Real Estate Terms Glossary
Navigating the world of real estate can often feel like learning a whole new language. With terms like "appraisal," "escrow" and "closing costs" thrown around, it is no wonder that prospective homebuyers can find themselves overwhelmed. If you find yourself feeling stressed out by real estate terms, don’t worry. You are not alone and I am here to break down these complex concepts into bite-sized pieces, making the home-buying process more accessible and less intimidating. Whether you are a first-time buyer or simply looking to refresh your knowledge, I am here to guide you through the maze of real estate jargon.
If you are looking for a Portland, Maine based real estate agent to help along the way, let’s connect. Click here to get in touch with me directly! I would love to be a part of your journey to your dream home.
Appraisal - An appraisal is typically required when buying a home through a bank and obtaining a mortgage. The appraisal is conducted by a third party to ensure the lender that the property is worth what the buyer is offering to pay.
Home Inspection - A home inspection is typically conducted by a home buyer to learn more about a property before purchasing.
Assessed Value - The town or city that a home is located in will assess property values. The value the town has the home assessed at is what property taxes are based on.
Earnest Money Deposit - An earnest deposit is a term of the purchase and sale agreement. This is money that a buyer provides with their offer to show the seller you are serious about your offer and to show good faith in moving forward with the transaction.
Contingency - There are several contingencies within a contract, these can include financing, inspections, clear title, or the need to sell another property. All of these are checkpoints throughout the transaction where conditions must be met and agreed upon by the seller and buyer for the transaction to move forward.
Down Payment - This is the amount of money you are putting as an initial payment towards your mortgage loan, it is typically a percentage of the purchase price.
Closing Costs - These are costs associated with acquiring your mortgage loan. These will include items such as a loan origination fee, transfer tax, prepaid interest on your loan, and getting your escrow account set up with money towards homeowner’s insurance and property taxes.
Cash to Close - This amount is the total that the home buyer needs to bring to the closing. The buyer receives this total amount from their lender at least 3 days prior to closing. This amount is a combination of your down payment and your closing costs. The earnest money deposit that was initially made with the offer is also deducted from this amount.
Now that you have a glimpse into the world of real estate terminology, do not let these terms stand between you and your dream home! I am here to help you every step of the way. If you are ready to take the next step, whether it is clarifying a term, starting your home search, or diving into the buying process, do not hesitate to get in touch. Your journey to homeownership starts here, and I am excited to be a part of it. If you are looking to buy or sell a home in the Greater Portland Area, I would love to chat. Click here to get in touch with me directly!