REAL ESTATE GLOSSARY
We provide a basic glossary of the most commonly used real estate terms and their definitions in order to help you better understand terminology used along your home buying or selling process. There is a lot of real estate terminology used during the home buying and selling process, but you don’t need to know them all. Monica is here to help you understand those terms.
A Balloon Mortgage is one which matures with a balance still owed at the end of the term.
A Commitment Letter is a letter issued by a lending bank that legally binds you and obligates you to provide funds as specified. This letter is subject to written terms and conditions.
A Contract, also known as a Purchase of Sales Agreement, is a written agreement between seller and a buyer— in which the purchaser agrees to buy property and the seller agrees to sell this property under predetermined terms and conditions.
A Covenant is an agreement written into deeds. It guarantees that one performs or purposefully does not perform certain acts. It also stipulates certain uses or non-uses of the property.
A Deed Restriction is an imposed restriction, found in a deed, that limits the use of the land.
Earnest Money, also known as a Deposit or Down Payment, is made by a purchaser of real estate as evidence of good faith.
Escrow is the means by which money (a deposit or down payment) is held by one person in trust for another, for the purpose of seeing that the agreement goes through. Normally, in a residential real estate sale, the attorney for the seller is the “escrow agent” for the deposit money—meaning that they are entrusted with it until the deal is completed.
- Exclusive Right to Sell Agreement
Exclusive Right to Sell Agreement is an agreement between a broker and a seller which designates the broker as the seller’s sole representative. Under this agreement, a commission must be paid to the broker even if the property is sold directly by the owner.
A financing Loan is secured by personal property. The stock and lease of a co-operative corporation constitutes personal property, and real estate brokers often refer to these financing loans as mortgages, although technically they are not.
Fixtures are personal property attached to the land, or any improvements made to the land, that are to become part of the real property.
The Grantee is the party to whom the title of real property is conveyed.
A Landmark is a designation given to a building which places it under protection for the purpose of preservation.
- Listing Agent
A Listing Agent, also known as the Exclusive Broker, is the broker who represents the interests of the seller.
The Market Value is the most reasonable price for a property placed in the open market for a reasonable period of time, with both the buyer and seller aware of current market conditions (neither being under duress).
- Mortgage Broker
A Mortgage Broker is the real estate professional who represents an array of banks seeking to issue mortgages. This person meets with a customer, assists with the mortgage applications and navigates the mortgage process on behalf of both the borrower and the bank. Generally, the mortgage broker is paid a fee by the bank for this service.
Points are a payment made to a bank as consideration for issuing a mortgage. These are usually based upon a percentage of the loan amount..
Title Insurance is an insurance polity which indemnifies the holder for any loss sustained by Title Insurance is an insurance polity which finds the holder responsible for any loss sustained due to defects in the title.
- Title Search
A Title Search is an examination of the public records to determine the ownership and encumbrances of the real property.