Real Estate Terms to Learn Before Your First Home Purchase!
October 16, 2018 |
Adjustable Mortgage Rate – The interest rate can vary throughout the life of the loan, these mortgages are usually over a shorter time period such as 5, 7, or 10 years.
Appraisal – When you apply for a mortgage the lender will require an appraisal of the home you would like to purchase so they can get an estimate of the home’s value. During an appraisal
a licensed appraiser will look at the home and compare it to homes sold in the same area to estimate the price.
Buyer’s Agent – The agent who represents the home buyer.
Contingencies – The specific conditions that must be met for the deal to go through. Common contingencies include the loan most go thorough (financing contingency, the home inspection
must pass (inspection contingency), and the appraised value is close to what you will be paying (appraisal contingency).
Equity – Home equity is the difference between the home’s fair market value and the unpaid balance of the mortgage. For example, if your home is worth $300,000 and you still owe $100,000,
$200,000 is your equity.
Fixed Rate Mortgage – This mortgage as a predetermined interest rate throughout the life of the loan; the rate won’t change!
Home Warranty – A fee payed to protect the home against future issues such as plumbing, heating, or appliances – depending on what the package you are paying for covers!
Listing Agent – The agent who represents the home seller.
Listings – A listing is a home, for sale or rent, on the agent’s website that shows all the information on the home. This is where you’ll find more details on price, number bedrooms, square
footage, and more.
Pre-Approval Letter – A letter from your bank stating an estimate of how much they will lend you. This letter will help you determine what you can afford and will show home sellers you
will be able to get a loan.
Title – The legal term that identifies a piece of property that the owner is in lawful possession of that property.
Title Insurance – This insurance (which you need to get) protects real estate owners and lenders against any property loss or damage that could occur due to liens, encumbrances or defects.