Here is a brief listing of some of the more commonly used terms in real estate.

ADDENDUM
A change, addition, or modification to any form. It must be in writing and signed by both parties

AMORTIZATION
The process of paying off a debt by installments over a fixed period of time

ADJUSTABLE RATE
A mortgage loan that allows the interest rate to be MORTGAGE(ARM) changed at specific intervals over the term of the loan

APPRAISAL
An estimate of property value by a qualified person.

ASKING PRICE
The price at which the seller is offering property

BROKER
One who acts as an agent for other persons in the purchase, sale, or lease of real property

CLOSING
Asking for the listing or the sale resulting in a signed contract agreement. Also used to refer to settlement.

CLOSING COSTS
Sometimes called settlement costs or points, these are the expenses and fees paid by either the buyer or seller at the closing of a real estate transaction. They include points assessed by the lender to complete the financial transaction(each point equals one percent of the purchase price), as well as recording fees, attorney fees, discount points, and title insurance

CMA
Competative market analysis.

COMMISSION
An agent’s compensation for the performance of his or her duties. The amount is often determined as a percentage of the selling price of a property, but may also be established in other ways, such as a flat fee.

COMPARABLES
A shortenened term for "comparable properties" used for comparison when determining the asking price for a given property.

CONTINGENCY
Any requirement or stipulation in a contract that must be satisfied before contract closing; often referred to as a "subject to" clause.

CONVENTIONAL LOAN
A mortgage loan made with real estate as security that is not guaranteed by the Veterans Administration or insured by the Federal Housing Administration

CONTRACT
Where real property is concerned, a dated, written, and signed agreement between two or more competent parties who agree to perform a legal act, such as the sale and transfer of property, within a specified time.

COUNTER OFFER
A seller’s response to a buyers’s offer where the seller proposes specific changes in the original offer. Both the buyer and the seller must sign the counteroffer for it to become a binding agreement.

DISCLOSURE STATEMENT
A statement informing others of pertinent facts. In some states a required clause in a purchase agreement whereby a seller states the condition of the property being sold.

DISCOUNT POINTS
A one time charge to the seller or buyer by the lender when the loan is originated. Additional points are added to increase the yield of the mortgage loan up to a level competitive with the yield from other types of investments

EARNEST MONEY
A deposit given to bind a sale of real estate.

FIXTURE
Personal property that has been installed or attached to land or a building in a permanent manner, regarded in law as part of the property.

LEGAL DESCRIPTION
A description of a parcel of land that identifies the parcel according to a system established or approved by law.

LIEN
A legal claim or charge against a property in which the property is security for payment of a debt.

LISTING
The contract between a property owner and a licensed real estate broker in which the broker acts as agent to sell the property and the owner agrees to pay the broker a commission for services rendered

MARKET VALUE
The highest price a home will bring if offered for sale in the open market.

MLS
Multiple List Service-A network of real estate brokers serving a common market area who submit their exclusive listings to a central service, which in turn, distributes the information to its membership. The information distributed for other brokers to cooperate in the identification of ready, willing, and able buyers for listed properties.

MLS TOUR
A scheduled tour or caravan of homes in MLS files for agent members of the MLS; this allows a wide exposure of a property to many agents

MORTGAGE INSTRUMENT
A written document evidencing a mortgage

OFFER PRESENTATION
A meeting of the agent and the seller in which the terms and contingencies of an offer from a prospective buyer are discussed and analyzed.

ORIGINATION FEE
Amount paid by the borrower for the cost of issuing a loan

POINT
Charges rendered by a bank for processing a loan; one point is one percent of the loan

PMI
A private mortgage insurance policy that enables the homebuyer to obtain a mortgage with a lower downpayment than would otherwise be available from lenders

PROPERTY INFORMATION
A form containing information about a property to FORM be sold, such as address, dimensions of rooms, school districts, and photo of the property; a completed form often left at a listed home given to prospective buyers for reference.

PURCHASE OFFER
Terms and conditions offered by a prospective buyer to purchase real estate.

PURCHASE AGREEMENT
A purchase offer signed by all interested parties; a binding contract between a buyer and a seller. Also known as a contract for the sale of real estate.

QUALIFICATION
The process of determining a buyer’s eligibility for credit and/or ability to repay a credio obligation

QUALIFYING
Determining the maximum purchase price of a house that a buyer could afford

TITLE COMPANY
A corporation that insures that title to real property will not be adversely impaired by undisclosed defects or encumbrances, and compensates the owner in the event that such impairments are discovered.

TITLE SEARCH
An investigatiopn into prior conveyances of a given parcel of land, or into encumbrances such as liens, mortgages, judgments, and easements thereon, for the purpose of determining who has title and whether that title is clear or encumbered

WARRANTY DEED
A deed that promisess that the seller currently has title to the property and, therefore, the right to convery the property.

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