Whether you’re a realtor, homebuyer, homeowner or looking for a house on the market, there is some “real estate lingo” everyone should know.
Here are some real estate terms, broken down alphabetically, every person should be knowledgeable about:
A statement that justifies the price paid or value of a property, based on sales of similar homes, and written by an appraiser.
Other words: Asset; Agreement; Amortization; Automated underwriting
Some realtors are referred to as “agents,” and they work under a broker; some realtors are both. In the mortgage industry, broker usually refers to a company or individual that does not lend the money for the loans themselves, but broker loans to larger lenders or investors.
Other words: Bankruptcy; Bridge loan; Balloon Payment; Buyer’s market
The expenses that both buyers and sellers have to pay during settlement of the property or in the transfer of ownership of property that aren’t necessarily the property itself (i.e. broker fees, attorney fees,etc.) There are two types of closing costs: non-recurring closing costs and pre-paid items.
Other words: Commission; Contract; Closing date; Commercial property
The partial payment that the buyer pays for that goes toward the total selling price of the property. Not the same as financing with a mortgage.
Other words: Deed; Debt; Days on the market; Developer
Other words: Estate taxes; Exclusive listing; Equitable mortgage
Fair market value
The price that a buyer would pay for a property within a period of time on the open, active market and the lowest price a seller is willing to accept.
Other words: Fixed-rate mortgage; Foreclosure; FICO; Firm commitment
A loan that fills the difference between the first loan and the full amount of the permanent loan.
Other words: Grantee; General mortgage loan; Government National Mortgage Association (Ginnie Mae)
A professional, typically called a home inspector, examines the property for the structural condition, mechanical soundness and workmanship of the building. This is what can determine if the property is really at the value the seller is asking for. Buyers usually can have a home inspection performed as a part of a contingency clause the seller agrees to.
Other words: Homeowners’ association; Home equity line of credit; Home loan; Home Mortgage Disclosure Act