First 30 Days Blog

26 sep

A Home Buyer’s Guide to the Lingo of Real Estate

RobertCordrayShopping for a house is like moving to a foreign country. You find yourself in strange and unfamiliar places expected to understand new and confusing customs and formalities. Worst of all, as soon as you find a realtor, you discover that there’s an entirely new home-buyers language being spoken, and if you want to be able to locate the right house for you, you’re going to need to learn how to speak it too. So, in the hopes of saving you a little time and a lot of embarrassment, here are 22 terms that you should study up on if you want to know how to buy a home.

  1. #B/#B: This indicates the number of bedrooms and bathrooms in the home (where # would be replaced with an actual number). “Bedroom” generally refers to a room with a window and a closet, but there’s no set definition, so be mindful.

  2. Amortization: The process of decreasing a loan over time by dividing the loan payments between reducing the the principal balance and paying off the interest.

  3. APR: Annual Percentage Rate. The interest rate charged on a loan.

  4. Appraisal: An estimate on the market value of a property.

  5. ARM: Adjustable-Rate Mortgage. A mortgage with an unfixed interest rate—usually adjusted annually—used to bring it inline with current market rates.

  6. As-is: When used to describe a home, this usually means that the seller is unwilling to pay for any additional repairs or upgrades. Basically, what you see is what you get.

  7. Assumable mortgage: An alternative to traditional mortgage in which the buyer is able to take over the existing mortgage of the seller—assuming that the mortgage lender approves.

  8. Blended payment: A mortgage payment that includes both principal and interest.

  9. CC&Rs: Covenants, Conditions and Restrictions. A document that details restrictions placed on homes in a certain area.

  10. Closing costs: Any fees that you will be asked to pay “upfront” when the mortgage loan transaction is complete and the property sale finalized.

  11. Closing day: The date on which the sale of a property becomes final.

  12. CMA :Comparative market analysis or competitive market analysis. An evaluation of similar, nearby, recently sold homes used to establish a price estimate.

  13. Contingency: A provision in an agreement that postpones the agreement from taking effect until after a specific condition is met.

  14. Counteroffer: An offer made, either by a buyer or a seller, in response to an unaccepted offer.

  15. Deposit: A small amount of money that a prospective buyer will sometimes give a seller to convince them that they are serious in their intent to purchase the property. Deposits prevent the home from being sold to other interested parties until the first party has made a decision.

  16. Down Payment: The portion of the price of the property that is not covered by the mortgage loan. The down payment is paid by the buyer before the mortgage can be secured.

  17. Equity: The difference between the price of the property and the amount still owed to the lender.

  18. Fixture:Anything of value that is permanently attached to or a part of the property, such as carpeting, built in appliances, landscaping, etc.

  19. Full bathroom: A room with a toilet, sink, and a bathtub.

  20. Half bathroom: Also called a “powder room,” a room with a toilet and a sink.

  21. HOA: Home Owner’s Association. A legally designated group that has the authority to enforce deed restrictions with membership being mandatory for all property owners within the development. HOAs often charge fees.

  22. Listing :an agreement between a homeowner and a real estate broker that allows the broker to market and arrange for the sale of the home.

  23. MLS: Multiple Listing Service. A database service that collects, compiles and distributes information about homes listed for sale and accessible by real estate agents.

  24. Mortgage Broker: The person who acts as the intermediary between the buyer and the bank in regards to mortgages.

  25. Origination Fee: A fee charged by lenders to help cover the cost of preparing and processing a loan.

  26. Three-quarter bathroom: A room with a toilet, sink, and shower.

  27. Title insurance: An insurance policy that protects the interest of either the lender or the owner in real property from assorted types of fraudulent claims of ownership.

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Posted by Robert Cordray on September 26th, 2013 in House and Home | 0 comments

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