Buying a home is exciting and fun. It means a step forward in your life with new memories. Oftentimes, it seems like everyone assumes what you should know when it comes to purchasing a home. But what if you don’t? Real estate is a learning game for everyone involved. We’ve decided to do a list of commonly used terms you will hear throughout the purchasing process.
Buyer’s Agent: The real estate agent that represents the buyer in the transaction.
Pre-approval Letter: Recommended when applying for a mortgage or viewing homes. It is an estimate of how much a bank will lend you to purchase a home or property.
Closing Costs: Fees paid at the end of the transaction by the seller, the buyer, or both. Closing costs will include taxes, lender expenses, and insurance.
Home inspection: As simple as it sounds. An inspection of the property or home’s condition. The buyer is responsible for hiring an inspector.
Disclosures: Disclosures include information that sellers must provide to the prospective buyer. The disclosures list all known current or past issues that the buyer would want to know when purchasing the home. It is important that a buyer read through all disclosures and hire a reputable home inspection to ensure the home is really in the condition the seller says it is.
Escrow: A deal moves into escrow once both parties (buyer and seller) have signed a contract on a property. An escrow officer (typically the title company or an attorney) acts as a neutral party to make sure each side completes what has been agreed upon in the contract within a timely manner. When the escrow is closed, the home is officially sold.
Deed: A written, legal document that transfers the property from one person or entity to another during a sale. Deeds are kept at the courthouse or local assessor’s office.
Title: Not the same as the deed. A title is a record of ownership and can be held by one or more people. You can only transfer your portion of land when you hold a percentage of the title.
Next week we’ll provide the second round of must-know buyer terms. Stay tuned!
“An investment in knowledge pays the best interest.” – Benjamin Franklin