Real Estate Terms Cheat Sheet

architectural-design-architecture-contemporary-1884256.jpg

Real estate terms come naturally for real estate agents, mortgage lenders, and title insurance agencies. Not so much for clients. Serving your clients well means explaining some of the words they’re going to hear a lot throughout the buying and selling process. This will give them confidence in their understanding of what is going on during the process. Sometimes, you need a good cheat sheet of terms that clients often hear during the home buying or selling process, but often don’t fully understand. We’ve compiled a list of 15 terms with a quick, one phrase description to help your clients know the important lingo that can give them the knowledge to best understand the complicated process of real estate purchases or sales. 

Appraisal – the estimated value of a piece of real estate including the home and land it sits on

Buyer’s/Listing Agent – real estate agent that helps buyers find their new home

Closing Disclosure/CD – form that details and itemizes all costs and fees between buyers and sellers

Closing Costs – expenses associated with the sale and purchase of property

Contingencies – conditions written into a contract that must be met in order for the sale to go forward

Due Diligence – the period of time to research and inspect the home prior to final sale

Earnest Money – deposit paid by the buyer for the property after the seller agrees to the offer, usually between 1 and 3 percent of the contract price

Escrow – unbiased third party that holds all funds, documents, and instructions related to the purchase of the home

Equity – market value for the home minus remaining mortgage balance

Principal – amount of money owed to the lender

REO – real estate owned properties or foreclosed properties owned by a lender

Seller Concession – incentives offered by a seller, such as closing cost assistance, home warranties and other repairs

Short Sale – selling a home for less than the balance left on the mortgage

Title Search – examines public records to check for mistakes and errors in filing

Underwriting – the process by which lenders check buyers’ credit scores and ability to repay loans being issued

We hope that this cheat sheet of terms will help you and your clients to better understand the process of buying and selling property and houses. Please reach out to our team if we can help you through the process of purchasing or listing property.