Real Estate Terms
Agent
A licensed professional who represents either the buyer or the seller in a real estate transaction.
Amortization
The process of gradually paying off a loan by making regular payments that include both principal and interest.
Appraisal
An evaluation of a property's value conducted by a professional appraiser.
Asking price
The price at which the seller lists their property for sale.
Assessed value
The value of a property for tax purposes, as determined by the local government.
Closing
The final step in a real estate transaction, where the buyer and seller sign all necessary documents and the title is transferred.
Closing costs
The fees and expenses that must be paid by the buyer and/or seller at the closing of a real estate transaction.
Contingency
A condition that must be met before a contract becomes legally binding.
Counteroffer
An offer made in response to an initial offer, typically with changes or adjustments.
Equity
The difference between the value of a property and the amount owed on any mortgages or other liens.
Foreclosure
The legal process by which a lender takes possession of a property after the borrower defaults on their mortgage payments.
Home inspection
An examination of a property's condition by a professional inspector, typically conducted before a sale is finalized.
Interest rate
The percentage of a loan that must be paid as interest over time.
Lease
A contract between a landlord and a tenant, giving the tenant the right to occupy the property in exchange for rent payments.
Listing
A property that has been put on the market for sale.
Loan-to-value ratio
The ratio of the loan amount to the value of the property, expressed as a percentage.
Market value
The estimated value of a property based on comparable sales in the surrounding area.
Mortgage
A loan taken out to purchase a property, with the property serving as collateral for the loan.
Multiple Listing Service (MLS)
A database of available real estate properties that is used by real estate agents to match buyers and sellers.
Offer
A proposal to buy a property, typically made by a potential buyer and subject to negotiation.
Pre-approval
A lender's written commitment to provide financing up to a certain amount, subject to certain conditions being met.
Principal
The amount of money borrowed in a loan.
Purchase agreement
A legally binding contract between the buyer and seller, outlining the terms of the sale.
Real estate market
The overall market for buying and selling properties in a particular area.
Refinance
The process of replacing an existing mortgage with a new one, typically to take advantage of lower interest rates.
Seller's market
A real estate market in which demand exceeds supply, making it easier for sellers to sell their properties.
Title
The legal right to ownership of a property.
Underwriting
The process by which a lender evaluates a borrower's financial situation and creditworthiness before approving a loan.
Zoning
The local government's regulations governing the use of land within a particular area.