Real Estate Terms You May Need to Know
If you've ever sat down with a mortgage lender or real estate agent, there is a chance they've thrown some terms around that you may not be completely familiar with. While you don't want to sound like you don't know what you're doing, if you are a first time home buyer in Colorado Springs, we know that you are learning along the way and welcome and questions you may have. Here are a few "Greek" terms that you may hear through the real estate process, and what they mean!
Appraisal
This is the estimated value of the property that you've chosen. There will be an individual who will come out and appraise your property to see what it's worth.
Certificate of Title
This is the document that guarantees the property is legally owned by the person who claims it.
Closing Costs
All of the fees and expenses associated with closing on a home, usually around 6% of the cost of the home.
Comparative Market Analysis (CMA)
Thi is a study that your Colorado Springs real estate agent will conduct to see how comparable local homes have sold to help determine a reasonable price for a property.
Contingencies
Do you have conditions that must be met in order for the offer on a home to proceed? That is what a contingency is. Perhaps you're waiting on the final approval from your bank, or maybe there are things about the home that must be completed before it can be sold.
Due Diligence
These are actions that a responsible buyer must address in order to protect the real estate investment.
Debt to Income Ratio
If you want to qualify for a loan, your monthly debt cannot exceed 43% of your monthly income.
Earnest Money Deposit
This would be a payment made to the seller with the offer to show serious intention.
Escrow
An account where all closing costs are collected while the lender approves the deal.
FICO Score
This is a numerical value assigned to lenders based on their credit history.
Fiduciary Duties
These are the responsibilities of the broker that the real estate agent works for.
Good Faith Deposit
Just like it sounds, a payment made to the lender with the offer to show how serious you are about buying.
HOA
Homeowners Association. This is the organization that determines community rules and standards. There can be a fee associated with living in an HOA, but it can come with some great perks. This is something your real estate agent can explain to you.
Loan to Value Ratio
This is how the lender determines if the loan is worth the risk associated with it.
Mortgage
This one is pretty simple, it's the home loan that you will need to fund the purchase of your home.
Pre-Qualification
This is the process to determine if a borrower is qualified for a loan. Keep in mind that the amount is approximate because it's not based on solid figured, but numbers that you've given them to work from.
Pre-Approval
You will need a pre-approval in order to purchase your home. More paperwork will be required in order to supply this number for you because it will only be based on hard numbers from your bank statements, W-2s, pay stubs, and more.
Payment Terms
Principal, Interest, taxed, PMI, etc. All you really need to know as a buyer is the monthly and cumulative totals of your new home.
Colorado Springs Real Estate
Are you ready to take the next step and start looking for a home in Colorado Springs? Our team would be honored to work with you to not only learn the terminology of real estate but also help you find a home that you can memories in for years to come. Visit our website to learn more about our buying process, our Colorado Springs real estate agents, and mortgage lenders that we recommend. We can't wait to help you buy a Colorado Springs home!
This is the estimated value of the property that you've chosen. There will be an individual who will come out and appraise your property to see what it's worth.
Certificate of Title
This is the document that guarantees the property is legally owned by the person who claims it.
Closing Costs
All of the fees and expenses associated with closing on a home, usually around 6% of the cost of the home.
Comparative Market Analysis (CMA)
Thi is a study that your Colorado Springs real estate agent will conduct to see how comparable local homes have sold to help determine a reasonable price for a property.
Contingencies
Do you have conditions that must be met in order for the offer on a home to proceed? That is what a contingency is. Perhaps you're waiting on the final approval from your bank, or maybe there are things about the home that must be completed before it can be sold.
Due Diligence
These are actions that a responsible buyer must address in order to protect the real estate investment.
Debt to Income Ratio
If you want to qualify for a loan, your monthly debt cannot exceed 43% of your monthly income.
Earnest Money Deposit
This would be a payment made to the seller with the offer to show serious intention.
An account where all closing costs are collected while the lender approves the deal.
FICO Score
This is a numerical value assigned to lenders based on their credit history.
Fiduciary Duties
These are the responsibilities of the broker that the real estate agent works for.
Good Faith Deposit
Just like it sounds, a payment made to the lender with the offer to show how serious you are about buying.
HOA
Homeowners Association. This is the organization that determines community rules and standards. There can be a fee associated with living in an HOA, but it can come with some great perks. This is something your real estate agent can explain to you.
Loan to Value Ratio
This is how the lender determines if the loan is worth the risk associated with it.
Mortgage
This one is pretty simple, it's the home loan that you will need to fund the purchase of your home.
Pre-Qualification
This is the process to determine if a borrower is qualified for a loan. Keep in mind that the amount is approximate because it's not based on solid figured, but numbers that you've given them to work from.
Pre-Approval
You will need a pre-approval in order to purchase your home. More paperwork will be required in order to supply this number for you because it will only be based on hard numbers from your bank statements, W-2s, pay stubs, and more.
Principal, Interest, taxed, PMI, etc. All you really need to know as a buyer is the monthly and cumulative totals of your new home.
Colorado Springs Real Estate
Are you ready to take the next step and start looking for a home in Colorado Springs? Our team would be honored to work with you to not only learn the terminology of real estate but also help you find a home that you can memories in for years to come. Visit our website to learn more about our buying process, our Colorado Springs real estate agents, and mortgage lenders that we recommend. We can't wait to help you buy a Colorado Springs home!
Mike MacGuire
Colorado Springs Real Estate Agent
The MacGuire Team
6760 Corporate Dr
Ste 300
Colorado Springs, CO 80919
719-536-4324 or 719-660-6793
Mike@BuyWithMike.com
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