Common Real Estate Terms

Real estate has its own set of terms and jargon. Here's a list of common real estate terms:

A

1. Appraisal:
   • A professional estimation of a property's value, often conducted by a licensed appraiser.
2. Assessment:
   • The value assigned to a property for taxation purposes by a local government authority.

1. Buyer's Agent:
   • A real estate agent who represents the buyer in a real estate transaction.
2. Broker:
   • A real estate professional who has obtained a broker's license, allowing them to operate their own real estate office or work as a supervisor for other agents.

1. Closing:
   • The final step in a real estate transaction where the property is officially transferred to the buyer, and all funds are settled.
2. Closing Costs:
   • Expenses incurred by buyers and sellers during the closing of a real estate transaction. These can include fees for services, taxes, and insurance.
3. Contingency:
   • A condition that must be met for a real estate contract to be binding. Common contingencies include financing, inspections, and appraisals.

1. Down Payment:
   • The initial payment made by a buyer, typically a percentage of the property's purchase price.

1. Escrow:
   • A neutral third party that holds funds and important documents during the real estate transaction.
2. Earnest Money:
   • A deposit made by the buyer to demonstrate their commitment to purchasing the property.

1. For Sale By Owner (FSBO):
   • A property that is being sold directly by the owner, without the involvement of a real estate agent.
2. Fixed-Rate Mortgage:
   • A mortgage with a constant interest rate throughout the entire loan term.

1. Home Inspection:
   • A thorough examination of a property's condition, usually conducted by a professional inspector.
2. Homeowners Association (HOA):
   • A governing body in a residential community that enforces rules and regulations.

1. Listing Agent:
   • A real estate agent who represents the seller in a real estate transaction.
2. Loan-to-Value Ratio (LTV):
   • The ratio of the mortgage loan amount to the appraised value of the property.

1. Multiple Listing Service (MLS):
   • A database used by real estate professionals to share property information and facilitate the buying and selling process.

1. Pre-approval:
   • A preliminary approval from a lender indicating the amount a buyer can borrow for a mortgage.
2. Private Mortgage Insurance (PMI):
   • Insurance required by lenders when a borrower makes a down payment of less than 20%. It protects the lender in case of default.

1. Real Estate Owned (REO):
   • Properties that have been foreclosed and are now owned by a bank or other financial institution.
2. Realtor:
   • A real estate professional who is a member of the National Association of Realtors (NAR).

1. Seller's Market:
   • A market condition where demand for homes exceeds the supply, giving sellers an advantage.
2. Short Sale:
   • A sale in which the proceeds from selling a property fall short of the balance of debts secured by liens against the property.

1. Title:
   • A legal document that identifies the owner of a property.
2. Title Insurance:
   • Insurance that protects the buyer and lender against defects in the title that may arise after the sale.

1. Under Contract:
   • A property that has an accepted offer but has not yet completed the closing process.

1. VA Loan:
   • A mortgage loan program for eligible veterans, active-duty military members, and their spouses, guaranteed by the Department of Veterans Affairs.

These are just a few real estate terms, and the industry has many more. Understanding these terms can help buyers and sellers navigate the complex process of real estate transactions.