If you’re new to real estate it might seem overwhelming with all the terminology that’s foreign to you. There is no need to be an expert in the real estate industry when you decide to buy or sell. You’ll feel better though to be aware of terms you will hear a lot throughout your home buying or selling experience.
Here are some of the most common real estate terms you will likely encounter when buying or selling a property:
- Pre-approval letter – a letter that estimates how much the bank will loan the buyer. The benefits of pre-approval are two fold. It helps the buyer know how much they can afford and assures the seller that the buyer can get a loan for the property.
- Listings – In the real estate, we call properties for sale “listings.” You can view listings online to see information and pictures of the property. See Location Williamson’s own listings and search listings in your area!
- Appraisal – The lender requires an appraisal of the property after the buyer apply for a mortgage. An appraiser will assess the home’s value by studying comparable houses in the area and investigating the property.
- Contingencies – These are condition(s) that must be met before the sale goes through between buyer and seller (The home sale is contingent on these conditions). These are given when an offer is made on a property. A home inspection is a common contingency. In this case, if the home inspection shows major issues the buyer doesn’t want to tackle, they can walk away without losing money.
- Closing costs – A variety of fees (by lenders and third parties) that come with buying a home beyond the down payment. Lenders have to give you a Good Faith Estimate of what closing costs will be after you apply for the loan. Three days before closing you will receive your HUD-1 Settlement Statement detailing what your exact closing costs are. Find out what to expect on closing day HERE.
- Earnest money – A buyer provides this deposit to show good faith to the sellers. It is held until the sale goes through, and if all goes through, it is applied to the loan.
- Escrow – The process you enter after the buyer and seller agree on the sale price and conditions. During this time the buyer pays the earnest money, schedules appraisals, inspections, and insurances. Your earnest money is placed in an escrow account, held by a third party until the sale goes through (or falls through and the earnest money is returned to the buyer).
- Multiple Listing Service (MLS) – The MLS is composed of hundreds of database computer systems used for real estate agents to show their properties for sale. Each individual property for sale is given a unique MLS number. The MLS is used all over the United States! At Location Williamson all of our listings are added to the MLS!
We want you to be educated as we serve your real estate needs! Let us walk through this process with you. Tell us about the type of property you want to buy or looking to sell, or give us a call at 615.469.1412.
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