If you’re doing virtually anything in real estate, you are most likely to hear most, if not all, of these terms throughout your experience. Learn this list of terms and you’ll be well on your way to learning the language of your real estate agent.
An official offering of real estate on the market for sale.
Offers are official proposals for the exchange of real estate. They are like the buyer and seller’s questions to one another in a legal conversation where the ultimate goal is to get the other person to give you a plain and definitive “yes!” The first offer begins this legal conversation of how the real estate transaction is going to play out. Once an offer is accepted, it becomes a legally binding contract.
A contingency is like a clause in a made agreement for the transaction of real estate. Offers are often contingent upon the buyer’s ability to secure a loan, and the results of a home inspection. An offer could also be contingent on something like the seller leaving all furniture.
A broker is a real estate agent who has enough experience, required by law, allowing them the option the practice real estate independently, and hire agents. Big real estate agencies are technically brokers that have agents working on their behalf.
A licensed real estate salesperson works on behalf of a broker to conduct transactions of real estate. While most people work with an agent, technically you hired the broker, whether a small or big company, and the agent is working on the broker’s behalf.
This is the process by which a licensed real estate appraiser evaluates real estate to determines its fair market value. The amount that the appraiser deems as the value is known as the appraised value.
This dollar value is assigned to real estate for the purpose of taxes. The percentage of taxes paid to the municipality in which your property lives is based on the assessed value.
Escrow companies are non-interested third parties that hold funds from both parties until all agreements of a contract have been fully executed.
The last step in the exchange of real estate. On the closing date, ownership of the real estate is transferred and consideration is exchanged.
Comparative Market Analysis:
This is a report that gives a breakdown of the current market. Agents will often provide these reports to give their clients a better idea of where their asset fits in the market.
This is the value of a property minus the charges against it. Property will have positive equity in a rising real estate market.
This is a letter that outlines the amount of money a lender is willing to loan to a borrower. This letter is proof to the agents and sellers that you can actually afford the homes you are looking at. Many agents will not take a client on visits until they have that pre-approval letter from a lender.
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