Time To Learn A New Language
How well do you speak the real estate language ?
Real estate agents often use words that have no meaning to a buyer or a seller unless they speak the real estate language. Most folks that don't speak the real estate language (and aside from agents few do) are afraid to admit it because they fear looking foolish and or they fear that they may be taken advantage of making them easy targets...
To give our clients and buyers an easy way to learn the real estate language I wrote a "Buyer Book" several years age.
Our agents give a copy of the book to every client and buyer they work with.
One of the things I included in the book was a list of 45 real estate terms that most folks are not familiar with.
I hope this list of the 45 most often used and seldom understood terms gives you a better understanding of the real estate language. Please call on us should you have any questions....RE/MAX Wittney Estates
1. Abstract of Title ... History of a parcel of real estate, compiled from public record, listing transfers of ownership and claims against the property.
2. Acknowledgement ... Formal declaration before a public official that one has signed a document.
3. Adjustable Rate Mortgage ... A loan whose interest rate is changed periodically to keep pace with current interest rates.
4. Amortization ... Gradual payment of a dept through regular installments that cover both interest and principal.
5. Appraisal ... Estimate of value of real estate, presumably by an expert.
6. Appreciation ... Increase in value or worth of property.
7. Assumable Mortgage ... A loan that may be passed to the next owner of the property.
8. Balloon Loan ... A mortgage in which a large portion of the borrowed principal is repaid in a single payment at the end of the loan period.
9.Balloon Payment ... Final payment on a balloon loan.
10. Bill of Sale ... Written document transferring personal property.
11. Buydown ... The payment of additional points to a mortgage lender in return for a lower interest rate on the loan.
12. Cap ... Limit (typically about 2%) by which an adjustable rate loan might be raised at any one time.
13. Ceiling .... Also known as a lifetime cap, limit beyond which an adjustable mortgage rate may never be raised.
14. Certificate of Occupancy .... Document issued by local government agency stating that property meets standards for occupancy.
15. Closing ... Conclusion of a real estate sale, at which time title is transferred and necessary funds change hands.
16. Closing Costs ... One-time charges paid by buyer and seller on the day property changes hands.
17. Closing Statement ... Statement prepared for buyer and seller listing debits and credits, completed by the person in charge of the closing.
18. Commitment Letter ... Written promise to grant a mortgage loan.
19. C. M. A. ... Comparative Market Analysis Method used by brokers to determine the current market value of a property.
20. Contract ... Legally enforceable agreement to do, or not to do a particular thing.
30. Conventional Mortgage ... Loan arranged between lender and borrower with no governmental guarantee or insurance.
31. Deed ... Formal written document transferring title to real estate; a new deed is used for each transfer.
32. Earnest Money ... Buyer’s “good faith” deposit accompany purchase offer.
33. Easement ... A permanent right to use another’s property (telephone lines, common driveway, footpath etc.)
34. Escrow ... Funds given to a third party to be held pending some occurrence; may refer to earnest money, funds collected by a lender for the payment of taxes and insurance charges, funds withheld at closing to insure uncompleted repairs.
34. FHA Mortgage ... Loan made by a local lending institution and insured by the FHA, with the borrower paying the premium.
35. Lien ... A claim against property for the payment of a debt.
36. Negative Amortization ... Arrangement under which the shortfall in mortgage payment is added to the amount borrowed.
37. PITI ... Abbreviation for principal, interest, taxes and insurance, often lumped together in a monthly payment.
38. PMI ... Private mortgage insurance.
39. Point ... One percent of a new mortgage being placed, paid in a one-time lump sum to the lender.
40. Survey ... Map made by a licensed surveyor who measures the land and charts its bounds.
42. Title Insurance ... Policy protecting the insured against loss or damage due to defects in title.
43. Title Search ... Check of the public records, usually at the local courthouse, to make sure that no adverse claims affect the value of the title.
44. VA ... Veterans’ Administration, which guarantees a veteran’s mortgage so that a lender is willing to make the loan with little or no down payment.
45. Zoning ... Laws of local government establishing building codes and regulations on usage of property.
Wittney Estates has been serving Long Island home buyers and home sellers since 1984. With sales in excess of 3 billion dollars home buyers and sellers may relax with confidence knowing that our proven track record will successfully resolve all their real estate needs.
At RE/MAX Wittney Estates we are committed to making the home buying and selling process a stress free and positive experience for all parties.