SAY WHAT?!?

SAY WHAT?

Real estate lingo can be confusing, especially for first-time home buyers and sellers. Below you will find definitions to some of the most used terms and phrases you might hear during your real estate journey. But don’t be intimidated by them. Leiser Real Estate Group is here to help you and guide you through the process. Reach out to us today! 

APPRAISAL – A report highlighting the estimated value of the property completed by a qualified 3rd party. This is typically done for the benefit of the buyer or the buyer’s lender to ensure the property is worth the purchase price.

CLOSING – when the new title to the property is officially recorded by the County Recorder’s Office and ownership of the property transfers to the new buyer.

CLOSING COSTS – the buyer and seller have expenses associated with the transaction other than that of the actual cost of the home. For example, the buyer has a variety of fees due for obtaining a new loan and the seller must pay commission to both agents.

COMMISSION – a percent of the sale price of the home that is paid to agents. The seller pays commission to both the buyer and listing agent.

COMPARABLES – homes in the area of interest that have recently sold that have similar features.

CONTINGENCIES – conditions which must be met in order to close. Contingencies are typically tied to a date, referred to as a deadline. If the contingency is not satisfied, the contract may be cancelled.

COUNTEROFFER – the response from the seller in regard to an offer.

DOWN PAYMENT – a percent of the cost of the property that is paid up front as a part of the mortgage.

EARNEST MONEY – the deposit made from the buyer to the seller when submitting an offer. This deposit is typically held in trust by a third party. Upon closing, the money will generally be applied to the down payment or closing costs.

ESCROW – this term has multiple meanings; earnest money is typically held by a third party until closing in “escrow.” It can also be referred to as the time period from when the contract is written and accepted by the seller to when the home sale actually closes.

EQUITY – the difference in the market value of a home versus what is owed on the home.

FHA – a mortgage that is financed through a private lender and insured by the Federal Housing Administration, often requiring a lower down payment and income to qualify.

HOME INSPECTION – the process in which a professional inspects the seller’s home for issues that may not be readily apparent, and then creates a report for the buyer to review.

MULTIPLE LISTING SERVICE – the national list of real estate properties that are available for sale. These are the most realizable sources to receive up-to-date listing information.

PRE-APPROVAL – the process in which a lender makes an initial evaluation of how much money a buyer might be qualified to borrow based on the preliminary financial information provided. This gives the seller more confidence in the buyer’s ability to close escrow but is not a guarantee that the loan will be approved.

REO – real estate owned properties or foreclosed properties currently owned by a financial institution such as the bank that made the loan to the previous owner.

SHORT SALE – a situation when the seller’s lender is willing to accept an offer and allows the sale to be completed for an amount less than the mortgage amount owed by the seller.

TITLE – a legal document providing current and proper ownership of the property. Also referred to as a Title Deed, this document highlights the history of property ownership and transfers.

VA LOAN – special no down payment loans that are available to Americans who have served in the Armed Forces. These loans are issued by private lenders and are guaranteed by the Department of Veterans Affairs.