There are many terms that are used in the real estate world that are very helpful to when you are buying a home. Below is a list of common used terms in the process.
Active
The property is actively for sale and on the market. The sellers may have received offers but have not accepted any yet.
Back on market
This property was under contract with another buyer and their contract fell through, so it is Active again.
CMA
Comparative market analysis or competitive market analysis. A CMA compares the sales price of similar properties in the area to help determine the price of a property.
Closing costs
The fees that the buyer pays at closing that associated with the homebuying process, such as the appraisal, mortgage fees, title insurance, closing fee, etc.
Contingency
A provision of the contract that keeps the agreement from being fully legally binding until a certain condition is met. For example, the purchase of a home can be contingent upon the buyer selling their home first.
Down payment
The sum in cash that you can afford to pay at the time of purchase. A conventional loan down payment is usually somewhere between 5% to 20% of the sales price, other types of financing require as little as 3.5% to 15%. A mortgage lender can tell you what types of loans you qualify for.
FSBO
For Sale by Owner. Often pronounced “fisbo” The owner of the home has it listed without an agent representation. A Buyer’s agent can usually still show the home, as many FSBOs will agree to work agents representing a buyer.
Interest
A percentage of the principal that you borrowed from the bank.
Pending
The property owner has accepted an offer and are under contract with a buyer. Their agreement may be contingent upon a variety of contingencies: inspections, appraisal, financing, and more. The home is not sold just yet.
MLS
The Multiple Listing Service. The MLS is the organization real estate broker’s use to search for and list properties. They collect, compile and distribute all information about homes listed for sale. Membership isn’t open to the general public, although we do have a public website that we share most of the information on. In West Michigan the website is GRAR.com click here for the link to search.
Title insurance
An insurance policy that protects a mortgage lender’s or owner’s interest in real property from assorted types of fraudulent claims of ownership.