Real Estate Glossary for Buyers & Sellers

An opinion of value prepared by an appraiser for a defined purpose. It is different from a home inspection and may differ from an asking price or automated estimate.

Annual percentage rate: a measure of borrowing cost that includes interest and certain other loan charges. Compare APR alongside the loan terms, fees and time you expect to keep the loan.

Documents describing a common-interest community’s governance, finances and responsibilities. Buyers should review the relevant rules, reserves, insurance and maintenance obligations.

A real estate broker’s opinion of a property’s likely market value or price for a particular purpose. It is not the same product as a formal appraisal.

A written agreement describing a broker’s relationship with a buyer, including the services, scope, term and compensation arrangements. Review the actual agreement before signing.

The funds a buyer must provide to complete the transaction after the applicable deposits, credits and other adjustments. Review the final amount with the lender and closing provider.

Transaction expenses associated with completing a purchase or loan, separate from the down payment. The applicable charges depend on the transaction and agreements.

The mortgage disclosure showing final loan terms and closing costs. Compare it with the most recent Loan Estimate and ask for explanations of differences.

Completed sales used to help evaluate another property. Useful comparisons account for differences in location, condition, size, property type and other material features.

A condition in an agreement that must be addressed according to its terms. Inspection, financing and appraisal provisions are common examples; the actual contract determines the rights and deadlines.

A proposed change to an offer’s terms. Review the entire document and how it interacts with the original offer before deciding whether to accept.

A document used to transfer an interest in real property. The type of deed and manner of ownership should be reviewed with the appropriate closing or legal adviser.

Funds delivered under the purchase agreement as part of the transaction. The contract and applicable law determine how the funds are held and what happens in different circumstances.

Information provided about the property, transaction or representation. Read the actual documents and investigate questions rather than treating a disclosure as a substitute for an inspection.

The portion of a purchase price funded by the buyer rather than the mortgage loan. Closing costs and required reserves may be additional to this amount.

A right affecting the use of land for a specified purpose. Review the recorded documents and how the easement affects the particular property and your intended use.

An arrangement in which a neutral third party holds funds or documents and carries out instructions for a transaction. Its role and completion requirements depend on the applicable instructions.

Charges assessed by a homeowners association. Compare the amount, included services, reserves and potential additional assessments with the responsibilities of owning the property.

An evaluation of a property’s condition within the inspector’s scope. It is not a valuation and may identify the need for further specialist investigation.

Internet Data Exchange: technology used to display participating real estate listing information. Listing availability and details should be confirmed for the property you are considering.

A standardized disclosure of estimated loan terms and costs. It helps compare mortgage offers; receiving one does not mean the loan has been finally approved.

A lender’s preliminary review of a borrower under its stated process. Ask what has been reviewed, what conditions remain and whether the specific property qualifies.

Real estate owned by a lender or institutional owner after foreclosure. Review the actual seller requirements, property condition and transaction documents.

A proposed sale for less than the mortgage amount owed, requiring the necessary creditor approvals. The actual approval terms and professional advice matter to the parties involved.

Information about recorded interests and matters affecting a property’s title. Review the report, exceptions and underlying documents with the appropriate professionals.

Local rules governing land use and development. Confirm the property’s jurisdiction and applicable requirements before assuming a proposed use or improvement is allowed.