Glossary of Real Estate Terms

Below are definitions for words associated and commonly used within the real estate and housing industries. If you’re here searching for home builders, new home incentives and information about new homes, you might what to visit our homepage.

Absentee owner – An owner that does not live in/on their property; most absentee owners utilize the services of property management companies.

  • related terms – real estate investor, investor, landlord
  • common misspellings – absentie owner, absente owner, absenty owner

Active-adult – An active-adult is most often referred to as a person between the ages of 55 – 74.

  • related terms – active lifestyle, 55+, 55 or better, active lifestlye communities
  • common misspellings – actve adult, active adut, activ adult, active adlt

Active-adult Community – An active-adult community is typically a community consisting of homes for active-adults. Active-adult communities usually have more amenities than non active-adult communities and often have resident age requirements.

  • related terms – active lifestyle community, 55+ community, age registricted community
  • common misspellings – actve adult community, active adut community, activ adult community, active adult comunity

Adjustable Rate Mortgage (ARM) – A mortgage loan with an interest rate that is subject to change during the loan repayment period.

  • related terms – 3-1 buydown, 5-1 buydown, 3-2-1 buydown, non-fixed mortgage
  • common misspellings – adjustible rate mortgage, adjustable rate mortgag, adjustable rat mortgage, adjustible rate mortgae

Agreement of sale – a written agreement between a buyer and seller in which the buyer agrees to buy and the seller agrees to sell based on agreed upon terms set forth within the contract or agreement.

  • related terms – sales contract
  • common misspellings – agrement of sale, aggreement of sale

Appraisal – An estimate or opinion on the value of a property provided by a qualified appraiser. An appraisal is usually based on several variables and is only an opinion or estimation.

  • related terms – property value, property appraiser, home value estimate
  • common misspellings – apprasal, apraisal, appraisel

Appraisal fee – amount paid to obtain an appraisal report on a real estate property.

  • common misspellings – apraisal fee, appraisal fe, appraisel fee, aprasel fee

Appraiser – A person qualified to give an opinion or estimate on the value of a real estate property. An appraiser has special training and qualifications.

  • related terms – property apprasier, home value appraiser
  • common misspellings – apraiser, appraiser, appraisser, appraisur

APR – APR is an acronym for annual percentage rate and is the actual rate a borrower pays for borrowing money.

  • related terms – borrowing rate, annual borrowing rate
  • common misspellings – annul percentage rate, annual percetag rate, annual percentage rat, anual percentage rate

Condominium Home – A condominium home is an attached home in which an individual or individuals owns a unit of a building structure. There is a separate property owner of the land and building structure. Condominiums units are similar to apartments.

  • related terms – urban home, condo, unit
  • common misspellings – condominim home, condominim, condminium home, condo hom, condominium hom

Community of Homes – A community is often created by one home builder and typically consists of parks, walking trails, a community pool(s) and common areas. Communities can consist of hundreds of single-family, condominium, town, custom and/or active adult homes.

  • related terms – subdivision, new home development
  • common misspellings – community of homs, comunity of homes, communty of homes, subdivsion, developmnt

Custom Home – A custom home is designed to meet the specific wants and needs of the home owner

  • related terms – luxury home, semi-custom home, unique home
  • common misspellings – custm home, custome hom, luxry home, costom home

Earnest Money – A sum of money offered by the buyer and used by the seller to hold a specific property or properties off of the market. Earnest deposits are sometimes required by the seller and are usually given back to the buyer at closing.

  • common misspellings – earnst money, earnest moni, earnest mone, earnest mony

Escrow – The placement of legal documents or fund with a neutral third party during the purchase and/or sale of a property. The neutral party usually ensures that all agreed on conditions are met.

Equity – an amount of money an owner has over and above the amount owed in liens on a specific property.

Hard money loan – A debt that is incurred in exchange for cash.

High-rise – A term used to describe a building with an elevator and more than 5 stories.

HOA – HOA is an acronym for Home Owner’s Association. An HOA is an association that manages the communal areas within a community.

Homeowner – A homeowner is an individual or individuals that own a home.

Home Builder – A home builder is an individual or business that builds single-family, condominium, town, custom and/or semi-custom homes.

Home Equity loan – A loan given to a homeowner that uses the homeowner’s residence as collateral; the amount of a home equity loan is usually less than the amount of the homeowner’s available equity.

Homeowner’s insurance – An insurance policy that covers a homeowner from financial loss from a fire, theft, property damage, personal liability, etc.

Interest Rate – An interest rate is the rate paid or charged for borrowing money from a lender.

Jumbo loan – A jumbo loan is a loan for an amount larger than limits set by Fannie Mae and Freddie Mac. Jumbo loan amounts change (check with your lender for current jumbo loan amounts) and usually carry a higher interest rate.

Land Developer – A land developer develops raw land in preparation for residential or commercial structures.

Lease – An agreement between the property owner and tenant that sets forth conditions for the tenants use of the property.

Lease option – A lease agreement that sets conditions in which the tenant can purchase the property at a later date usually at the end of the lease term.

LIBOR – London Inter Bank Offered Rate. A rate that international banks charge for large loans; sometimes ARM loans are based on the LIBOR.

Listing Agent – The real estate agent or Broker that is listing the property for the owner/seller.

Master-planned Community – A master-planned community is usually a “super” community featuring homes from several home builders. In addition to consisting of parks, walking trails, community pools and common areas, a master-planned community typically has commercial centers and schools. Master-planned communities can consist of thousands of homes.

Mortgage – A mortgage is a loan to purchase real estate. Mortgages usually have monthly payments and interest charges.

Mortgage Refinance – A mortgage refinance is a loan used to pay of an existing mortgage.

Purchase Agreement – Agreement between the buyer and seller with conditions to the sale of real property.

REO – REO is property in the possession of a lender. Lenders usually obtain ownership through a foreclosure or forfeiture.

Real Estate – real estate is land, the ground below it, the air above it and any structure resting on it.

  • related terms – new homes, home builders, housing, construction, land, real estate agent
  • common misspellings – rel estate, reel estate, real estat, real estte, real estat, ral estate

Real Estate Lender – A real estate lender is an individual, institution or business that lends money to individuals or businesses to purchase real estate.

Section 8 housing – A federal program that allows for leasing a property to lower-income families.

Seller financing – An agreement in which the property seller also acts as the lender.

Single-family Home – A single-family home is a detached home typically consisting of a front yard, backyard, driveway and garage.

Semi-custom Home – A semi-custom home is a home that is part production home and part custom home. The home buyer has the ability to customize some aspects of the home but not all.

Subdivision – An area of land that is divided into lots and suitable for building.

Townhome – A townhome is an attached home in which an individual or individuals owns a unit of a building structure. The main difference between a Condominium and a Townhome is that the unit owner also owns the land that the unit is on.

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