When it comes to real estate there will be some vocabulary words and terms that you will hear along the way. Being familiar with them and having some knowledge of their meanings will help you be prepared during this process. I always want my clients to feel like they are as informed as they can when it comes to purchasing or selling their homes. Here is my mini glossary on the top 10 real estate terms to know when you are buying or selling in Boulder.
1.Buyer’s Agent VS Listing Agent
- Buyer’s Agent- Click here to read my blog on Buyer’s Agents
- Represents buyers in a real estate deal
- Helps you find property in your price range
- Find your properties close to amenities
- Help you determine a fair price for your offer
- Negotiate your offer
- Advise you throughout the transaction
- Listing Agent-
- Represents sellers in the sale of their home
- Helps you determine the fair market price of your home
- Markets your home to sell
- Holds open houses if desired
- Negotiates offers
- Guides you through the transaction to closing
2. Fixed-Rate VS. Adjustable Rate Mortgages
- The fixed interest rate for the entire term of the loan
- Mortgage carries a constant interest rate from beginning to end
- Adjustable-Rate Mortgages
- Can also be called variable-rate mortgage or tracker mortgage
- The loan that has an interest rate that can periodically adjust
- Adjusts based on the index that reflects the cost to the lender or borrowing credit markets
3. Pre-Approval Letter
A pre-approval letter provides a buyer with documentation that you have been approved to borrow from the bank. It shows both your Realtor and the sellers that you are prepared to buy a home. Your pre-approval letter will state your loan program, loan type, and loan amount. It can make a huge difference for homebuyers in having their offer accepted by the seller. Keep in mind a pre-approval letter doesn’t guarantee you a home loan. Want more information on pre-approval? Click here to read my blog post on it!
You probably would just assume listing refers to homes that are on the market in Boulder. The listing refers to the listing agreement that is made between a principal and an agent, regarding the marketing of the seller’s property.
5. Home Inspections
A home inspection is an examination of a home and it observes and reports the condition of a property. This can be done by the seller prior to marketing the home and is then called a pre-inspection. A buyer will most often have an inspection done soon after going under contract to buy. A qualified home inspector assesses the condition of the property including heating and cooling systems, plumbing, electrical, and water. They will do a general inspection and look for water, fire, structural or any other damage that could affect the value of the house. In addition to a general inspection, there are many other specialized inspections that a buyer can have done in addition to the general inspection, from sewer and radon, to mold, pests, and if recommended by the general inspector, an in-depth structural inspection performed by a structural engineer.
An appraisal is the estimated value of a home determined by an inspection of the property and its comparisons to recently sold homes in the area. Unless you are purchasing the property with cash, an appraisal will be required. An appraisal is also needed when refinancing a home. The appraisal amount will determine the amount a mortgage lender will let you borrow for the property.
Contingencies are actions or conditions that must be met for a real estate contract to become binding. It becomes part of a binding sales contract when both parties, the buyer and the seller, agree to the terms and sign the contract. Contingencies protect both the buyer and the seller. Click here to get more information on contingencies.
8. Offers & Contracts
- Offer- Click here if you need more advice on making offers.
- The conditional proposal made by a buyer or seller to buy or sell an asset
- The offer becomes legally binding upon the mutual execution of the contract (MEC)
- Submission of a bid to buy
- Contracts are between both parties buyer and seller for the purchase of the home
- Protects both buyers and sellers
- They have agreed to terms but the deal is still not finalized or completed
9. Closing Costs
Closing Costs are additional fees due at the closing of a real estate transaction. They can include origination fees, appraisal fees, title fees, surveys, taxed, and credit report charges. They must be disclosed by law to buyers and sellers and agreed upon before a real estate deal can be completed. Click here to read my blog post all about closing costs!
10. Title Insurance
Title insurance is the only insurance that protects you from things that happened in the past. It is a way to ensure that the property is transferred to the buyer correctly. It also helps with legal expenses in the event there is a defect in title to your property that is covered by your policy. This isn’t an additional monthly payment it is just a one-time payment due at the closing.
How Can I Help?
I hope my mini glossary on these real estate terms that will make the sale or purchase of your home go smoothly has been helpful to you. These 10 real estate terms to know when buying or selling in Boulder will make you feel like you’re a step ahead when you know what they are referring to.
If you are looking to buy a home in Boulder or the surrounding areas, please reach out to me! I am still keeping social distancing guidelines when it comes to showings for my listed properties as well as taking the utmost care when showing my buyers homes. If you have any questions or concerns, please feel free to reach out and contact me! I will continue to provide my clients with market updates so they can make informed decisions. If you are planning on buying or selling a home in the near future give me a call. I’d love to help you.
If you would you like more information about the Boulder area or the real estate market specifically, click here to download my current market report on the area or visit this link – http://elisabethnelsonrealestate.com/market-report-newsletter/
Luxury Home Specialist & New Home Specialist
Coldwell Banker Realty
(303) 916 5859