Real Estate Terms You Should Familiarize Yourself With
Real estate has numerous terms we should all know and understand whether you are selling or buying a home. These terms can confuse an already challenging process. Here are some of the terms you should know:
- Appraisal – it is required to know the estimated value of a real estate property. Mortgage lenders send appraisers to decide if the property is worth the loan the potential buyer wants.
- As is – refers to the property’s condition at the time the offer was written. Hence, the property seller is not willing to do the repairs. In ‘as is’ condition, real estate properties are sold at a lower cost than market pricing.
- Back-up offer – if a real estate buyer wants to buy a property that’s already under contract to someone else, he has the opportunity of submitting a ‘back-up offer’ in case the contract falls apart. The back-up must be negotiated and required monies, for example, earnest submitted to confirm the offer.
- Blind offer – this type of offer is made by a buyer even if he has not seen the property. Blind offers are common in highly competitive areas or circumstances.
- Buyer’s agent – also known as a selling agent. Refers to a licensed real estate agent whose main objective is to locate the next property for a potential buyer. The agent also negotiates the best price for a property.
- Closing – when a real estate property is considered final, i.e., both parties have signed the documents and required money is paid. The final step entails recording the deed with the county clerk to declare the new homeowner.
- Closing costs – refers to the assortment fees, for example, the fees charged by the title company, taxing authorities, attorneys, insurance companies, lenders, real estate agents, and homeowner’s association. All these costs are paid when closing all real estate transactions.
It is essential to familiarize yourself with these terms because they help you communicate with your real estate agent, property sellers, attorneys, and other parties involved with ease.