Appraisal – An appraisal is an estimate of a property’s market value conducted by a licensed appraiser. Lenders require appraisals to ensure the property is worth at least the amount of the mortgage loan.

Assessed Value – The assessed value is the value placed on a property by the local tax assessor’s office for purposes of calculating property taxes. It may differ from appraised or market value.

Deed – A deed is a legal document that transfers ownership of real estate from the seller to the buyer. It contains information about the transaction and provides a guarantee of clear title.

Down Payment – A down payment is the amount a buyer pays upfront towards the purchase of a home. It is usually expressed as a percentage of the total purchase price.

Mortgage Down Payment – A mortgage down payment is the portion paid upfront when obtaining a mortgage loan to purchase a property. Common down payment amounts are 20% or 10% of the home’s value.

Down Payment Assistance Programs – Down payment assistance programs provide qualifying buyers with grants or loans to cover all or part of a home’s down payment. These programs make homeownership more accessible.

Equity – Equity is the portion of a home’s value that the owner has full ownership rights to. It’s calculated by subtracting the outstanding mortgage balance from the property’s market value.

Escrow – Escrow refers to the holding of documents and money during the time a real estate transaction is underway. It helps facilitate a smooth closing when the buyer and seller each deliver payments and paperwork to a neutral third party until all terms are met.

Foreclosure – Foreclosure is the legal process by which a lender seizes a property after the homeowner defaults on mortgage payments. The property is then sold to recover the unpaid debt.

FSBO (For Sale by Owner) – FSBO stands for “For Sale by Owner” and refers to a property that is being sold directly by the homeowner, without listing with a real estate agent. Selling FSBO can save on agent commissions, but may be more challenging for those unfamiliar with pricing, marketing, paperwork, and negotiations.

MLS (Multiple Listing Service) – A multiple listing service (MLS) is a database of properties listed for sale by real estate brokers who are members of the local MLS system. Agents use this service to list clients’ homes and search for homes on their clients’ behalf.

Mortgage – A mortgage is a loan used to finance the purchase of real estate. The property serves as collateral that the lender can seize if the borrower defaults on payments.

Fixed-Rate Mortgage – A fixed-rate mortgage keeps the same interest rate for the entire loan term. The monthly payment amount stays the same over the life of the loan.

Adjustable-Rate Mortgage – An adjustable-rate mortgage (ARM) has an interest rate that periodically changes based on an underlying index rate. Monthly payments can go up or down accordingly.

Property Taxes – Property taxes are taxes assessed locally on real estate owners based on the property’s value. They help fund services like public schools, police, infrastructure, etc.

Real Estate Agent vs. Broker – A real estate agent is licensed by the state to represent clients in real estate transactions. They are overseen by a managing real estate broker. An agent’s primary role is to help buyers and sellers navigate transactions.

Title Search – A title search examines the property’s title history to determine if there are any defects that could prevent a clean transfer of ownership. Title issues like liens or unpaid taxes must be resolved before closing.

Making an Offer – Once a buyer finds a home they want to purchase, their real estate agent will draw up a purchase offer contract to submit to the seller. This will include their proposed price and any special contingencies.

Home Inspections – After an offer is accepted, the buyer will hire inspectors to thoroughly evaluate the home’s condition. They may request repairs or credits from the seller based on inspection findings.

Appraisal and Financing Contingencies – Most offers include an appraisal contingency allowing the buyer to back out if the home doesn’t appraise for the agreed purchase price. Financing contingencies give the buyer an out if they fail to secure a mortgage loan.

Closing Costs – In addition to the purchase price, buyers and sellers have to pay closing costs like lender origination fees, title insurance, recording fees, taxes, commissions, etc. Closing costs are typically 2-5% of the home price.

Closing and Possession – During closing, the deed is recorded, money changes hands, documents are signed, and keys are handed over. This is when ownership officially transfers and the buyer takes possession of the home.