Real estate terms!

MLS (Multiple Listing Service)

A database where agents list and search for properties (includes listings for commercial properties, vacant land, and investment properties)

Listing

A property that’s for sale, represented by an agent.

Appraisal

Professional estimate of a property’s market value.

Closing

Final step in a real estate transaction when ownership transfers.

Commission

The fee paid to real estate agents for their services (usually a % of the sale price).

Pre-approval / Pre-qualification

Steps lenders use to tell buyers how much they can borrow.

Down Payment

The upfront cash a buyer pays (usually a % of purchase price).

Mortgage

Loan used to purchase a property.

Interest Rate

The cost of borrowing money, expressed as a %.

Escrow

A third-party account that holds money/documents until the deal is finalized.

Amortization

How a loan is paid off over time with regular payments.

Title

Legal ownership of a property.

Deed

The legal document transferring ownership.

Lien

A legal claim against property (e.g., unpaid taxes or mortgage).

Equity

The difference between what the property is worth and what is owed on it.

HOA (Homeowners Association)

An organization that manages shared property/community rules.

Comparables (Comps)

Similar properties used to estimate a property’s value.

Fair Market Value (FMV)

What a property would sell for under normal conditions.

Cap Rate

A measure of investment return for rental properties.

ROI (Return on Investment)

Profit compared to cost.

Cash Flow

Money left over after rental income minus expenses.

Offer / Counteroffer

Buyer’s proposal to purchase and seller’s response.

Contingency

A condition that must be met for the sale to go through (like inspection or financing).

Disclosure

Information the seller must legally share (e.g., property issues).

Earnest Money

A deposit showing the buyer’s serious intent to purchase.

Single-Family Home (SFH)

A standalone residential property for one household.

Multi-Family Property

A property with multiple units (duplex, triplex, apartment building).

Condominium (Condo)

Individual ownership of a unit within a larger building, with shared common areas.

Co-op (Cooperative)

Residents own shares in a corporation that owns the property, not the unit itself.

Tenancy in Common (TIC)

Two or more people owning property together with no right of survivorship.

Joint Tenancy

Shared ownership where if one owner dies, their share automatically passes to the other owners.

Broker

A licensed professional who manages agents and can run their own firm.

Agent / Salesperson

A licensed professional who represents buyers or sellers in real estate.

Dual Agency

When one agent represents both the buyer and seller (legal in some states, restricted in others).

Fiduciary Duty

An agent’s legal responsibility to act in the best interest of their client.

Easement

The right for someone else to use a portion of a property (e.g., utility lines, shared driveway).

Encroachment

When one property physically extends onto another (like a fence or garage crossing a property line).

Zoning

Local government rules about how land can be used (residential, commercial, mixed-use).

Adjustable-Rate Mortgage (ARM)

A mortgage with an interest rate that changes over time.

Fixed-Rate Mortgage

A mortgage with the same interest rate for the entire loan term.

Balloon Mortgage

A loan with small monthly payments and a large final payment.

Points

Fees paid to the lender at closing to reduce the interest rate.

Private Mortgage Insurance (PMI)

Insurance required if the buyer’s down payment is less than 20%.

1031 Exchange

A tax-deferred swap of investment properties under IRS rules.

Depreciation

A tax benefit allowing investors to deduct property value loss over time.

Inspection

Professional evaluation of a property’s condition before purchase.

Title Insurance

Protects against future claims on ownership of the property.

Survey

A professional measurement of property boundaries and land features.

Short Sale

When a property sells for less than what’s owed on the mortgage (with lender approval).

Foreclosure

Legal process where a lender takes ownership because the borrower defaulted on the loan.

REO (Real Estate Owned)

A property owned by a bank after foreclosure.