Understanding all of the lingo and abbreviations in real estate can sometimes feel like reading a tween's text messages ("omg, ily, lol, g2g"). But your money is at stake, so it's important to understand what's going on. Now you can brush up on your real estate terms with the assistance of the glossary we've compiled. Or you can just impress your friends at cocktail parties. That's fine, too.
• AGENT - Someone certified to represent buyers or sellers. the agent's job is to find the perfect match based on each customer's circumstances.
• APPRAISAL - An estimation of the monetary value of a property executed by an independent service.
• ASSESSMENT - The authoritative number that results from the appraisal and that is an important marker for sales, taxes and loans.
• BUYER'S AGENT - The agent who represents someone looking to buy a home by finding relevant properties and negotiating the transaction.
• CLOSING - The final step of a real estate transaction that finalizes the change in ownership of a house.
• COMPARABLE MARKET ANALYSIS (CMA) - A statistical analysis of recently sold, relevant houses in terms of details like location, condition and features. this provides data that can be helpful in predicting a similar sale or purchase.
• CONTINGENCIES - Specifications in the c
ontract of purchase that must be met in order to obtain completion.
• DISCOUNT POINT - A dollar amount, equal to one percent of one's mortgage, that reduces the interest rate of the mortgage.
• FORECLOSURE PROPERTY - A property, which was used as collateral for a loan, that has been reclaimed by the bank after nu
llifying the owner's right to it.
• FOR SALE BY OWNER (FSBO) - A property being sold by its owner without representation from an agent.
• HOMEOWNER'S POLICY - An insurance bundle of different protections for one's home like fire, theft or weather damage.
• INTEREST RATE CAP - The highest interest rate allowed on a loan.
• MORTGAGE - A loan taken out in order to buy real estate.
• MULTIPLE LISTING SERVICE (MLS) - A cooperative tool that allows realtors to exchange information about properties.
• OPEN MORTGAGE - A mortgage any amount of which can be repaid at any time.
• PRINCIPAL - Any person who chooses to be represented by an agent.
• PROPERTY TAX - A tax on private property that varies with its market value.
• REALTOR - An agent who belongs to the national association of realtors.
• RECORDING - The report of a real estate transaction to the government that finalizes it.
• TITLE - Also known as a "deed" a document of ownership of a property.
• WARRANTY - A promise between two parties that a condition or set of conditions will be satisfied.