From buying a home to selling your own, real estate, in general, can seem like an overwhelming process. Don’t worry! As your community real estate firm, we are dedicated to educating our clients on the entire real estate process so each transaction feels more like a sound decision and good move rather than a stressful, overwhelming undertaking. Don’t be afraid of these Real Estate Terms!
Here are some common terms that you will often hear in the world of real estate:
- Appraisal – estimated value of the property
- Certificate of Title – document that ensures the property is legally owned
- Closing Costs – all the fees and expenses associated with the closing on a home
- Comparative Market Analysis (CMA) – study of how comparable local homes have sold to help determine a reasonable price
- Contingencies – condition that must be met in order for the offer on a home to proceed
- Due Diligence – actions that a buyer must undertake in order to protect the real estate investment
- Debt to Income Ratio – monthly debt payments divided by your gross monthly income – in order to qualify for a loan, monthly debt can’t exceed 43% of monthly income
- Earnest Money Deposit – payment made to the seller with the offer to show serious interest
- Escrow – account where all closing costs are collected while the lender approves the deal
- FICO Score – numerical value assigned to lenders based on credit history
- Fiduciary Duties – responsibilities of the broker that the real estate agent works for
- Good faith deposit – payment made to the lender with the offer to show serious interest
- HOA – homeowners associated – organization that determines community rules and standards
- Loan to Value Ratio – how the lender determines if the loan is worth the risk
- Mortgage – the home loan
- Prequalification – process to determine if a borrower is qualified for a loan
- Payment Terms – principal, interest, taxes, PMI, etc.
