Real Estate Glossary

APPRAISAL

A written estimate of a property’s current value.

CLOSING COSTS

Fees associated with buying a house that your lender charges and/or you rack up from various

third parties.

CONTINGENT

A status in which a house has accepted an offer but relies on meeting certain criteria, such as

passing a home inspection or appraisal.

CONVENTIONAL MORTGAGE

A mortgage loan not insured by the government or guaranteed by the Veterans’ Administration. It is subject to conditions established by the lending institution and State statutes.

COMMISSION

A percentage of the sale that is paid to the real estate professional. In most situations, commissions are paid by the seller of the property.

DOWN PAYMENT

The amount of your home’s purchase price you pay upfront.

FHA MORTGAGE

A mortgage that is insured by the Federal Housing Administration (FHA). FHA loans are designed to make housing more affordable.

FORECLOSURE

A property seized by the mortgage lender due to the homeowner failing to make full payments on their mortgage. In hopes to recover the balance of the home loan, the lender will sell the house.

FSBO

A.K.A. For Sale by Owner. A FSBO is a property that is being sold by the current homeowner without the aid of a real estate agent.

HAND MONEY (EARNEST MONEY)

A deposit made by the potential home buyer to show that he/she is serious about buying the house.

INSPECTION

An evaluation of the home in which a professional inspector determines the current condition of the home and its systems.

LISTING

A list of information about a home that is currently on the market.

MLS

A.K.A. Multiple Listing Service. The MLS is a database that includes all available homes for sale

in a particular area. PMI (Private Mortgage Insurance) The monthly insurance payment a

lender must pay if the down payment is less than 20% of the sale price.

PRE-APPROVAL

An evaluation by a lender that determines if the potential buyer qualifies for a loan and, if so,

the maximum amount the lender would be willing to lend.

REO

An acronym for “Real Estate Owned.” A REO property is owned by the bank due to a foreclosure. REO properties can be purchased from the bank; however, they are often sold “as is.”

SELLER ASSIST

Money given from the seller to the buyer at settlement to pay for part of the closing costs. The amount varies depending what the mortgage company allows.