Does it sometimes sound like your Agent is speaking to you in another language? Below you will find real estate jargon explained in layman terms:
A thorough assessment of a borrower’s income, assets and liabilities to determine a loan amount he/she would qualify for.
Earnest Money Deposit (EMD)
A check in the amount of 1 – 2% of the asking price of the home you are trying to purchase. The EMD is to demonstrate to the seller that you are serious about purchasing their home.
The agent that represents the buyer as a client in the purchase of residential property. The agent owes the buyer client undivided loyalty, reasonable care, disclosure, obedience to lawful instruction, confidentiality and accountability. The agent must put the buyer’s interest first and attempt to negotiate terms acceptable to their buyer client.
Principal. Interest. Taxes. Insurance. PITI pertains to the total monthly payment for your new home. Principal and interest is applied to your loan. Taxes and insurance are escrowed each month.
Money that is held in reserve to pay a bill later. Like the example above your taxes are usually paid every six months while your insurance is paid for yearly.
A shortage of buyers and the market is saturated with homes for sale. Homes sit on the market longer which means the buyer has the negotiating power.
A shortage of homes and an increase in buyers. The seller has the negotiating power and the buyer might be looking longer.
Sale of a home by an owner who owes more on the home than it’s worth. The seller’s bank must approve a lower list price before the home can be sold. This type of sale can take 4 months to a year to close and sometimes longer.
A buyer has made an offer on a home and the seller has accepted. Now it’s time for the home to be inspected and appraised.
Conditions written into a residential contract of sale that protect the buyer should issues arise with financing or the home inspection.
A document sent to the buyer three days before closing. This document spells out all the terms of the loan, the amount, the interest rate, the monthly payment, mortgage insurance, the monthly escrow amount and all closing costs.
VA Funding Fee
A fee that protects the lender from loss. The fee is assessed to the VA buyer however, it can be paid for by the seller if negotiated.
Usually a one hour meeting with buyers, sellers, agents and title/attorney staff. Home ownership is transferred at this meeting.
Get a professional to assist you when purchasing or selling real estate.