Plan on buying a home soon? Here are 10 words you should know during the process:
- OFFER: An agreement between buyer to seller to purchase real estate. Also known as a sales contract.
2. CLOSING COST: Fees paid at the end of a transaction either by the seller, buyer, both, or lender. They include the taxes, insurance and other lender fees.
3. HOME INSPECTION: Examination of the property’s condition. Usually performed by a qualified home inspector of your choice.
4. APPRAISAL: Property and or land valuation completed by an appraiser who determines the market value, typically paid by the buyer when in escrow to purchase.
5. SIGNING: Typically occurs when you will be signing your loan documents for the home purchase. Scheduled by your lender near the end of the escrow period.
6. CONTINGENT: Occurring or existing only if (certain circumstances) are the case. For example your offer to purchase is valid if the appraisal, home inspection, and mortgage approval is approved.
7. EARNEST MONEY DEPOSIT: An upfront deposit made to the seller showing the buyer’s good faith in a transaction. Typically held in an escrow account until the close of escrow. Initial deposit can be returned to the buyer if no contingencies have been completed.
8. TITLE: A bundle of rights in a piece of property. The title company will provide you with the preliminary title to review before accepting the property.
9. INSURANCE: Choose your home owners insurance and provide the information to your lender. Gather 3 or more quotes before choosing.
10. RECORDING: The day after signing your final loan documents, the loan will fund and the ownership of the property will be transferred to the buyer. This is the day you will receive your keys!