Real Estate Glossary
From Confusion to Clarity
Explore our comprehensive Real Estate Glossary, designed to simplify complex property terms and concepts. From buying and selling to financing and investing, gain clear insights into essential terminology. Perfect for first-time buyers, seasoned investors, and industry professionals seeking clarity in the ever-evolving world of real estate. Your guide to smarter decisions!
Adjustable-Rate Mortgage (ARM) – A loan with an interest rate that adjusts periodically.
Amortization – The process of gradually paying off a mortgage through regular payments.
Appraisal – An evaluation of a property’s value by a licensed professional.
Assessment – The valuation of a property for tax purposes.
As-Is Condition – Selling a property in its current state, without repairs or guarantees.
Balloon Payment – A large final payment due at the end of a loan term.
Broker – A licensed individual who facilitates real estate transactions.
Bridge Loan – A short-term loan used until long-term financing is secured
Breach of Contract – Failure to fulfill the terms of a real estate agreement.
Buyer’s Agent – A real estate agent who represents the buyer’s interests.
Capital Gains – Profits earned from the sale of property.
Cash-Out Refinance – Replacing an existing loan with a new one, withdrawing some equity as cash.
Closing Costs – Expenses incurred during the finalization of a real estate transaction.
Comparative Market Analysis (CMA) – A report used to determine a property’s market value.
Contingency – A condition in a contract that must be met for the agreement to be binding.
Deed – A legal document transferring property ownership.
Depreciation – A decrease in the value of a property over time.
Disclosure – Information about a property that must be shared with buyers.
Down Payment – The initial upfront payment made when purchasing a property.
Dual Agency – When one agent represents both the buyer and seller.
Earnest Money – A deposit made by a buyer to demonstrate their commitment.
Easement – The right to use another person’s land for a specific purpose.
Equity – The difference between a property’s market value and the owed loan amount.
Escrow – A neutral third party that holds funds or documents during a transaction.
Exclusive Listing – A property listing where only one agent represents the seller.
Fair Market Value – The estimated price a property would sell for in the current market.
FHA Loan – A government-backed loan from the Federal Housing Administration.
Fixtures – Items permanently attached to the property.
Fixed-Rate Mortgage – A loan with an interest rate that remains constant.
Foreclosure – The legal process by which a lender takes possession of a property due to nonpayment.
General Contractor – A person responsible for overseeing construction or renovations.
Grantee – The person receiving property through a deed.
Grantor – The person transferring property through a deed.
Gross Income – Total income from a property before expenses are deducted.
Ground Lease – A lease agreement for the land on which a property is built.
Hazard Insurance – Insurance that covers damage to a property caused by natural disasters.
Home Equity Line of Credit (HELOC) – A loan that uses home equity as collateral.
Home Inspection – An evaluation of a property’s condition by a professional.
Homeowners Association (HOA) – An organization governing a community or property.
HUD – The U.S. Department of Housing and Urban Development.
Interest Rate – The cost of borrowing money expressed as a percentage.
Inspection Contingency – A contract condition allowing buyers to back out based on inspection results.
Income Property – Property purchased to generate rental income.
Interest-Only Loan – A loan where payments initially cover only the interest.
Inflation – The increase in prices over time, affecting property value.
Joint Tenancy – Co-ownership with equal shares and survivorship rights.
Judicial Foreclosure – Foreclosure handled through court proceedings.
Jumbo Loan – A loan exceeding conventional loan limits.
Judgment Lien – A lien placed on property due to a court ruling.
Just Compensation – Payment to a property owner when the government takes private property.
Key Money – A fee paid to secure a lease or tenancy.
Key Tenant – A major tenant whose lease terms impact other tenants.
Kick-Out Clause – A provision allowing sellers to cancel a contract under specific conditions.
Kitchen Work Triangle – A design principle for kitchen efficiency.
Knock-Down – A property purchased with the intention of demolishing and rebuilding.
Landlord – The owner of a rental property.
Lien – A legal claim on a property as security for a debt.
Listing Agreement – A contract between a seller and a real estate agent.
Lot Line – The boundary defining a property’s size and shape.
Loan-to-Value Ratio (LTV) – The ratio of a loan to the property’s value.
Market Value – The price a buyer is willing to pay and a seller is willing to accept.
Median Price – The middle price of homes sold in a specific area.
Mortgage – A loan used to purchase real estate.
Mortgage Insurance – Insurance protecting the lender if the borrower defaults.
Multiple Listing Service (MLS) – A database of property listings.
Negative Amortization – When loan payments don’t cover the interest, increasing the balance.
Net Operating Income (NOI) – The income from a property after operating expenses.
Notary – An official who verifies the authenticity of signatures on documents.
Non-Conforming Loan – A loan that doesn’t meet Fannie Mae or Freddie Mac standards.
Notice of Default – A formal notice given to a borrower in default.
Offer – A proposal to buy property at a specified price and terms.
Open House – A property showing open to the public.
Option Contract – A contract giving a buyer the right to purchase property within a time frame.
Origination Fee – A fee charged by lenders for processing a loan.
Owner-Occupied – Property used as the owner’s primary residence.
Plat Map – A map showing property divisions in a subdivision.
Principal – The original loan amount or remaining balance.
Pre-Approval – A lender’s confirmation of a buyer’s loan eligibility.
Property Taxes – Taxes levied by the government based on property value.
Private Mortgage Insurance (PMI) – Insurance required for loans exceeding 80% LTV.
Quitclaim Deed – A deed transferring ownership without guaranteeing clear title.
Qualifying Ratios – Ratios lenders use to evaluate a borrower’s ability to repay.
Quiet Title – A legal action to resolve disputes over property ownership.
Quorum – Minimum attendance required for HOA or community meetings.
Quick Sale – A sale completed faster than usual, often at a lower price.
Refinance – Replacing an existing loan with a new one, often at better terms.
Real Estate Agent – A licensed professional assisting in buying, selling, or renting property.
Reverse Mortgage – A loan for homeowners 62+ to convert home equity into cash.
Right of First Refusal – A contractual right to purchase property before others.
ROI (Return on Investment) – The profitability of a real estate investment.
Seller’s Market – A market where demand exceeds supply, favoring sellers.
Security Deposit – Funds held by landlords to cover potential tenant damages.
Short Sale – Selling a property for less than the mortgage owed.
Survey – A professional assessment of property boundaries.
Subdivision – A tract of land divided into smaller lots.
Tenancy in Common – Co-ownership where each owner has separate shares.
Title – Legal ownership of property.
Title Insurance – Protects against potential title disputes or defects.
Transfer Tax – A tax on the transfer of property ownership.
Trustee – A person or entity managing property held in trust.
Underwriting – The process lenders use to assess loan risk.
Upside-Down Loan – When the owed amount exceeds the property’s market value.
Urban Renewal – Revitalization of city areas through redevelopment.
Usable Square Footage – Space within a property available for use.
Utilities – Essential services like water, electricity, and gas.
Vacancy Rate – The percentage of unoccupied rental units.
VA Loan – A mortgage backed by the Department of Veterans Affairs.
Variance – Permission to deviate from zoning rules.
Value-Add Property – A property that can be improved to increase value.
Virtual Tour – An online viewing experience for a property.
Walk-Through – A final inspection before closing a transaction.
Warranty Deed – A deed guaranteeing the property is free of claims.
Wetlands – Protected land areas often subject to specific development regulations.
Wraparound Mortgage – A secondary mortgage encompassing the first.
Wholesaling – Buying and selling property quickly, often at a discount.
X-Date – The date a policy or contract takes effect.
X-Out – Canceling or removing a property listing.
X-factor Property – A unique property with standout features.
Xeriscaping – Landscaping to minimize water use, common in arid areas.
XML Listing – Digital listing format for real estate websites.
Yard – Outdoor property space, often landscaped.
Year-End Statement – A summary of financial transactions related to a property.
Year Built – The year a property was constructed.
Yield – The return on an investment, often expressed as a percentage.
Yield Maintenance – A prepayment penalty ensuring lenders’ expected returns.
Zero Lot Line – Property built close to or on the lot boundary.
Zero Down Payment – A loan requiring no upfront payment.
Zestimate – A property value estimate from Zillow.
Zoning – Regulations governing land use in specific areas.
Zone Improvement Plan (ZIP) – Postal codes for efficient delivery services.
