Your Real Estate Glossary

By: Jacob Asparian

Your Real Estate Glossary

Tags: real estate, durham region, durham region real estate, real estate terms, Oshawa real estate agent, Oshawa real estate, real estate blog, buying, selling, home, house, soldbyjacob, Keller Williams, Keller Williams Energy, conditional offer, deposit, chattels, fixtures, mortgage, land transfer, sign back, title search, irrevocable date

Important Terms for the First (or even second) Time Home Buyer

 
If you’re a first-time home buyer or you’re looking to make a move for the first time in 20 years, this glossary of terms is for you. It’s important to be knowledgeable and stay up-to-date with not only the real estate market, but all of the jargon that comes along with it. Have a look at our list so that when it’s time to buy your next dream home you’re prepared to sign on the dotted line.
 
Amortization: the process of decreasing the principal amount of a loan over a certain period of time.
 
Amortization period: the amount of time it takes to entirely pay off a loan amount.
 
Bridge financing: a temporary loan that “bridges” the break between the sale price of a new home and a home buyer’s new mortgage, in the event the buyer’s home has not yet sold.
 
Chattels: tangible and movable personal property in a home (example: furniture, window coverings, etc.)
 
Closing date: the date on which parties consummate the purchase contract and the property’s ownership is transferred to the buyer.
 
CMHC: Canada Mortgage and Housing Corporation, whose mandate is to help Canadians access a variety of housing options.
 
Conditional offer: an offer to purchase that is subject to conditions, which may include financing, sale of the buyer’s property, etc.
 
Cooperating agent: the sales representative on the buying side of a real estate transaction.
 
Deposit: an amount paid to the seller toward the mortgage given in advance to secure the property.
 
Disbursements: expenses charged by your lawyers for out-of-pocket expenses that you would otherwise be required to pay if you handled the transaction yourself.
 
Fixed vs. variable rate mortgage: a fixed mortgage rate remains constant throughout the term. With a variable rate mortgage, the rate will change depending on the prime lending rate set by the Bank of Canada.
 
Fixtures: physical property that is permanently attached to a property, where the removal would damage the property.
 
High ratio mortgage: a mortgage in which a borrower places a down payment of less than 20% of the property’s purchase price.
 
Irrevocable date: the date and time a person receiving an offer has to either accept or counter offer an agreement.
 
Land transfer tax: a government imposed tax paid by the purchaser of a property on closing. The land transfer tax applies whenever a property is transferred from one owner to another, and is calculated based on the selling price of a house.
 
Lien: the right to keep possession of property belonging to another person until a debt owed by that person has been paid.
 
Mortgage commitment: a document provided to the seller which states written proof that a bank is willing to give the buyer a specific advanced sum in the form of a mortgage loan in order to complete the purchase of a property.
 
Mortgage insurance: an insurance policy compensating lenders or investors for losses in the case of the default of a mortgage loan.
 
Mortgage pre-approval: a process in which a potential home buyer fills out a home mortgage loan application and submits documentation that gets verified to confirm exactly the type of loan and amount the qualify for.
 
Possession date: the date on which the purchaser is entitled to possession of the property.
 
Sign back/counter offer: an offer that is made in response to a previous offer by the other party. Making a counter offer automatically rejects the first offer, and requires an acceptance under the terms of the counter offer in order to finalize the contract.
 
Title: an investigation into public records that determine and confirm a property’s legal ownership, and find out what claims are on the property such as any outstanding loans or property taxes.
 

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