Real Estate Glossary

Here are some words and phrases, real estate lingo that may be helpful for you, if you have any questions don’t hesitate to contact Dan.

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z


A

Accrued Depreciation – The total loss in value of a building due to any cause.

Adjustments – Changes or adaptations made in real estate, for example, the amount of taxes owed as of the Completion Day. Adjustments are to be noted on the Purchase Contract.

Amortization – The loan payment consists of a portion which will be applied to pay the accruing interest on a loan, with the remainder being applied to the principal. Over time, the interest portion decreases as the loan balance decreases, and the amount applied to principal increases so that the loan is paid off (amortized) in the specified time.

Appraisal – A written justification of the price paid for a property, primarily based on an analysis of comparable sales of similar homes nearby.

Arrears – The amount of monthly payments due under a mortgage plus interest on these payments. A person said to be “in arrears” is behind with his or her payments.

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B

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C

Closing – The completion of the transaction between buyer and seller.

Closing Costs – Additional expenses, on top of the purchase price of a property.

Closing Date – The date on which the keys are exchanged, the title is legally transferred and all money is paid.

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D

Default – Failure to repay as agreed. To fail to pay an outstanding debt (ie. mortgage).

Deposit – Money or considerations of value given as a pledge of commitment to the contract or agreement.

Down Payment – A sum of money used to prepay the mortgage. The remainder of the mortgage becomes the principal.

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E

Easement – A legal right to use another person’s land for limited purposed. For example is a property with a fire hydrant.

Equity – The borrower’s equity is made up of the value of all mortgages against a property against it’s current market value. If the value is greater than the mortgage amount than the difference is known as the equity the borrower holds.

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F

Foreclosure – A legal procedure in which the lender gets ownership of the property if the borrower defaults on the mortgage loan.

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G

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H

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I

Interest – The cost of borrowing money for a given period of time. Interest is usually paid to the lender in installments along with repayment of the principal loan amount.

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J

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K

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L

Loan to Value Ratio – The ratio of the loan to the lending value of a property expressed as a percentage. For example, the loan-to-value ratio of a loan for $25,000 on a home which costs $100,000 is 25%.

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M

Mortgage – Security for a loan to purchase property. It is the purchaser’s personal guarantee to repay the loan and a pledge of the property as security for the loan.

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N

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O

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P

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Q

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R

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S

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T

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U

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V

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W

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X

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Y

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Z

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