Real Estate Terms
Plain-language definitions so you always know exactly what's happening.
Real estate has its own language — and we believe you should always understand exactly what's being said. Here's a plain-language guide to the most common terms you'll encounter.
Active Adult Community
A residential community designed for adults 55+ that offers amenities and activities tailored to active lifestyles. May be age-restricted or age-targeted.
Age-Restricted Community
A community legally designated for residents 55 and older under the Housing for Older Persons Act (HOPA). At least 80% of units must be occupied by at least one person 55+.
Appraisal
A professional estimate of a property's market value conducted by a licensed appraiser, typically required by lenders before approving a mortgage.
As-Is Sale
A property sold in its current condition without the seller making repairs or improvements. Buyers typically still have the right to inspect.
Bridge Loan
Short-term financing that allows you to buy a new home before selling your current one, using your existing home's equity as collateral.
Buyer's Agent
A real estate agent who represents the buyer's interests in a transaction.
Closing Costs
Fees and expenses paid at the closing of a real estate transaction, including lender fees, title insurance, taxes, and prepaid items. Typically 2–5% of the loan amount.
Comparative Market Analysis (CMA)
A report prepared by a real estate agent comparing recent sales of similar properties to help determine a home's market value.
Contingency
A condition that must be met for a real estate contract to become binding. Common contingencies include home inspection, financing, and appraisal.
Deed
The legal document that transfers ownership of property from one party to another.
Earnest Money
A deposit made by the buyer to show good faith in a real estate transaction. Typically applied toward closing costs or returned if contingencies aren't met.
Equity
The difference between a home's market value and the remaining mortgage balance. This is your financial stake in the property.
Escrow
An account held by a neutral third party that holds funds or documents during a transaction until all conditions are met.
HOA (Homeowners Association)
An organization that manages a community's shared spaces and enforces community rules. Members pay dues that fund maintenance and amenities.
Listing Agreement
A contract between a seller and a real estate agent authorizing the agent to market and sell the property.
MLS (Multiple Listing Service)
A shared database used by real estate agents to share property listings with each other and buyers.
Offer
A formal proposal to purchase a property at a specified price and terms, which becomes a contract when accepted by the seller.
Pre-Approval
A lender's written commitment to provide a mortgage up to a specified amount, based on a review of the borrower's finances.
Title
Legal documentation of a property's ownership history. A clear title means no disputes or claims exist against the property.
Title Insurance
Insurance that protects against financial loss from defects in a property's title. Required by most lenders and strongly recommended for buyers.
Have a term you don't see here? Just ask us.
ASK A QUESTION