Are you buying or selling a home and feeling unfamiliar with the real estate lingo being thrown around? Understanding real estate terminology can often seem complex and overwhelming, especially for those new to the process. That’s why we’re here to help! In this comprehensive glossary, we’ve simplified 50 important real estate terms that everyone entering the real estate market should know. By familiarizing yourself with these words and phrases, you can navigate the real estate space with confidence and make informed decisions. 

 

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Untangling Real Estate Terminology: 50 Terms Explained

 

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Essential General Real Estate Terms

 

toy houses being inspected my magnifying glass.

 

Let’s start with essential general real estate terms that every buyer and seller should know. These concepts form the foundation of real estate transactions:

 

1. Appraisal

An assessment of a property’s value conducted by a licensed professional. 

 

2. Broker

A licensed individual with advanced real estate training who serves as an intermediary between buyers and sellers in real estate transactions. 

 

3. Buyer’s Market

A real estate market condition where there are more properties for sale than buyers, giving buyers an advantage in negotiations. 

 

4. Cash Offer

A purchase offer made by a buyer without the need for financing. 

 

5. Closing

The final stage of a real estate transaction where ownership is transferred, and funds are exchanged. 

 

6. Closing Costs

Fees associated with finalizing a real estate transaction. 

 

7. Commission

The fee paid to real estate agents or brokers for their services in facilitating a transaction. 

 

8. Comparative Market Analysis (CMA)

An evaluation of recently sold properties similar to the one being appraised, used to determine market value. 

 

9. Contingency

A condition that must be met before a real estate contract is binding such as getting a home inspection 

 

10. Counteroffer

A response to an offer during negotiations, proposing different terms. 

 

11. Earnest Money Deposit (EMD)

A deposit made by the buyer to demonstrate their seriousness and commitment to the transaction. 

 

12. Equity

The difference between the market value of a property and the outstanding mortgage balance. 

 

13. Escrow

The process of placing funds or important documents in the care of a neutral third party until the completion of a transaction. 

 

14. Foreclosure

The legal process by which a lender takes possession of a property due to the homeowner’s failure to make mortgage payments. 

 

15. Home Inspection

A thorough assessment of a property’s condition conducted by a professional inspector. 

 

16. Home Sale Contingency

A clause in a real estate sales contract that allows the buyer to proceed with the purchase only if they can sell their current home within a specified timeframe. 

 

17. Lien

A legal claim against a property due to an outstanding debt. 

 

18. Mortgage

A loan taken out to finance the purchase of a property. 

 

19. Offer

A proposal to purchase a property at a specified price and with specific terms. 

 

20. Seller’s Disclosure

A document in which the seller discloses known issues or defects with the property. 

 

21. Seller’s Market

A market condition favoring sellers due to low inventory and high demand from buyers. 

 

22. Survey

The measurement and mapping of a property’s boundaries, including its features and any easements or encroachments. 

 

23. Title

Legal ownership of a property. 

 

 

Real Estate Terminology for Buyers

  

happy couple hugging and holding key after buying a home

 

24. Adjustable-Rate Mortgage (ARM)

A mortgage with an interest rate that can change over time. 

 

25. Amortization

The process of gradually paying off a mortgage loan over time through regular payments. 

 

26. Buyer’s Agent/Listing Agent

A real estate agent who represents either the buyer or the seller in a transaction. 

 

27. Days on Market (DOM)

The number of days a property has been listed for sale. 

 

28. Due Diligence

The process of completing inspections and investigations before purchasing a property. 

 

29. FHA Loan

A mortgage insured by the Federal Housing Administration, often offering more flexible qualification requirements. 

 

30. Homeowner’s Association (HOA)

A governing body that manages and enforces rules within a planned community or condominium complex. 

 

31. Home Warranty

A service contract that covers the repair or replacement of certain home systems and appliances for a specified period. 

 

32. iBuyer

A company that uses technology to make instant offers on homes. 

 

33. Multiple Listing Service (MLS)

A database of properties available for sale in a particular area. 

 

34. Pre-Approval

The process of obtaining a lender’s preliminary approval for a mortgage loan, based on the borrower’s creditworthiness. 

 

35. Principal

The initial amount borrowed for a mortgage before interest. 

 

36. Proof of Funds

Documentation that demonstrates the buyer has enough money to purchase the property. 

 

37. Title Insurance

Insurance that protects the buyer or lender against any loss resulting from defects in the title or ownership of a property. 

 

38. VA Loan

A mortgage loan guaranteed by the Department of Veterans Affairs, available to eligible veterans and service members. 

 

 

Real Estate Terminology for Sellers

  

home with for sale sign in front yard

 

39. As-Is

Selling the property in its current condition, without making any repairs or improvements. 

 

40. Covenants, Conditions & Restrictions (CC&Rs)

Rules and regulations that govern the use and appearance of a property in a specific neighborhood or community. 

 

41. Listing

The act of putting a property up for sale. 

 

42. Listing Agreement

A contract between a property owner and a real estate agent, authorizing the agent to market and sell the property. 

 

43. Listing Price

The amount at which a property is listed for sale. 

 

44. Realtor

A licensed real estate agent who is a member of the National Association of Realtors. 

 

45. Rent Back

Allowing the buyer to rent the property back to the seller after the sale is completed, often for a specific period. 

 

46. Short Sale

Selling a property for less than the total amount owed on the mortgage. 

 

47. Staging

Preparing a property for sale by enhancing its appeal to potential buyers. 

 

48. Title Search

An examination of public records to confirm the property’s ownership history and identify any potential issues. 

 

49. Trust Sale

Selling a property held in a trust, often due to the owner’s passing. 

 

50. Zoning

Regulations that dictate how a property can be used. 

 

 

Metropolitan Title Has You Covered for Real Estate Terminology and More!

Metropolitan Title is here to support you throughout your real estate journey. Make sure you always have this real estate terminology breakdown on hand when you need it with our downloadable version. Additionally, here are a few other helpful resources to help you navigate your real estate process: 

Remember, Metropolitan Title is your trusted partner for all your real estate needs. Don’t let real estate terminology intimidate you. With this knowledge in hand, you’ll be well-prepared to engage in meaningful conversations with your real estate professionals and make informed decisions throughout your buying or selling process. But don’t worry. If you ever have any questions, reach out, we’re always happy to help.  

 

Wondering what to expect at your closing. This helpful video explains all! Watch the video here.