Adjustable Rate Mortgage (ARM)
A mortgage that provides for periodic changes in the interest rate, based on changing market conditions.
This real estate glossary list covers all major real estate terms you need to know before you start off.
A mortgage that provides for periodic changes in the interest rate, based on changing market conditions.
To liquidate or extinguish (a mortgage, debt, or other obligations), especially by periodic payments to the creditor or a sinking fund, to write off a cost of (an asset) gradually.
Annual percentage rate: the annual rate of interest; the total interest to be paid in a year divided by the balance due.
The act of estimating or judging the nature or value of something or someone. An estimate of value, as for sale, assessment, or taxation; valuation.
An offer on a home under contract that becomes Active if the primary contract falls through.
The final step in a property purchase. This is where the title is transferred from the seller to the buyer. At closing the seller receives payment for the property. Also known as settlement.
Fees charged to the purchaser by a bank, lawyer, etc. For services related to a sale, a title search, an appraisal, etc. Any expenses over the purchase price of the house, land, etc., that are paid by the purchaser or seller after the sale.
A closing disclosure provides final details about the mortgage loan you have selected. It will be sent before closing and the initial document must be signed 72 business hours before closing. It includes the loan terms, your projected monthly payments, and how much you will pay in fees and other costs to get your mortgage (closing costs).
A clause in a purchase contract outlining conditions that must be fulfilled before the contract is executed. Both buyer and/or seller may include contingencies in a contract, but both parties must accept the contingency.
Offer accepted by the seller, but certain conditions must be met before the sale is final.
A private-sector loan, one that is not guaranteed or insured by the U.S. Government.
Writing or document executed under seal and delivered to effect a conveyance, especially of real estate.
The release of relevant information about a property, that could influence the final sale, especially if it represents defects or problems. “Full disclosure” usually refers to the responsibility of the seller to voluntarily provide all known information about the property. A seller found to have knowingly lied about a defect may face legal penalties.
The percentage of the home purchase is price-dependent upon loan type.
The money provided by a buyer to a seller to bind a contract.
A right held by one property owner to make use of the land of another for a limited purpose, as a right of passage.
A contract, deed, bond, or other written agreement deposited with a third person, by whom it is to be delivered to the guarantee or promise on the fulfillment of some condition.
Provides mortgage insurance on loans made by FHA-approved lenders throughout the United States and its territories. FHA insures mortgages on single-family and multifamily homes including manufactured homes and hospitals.
A home mortgage for which equal monthly payments of interest and principal are paid over the life of the loan, usually for a term of 30 years.
Federal Home Loan Mortgage Corporation (FHLM); a federally-chartered corporation that purchases residential mortgages, secures them and sells them to investors; providing lenders with funds for new buyers.
A form used by lenders to give borrowers an estimate of fees due at closing.
A management organization within a community, subdivision, or neighborhood that creates and enforces rules for properties within its jurisdiction.
An examination of a property and its systems. Performed by a qualified professional.
A mortgage that exceeds the conforming-loan amount limit, commonly used for luxury home purchases.
An interest rate set by the federal government that determines the cost to borrow money.
The legal claim of one person upon the property of another person to secure the payment of a debt or the satisfaction of an obligation.
The risk assessment ratio used by lenders. To calculate the LTV, divide the mortgage by the appraised value.
A database for real estate agents to list and market for-sale homes.
The amount received by the seller at closing after all other costs have been deducted.
An event hosted by a listing agent to showcase a home to potential buyers.
A fee charged by a lender for evaluating and processing a loan application, usually a percentage of the face value of the loan.
Principal, interest, taxes, and insurance.
A letter indicating that a lender is willing to loan a specific amount of money for a home purchase: pre-approval does not guarantee a loan.
A written promise to pay a specified sum of money to a designated person or his or her order, or the bearer of the note, at a fixed time or on-demand.
A deed that transfers property rights without any validation of ownership; typically used between spouses and family members.
A commitment by a lender to a borrower guaranteeing a specific interest rate over a period of time at a set cost.
A repossessed property owned by a lender after an unsuccessful sale at auction.
A document completed by the seller disclosing the property’s history and defects.
In property law, a title is a bundle of rights in a piece of property in which a party may own either a legal interest or equitable interest. The rights in the bundle may be separated and held by different parties. It may also refer to a formal document, such as a deed, that serves as evidence of ownership.
Insurance protecting the owner or mortgagee of real estate from lawsuits or claims arising from a defective title.
The process of analyzing a loan application to determine the amount of risk involved in making the loan; includes a review of the potential borrower’s credit history and a judgment of the property value.
A buyer has submitted an offer and the seller has accepted, but the closing is not final.
A mortgage loan for veterans and their spouses, made by private lenders and guaranteed by the U.S. government.
The final inspection that is conducted before a home sale is final.