Equity Trusts
Definition of "Equity trusts"
Same as term REIT: Type of investment company that invests money in mortgages and various types of investment in real estate, in order to earn profits for shareholders. Shareholders receive income from the rents received from the properties and receive capital gains as properties are sold at a profit. REITs have been formed by a number of large financial institutions such as banks and insurance companies. The stocks of many of them are traded on security exchanges, thereby providing investors with a marketable interest in real estate investment portfolio. By law, REITs have to distribute 95 percent of their income to shareholders, and in turn they are exempt from corporate taxes on income or gains. In exchange for this special tax treatment, REITs are subject to numerous qualifications and limitations including:
- Qualified asset and income tests. REITs are required to have at least 75% of their value represented by qualified real estate assets and to earn at least 75% of their income from real estate investments.
- Shareholder qualifications. Generally, REITs are not permitted to be closely held and must have a minimum of 100 shareholders.
Popular Real Estate Terms
A public officer given the right to authenticate a document, accept a person's oath, administer depositions, and to conduct other activities in commercial business. An official seal is used ...
Business entity providing water services in a particular locality. ...
Investments you can hold on to all your life or sell for a profit when they have appreciated in value. Real assets are those investments you can put hands on. Real property includes real ...
The English language is brilliant. However, words can often be misleading, as their meaning depends on context. Let's take, for instance, delivery. At first, the answer to the question: ...
Financing of a home based on how much equity the homeowner has in it. The interest rate is typically a variable one. ...
Through the homestead exemption definition, we understand the legal instrument that provides physical and financial shelter in dire situations. The homestead exemption legal provision can ...
To default on a loan means to intentionally or unintentionally miss several consecutive monthly payments over the course of a few weeks or months. Most borrowers learn the definition of ...
Provision in a commercial lease providing a financial allowance for a tenant to finish the interior of a building according to individual requirements. ...
Land that has poor income potential, usually used in an agricultural sense meaning that the land is untellable, has poor access, is extremely steep, has suffered serious erosion, is ...
Have a question or comment?
We're here to help.