If you’re buying a home for the first time, you may hear more than a few terms that you have no frame of reference for. A grasp of real estate language is critical; knowing as many key real estate terms as possible going into your sale will be crucial in order to make the right decisions. This simple list of common terms will get you started:
Amortization – This is a means of paying off a mortgage that combines interest and principal for your payments, paying more interest at the beginning, and more principal at the end of a loan term.
CMA – aka Comparative Market Analysis, or ‘comps.’ Simply put – the average costs of similar homes in the area that were recently sold/currently on the market; a critical element of an accurate value assessment of your (potential) home.
Contingency – This clause in an agreement keeps things from being legally binding unless a certain condition is met. Typically, contingencies involve results of home inspections.
Equity – Equity describes the difference between a home’s market value and the unpaid balance of its mortgage. Equity also increases over the life of a loan. For example, if your home is worth $300,000, and you owe $150,000 still, the other $150,000 is your equity.
Stonebridge Mortgage Group can help you with your Reverse Mortgage, Real Estate Loan, and many other mortgage solutions. We serve the greater Portland area and are located in Gresham, Oregon. Call us today at 503.661.5580.
References: Four Seasons Sotheby’s International Realty