Home Seller & Real Estate Glossary
Absentee Owner – A property owner who does not live in the property, often renting it out or leaving it vacant.
Abstract of Title – A summary of the legal history of a property, including ownership and liens.
Acceleration Clause – A mortgage clause that allows the lender to demand full repayment if certain conditions are not met.
Acquisition Cost – The total cost of acquiring a property, including purchase price and closing costs.
Adjustable-Rate Mortgage (ARM) – A mortgage with an interest rate that may change periodically based on market conditions.
After-Repair Value (ARV) – The estimated value of a property after renovations or repairs are completed.
Appraisal – A professional estimate of a property’s market value.
As-Is – A property sold in its current condition without repairs or warranties.
Assignment of Contract – The transfer of rights and obligations in a purchase agreement to another buyer.
Balloon Payment – A large final payment due at the end of a loan term.
Bankruptcy – A legal process where individuals or businesses seek relief from debts, often affecting property sales.
Breach of Contract – Failure to meet the terms agreed upon in a real estate contract.
Bridge Loan – A short-term loan used until permanent financing or property sale is secured.
Broker Price Opinion (BPO) – An estimate of property value prepared by a licensed real estate broker.
Buyer’s Agent – A licensed agent who represents the interests of the buyer in a transaction.
Capital Gains Tax – A tax on the profit from selling a property.
Cash Offer – An offer to purchase a property without financing, closing more quickly.
Clear Title – Ownership free of legal claims, liens, or disputes.
Closing Costs – Fees and expenses paid at closing, such as title fees, attorney fees, and recording costs.
Closing Date – The date when ownership of a property is legally transferred to the buyer.
Cloud on Title – Any claim or unresolved issue that may affect property ownership.
Comparative Market Analysis (CMA) – A report comparing similar recently sold homes to estimate value.
Commission – A fee paid to real estate agents for services, typically a percentage of the sale price.
Contingency – A condition that must be met for a real estate contract to proceed (e.g., inspection).
Contract for Deed – An agreement where the buyer makes payments directly to the seller until the property is paid off.
Conventional Loan – A mortgage not insured by government programs like FHA or VA.
Counteroffer – A new offer made in response to an initial offer, altering terms.
Deed – A legal document transferring property ownership.
Deed in Lieu of Foreclosure – When a homeowner voluntarily transfers property to the lender to avoid foreclosure.
Default – Failure to meet mortgage obligations, often leading to foreclosure.
Delinquency – A borrower’s failure to make mortgage payments on time.
Disclosure – Information a seller must legally share about a property’s condition or issues.
Divorce Sale – A property sold as part of dividing assets during divorce proceedings.
Down Payment – The initial cash payment made toward a property purchase.
Earnest Money Deposit – A deposit made to show serious intent to buy a property.
Encumbrance – A claim, lien, or liability attached to a property.
Equity – The difference between a property’s market value and the amount owed on the mortgage.
Escrow – A neutral third party that holds funds and documents until conditions are met.
Estate Sale – The sale of property from a deceased owner’s estate.
Fair Market Value – The price a property would sell for in a competitive market.
FHA Loan – A government-backed loan insured by the Federal Housing Administration.
Final Walkthrough – A last inspection before closing to ensure the property’s condition has not changed.
Fire Damage – Property damage caused by fire or smoke, often requiring remediation.
Fix and Flip – Buying, renovating, and reselling a property for profit.
Forbearance – A lender temporarily reduces or suspends mortgage payments.
Foreclosure – The legal process where a lender repossesses property due to missed payments.
FSBO (For Sale by Owner) – A property listed and sold directly by the owner, without a real estate agent.
Hard Money Loan – A short-term, high-interest loan often used by investors.
Home Inspection – An examination of a property’s condition by a licensed inspector.
Homeowners Association (HOA) – An organization that manages a community and enforces rules, funded by dues.
Hoarder House – A property with excessive clutter, making it difficult to sell without cleanup.
HUD-1 Settlement Statement – A detailed list of all charges and credits in a real estate transaction.
Inheritance Sale – Property sold by heirs after being passed down through probate.
Inspection Contingency – A contract clause allowing buyers to cancel or renegotiate after inspection results.
Judgment Lien – A court ruling that gives a creditor a claim on a property until a debt is paid.
Lease Option – A lease agreement giving the tenant the right to purchase the property later.
Lien – A legal claim against a property for unpaid debt or obligation.
Listing Agreement – A contract between a property owner and an agent to sell the property.
Loan Modification – A lender changes the terms of a mortgage to help a borrower avoid foreclosure.
Market Value – The most likely price a property would bring in an open market.
Mechanic’s Lien – A lien placed by contractors or suppliers who haven’t been paid.
MLS (Multiple Listing Service) – A database of properties listed by real estate professionals.
Mortgage – A loan secured by real estate, requiring repayment with interest.
Mortgagee – The lender in a mortgage agreement.
Mortgagor – The borrower in a mortgage agreement.
Notice of Default (NOD) – A public notice that a borrower has defaulted on a mortgage.
Offer – A formal proposal to purchase a property under stated terms.
Open House – An event where a home for sale is open for public viewing.
Option to Purchase – A contract giving a buyer the right to buy a property at a later date.
Owner Financing – When the seller provides financing directly to the buyer instead of a bank.
Pending Sale – A property under contract but not yet closed.
Power of Attorney – A legal document allowing one person to act on another’s behalf in a transaction.
Pre-Foreclosure – The stage after default but before foreclosure sale.
Pre-Qualification – An estimate of how much a buyer can borrow based on basic financial info.
Probate – The court process of transferring ownership from a deceased person to heirs.
Promissory Note – A written promise to repay a loan under stated terms.
Quitclaim Deed – A deed that transfers any ownership interest without guarantees.
Real Estate Owned (REO) – Property owned by a lender after an unsuccessful foreclosure auction.
Recording Fees – Charges for entering a property transaction into public records.
Redemption Period – The time after foreclosure when the borrower can reclaim the property by paying debt.
Refinance – Replacing an existing mortgage with a new one, often with better terms.
Relocation Sale – When a homeowner sells due to job transfer or moving.
Reverse Mortgage – A loan for homeowners 62+ that converts home equity into cash.
Seller Concessions – Costs the seller agrees to cover on behalf of the buyer.
Short Sale – Selling a property for less than the mortgage balance with lender approval.
Subject-To – An investment strategy where the buyer takes over payments on the seller’s existing mortgage.
Survey – A professional measurement of property boundaries and land features.
Tax Lien – A government claim against a property for unpaid taxes.
Tax Sale – A sale of property due to unpaid property taxes.
Tenant-Occupied – A property that currently has renters in place.
Title – Legal ownership of property.
Title Insurance – Insurance that protects against issues with property ownership.
Trustee Sale – A foreclosure auction handled by a trustee.
Upside Down Mortgage – When a homeowner owes more on a mortgage than the property’s market value.
Vacant Property – A property not occupied by an owner or tenant.
Warranty Deed – A deed guaranteeing clear ownership and right to sell.
Water/Mold Damage – Property damage caused by leaks, flooding, or mold growth.
Wholesaling – Contracting to buy a property and assigning it to another buyer for a fee.