Buying and Selling Terms to Know

BHHS Pro believes in the strength of transparency. We know that potential homebuyers dive into their search with varying knowledge of the home buying process. It can be both intimidating yet beneficial to work with an agent who has many years of professional experience. The good news is we are here to spare you the burden of intimidation.

We have combined a list of common terminology that you may be exposed to in your home buying or selling process. Knowing the language your agent speaks over the phone will save time and potentially secure your dream home before someone else beats you to it.

Multiple Listing Service (MLS) is a service used by realtors to market property to other realtors. This service is an advantage to working with real estate professionals because you have access to search all homes currently on the market.

Title is a legal document that proves the buyer owns the property.

An appraisal is a service provided by a third party that views a house and determines it's market value.  

Market Price is the amount the seller is willing to accept and the buyer is willing to purchase a home for.

Market Value is how much your house could sell for under the current conditions of the market, the features of your home and what homes around you have sold for.

A buyer’s market is a great time to buy a home because the market value of homes is low. Although you can pay a lower price for a new home, the market value of your home is also low.

A seller’s market is a great time to sell your home because your home’s market value is high. However, If you’re buying a house in a seller’s market you’re paying a higher market value on the home.

Pre-approval is the process of obtaining a loan. It’s typically contingent upon the buyer finding a house and ordering an appraisal.

Pre-qualification is discussed between a seller and lender. The lender will discuss the seller’s income and debt to determine buying power.

A high home equity means your home is worth more than you owe. If your home has high equity, the market value of your home increases. A common way to increase equity is by making small home improvements that make the market value of your home higher.

Earnest Money is a deposit the buyer makes to show that they’re serious about buying your home. The buyer’s broker will credit the deposit back at closing.

Contingent is the term used for conditions that need to be met in order for the buyer to be able to buy the home.

A counteroffer occurs when the buyer doesn’t accept an offer. The buyer comes back with different terms.

Closing costs are the transactional fees charged during the purchase of the home.

A home inspection is a non recurring closing cost that’s paid so a buyer can purchase a property and get a loan. A third party inspects the home to evaluate the condition of the property. The third party looks for life threatening and major mechanical issues.

Closing mean all parties have come together to consummate the purchase of a property after every condition has been met. During this final step in your process, you will solidify the purchase of the home.

Whether your a first-time homebuyer or a frequent seller, your new knowledge of the home buying and selling process is sure to impress your next real estate agent!