Real Estate Terms

  1. Active (or Back on Market) Listing - Property is on the market, for sale.
  2. Adjustable Rate Mortgage (ARM) - A mortgage that permits the lender to periodically adjust the interest rate to reflect fluctuations in the cost of money.
  3. Annual Percentage Rate (APR) - The relationship of the total finance charges associated with a loan. This must be disclosed to the borrowers by lenders under the Truth-in-Lending Act.
  4. "AS IS" Value - The value of the property in its current condition.
  5. AS Repaired" Value - An estimate of what the property will sell for if it is rehabilitated to a condition competitive in the market place for homes of the subject's age and type.
  6. Competitive Market Analysis (CMA/Comps) - An estimate of the fair market price of a property for sale or purchase. CMA's/Comps are traditionally prepared by real estate agents in anticipation of a listing, considering an offer or to assist a buyer in making an offer on a property.
  7. Contingency Period - This is the time period you have from the start date of the contract, to the deadline date you have to complete certain items (contracted time frame).
  8. Curable Repair - Repairable or able to be fixed; something that can be fixed at a reasonable cost, with the value added to the property being more than the cost of the repair. Compare to: Incurable.
  9. Days on Market (DOM) - How long a listing is for sale before being sold.
  10. Deed - A written instrument that, when executed and delivered, conveys title of or an interest in real estate.
  11. Estate - Property owned by a person who is now deceased.
  12. Equity - The interest or value that an owner has in property over and above all debts on property.
  13. Executor/Executrix - A person appointed in a will to carry out the provisions of the will. If a man is appointed, he is called an Executor. If a woman is appointed, she is called an Executrix.
  14. Fair Housing Act - The federal law that prohibits discrimination in housing based on race, color, religion, sex, handicap, familial status, age and national origin.
  15. Foreclosure - The legal process whereby the lender, who is not being paid, reclaims the property, which is security for the loan.
  16. Functional Obsolesence - Where your home is located, and how your home was built can lead to lower property value.
  17. HUD - The Department of Housing and Urban Development, a government agency that deals with housing issues.
  18. Joint Tenancy - Ownership of real estate between two or more parties who have been named in one conveyance as joint tenants. Upon the death of a joint tenant, the descendant's interest passes to the surviving joint tenant or tenants by the right of survivorship.
  19. Offer/Sales Agreement - Your written proposal/agreement to purchase a property. Once all parties have signed the offer/sales agreement, it is now a contract.
  20. Pending Listings - A property is under contract but has not reached settlement yet.
  21. Physical Depreciation - A loss in value from general eroding of the physical structure or from deferred maintenance.
  22. Prepayment Penalty - A penalty charged by the lender to the borrower if the loan is paid off early.
  23. REO (Real Estate Owned) - A property that has gone through the foreclosure process and is owned either by the original lender, a private mortgage insurance (PMI) company, or an intermediary.
  24. RTO - Rent to Own.
  25. Short Sale - Is a lender-approved sale in which the proceeds from the sale are not sufficient to cover the mortgage amount(s). Typically, short sale is done to avoid foreclosure and all the high costs involved. Even though the seller may approve the offer amount, the mortgage lender(s) must also approve the offer. Some buyers have waited as long as 4 to 6 mths for a deal to go through in a short sale transaction.
  26. Sold Listing - A property that was on the market for sale that has reached settlement.
  27. Survey - The process by which boundaries are measured and land areas are determined; the on-site measurement of lot lines, dimensions and position of a house on a lot, including the determination of any existing encroachments or easements.
  28. Tenancy in Common - A form of co-ownership by which each owner holds an undivided interest in real property as if he or she were sole owner. Each individual owner has the right to partition. Unlike joint tenants, tenants in common have right of inheritance.
  29. Title Insurance - A policy insuring the owner or mortgagee against loss by reason of defects in the title to a parcel of real estate, other than encumbrances, defects and matters specifically excluded by the policy.
  30. Title Search - The examination of public records relating to real estate to determine the current state of the ownership.< ol>