There’s a lot real estate talk these days. Whether you are listening to a news story, browsing an article or reading a blog like this one you probably encounter a lot of industry terminology. Do you feel like you know what these sources are really talking about?
Well enough of just “talk”. Here are five need-to-know, frequently used real estate terms that everyone should know.
Short Sale- the sale of real estate in which the sale proceeds fall short of the balance owed on the property’s loan.
- Occurs when a borrower is behind in payments and cannot pay the mortgage on the property, but the lien holder(s) agree to allow the owner to sell the property at a moderate loss in order to avoid foreclosure and proceeds of the sale go directly to the lender.
- A short sale “selling amount” is less that the outstanding balance of the loan
Shadow inventory- the number of homes that are in some stage of foreclosure, but have not yet reached the markets.
- Some experts consider shadow inventory as the number of distressed properties not yet listed, but seriously delinquent in foreclosure and owned by lenders
Private Mortgage Insurance (PMI)- insurance requirement on most conventional loans with less than a 20% down payment
- Payments for PMI are included in your mortgage payment and protect the lender should you default on the loan.
- On Federal Housing Administration Loans, you pay a Mortgage Insurance Premium (MIP), which accomplishes the same purpose
Real Estate Owned (REO) Property- properties owned by a lender after an unsuccessful sale at a foreclosure auction
- REO property lenders are typically a bank, government agency or government loan insurer
Contingencies- Conditions or safety values written into real estate offers and contracts to prevent a buyer from being forced to buy a house that is unsatisfactory.
- Examples of contingencies are: Title Insurance, Title Review, Due Diligence Review, Inspection, Appraisal Loan Conditions and Walk-Throughs
- NOTE: these are specific to transactions completed using a Colorado real estate contract to buy and sell real estate and therefore may be different in other states
Whether you are in the process of buying or selling a home or are just interested in current happenings take your real estate knowledge to the next level and join the conversation!
If you are in the process of buying or selling your home let me share my knowledge with you and ensure that you get the results you want.
-Courtney Ranson Licensed in the State of Colorado
SEARCH HOMES FOR SALE – DENVER WASH PARK - BY NEIGHBORHOOD
SEARCH HOMES IN OTHER NEIGHBORHOODS