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Real Estate Glossary

Explore commonly used terms in residential real estate to enhance your understanding whether you're buying, selling, or investing.



An estimation of a property's market value by a licensed professional, based on market trends, recent sales of similar properties, and the property’s condition.


The process of spreading out a loan into a series of fixed payments over time. Each payment is allocated between interest and principal repayment.


A licensed professional who represents buyers or sellers in real estate transactions.



A person or company licensed to buy, sell, exchange, or lease real property for others and to charge a fee for these services.

Bridge Loan

A short-term loan used until a person or company secures permanent financing or removes an existing obligation. This provides immediate cash flow.


Closing Costs

Expenses over and above the price of the property that buyers and sellers normally incur to complete a real estate transaction.


A condition that must be met before a real estate contract is legally binding. For example, a buyer's sale might be contingent upon receiving a mortgage.


A private residence within a group of housing units where owners share ownership of common use areas.



A legal document that grants ownership of a property to a new owner.

Down Payment

The part of the purchase price of a property that the buyer pays in cash and does not finance with a mortgage.



The difference between the market value of a property and the amount still owed on its mortgage.


A contractual arrangement in which a third party receives and disburses money or documents for the primary transacting parties, with the disbursement dependent on conditions agreed to by the transacting parties.



A legal process in which a lender attempts to recover the balance of a loan from a borrower who has stopped making payments to the lender by forcing the sale of the asset used as the collateral for the loan.

Fixed-Rate Mortgage

A mortgage that has a fixed interest rate for the entire term of the loan.


Home Inspection

An examination of a property's condition, typically performed by a qualified inspector who provides a report to the buyer.

Homeowner's Association (HOA)

An organization in a subdivision, planned community, or condominium that makes and enforces rules for the properties and their residents.



A legal right or interest that a lender has in the borrower's property, employed as a security for the repayment of a debt.

Loan-to-Value Ratio (LTV)

A risk assessment ratio that financial institutions and other lenders examine before approving a mortgage, calculated by dividing the amount borrowed by the property’s appraised value or selling price.



A debt instrument, secured by the collateral of specified real estate property, that the borrower is obliged to pay back with a predetermined set of payments.

MLS (Multiple Listing Service)

A service used by a group of real estate brokers that allows them to see one another's listings of properties for sale.



A lender’s conditional agreement to lend a specific amount based on the information provided by the borrower, which is useful when shopping for a home.


The amount of debt, not including interest, left on a loan.



A legal document evidencing a person's legal right to possession of a property.

Title Insurance

An insurance policy that protects residential or commercial property owners and their lenders against losses related to the property’s title or ownership.



The process by which lenders verify and assess the risks involved in lending to a real estate buyer and establish appropriate terms and conditions for the loan.



Regulations established by local governments regarding the type of activities that may take place on a piece of property.

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