Exclusive Buyer Representation
Adjustable Rate Mortgage (ARM)... A mortgage whose rate of interest is set for a period of time, and then becomes open for changes according to a predetermined financial index. There is generally a maximum amount that the rate may increase both in a year's time and for the life of the loan.
Agreement to Purchase Contract... The contract with which an offer is made to purchase real property.
Amortization... Equal and periodic payments of principal and interest over a specific term to satisfy a mortgage loan.
Assumption of Mortgage... Assumption by a purchaser of the primary liability for payment of an existing mortgage. The seller remains secondarily liable unless specifically released by the lender.
Balloon Mortgage... A mortgage with periodic payments of principal and interest that do not pay the note in full at the end of the term. A lump sum to satisfy the full amount of the loan is due at the term's end.
Certificate of Title Opinion... A report, based on a title examination by an attorney which involves searching the Chain of Title (past ownership of the property) to ensure that no clouds appear on that title (problems with past conveyances of the property).
Closing... Also called the Settlement. The consummation of a real estate transaction in which all the documents are executed and the sale is completed.
Closing Costs... Expenses incurred in the purchase and sale of real property, such as loan fees, legal fees, title insurance, etc..
Closing Statement... A financial disclosure of funds expected and received at the closing.
Comparables... Properties which have sold and are included in a Comparable Market Analysis which are of similar location, size, construction, and condition as the home to be purchased.
Comparable Market Analysis (CMA)... An investigation into comparable homes sold in the vicinity of the home to be purchased, which will prove the value of the home. This process is used by the real estate agent to reach a Fair Market Value of the home for the presentation of the Agreement to Purchase Contract, and by the appraiser, verifying the appraised value of the home.
Conventional Loan... A mortgage that is not insured under a government program.
Discount Points... Also referred to as 'Points'. A percentage of the loan amount that a lender requires to make a mortgage loan. Each point is 1% of the loan amount and is a one time charge, collected at closing, and passed on to an investor to increase the yield on the mortgage loan. Generally the interest rate is lowered with each point that is charged.
Earnest Money... A deposit of money made by a buyer at the time of making an offer to demonstrate the earnest intent to purchase. Also called binder, good faith deposit, or escrow deposit.
Easement... A right of one to access and/or use a portion of property owned by another.
Encroachment... A trespass on the land of another as a result of an intrusion by some structure or other object.
Encumbrance... A claim, lien, charge, or liability attached to and binding upon real property.
Fair Market Value... A price for property agreed upon between buyer and seller in a competitive market with neither party being under undue pressure.
Fixed Mortgage... A predictable monthly payment protected from interest rate increases, 'fixed' for the length of the term, usually 15 or 30 years..
Graduated Payment Mortgage (GPM)... A mortgage in which monthly payments start low and increase over a specific period of time and then level off.
Homeowner's Policy... An insurance policy for the home to cover a variety of hazards, protecting the homeowner, and the interests of the mortgage lender.
Homeowner's Warranty (HOW)... An insurance policy protecting the homeowner against loss caused by defects in a dwelling for a specific period of time immediately after the sale of the home.
Loan-to-Value-Ratio... The relationship between the amount of the mortgage loan and it's appraised value.
Mortgage Insurance Premium (MIP)... The consideration paid for mortgage insurance either to FHA or a private mortgage insurance company (PMI).
Origination Fee... A service charge made by a lending institution for making a mortgage loan.
Prepaid Items... Charges that are paid "in advance" at the closing of a loan. Example: property taxes, insurance premiums, interest, etc..
Prepayment Penalty... A financial penalty imposed on a borrower for paying a mortgage prior to the expiration of the full mortgage term.
Private Mortgage Insurance (PMI)... A form of insurance coverage required in high loan-to-value ratio conventional loans to protect the lender in case of borrower default in loan payment.
Specific Performance... An instruction of a court requiring a defaulting party to a contract to buy and sell real property to specifically perform his/her obligations under the contract.
Title... The documentation which is evidence of the right to possess property.
Title Insurance... A policy protecting the insured from financial loss in the case of a defect, or cloud on the title.
Title Search... An examination of public records regarding ownership to real property.
MAKE YOUR FIRST CALL TO THE BUYER'S REALTY!!
The Buyer's Realty
Shelly F. Deshotels
337-261-9090 / Fax 337-235-7999