All this real estate terminology can be terribly confusing. Fret not, keep this dictionary tab open in your browser and master your real estate lingo.
Pre-approval letter:
A document that outlines the preliminary results of an evaluation into a potential borrower’s finances. Determined by a borrower’s income, cash reserves, creditworthiness, and more, the pre-approval letter determines the amount you can offer to purchase a house.
Given today’s fast-paced market, we encourage buyers to complete the pre-approval process before beginning their home search (and save some potential heartbreak). Evolve Realty has a team of talented, attentive, diligent, and personable mortgage brokers who can help you along the entire financing process.
Offer to purchase:
A legally binding document that outlines the terms under which you would like to purchase a property. These terms can include the price you’re offering for the property, the dates for key deadlines, non-real property you would like included in the purchase, and more.
Offers are accompanied by a deposit that can be non-refundable (depending on contingencies outlined in your offer) should you decide you no longer want to purchase that specific property while having a fully executed offer.
Don’t worry if this feels like a lot—it is! Your Evolve agent will help you explore numerous options and make recommendations for various terms to help you make the best-informed decision and offer possible. Your Evolve agent will write up offers and represent your best interests when engaging with other agents.
Contingency:
In real estate contracts, a contingency outlines something that must occur in order for other steps in the contract to be fulfilled. If a contingency is not met throughout the process, the buyer may have the ability to leave the deal without penalty. Common contingencies include:
- Mortgage contingency: states that the buyer must obtain a mortgage for a certain value within a certain amount of time.
- Inspection contingency: grants the buyer the right to conduct a general home inspection and various smaller, more specific inspections for mold, radon, or lead. Should the results of the inspections dramatically impact the perception of the house, the buyer may exit the deal without penalty.
- Appraisal contingency: ensures that buyers do not pay more for a property than a professional appraiser believes the house is worth. Appraisals are often a necessary part of the financing process.
Want to learn more about the process of buying and selling real estate?
Give us a call at (508)545-1323
