Selling a home can be a daunting enough prospect even without the specialized jargon that goes along with the process. The following are important real estate terms to know to make the process smoother and less imposing.
Affidavit of title: This written statement includes everything from relevant dates to marital status; it certifies that the recipient possesses, by title, the property.
Appraisal: This estimate of the property’s market value is calculated by a real estate appraiser with local area knowledge.
Appreciation: The value of a property should go up over time, due to inflation and increased demand on the market. The difference between the original value of the home when purchased and its value when sold is appreciation.
Assessed value: A tax assessor sets this dollar value to the home for the purpose of state and city taxes; it is distinct from market value and home appraisal value.
As-is: This specification declares that, as the seller, you are not obligated to correct any problems or make any repairs upon sale of the property.
Assumption of Mortgage: If a current mortgage is in place, this stipulation makes the buyer responsible for its remainder.
Brokerage: A brokerage is an agency that handles the selling and buying of properties for clients.
Buyer’s agent: The real estate agent in charge of representing a potential buyer is considered the buyer’s agent.
Capital gain: This cause for celebration means that you’ve received a percentage of extra profit; this is when the sale price is above the initial price and fees.
Chain of title: A clear chain of title is important to distinguish who owned the property at what time; it is a timeline showing the owners of the property from the time of the home’s construction.
Closing: In the closing process, the transaction is almost finished. Documents have been signed, the deed has exchanged hands, and payment has been initiated.
Closing costs: These expenses are important to note; they encompass the expenses outside of the home’s actual price. Taxes, agent fees, and other expenditures are lumped together in this category, which can be divvied up between buyer and seller depending on negotiations.
CMA: The Comparative Market Analysis is a report looking at homes in your area similar to yours that are either currently on the market or were recently sold. Also known as “comps” this report helps give an idea of your home’s accurate value.
Commission: A potentially negotiable amount, this is paid to an agent or broker when the house is sold.
Counter offer: When you respond to a buyer’s offer with an offer of your own, this is a counter offer.
Curb appeal: An element that can raise the value of your home, this is how appealing your home looks from the curb: everything from the lawn maintenance to the front door paint.
Deed: To transfer the property’s title from the previous owner to the new buyer, a deed is used.
Disclosure: This is the practice of letting a potential buyer know of requirements of anything of relevance in the real estate industry, from local, county, state, and federal requirements of renting, improving on, owning or buying a home.
Down payment: The money a buyer pays up front on the home’s purchase is known as the down payment.
Earnest money deposit: This payment comes as part of an offer indicating serious interest in the home, is refundable, and is considered to be an advance part of the down payment.
Equity: When there is a difference between the value of an unpaid mortgage and the property’s fair market value, this is known as the equity.
Escrow: An account established by the lender, the escrow holds payment from the purchaser pending the sale’s completion.
Inclusions: When you include a bonus in the sale of the home, such as an above-ground swimming pool or the clothes washer and dryer, these perks are known as inclusions.
List date: This is the official date the property is listed on the market.
List price: Quite simply, the list price is the price listed for the property.
Market value: Different from assessed and appraised values, the market value might be considered the fair value, which is what the house would properly be worth in normal market conditions.
Open listing: This agreement is made when the broker won’t get paid until a purchaser is found and buys the house, all the way through the closing stage.
Parcel identification number: This is the number used by the city or county to track a property.
Principal: This amount is borrowed to purchase a home; it must be repaid with interest.
Quit-claim deed: When a potential buyer makes this request, it is for a document stating that the seller gives up any interest in the property, even prior to the closing.
Real estate agent and Realtor: An agent is the hired representative for the buyer or seller in the sale or purchase of a property. A Realtor is a real estate agent who has membership in the National Association of Realtors. The NAR requires its members to hold to a certain code of ethics, and often these agents are top performers.
Staging: In this process, a hopeful seller arranges the property in an appealing manner, rearranging furniture and accessories in eye-catching ways to appeal to buyers, and sometimes going so far as to repaint the house in neutral colors.
Survey: Often the county is requested to perform a survey, as it generally involves lot line measurements, dimensions and positioning, to be accurately aware of how much property you truly have outside the structure itself. Easements and encroachments, such as additions outside lot lines and pathways, are also determined.
Title: This is a document referring to your ability to sell, as it declares your right of ownership.
Hopefully, armed with the arsenal of home-selling definitions, the process of selling a home becomes much less stressful. As is so often the case, knowledge is power, and being forewarned as to the meanings of various phrases and terms can save on time and undue worry.