We began with an explanation of the top 10 most used real estate terms to help prospective clients get familiar with terms used within the real estate industry. In Part 1 we explained the first five most used terms in real estate and now we will continue to explain the remaining five terms for you here.
Real Estate Assessment
Assessment in real estate is a process almost identical to an appraisal in that both terms refer to a calculation of a property’s value. But the main difference is that an assessment is done by the local government, primarily to calculate a home’s value for property tax purposes.
A balloon mortgage is a short-term loan, usually between 5 to 7 years long, that has an initial period of low or no monthly payments. However, at the end of its term, the borrower is required to pay off the full balance in a single lump sum.
The monthly payments typically have a very low-interest rate, and sometimes the borrower only must pay the interest. This type of loan is usually used by home flippers, construction companies, and investors who rely on year-end bonuses for most of their income.
Breach of Contract
A breach of contract is failing to provide mortgage commitment hen due. This happens when either the buyer or seller violates any of the terms or conditions of a binding contract. This breach could range from something relatively minor, such as being one day late on a payment, to something serious, such as not delivering an asset, completely halting payments, etc.
As its name suggests, a buyer’s agent is a licensed real estate agent that focuses on representing a home buyer’s interests during a real estate transaction. A buyer’s agent responsibilities include negotiating the best possible price for a home, securing the best terms, researching the home’s neighborhood and the surrounding area, making sure the home has been thoroughly and properly inspected, and facilitating the buying process for their client.
Whenever a housing market has a larger housing supply than demand for an extended period, causing buyers to have the upper hand in price negotiations, we can say that the market is a buyer’s market.
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