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Real Estate Terms You Should Know

Get familiar with these commonly used terms in the real
estate industry.

If you are involved in buying or selling real estate. Or, just
for your general knowledge. There are numerous terms, commonly used jargon, in the real estate industry that make
up a peculiar language all its own, which would be beneficial
for you to learn.

This jargon isn’t difficult to master, but there is real danger of hearing and using words you don’t fully understand.

Following are some basic terms that are often misunderstood:

MLS—Multiple Listing Service
An organization that collects, compiles, and distributes information about properties listed for sale by its members,
who are real estate brokers. Membership isn’t open to the general public, although selected MLS data may be sold to
real estate listing websites. MLS’s can be local or regional. There is no “one” MLS covering the entire nation.

Principle, interest, taxes and insurance (PITI) are the four components of a monthly mortgage payment. Principal refers to the part of the monthly payment that reduces the remaining balance
of the mortgage. Interest is the fee charged for borrowing the money. Taxes and insurance refer
to the amounts that are paid into an escrow account each month for property taxes and mortgage
and hazard insurance.

Comparative Market Analysis. A CMA is a report that shows prices of properties that are
comparable to a subject property and that were recently sold, are currently on the market or
were on the market, but not sold within the listing period.

Closing Costs
The entire package of miscellaneous expenses paid by the buyer and seller when the
transaction closes. These costs include the brokerage commission, mortgage-related fees,
escrow or attorney’s charges, recording fees, title insurance, etc. Closing costs generally
are paid through escrow.

provision of an agreement that keeps the agreement from being fully legally binding until a
certain condition is met. One common example is a buyer’s contractual right to obtain
a professional home inspection before purchasing the home.

Title Insurance
An insurance policy that protects a lender’s or owner’s interest in real property from assorted
types of unexpected or fraudulent claims of ownership. It’s customary for the buyer to pay for the lender’s title insurance policy.


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