Real Estate Glossary
Comprehensive dictionary of real estate terms, mortgage terminology, and home buying definitions.
A
Amortization
The process of paying off a loan over time through regular payments that include both principal and interest.
Appraisal
A professional assessment of a property's market value, typically required by lenders before approving a mortgage.
C
Closing Costs
Fees and expenses paid at the closing of a real estate transaction, typically 2-5% of the loan amount.
D
Debt-to-Income Ratio (DTI)
A measure comparing your monthly debt payments to your gross monthly income, used by lenders to assess affordability.
Down Payment
The initial payment made when purchasing a home, typically expressed as a percentage of the purchase price.
E
Earnest Money
A deposit made to demonstrate serious intent to purchase a property, typically held in escrow until closing.
Equity
The difference between your home's market value and the amount you owe on your mortgage.
Escrow
A third-party account that holds funds or documents until specific conditions are met in a transaction.
F
FHA Loan
A mortgage insured by the Federal Housing Administration, popular with first-time buyers due to lower down payment requirements.
Fixed-Rate Mortgage
A mortgage with an interest rate that remains constant throughout the entire loan term.
H
Home Inspection
A professional examination of a property's condition, including structure, systems, and components.
Homeowners Insurance
Insurance that protects your home and belongings against damage, theft, and liability.
I
Interest Rate
The percentage of the loan amount charged by the lender for borrowing money.
M
Mortgage
A loan used to purchase real estate, secured by the property itself.
P
PMI (Private Mortgage Insurance)
Insurance required when putting less than 20% down on a conventional loan, protecting the lender if you default.
Pre-Approval
A lender's conditional commitment to lend you a specific amount, based on verified financial information.
Principal
The original amount borrowed on a mortgage, not including interest.
Property Tax
Annual tax assessed by local government based on the value of real estate.
T
Title Insurance
Insurance that protects against defects in the title or ownership of a property.
V
VA Loan
A mortgage program for eligible veterans and military members, offering 0% down payment and no PMI.