Real Estate Jargon

Real estate can come with a lot of unfamiliar terms, and understanding the language is an important part of feeling confident in the buying or selling process. Our Real Estate Jargon list is designed to break down common industry words and phrases into clear, easy-to-understand definitions. Whether you’re hearing terms like escrow, appraisal, or contingency for the first time or just need a quick refresher, this resource helps you navigate conversations and paperwork with greater clarity and peace of mind.

Our list from A-Z

• Amortization: The process of a loan being paid off in regular installments, which includes both principal and interest, over a set period. 
• ARM (Adjustable-Rate Mortgage): A mortgage with an interest rate that can change over time. 
• “As Is”:  Selling a home "as is" means the seller won't make repairs, selling the property in its current condition, but it doesn't exempt sellers from state disclosure laws, meaning they must still reveal known major defects (like foundation issues or hazardous materials) on the official Residential Real Estate Sales Disclosure form. While it streamlines sales by avoiding repair negotiations, buyers still typically perform inspections and may walk away if major problems arise
• Buyer's Market: A market where there are more available homes for sale than there are buyers, giving homebuyers more power to negotiate favorable terms, such as lower prices or seller concessions. 
• Closing: The final meeting where a home sale is legally completed, including signing documents and transferring ownership. 
• Closing Costs:  The fees and expenses paid at the end of a real estate transaction, in addition to the property’s price and down payment. Click here for a more detailed look at Closing Costs.
• Collateral: The property being purchased is used as security for the loan. This is known as a secured loan.
• Commission:  A fee paid to agents for facilitating a property sale, calculated as a percentage of the final sale price.
• Comparables (Comps): Recently sold properties with similar features used to determine the value of a subject property. 

• CMA (Comparative Market Analysis):  A real estate tool used to estimate a property's current market value. It involves comparing the subject property to similar, recently sold properties in the same area (comps).
• (Seller) Concessions: Something one party gives up during negotiations, such as the seller agreeing to help pay for the buyer's closing costs.  Note:  Seller Concessions cannot be used for the down payment.
• Contingency: A condition in a purchase contract that must be satisfied before the sale can be completed, such as a successful home inspection,  loan approval, or the buyer’s current home selling.
• Conveyance: The act of transferring a title of real estate from one party to another.
• CC&Rs (Covenants, Conditions & Restrictions):  The legal rules that govern the use of a property within a community. These rules are enforced by a homeowners' association (HOA) or other managing entity and can include restrictions on things like fences, garbage cans, and parking, as well as requirements for homeowners to pay dues for upkeep.
• Days on Market (DOM): The total number of days a property has been listed for sale on the market. 
• Deed:  A legal document that transfers ownership of real property from one person (grantor) to another (grantee). 
• Down Payment:  A down payment is the upfront cash (a percentage of the home's price) you pay at closing to reduce your mortgage, with options varying from 0% (VA, USDA) to 3.5% (FHA) to 20% or more (conventional), with 20% avoiding Private Mortgage Insurance (PMI) and programs like IHCDA offering assistance for first-timers. 

• Due Diligence: The process where a buyer completes inspections and investigations before finalizing the purchase. 
• Earnest Money: A deposit a buyer makes when submitting an offer to purchase a property, which shows the buyer is serious.
• Equity: The difference between a property's market value and the amount still owed on the mortgage.
• Escrow: A temporary arrangement where a neutral third party holds documents and funds until all conditions of the sale are met. 
• Foreclosure: The legal process where a lender takes back a property from the owner because of the owner's failure to make mortgage payments.
• Handyman Special: A property that requires significant repairs and is often sold at a lower price. 
• Homeowners Association (HOA): A governing body in a community that enforces rules and manages common areas and fees. 
• Homeowners Insurance:  A type of property insurance in real estate that protects a homeowner's residence and its contents from damage or theft. It is a contract in which a homeowner pays regular premiums to an insurance company in exchange for financial protection against covered events.
• Home Warranty:  A service contract that covers the repair or replacement of major home systems (like HVAC and plumbing) and appliances (like refrigerators and ovens) due to normal wear and tear. It is different from homeowners insurance, which covers damage from events like fires or natural disasters. For a monthly or annual fee and a service call fee per visit, it can protect homeowners from unexpected costs for repairs or replacements.
• HVAC (Heating, Ventilation, and Air Conditioning):  It refers to the system that controls a building's indoor temperature, humidity, and air quality.
• Inspection:  A visual and limited examination of a property's physical condition, conducted to identify any existing or potential problems that could affect its safety, value, or livability. An independent inspector assesses major systems like the foundation, roof, electrical, plumbing, and HVAC, then provides a detailed report of their findings to help buyers and sellers make informed decisions before a real estate transaction.  
• Lien: A legal claim against a property for the satisfaction of a debt, such as a mortgage or a contractor's unpaid bill.
• Listing: An agreement between a property owner and a real estate broker to market and sell a property.

• MLS (Multiple Listing Service): A database that real estate agents use to share information about properties for sale. 
• Mortgage:  A loan used to purchase real estate, where the property itself serves as collateral for the loan. If the borrower, or mortgagor, fails to make payments, the lender, or mortgagee, can foreclose on the property to recover the debt. These loans are repaid over time through monthly installments that include both principal and interest.  Click here for a more detailed explanation of mortgages. 
• Property Taxes:  An annual fee levied by local governments, such as cities and counties, based on the value of a property. The funds are used to pay for local public services, including schools, roads, fire departments, and police. Property taxes are a key component of the overall cost of owning a home and can vary significantly depending on the property's value and location. 
• Repayment:  Mortgages are typically paid back in monthly installments over a set term, which can range from 8 to 30 years.  These payments usually include principal, interest, and often an amount for property taxes and homeowner’s insurance, which is held in an escrow account.
• Seller's Disclosure:  A document where a seller provides a written statement about the known condition of a property, including any material defects or issues that could affect its value or safety.
• Seller's Market: A market where there are more buyers than available homes, often leading to competitive bidding situations. 
• Seller’s Net Sheet:  A document that estimates the seller's net proceeds from a property sale after all expenses are deducted from the sale price.
• Survey:  A professional document that legally defines a property's boundaries and physical features.
• Title: The legal right of property ownership, as evidenced by a deed. 
• Title Insurance: A policy that protects against future claims or errors in the title history. 
• Title Company:  They act as a neutral third party to ensure a smooth and secure property transaction by verifying clear ownership, managing the closing process.  Most property transfers are done at a Title Company.

Still have questions? We’re always here to help translate the fine print and guide you every step of the way — because real estate should feel understandable, not overwhelming.