10 Real Estate Terms You Need To Know

1. Appraisal

This document determines the value of your property based on an examination of the house itself, as well as the price of other properties in the area.

2. Amortization

This allows home buyers to combine both interests and principal in payments instead of paying off interests at the start.

3. Buyer’s Agent

This refers to the real estate agent that is representing the buyer in the home-selling process.

4. Comparative Market Analysis (CMA)

This is a report that contains information about all the comparable properties in the area that are either for sale or already sold.

5. Closing Costs

Closing costs typically make up about 2-5% of the sale price, not including the down payment. Some examples are title insurance, excise tax, and loan processing costs.

6. Listing

This term represents the fact that homes are “listed” for sale in the MLS, a website, or any publication. Real estate agents constantly list homes to reach a large number of buyers.

7. Closing

Closing refers to the final meeting where sellers and buyers complete the sale. During this process, they both sign the final documents, and the buyer pays closing costs.

8. Inspection

Home inspections are crucial to allow the buyer to know exactly what the condition of the property is. Issues that may turn up during an inspection can influence the decision-making process of the home buyer.

9. Pre-Approval Letter

This document can be obtained from a bank and provides an estimate on how much the bank will lend the buyer.

10. Title Insurance

This document covers research into public records to make sure the title is free, clear and ready for sale. Title insurance is often required as part of the closing costs.