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Real Estate Terms and What They Mean
So, you think you might be ready to buy a home. Along with getting your credit in order, a down payment saved, and pre-approved, you’ll need a little real estate education first. Here are some of the most common real estate terms you’ll be hearing and reading about.
Abstract of Title – is a historical summary of the recorded instruments and proceedings on the title of a property.
Appraisal - is the evaluation of a property by a licensed appraiser on its price based on previous sales of similar properties.
Buyer’s Agent – is the Realtor who is looking for a home to fit the Buyer’s needs.
Contingencies - a condition that must be met before a contract is legally binding, or before a sale is to be completed.
Dual Agent – is an agent that works on behalf of both the seller and the buyer.
Escrow – is a neutral third party who holds other people’s funds in a secure account for future use. An earnest money deposit is held in a real estate broker’s escrow account.
Foreclosure – is the legal process that begins when a borrower fails to make payments to a lender on a mortgaged property.
HUD – stands for the U.S. Department of Housing and Urban Development. This agency is responsible for enforcing the federal Fair Housing Act among HUD’s many programs are urban renewal, public housing, rehabilitation loans, FHA subsidy programs, and water and sewer grants.
Home Inspection – is when a licensed inspector will go through every nook and cranny, and review things like the plumbing, electrical, foundation, walls, heating, and appliances.
Listings – are the available homes that are currently on the market and listed for Sale.
Listing Agent - is the Realtor who is marketing and helping the seller sell their home.
MLS – stands for Multiple Listing Service, which is a database that shows all of the properties that are listed for sale and their current status.
Offer – is when a buyer has submitted an agreement to purchase a property – it turns into a contract when the seller agrees, and all terms are accepted. However, is not legally binding until all signatures are obtained.
Pre-Approval Letter – this is a letter from a bank that gives you an estimate of how much they may lend you to find a home.
Realtor - A real estate broker or a real estate agent who holds active membership in a local board of Realtors that is affiliated with the National Association of Realtors® (or NAR).
Tax Lien – is placed on a property for unpaid taxes. A title company checks and ensures the title against liens, ownership claims, and title problems.
Underwriting – is the final approval or rejection by a lender upon reviewing all pertinent details of a loan applicant’s creditworthiness.
Zoning – is referring to local requirements for the use of real estate in a particular area.
And there you have it. Now you’re ready to talk to an agent. We’re available 24/7 here at Homeward to fulfill all your real estate needs. Whether you’re a first-time buyer or you’re a seasoned investor, our agents are ready and willing to guide you through the entire buying process. Call us today!
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