Real Estate Terms
by Donna Earl
|ARM - Adjustable rate mortgage, where
the lender can lower or raise the interest rate of a loan based on a
|Broker - An independent person who
runs a real estate office, hiring employees, and supervising their
|Buyer Agent - An
agent who represents the buyer in a real estate transaction.
|CRS - Certified Residential
Specialist; A professional title given to agents who complete an advanced
course of study in residential real estate and are proficient in sales and
production; they are members of the Residential Sales Council.
|Closing Costs - Costs associated with
the sale or transfer of real estate from one party to another. These costs
are paid by either the buyer or the seller or both, depending on what is
negotiated or required. Costs include legal fees, document preparation
fees, title research, commissions, etc. A competent REALTORŪ can explain
these costs in detail.
|Commission - Compensation paid to a
real estate agent (usually by the seller) for services rendered including
the sale or lease of property
|Deed - A legal document which
transfers ownership of a property from one party to another.
|Dual Agent - An
agent representing both the buyer and seller in a transaction. Dual agents
should always get written consent of both parties.
|Donna Earl - REALTORŪ known for
getting results for both buyers and sellers of real estate.
|Equity - The difference between the
current market value of a property and the unpaid portion of a mortgage.
|Escrow - The closing of a real estate
transaction through a neutral third party who holds funds and documents
until specific conditions have been met.
|Fannie Mae - Federal National
Mortgage Association; a purchaser of home mortgages, thus serving as a
source of funds for mortgage lenders. It is a privately owned corporation
whose shares are traded on the New York Stock Exchange and is subject to
supervision by HUD.
|Federal Fair Housing Law - Refers to
Title VIII of the Civil Rights Act, and stipulates that discrimination
based on race, color, sex, familial status, handicap, religion, or
national origin is illegal in connection with the sale or rental of most
|Foreclosure - The termination of a
mortgage where the bank or lender attempts to recover the balance of the
loan by forcing the sale of the property. This can occur when a home
owner stops making payments on the home.
|HUD - U.S. Department of Housing and
Urban Development; a federal department active in a variety of national
housing programs including urban renewal and public housing
|Lien - A charge or claim by one party
on the property of another as security for the payment of a debt.
|MLS - Multiple Listing Service; a
means by which agents are informed of the properties offered for sale by
|Mortgage - A legal document pledging
property as security for the payment of a loan.
|Origination Fee - A lender's charge
for establishing and processing a new mortgage loan. It is generally
computed as a percentage of the loan and may be tax deductible
|Owner of Record - The person named in
the public record as the owner of a property or mortgage.
|Points - A one-time charge paid to
the lender for issuing a loan. A point equals 1% of the loan amount.
|Principal - The amount of money upon
which interest is paid.
|RealtorŪ - A registered trade name
that may only be used by members of the National Association of Realtors.
|REO - A bank (lender) owned
property for sale, which was previously foreclosed but unable to be sold at
|Short Sale - The selling of real
estate where the selling price is less than the balance due on the mortgage
as agreed upon by the bank.
|Title - Legal document showing
ownership of property.
|VA Loan - A loan guaranteed by the
U.S. Department of Veterans Affairs (VA). VA loans are made to honorably
discharged veterans or their un-remarried widows or widowers. Such loans
require a minimal or no down payment and offer lower interest rates