Here is a list of Common Terms Used in Real Estate:
1. **
Amortization:** The process of gradually paying off a mortgage loan through regular payments of principal and interest over a specified period.
2. **
Appraisal:** An assessment or estimation of the value of a property, typically conducted by a licensed appraiser.
3. **
Closing Costs:** Expenses incurred by buyers and sellers during the real estate transaction, including fees for loan processing, title insurance, and legal services.
4. **
CMA (Comparative Market Analysis):** An analysis conducted by real estate agents to determine a property's market value based on recent sales of similar properties in the area.
5. **
Down Payment:** The initial payment made by a buyer, usually a percentage of the property's purchase price, paid upfront to secure a mortgage.
6. **
Earnest Money:** A deposit made by the buyer to demonstrate their serious intent to purchase a property. It is typically held in escrow and applied toward the down payment.
7. **
Equity:** The ownership interest in a property, calculated as the property's market value minus any outstanding mortgage balance.
8. **
Escrow:** A neutral third party that holds funds, documents, and other items related to a real estate transaction until all conditions are met.
9. **
Fixed-Rate Mortgage:** A mortgage with a constant interest rate and monthly payments that remain unchanged throughout the loan term.
10. **
Foreclosure:** The legal process through which a lender repossesses a property due to the borrower's failure to make mortgage payments.
11. **
Home Inspection:** A thorough examination of a property's condition, typically conducted by a professional inspector, to identify any issues or potential problems.
12. **
Homeowners Association (HOA):** An organization that manages and enforces rules for a community or condominium complex, often collecting fees for maintenance and amenities.
13. **
Listing:** A property that is for sale and is represented by a real estate agent.
14. **
Multiple Listing Service (MLS):** A database of properties listed for sale by real estate agents, accessible by other agents to facilitate property searches and transactions.
15. **
Mortgage:** A loan used to finance the purchase of real estate, with the property serving as collateral for the loan.
16. **
Pre-Approval:** The process of obtaining a lender's commitment for a mortgage loan amount based on an applicant's financial profile.
17. **
Principal:** The amount of money borrowed or the outstanding balance of a loan, excluding interest.
18. **
Real Estate Agent:** A licensed professional who represents buyers or sellers in real estate transactions.
19. **
Title Insurance:** Insurance that protects the buyer and lender against any defects in the property's title or ownership.
20. **
Underwriting:** The process of evaluating a borrower's creditworthiness and risk by a lender to determine the approval of a mortgage loan.
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