If you are a first-time homebuyer or even a repeat buyer, you quickly realize that real estate has a language all its own.
Understanding some of the lingo can help you navigate the process a little easier. By learning a few critical terms, you will be in a better position to ask the right questions and make the best decisions.
Buyer’s Market
A real estate climate where the number of listings outnumbers qualified buyers.
Seller’s Market
A real estate climate when there are very few desirable properties listed for sale.
Contingencies
Specific conditions included in an offer to protect the buyer against unexpected situations, such as inspection, loan approval, and appraisal value.
Earnest Money
Money deposited when the offer is accepted. Subject to any contingencies, this money protects the seller from a buyer who simply changes her mind.
Escrow Agent
A neutral third party who manages the paperwork in a state where attorneys are not used to conclude the contract.
Closing Costs
Fees that must be paid by both buyers to conclude the sale.
Conforming Loan
A conforming loan is a loan limit by which the loan can be sold on the secondary market; a jumbo loan is one which is higher than this limit.
PMI (Private Mortgage Insurance)
PMI is a fee paid by the borrower of a loan that they obtained with less than a 20% down payment.
These are just a few of the common terms used in real estate. If you are involved in a real estate transaction, learning a bit of the common lingo will help you understand the process better and make your home sale or purchase a smooth one.
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