terms!

we like the national association of home builders website. we can't help it, we just do. so since we spend time looking to see what is new we also spend time looking at what can help you. we recently stumbled across a home buyers dictionary and decided to place some terms on here to help you out. maybe you already know some or all or maybe you don't know any, either way, we're here for you. want more info? check out www.nahb.org

Appraisal - An evaluation to determine what a piece of property would sell for in the marketplace.
Appreciation - The increase in the value of a property
Buydown - A subsidy (usually paid by a builder or developer) to reduce the monthly payments on a mortgage loan.
Cap - A limit to the amount an interest rate or a monthly payment can increase for an adjustable rate loan either during an adjustment period or over the life of the loan.
Certificate of Occupancy (CO) - A document from an official agency stating that the property meets the requirements of local codes, ordinances, and regulations.
Closing - A meeting to sign documents which transfer property from a seller to a buyer. (Also called settlement)
Closing Costs - Charges paid at settlement for obtaining a mortgage loan and transferring real estate title.
Conditions, Covenants, and Restrictions (CC and Rs) - The standards that define how a property may be used and the protections the developer has made for the benefit of all owners in a subdivision.
Credit Rating - A report ordered by a lender from a credit bureau to determine if the borrower is a good credit risk.
Density - The number of homes built on a particular acre of land. Allowable densities are usually determined by local jurisdictions.
Downpayment - The difference between the sales price and the mortgage amount on a home. The downpayment is usually paid at closing.
Earnest Money - A sum paid to the seller to show that a potential purchaser is serious about buying.
Equity - The difference between the value of a home and what is owed on it.
Escrow - The handling of funds or documents by a third party on behalf of the buyer and/or seller
Fixed Rate Mortgage - A mortgage whose interest rate remains constant over the life of the loan. The payments are not necessarily level.
Interest - The cost paid to a lender for the use of borrowed money
Mortgage Broker - A broker who represents numerous lenders and helps consumers find affordable mortgages; the broker charges a fee only if the consumer fins a loan.
Mortgage Commitment - A formal written communication by a lender, agreeing to make a mortgage loan on a specific property, specifying the loan amount, length of time and conditions.
Mortgage Company (Mortgage Banker) - A company that borrows money from a bank, lends it to consumers who want to buy homes, then sells the loans to investors.
Mortgagee - The lender who makes a mortgage loan.
Mortgage Loan - A contract in which the borrower’s property is pledged a s collateral and which can be repaid in installments over a long period. The mortgagor (buyer) promises to repay principal and interest, to keep the home insured, to pay all taxes, and to keep the property in good condition.
Mortgage Origination Fee - A charge by a lender for the work involved in preparing and servicing a mortgage application (usually 1 percent of the loan amount).
PITI - Principal, interest, taxes, and insurance (the 4 major components of monthly housing payments).
Point - A charge of 1 percent of the mortgage amount. Points are a one-time charge assessed by the lender at closing to increase the interest yield on a mortgage loan.
Principal - The amount borrowed in a loan, excluding interest and other charges
R-Value - The resistance of insulation material (including windows) to heat passing through it. The higher the number, the greater the insulating value.
Sales Contract - A contract between a buyer and seller which should explain, in detail, exactly what the purchase includes, what guarantees there are, when the buyer can move in, what the closing costs are, and what recourse the parties have if the contract is not fulfilled or if the buyer cannot get a mortgage commitment at the agreed-upon terms.
Title - Evidence (usually in the form of a certificate or deed) of a person’s legal right to ownership of a property.
Transfer Taxes - Taxes levied on the transfer of property or on real estate loans by state and/or local jurisdictions
Walk-Through - A final inspection of a home before settlement to search for problems that need to be corrected before ownership changes hands.
Warranty - A promise, either written or implied, that the material and workmanship of a product is defect-free or will meet a specified level of performance over a specified period of time. Written warranties on new homes are either backed by insurance companies or by the builders themselves.
Zoning - Regulations established by local governments regarding the location, height, and use for any given piece of property within a specific area.