Whether you are buying or selling a home, you may hear some confusing lingo in the real estate industry. While it may take time to get used to, adding these words to your vocabulary can help you navigate the market. The following are some key terms that can be useful as you attend open houses, make financial plans, list your property, or make offers.
5 Essential Real Estate Terms to Know
When purchasing a home, it’s important to keep your finances organized. An escrow can help you do so. This term refers to an account that your lender sets up for you when you buy a home. You will use this account to pay monthly expenses like homeowners insurance and property taxes.
An appraisal is an evaluation of a home’s value. During this process, a licensed appraiser will consider a variety of factors and compare the home to others in the area. They will then estimate an accurate value. When you are buying a home, an appraisal can help you apply for the right mortgage. It can also help home sellers price their houses according to market value.
You have likely heard this term while discussing loans and payments. Home equity is the difference between your home’s value and the amount you owe on the house. You will build equity as you make payments on your house, thus building your own wealth. Equity can also change as the local market fluctuates, so be sure to tune into these adjustments.
When you present a set of contingencies, you are listing out the conditions that the seller must meet before you make an offer. For example, you might list that the seller must complete a home appraisal and inspection before you put in a final offer. While contingencies may be more flexible in a seller’s market, they can also protect buyers from entering an agreement hastily.
A real estate broker and agent are not the same. Brokers go through additional training and licensing requirements to earn this title. They may work on their own or hire agents, but requirements for brokers vary by state. You may also work with a mortgage broker at some point. These professionals can process your mortgage and place it with a bank or other party to fund it.
When buying or selling a home, you need a real estate team with local knowledge and years of expertise. This is why individuals and families in the Minneapolis area trust EXIT Realty Nexus. Located in Coon Rapids, MN, these real estate agents can list your home, set up showings, and help you effectively negotiate. They can also help you find the right loan to fit your needs. To view a list of available properties, visit them online today. You can also call (763) 548-1400 to set up a meeting with an agent.