The ABCs of Real Estate
A glossary of Real Estate Terms. Learn how to "talk the talk" of Real Estate before you buy or sell!
Whether you're a seasoned Seller brushing up or a first-time Buyer dipping your feet in the water, you've probably heard a ton of real estate jargon thrown around during your research and preparation. At Fine New England Living we are committed to cutting through the confusion of the real estate world for our clients. If you ever have any questions about real estate, please do not hesitate to get in touch with us. In the meantime, though, here's a helpful glossary of terms to assist you in your journey.
TERMS
Closing
The final step in the real estate buying and selling process when you sign the papers that execute the transaction. For Buyers, the closing allows them to officially take ownership of the property; for Sellers, the closing transfers the property and allows them to receive proceeds from the transaction. See also: "Settlement"
Closing Costs
The upfront fees charged in connection with transferring ownership of a property. These can include - but are not limited to - a loan origination fee, title examination, survey, appraisal, credit report, attorney’s fee, and prepaid items such as escrow deposits for taxes and insurance. Generally speaking, Closing Costs are between 3% - 5% of the home purchase price, but vary by region.
Closing Date
The date on which the Closing is set to occur. Usually agreed upon by the Buyer, Seller, and Lender during the Offer process, but can typically be amended with agreement by all parties.
Closing Disclosure (CD)
A government mandated form that lists all costs associated with the real estate or mortgage transaction. Aka "CD" or "HUD-1 Settlement Statement"
Cloud on Title
An outstanding lien, defect, or encumbrance on a Title which prevents Clear Title (see above). Some examples of Clouds on Title include filing errors, mechanic’s liens, encroachments, tax liens, or unknown heirs.
Common Areas
Portions of a building, land, or improvements and amenities which are not owned by a single resident. Some examples include hallways, elevators, or lobbies; or amenities such as pools, fitness centers, parks, or walking paths. Typically these areas will be owned and maintained by a CID or Homeowners’ Association (see below), and paid for by a monthly fee from all unit owners.
Common Interest Development (CID)
A type of development with common areas along with housing units or areas that are exclusively occupied by an individual owner. These can include condominiums, co-ops, planned developments, timeshares, golfing communities, high rises, retirement communities, etc. Also known as "CIDs"
Comparables
Similar properties in a nearby area, used to determine the value of a property or to assist buyers during negotiation.
Comparative Market Analysis (CMA)
An analysis of recent “comparables” (see above) primarily used by real estate agents as a starting point to determine a listing price for a home. One of the first steps in the home sale proces.
Condominium
Can refer to a multi-unit building, or a specific unit inside a multi-unit building. Each unit is owned and maintained by an individual, and typically has a percentage ownership of common areas which are used along with other owners. Typically unit owners are charged a monthly fee for maintenance, upkeep, taxes, and insurance for common areas, plus reserves for improvements.
Condominium Resale Documents Package
Documents that a Condominium Seller must compile and disclose to the Buyer during the real estate transaction. The documents must include specified information regarding rights, restrictions, and finances.
Contingency
A condition that must be met for a contract to be legally binding. Contingencies are typically written into an Offer by a Buyer to allow them to back out of buying a house if specified requirements are not met. Common contingencies include financing, inspection, or home sale contingencies.