TERMS IN REAL ESTATE

Appraisal: An estimate of value of property resulting from analysis of facts about the property; an opinion of value.  

Annual Percentage Rate (APR): The borrower's costs of the loan term expressed as a rate.   Beneficiary: The recipient of benefits, often from a deed of trust; usually the lender. 

Buyer Agent: A key role of the buyer's agent or broker is to work with the buyer to locate a suitable property and negotiate a successful home purchase.  

Closing Disclosure: Closing disclosure form designed to provide disclosures that will be helpful to borrowers in understanding all of the costs of the transaction. This form will be given to the consumer three (3) business days before closing.  

Close of Escrow: Generally the date the buyer becomes the legal owner and title insurance becomes effective. 

Comparable Sales: Sales that have similar characteristics as the subject property, used for analysis in the appraisal. Commonly called "comps."  

Consummation: Occurs when the borrower becomes contractually obligated to the creditor on the loan, not, for example, when the borrower becomes contractually obligated to a seller on a real estate transaction. The point in time when a borrower becomes contractually obligated to the creditor on the loan depends on applicable State Law. Consummation is not the same as close of escrow or settlement. 

Deed of Trust: An instrument used in many states in place of a mortgage. Deed Restrictions: Limitations in the deed to a parcel of real property that dictate certain uses that may or may not be made of the real property. 

Disbursement Date: The date the amounts are to be disbursed to a buyer and seller in a purchase transaction or the date funds are to be paid to the borrower or a third party in a transaction that is not a purchase transaction. 

Earnest Money Deposit: Down payment made by purchaser of real property as evidence of good faith; a deposit or partial payment. 

Easement: A right, privilege or interest limited to a specific purpose that one party has in the land of another. 

Endorsement: As to a title insurance policy, a rider or attachment forming a part of the insurance policy expanding or limiting coverage. 

Escrow Officer: An escrow leads the facilitation of your escrow, including escrow instructions preparation, document preparation, funds disbursement and more. 

Hazard Insurance: Real estate insurance protecting against fire, some natural causes, vandalism etc., depending upon the policy. Buyer often adds liability insurance and extended coverage for personal property.  

Impounds: A trust type of account established by lenders for the accumulation of borrower's funds to meet periodic payments of taxes, mortgage insurance premiums and/or future insurance policy premiums, required to protect their security.  

Legal Description: A description of land recognized by law, based on government surveys, spelling out the exact boundaries of the entire parcel of land. It should so thoroughly identify a parcel of land that it can not be confused with any other. 

Lien: A form of encumbrance that usually makes a specific parcel of real property the security for the payment of a debt or discharge of an obligation. For example, judgments, taxes, mortgages, deeds of trust. 

Listing Agent: A key role of the listing agent or broker is to form a legal relationship with the homeowners with the homeowner to sell the property and place the property in the Multiple Listing Service. 

Loan Estimate (LE): Form designed to provide disclosures that will be helpful to borrowers in understanding the key features, costs and risks of the mortgage loan for which they are applying. Initial disclosure to be given to the borrower three (3) business days after application.  

Mortgage: The instrument by which real property is pledged as a security for repayment of a loan. 

PITI: A payment that includes Principal, Interest, Tax and Insurance.  

Realtor®: A Realtor®  is a licensed real estate agent and a member of the National Association of Realtors® , a real estate trade association. Realtors® also belong to their state and local Association of Realtors®.  

Real Estate Agent: A real estate agent is licensed by the state to represent parties in the transfer of property. Every Realtor® is a real estate agent, but not every real estate agent has the professionals designation of a Realtor®.  

Recording: Filing documents affecting real property with the appropriate government agency as a matter of public record. 

Settlement Statement: Provides a complete breakdown of costs involved in a real estate transaction.

Title Company: These are the people who carry out the title search and examination, work with you to eliminate the title exceptions you are not willing to take subject to, and provide the policy of title insurance regarding title to the real estate property.