A
Adjustable-Rate Mortgage (ARM)
A mortgage with an interest rate that changes over time based on a specific benchmark.
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Amortization
The process of paying off debt with a fixed repayment schedule in regular installments over a period of time.
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Assessment Value
The valuation placed on property by a public tax assessor for purposes of taxation.
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Appraisal
An expert estimate of the value of something, in real estate, typically a home.
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B
Buyer’s Market
A situation in real estate where property supply exceeds demand, giving purchasers an advantage over sellers in price negotiations. Learn more.
C
Capital Gain
The increase in value of a real estate property that gives it a higher worth than the purchase price. Learn more.
Closing
The final step in executing a real estate transaction when the title of the property is transferred from seller to buyer. Learn more.
Closing Costs
Expenses over and above the price of the property in a real estate transaction. Learn more.
Condominium
A building or complex containing a number of individually owned apartments or houses. Learn more.
Curb Appeal
The attractiveness of a property and its surroundings when viewed from the street. Learn more.
D
Deed
A legal document that grants ownership of a property. Learn more.
Down Payment
The portion of a home’s purchase price that is paid upfront and is not part of the mortgage loan. Learn more.
Due Diligence
The process of carefully checking the details of a potential investment, such as a real estate transaction, before finalizing the agreement. Learn more.
E
Equity
The value of a homeowner’s interest in their home, calculated as the home’s value minus the outstanding balance of all liens. Learn more.
Equity Loan
A type of loan in which the equity of the borrower’s home is used as collateral. Learn more.
Escrow
Funds held by a third party on behalf of transacting parties. Learn more.
F
Fixture
Personal property that has been attached to land or a building that is regarded as an irremovable part of the real property. Learn more.
Fixed-Rate Mortgage
A mortgage that has a fixed interest rate for the entire term of the loan. Learn more.
Foreclosure
The process by which a lender takes control of a property from a homeowner who has defaulted on payments. Learn more.
G
Gentrification
The process of renovating and improving a house or district so that it conforms to middle-class taste.
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H
Home Inspection
A thorough assessment of a home’s condition, usually performed by a professional before a sale. Learn more.
Home Equity Loan
A type of loan in which the borrower uses the equity of their home as collateral. Learn more.
Homeowner’s Association (HOA)
An organization in a subdivision, planned community, or condominium that makes and enforces rules for the properties within its jurisdiction. Learn more.
I
Interest Rate
The proportion of a loan charged as interest to the borrower. Learn more.
Interest-Only Loan
A loan where the borrower pays only the interest for some or all of the term, with the principal balance unchanged during the interest-only period. Learn more.
L
Landlord
The owner of real estate that is rented or leased to an individual or business, who is called a tenant. Learn more.
Leasehold
An interest in a property that is held by a lease, typically involving payment to the owner. Learn more.
Liability
A financial obligation, or the amount owed. Learn more.
Listing
An agreement that represents the right of a real estate agent to handle the sale of real property and find a buyer. Learn more.
M
Market Value
The most probable price that a given property would bring in an open and competitive market. Learn more.
Mortgage
A loan used to purchase a home, where the property itself serves as collateral. Learn more.
O
Offer
A formal bid from the home buyer to the home seller to purchase a home. Learn more.
Origination Fee
A fee charged by a lender on entering into a loan agreement to cover the cost of processing the loan. Learn more.
P
Pre-approval
A lender’s offer to loan money under specific terms before a buyer finds a home.
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R
Real Estate Agent
A licensed professional who represents buyers or sellers in real estate transactions. Learn more.
Real Estate Investment Trust (REIT)
A company that owns, operates, or finances income-producing real estate. Learn more.
Refinancing
The process of obtaining a new mortgage, usually at a lower interest rate, to replace the original mortgage. Learn more.
T
Tenant
A person who rents or leases a space from another, often used in the context of commercial and residential properties. Learn more.
Title
A legal document evidencing a person’s right to or ownership of a property. Learn more.
Z
Zoning
Government (usually municipal) laws that control the use of land within a jurisdiction.
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