Learning the jargon of the real estate industry is the most empowering step that buyers can take in the purchasing process. The best Irvine real estate agents will explain these terms as they’re introduced so that you’re always making wholly informed purchasing decisions. The ten terms that follow are guaranteed to pop up at one time or another during your endeavor to find and secure your dream home.
An appraisal is performed by a qualified appraiser and is a written report that details the estimated value of a home for sale in Irvine, CA. Appraisals are used to determine property taxes and are also required by lenders. These analyses are typically performed after sellers have accepted offers from prospective buyers.
Appreciation represents all increases in property values that occur as the result of changing market conditions, owner investments in sweat equity, and other factors.
Depreciation is the opposite of appreciation. This represents all property value losses that occur due to changes in market conditions, property damages, and other factors.
4. Mortgage Broker
A mortgage broker is a professional who collects fees or commissions for connecting prospective borrowers with lending institutions and funding products that fit their goals and needs.
5. Private Mortgage Advisor
Rather than promoting specific funding products or lending institutions, advisors work directly for consumers. Instead of collecting commissions when funding products are successfully promoted, these professionals charge consumers upfront fees. Compared to brokers, advisors provide larger selections of funding options and offer a much more expansive array of professional services.
6. Closing Costs
Closing costs are a collection of expenses beyond the actual costs of a property that buyers and sellers must pay in order to transfer ownership. These can include attorney’s fees, taxes, monies placed in escrow, origination fees, survey costs and title company insurance among other things.
A loan pre-approval means that a borrower has undergone a thorough credit review and lenders have agreed to extend a specific amount of money following the completion of this review. A pre-approval should not be confused with pre-qualification as pre-qualification is performed in a matter of minutes, does not entail a review of the borrower’s finances, and in no way guarantees funding.
Comparables are similar or comparable properties that have recently sold and that can be reviewed by either sellers or buyers to establish reasonable offers or accurate sales prices. These homes should be in the same neighborhood, similar in size and have similar features and amenities. Moderate price adjustments can also be made for any minor differences that exist between target homes and comparable homes.
Contingencies are conditions that must be met before a contract goes into effect. For instance, buyers may have contingencies that require the provision of acceptable home inspection reports before they become financially responsible for backing their offers up.
10. Earnest Money Deposit
An earnest money deposit is a deposit that a prospective buyer makes to show that he or she is serious about buying the property in question.
Aside from brushing up on common terms, working with a friendly and experienced real estate agent will help you feel informed and at ease during the whole process. For more information on houses for sale in Irvine or to schedule an appointment with an agent, reach out to us at (714) 454-6304 today.