Frequently Used Terms in Real Estate
- Appraisal: An appraisal is a professional assessment of the value of a property carried out by a licensed appraiser. It takes into consideration various factors such as location, condition, size, and recent sales of comparable properties to determine a fair market value.
- Buyer's Agent: A buyer's agent is a licensed real estate agent who represents the interests of the buyer in a real estate transaction. They assist the buyer in finding suitable properties, negotiating offers, and guiding them throughout the buying process.
- Closing: Closing refers to the final stage of a real estate transaction when the property legally changes ownership. During the closing process, all required paperwork is signed, and the buyer pays the remaining balance. Additionally, any necessary fees are settled, and the property's title is transferred to the buyer.
- Deed: A deed is a legal document that transfers the ownership of a property from one party to another. It contains the names of the buyer and seller, a description of the property, and the signatures of both parties. Deeds are typically recorded at the county or city level to provide a public record of ownership.
- Escrow: Escrow is an arrangement in which a neutral third party holds funds, documents, or other assets during the real estate transaction process. It ensures that all conditions are met before the transfer of ownership and provides protection for both the buyer and seller.
- Foreclosure: Foreclosure is a legal process in which a lender repossesses a property due to the borrower's failure to repay the mortgage. It typically begins when the borrower falls significantly behind on payments. The property is then sold at a public auction or repossessed by the bank.
- Home Inspection: A home inspection is a thorough examination of a property's condition conducted by a certified home inspector. It assesses the structural integrity, electrical systems, plumbing, and other crucial aspects of the property. The inspection report helps buyers make informed decisions about the property's condition before proceeding with the purchase.
- Listing Agent: A listing agent is a real estate agent who represents the seller in a real estate transaction. They are responsible for marketing the property, finding potential buyers, and negotiating offers on behalf of the seller.
- Mortgage: A mortgage is a loan secured by real estate in which the borrower uses the property as collateral. It allows individuals to finance the purchase of a property by making regular payments, including principal and interest, over an agreed-upon period of time.
- Open House: An open house is an event in which a listed property is made available for potential buyers to visit without a prior appointment. It provides an opportunity for buyers to tour the property, ask questions, and get a sense of its features and condition.
- Pre-Approval: Pre-approval is the process of getting a lender's commitment to provide a mortgage loan for a specific amount. It involves submitting necessary financial documents and undergoing a credit check. Pre-approval helps buyers determine their budget and strengthens their position when making an offer.
- Real Estate Agent: A real estate agent is a licensed professional who represents buyers or sellers in real estate transactions. They serve as intermediaries, providing guidance, market knowledge, and negotiating expertise throughout the buying or selling process.
- Seller's Market: A seller's market occurs when there is a high demand for homes but a limited supply of available properties. In this market, sellers have an advantage as they can usually sell their property quickly and potentially receive multiple offers.
- Title: Title refers to the legal ownership rights to a property. When buying a property, a title search is conducted to ensure there are no existing claims, liens, or encumbrances that could affect the ownership. Title insurance is commonly purchased to protect against any undiscovered issues.
- Under Contract: Under contract means that a buyer and seller have reached mutual agreement on the terms of a real estate transaction. Once under contract, both parties are legally bound to fulfill their respective obligations, and the property is temporarily removed from the market until the closing process is completed.
