The field of real estate functions off endless amounts of complex terminology. So, jargon terms can add frustration, making an already stressful process even more intimidating for new buyers and sellers.
At Guidry & Company Real Estate, we want to alleviate any stress you may be feeling. Whether you are new to the real estate industry or want to brush up on your understanding of frequently used words and phrases, this blog is for you. These are some of the most used real estate terms that will guide you through your housing journey.
How to Speak Real Estate
Addendum: A document that clarifies and adds information/requests that were not a part of the original contract.
Appraisal: The value estimation of a property based on many factors, as required by a lender.
As-Is: The property is for sale in its current condition.
Buyer’s Agent: Also known as the Selling Agent; the real estate agent that represents the buyer.
Broker: A real estate agent with more experience and an earned designation who can also be a supervisor of other real estate agents, as well as a qualified representative for a seller or buyer.
Buyer’s Request (previously known as Buyer’s Response): a one-time request, in writing, during the DDI period that a buyer makes of a seller to have a specific list of items remedied as a condition of the purchase of real estate.
Closing: The process performed to transfer the real estate from the seller to the buyer, also known as the sale or act of sale.
Closing Costs: The combination of costs associated with obtaining real estate to complete the buying process at closing.
Contingency: A condition within a contract that must be met before the property transaction can close.
Deed: A legal document that shifts ownership from the seller to the buyer – also known as the sale document, cash sale, credit sale, bond for deed, and cash deed depending on the type of transaction.
Default: A condition that occurs when one of the parties in a contract does not fulfill the duties described and agreed upon in a purchase agreement.
Designated Agent: The specific real estate agent representing either a buyer or a seller.
Disclosure: A form signed by a seller to provide information to a prospective buyer which is available for consideration prior to an offer being made on a property.
Deposit: Amount offered and negotiated by a buyer and held in escrow during the time a property is under contract to be sold.
Due Diligence Inspection Period (DDI Period): The time negotiated in a purchase agreement to allow a buyer to evaluate all aspects of a real estate property to determine its suitability and allow the buyer to cancel the contract under the agreed upon terms if needed.
Escrow: A secure holding for funds until the real estate transaction is complete.
Fair Market Value: The value a property could sell for in normal market conditions.
Foreclosure: When a property owner misses payments, the lender performs this action to recover the rest of the loan. This type of property is generally offered for sale at a lower price because many factors about the property, including its condition, are unknown.
Inspection: This could be for anything related to the suitability of a property for a buyer. This could include, but is not limited to, inspecting the roof, school zones, electrical, availability of utilities, etc.
Legal Description: The description of the property in legal terms as determined by an attorney or surveyor. This could be described as the model number, serial number, etc., only it is not that simple. It can be rather complex depending on the property.
Legal Ownership: The specific person(s) or entity(s) that own a property, determined after a review of the legal documents that have been recorded in the local parish clerk of court’s office.
Listing Agent: The seller’s real estate agent.
Listed Price: The amount a property is listed for sale.
Lot: A tract of land.
Market Value: The value at which the property will currently sell; generally speaking, it’s the value a buyer is willing to pay and the amount the seller is willing to accept.
Mortgage: A loan given for the sale of real estate property.
Offer: A buyer makes an offer to purchase real estate in writing. An offer can be accepted, rejected, or countered by a seller. Also known as placing a bid in other industries.
Open House: A home for sale will be open for viewing at an advertised time. An open house is held for buyers looking for a home {or a REALTOR®}. Buyers can attend to view a home amongst other potential buyers.
Pending / Under Contract: An offer has been made by a buyer, and a seller has accepted. A purchase agreement has been signed and accepted, and a sale is pending.
Principal: The amount of money loaned to a buyer, not including the interest.
Preapproval: A letter from a lender stating the amount a buyer can afford when purchasing real estate.
Prequalification: A simple review and discussion between a buyer and a lender to assess the buyer’s current financial position.
Property Disclosure: A document filled out by a seller to state their knowledge (or lack of knowledge) regarding any defects associated with a property. A disclosure is available to a prospective buyer prior to an offer being made.
Purchase Agreement / Contract: A written document containing the terms that have been negotiated and agreed upon between a buyer and a seller regarding a real estate property.
Real Estate Agent: Licensed to sell real estate but may or not be a REALTOR®.
REALTOR®: A licensed real estate agent that is a member of the National Association of REALTORS® and complies with a strict code of ethics.
Real Estate Company: The brokerage company that the real estate agent works for.
Sale Price: The negotiated value of a property that will be the price paid at closing.
Seller’s Response: The seller may be willing to or refuse to remedy any deficiencies requested in writing by a buyer during the DDI period while under contract for sale.
Showing: A private showing scheduled by your REALTOR® for a buyer to view a home that is available for sale.
Title / Abstract: A review of the legal documents recorded in the Clerk of Courts office that shows all current and previous owners of a property and all those associated with it.
Let Us Lead You Home
Guidry & Company Real Estate is a Louisiana-based real estate company that has actively serviced the community since 1984. No matter where you are in your real estate journey, Guidry & Company can help guide you with the most knowledgeable, willing, and driven REALTORS®. For a free consultation, give us a call at (337) 984-4345.
