This is a professional judgement that is completed to place a quality value on any given property or estate that is on the market to be sold to potential buyers. The final determination of the property’s worth may not actually have any effect on its market value. This helps buyers, lenders, and sellers understand the security that may be offered on this property for a home loan.
These loans are received by the buyer on a short-term basis from the lender. These types of loans usually have higher interest rates than the long-term mortgage loans. These are usually only taken out for about two to three weeks when someone selling a home wants to buy a new one before the old one has been officially sold. This can also be referenced when a buyer or seller need a second subordinate loan in addition to their first.
Caveat emptor is a phrase that is originated from the Latin language and is roughly translated into English meaning “let the buyer beware.”
Although many states require the seller to tell potential buyers about any defects there may be with the property they’re selling, the final burden still lies with the buyer to make sure they are fully satisfied with the home they are trying to purchase. The buyer should take all the necessary steps and receive all the appropriate inspections to determine whether the home is right for them. All of these events should occur before the buyer legally closes on the home.
The homebuyer is able to make an offer to the seller with contingencies attached. These are requirements the seller must fulfill before the buyer is officially prepared to proceed with purchasing the home or property from the seller. The buyers can receive a refund of the earnest money deposit they gave if the seller is not able to fulfill the criteria established in the contingent offer. Potential contingencies may be that the buyer needs to sell their home first or the seller needs to have a specific inspection done on the home before the buyer will agreed to purchase the property.
This is an official agreement that occurs between the buyer and seller of a home or property. Within this contract is the buyer’s agreement to purchase the property at the price named by the seller. The entire list of terms and agreements associated with the buying and selling of the property are included in this contract. The official transfer of ownership occurs when the buyer pays the allotted amount of the seller gives over the property. This means closing is complete and the title rights are with the new owner.
The formal promise or agreement that is incorporated into every contract or deed. This specifies the conditions that must be met concerning any issues or defects that exist with the property. These stipulations are commonly included in the contract or deed because the covenant is usually presented in some form of written agreement.
The attorney designated by the buyer will commonly charge a fee for preparing the necessary transactional documents. These are all the appropriate legal documents both the buyer and seller need to sign in order to make the transaction official and legal.
This is a structure or feature of a home that overhangs onto someone else’s property. The structure or feature could also be a fence that is built over the line that legally separates the two properties. If such a structure exists, the owner of the encroachment can be asked to move it by the other property owner that it is affected. If they chose not to remove the structure, they could be subject to legal repercussions.
These are the home or property defects that are addressed by the buyer and the seller before the property is closed on. This can be in the form of a judgment, lien, easement, or any other restrictions that are currently placed on the property being sold. The buyer has a responsibility to make sure all the proper inspections are completed before they agree to purchase the property to make sure they are able to receive proper transfer of a clean title to their name.
These are very desirable loans for people who want to continuously pay the same amount of interest on the loan they are receiving from the lender. Some of these types of loans in California include the CalHFA FHA, CalPLUS FHA, CalHFA VA, CalHFA USDA, Cal-EEM + Grant Program, and NADL loans. A buyer who chooses this type of loan will pay the same amount of interest on it for the entire length of the loan term. This is usually during the time span of 15 to 30 years.
This is a type of insurance that the buyer usually discusses with their lender before the lender is willing to let them borrow the money to purchase their new home or property. The home or property is fully protected under this insurance from any kind of loss or damage. Lenders commonly want the insurance to cover the entire loan amount or at least 80% of the improvement value. The lender will choose the greater value and require the buyer to pay it throughout the duration of the loan.
These are all of these removable or easily movable items that the seller has agreed to allow the buyer to have with the overall purchase of the home or property. These items include personal belongings such as ceiling fans, air-conditioning units, lights, curtains, stoves, fixed cupboards, etc.
This is the full list of every item that is included in the purchase agreement. Every item listed in the inventory will be received by the buyer once escrow is closed. These items are usually the removable items that the seller isn’t going to take with them such as the furniture, furnishings, and other removable items that is considered unwanted by the seller.
A buyer will purchase a home or property in order to make money off the real estate they buy. They are investing the money they currently have in the hopes that they will earn an even larger sum of money as income. People who invest their money in real estate will usually purchase an average home, add some new furnishings as well as other modern renovations, and then sell the asset for a higher price than they originally bought it.
This is when two or more people have the legal rights to a home or property. They are considered to be in a joint tenancy when they have equal holdings. Additionally, the survivor of the property receives the interests of the person who died.
During closing the buyer can pay extra money in order to receive a decrease quote on their interest rate. This will allow the buyer to pay more cash upfront during the closing process so they have to pay less money each month for interest on the loan. If the lender choosing to use the “discount points”, one point usually equals about 1% of the total loan amount. When the lender offers the buyer points during closing, they are basically pushing the loan amount above the amount that is required for the original interest rate. This allows the buyer the opportunity to pay less interest throughout the entire life of the loan.
The Consumer Financial Protection Bureau wants to ensure that buyers complete extensive research before they decide which mortgage loan they want to receive. These forms allow the buyers to completely understand what the mortgage loans are going to cost so the buyer can choose a lender that is going to best suit their needs in both the short and long term. Most transactions require these forms to ensure the transaction is smooth and the buyer isn’t met with any unknown charges from the lender when they are about to officially close on their new home.
The subdivision restrictions that are included in the transaction documents addresses the specific amount the buyer must pay to the homeowner’s association for maintenance fees. These fees cover all costs that are necessary to keep the grounds and common areas aesthetically pleasing within the neighborhood. This is usually more common for buyers who live in condos or apartments, but this can also be the cause for homeowners who choose to live in more upscale neighborhoods.
A multiple listing service (MLS) is officially created by real estate brokers who gather any and all data they have about properties for sale into one database. The MLS is only accessible to brokers/agents and it gives them an opportunity to connect homebuyers and sellers who match really well based on the properties for sale contained in the provided listings. This extremely resourceful tool can be efficiently used by both buyers and sellers alike. Sellers are able to receive a lot of visibility because their home is being advertised to a large variety of people. Moreover, various agencies and brokerages provide buyers an easy way to search numerous listings all in one place. The MLS does not list homes that are classified as “For Sale by Owner” (FSBO).
This offer is the formal document used to purchase real estate. This document establishes the basic terms and conditions being proposed between the buyer and seller during any real estate transaction. Once the Offer is signed by the buyer and the seller and the contained contingencies are met, it then becomes a legally binding agreement.
Both the buyer and seller use this document to lay out the specific conditions that determine how the property is to be sold. Within this document, the seller states a particular price they would like to sell their home or property for. The buyer is then able to either fully agree to this price or agree to it based on certain contingencies that are also addressed in the purchase agreement and other legal documents that are exchanged during the transaction. This includes the contingency offer as well so all encumbrances or liens currently placed on the property must be resolved before the buyer officially purchases and gains legal ownership of the property.
This is the commonly used abbreviation that represents the various payments that a new homeowner is subject to when they purchase a new home or property. This abbreviation stands for principal, interest, taxes, and insurance. All of these features require the buyer to pay different amounts. Additionally, the buyer may not have to pay some of the features until the end of the loan term. This is especially true if they have an interest-only loan where the principal is only paid at the end of the loan term.
This is a written authorization that allows one person to act completely on behalf as another person. Some married couples enact a power of attorney when they get married so their spouse is able to make all legal decisions on their behalf.
The principal value is a specific amount of money that buyer must pay during the course of the loan term. This value is the exact amount of money the lender allowed the buyer to borrow when they were making the purchase for their new home or property. The buyer has to pay the lender back all of this money including interest by the end of the loan term or legal repercussions may be enforced on the delinquent buyer.
The transactional documents are established in the county records to make sure the new homeowner has legal rights to the title that was transferred when the property was closed. The county charges a fee to have these official records changed upon the transference of the property title to a new name.
Any restrictions that apply for the home or property specify what modifications can and cannot be made to the property by the new homeowner once they receive legal rights to the possession of the title. These restrictions are written down and contained within the official property deed. The homeowner’s association for any given neighborhood are most commonly in charge of enforcing these restrictions for every resident. The lender will usually require the buyer to give them a certified copy of all the restrictions contained within the deed. The buyer must also renew the restrictions after their termination date if applicable.
The settlement is reached when the buyer has paid the total amount owed to the seller. Once the money has been properly distributed to the appropriate parties, the buyer now has legal ownership over the title and the property.