Buyer's Information

• Abstract of Title: A summary of the public records relating to the ownership of a particular piece of land. It represents a short legal history of an individual piece of property, and traces the ownership of that property from the time of the first recorded transfer to present.
• Acceptance: Consent to an offer to enter into contract.
• Adjustable-rate mortgage (ARM): A mortgage that allows the interest rate to be changed periodically.
• Agency: A legal relationship in which an owner-principal engages a broker-agent in the sale of property or a buyer-principal engages a broker-agent in the purchase of property.
• American Society of Home Inspectors (ASHI): A professional trade association that provides training and education in home inspections. Members must meet qualification requirements to join.
• Amortization: The gradual repayment of a mortgage by periodic installments.
• Annual percentage rate (APR): The total finance charge (interest, loan fees, points) expressed as a percentage of the mortgage amount.
• Appraisal: An evaluation of a piece of property to determine its value.
• Appreciation: Increase in value due to any cause.
• Asbestos: A mineral fiber used in some building materials such as flooring, siding, insulation and roofing. It is presently banned for most uses in real property.
• Assessed value: The valuation placed on property by a public tax assessor as the basis of property taxes.
• Assumption of mortgage: An agreement whereby the buyer assumes responsibility for a mortgage owed by the seller.
• Balloon mortgage: A mortgage where the amount financed is not fully amortized over the period of the loan. When the loan becomes due, a large sum or “balloon” payment is required to satisfy the mortgage.
• Bridge loan: A short-term mortgage made until a longer-term loan can be made; it’s sometimes used when a person needs money to build or purchase a home before the present one has been sold.
• Broker: A person licensed by a state real estate commission to act independently in conducting a real estate brokerage business. Although requirements vary from state to state, an individual must usually have at least one year of experience in the industry and pass an examination to earn a broker’s license.
• Building codes: State and local laws that regulate the construction of new property and the rehabilitation of existing property.