There are so many real estate terms that surface during the buying and selling processes…it’s enough to make your head spin! (This is one of the reasons why it pays to employ the services of a licensed Realtor– read more about that in our previous post on the topic!) We thought we’d take a few terms at a time (starting with “A” of course) and give simple explanations for each, courtesy of National Association of Realtors (NAR) Real Estate Glossary. For the full list of the terms and definitions, click here!
Adjustable rate mortgage (ARM): A type of mortgage loan whose interest rate is tied to an economic index, which fluctuates with the market. Typical ARM periods are one, three, five, and seven years.
Application fees: Fees that mortgage companies charge buyers at the time of written application for a loan; for example, fees for running credit reports of borrowers, property appraisal fees, and lender-specific fees.
Back-up offer: When an offer is accepted contingent on the fall through or voiding of an accepted first offer on a property.
Buyer agent: The agent who shows the buyer’s property, negotiates the contract or offer for the buyer, and works with the buyer to close the transaction.
Closing: The end of a transaction process where the deed is delivered, documents are signed, and funds are dispersed.