It’s always a good idea to have a solid understanding of the real industry, whether you’re studying for your real estate license exam, curious about an unfamiliar word, or are looking to brush up on common real estate terms in order to refresh your memory.
In this post, I’ll go over the definitions of 105 common real estate terms that you’ll likely encounter in your real estate business.
Also, feel free to download my Real Estate Vocabulary PDF to save to your device for quick access and offline use.
1. What Does Contingent Mean in Real Estate
When the sale of a home is listed as contingent, it means that the seller has accepted an offer on the property, but there are still other steps, or contingencies, that must be met before the deal can go through.
Common contingencies include a positive home inspection report, appraisal, or a pending mortgage pre-approval letter.
2. What Does Pending Mean in Real Estate
If you see a home with a pending status, this means that the seller has accepted an offer from a buyer, but the deal has not been finalized yet. This is different from a contingency because it simply indicates that all the paperwork is still being processed before the deal is officially closed.
3. What is a Short Sale in Real Estate
A short sale occurs when a financially distressed home is sold for a smaller amount than what is still owed on the mortgage. In this scenario, all the money from the sale goes to the mortgage lender, who is also responsible for approving the sale. For a seller, selling their house in a short sale is financially better than a foreclosure.
4. What is Wholesaling in Real Estate
A wholesaler finds sellers willing to sell their properties at a discount and then connects them with a cash buyer or real estate investor. In exchange, the wholesaler collects a fee for bringing the two parties together. This helps the seller sell their home with minimal hassle, and the buyer or investor finds the perfect home.
5. What is Cap Rate in Real Estate
A cap rate, or capitalization rate, is one of the real estate terms that real estate investors need to know when considering investing in a property. A cap rate is the ratio of a property’s net income to its purchasing price. Investors use this number to determine how much profit they’ll make from the rental property.
6. What is ARV in Real Estate
ARV stands for After Repaired Value, which is the value a property has after it has been rehabbed. This value is determined by an appraiser before the repairs have been completed, based on a list of the proposed repairs.
7. Right of First Refusal Real Estate
The right of first refusal is a provision written into a lease or home agreement that says an interested party has the right to buy the home first before the seller considers any other potential buyers. The seller is unable to negotiate with other buyers unless the party with the right of first refusal ends up declining.
8. What is LTV in Real Estate
LTV stands for loan-to-value ratio and it’s a metric related to commercial real estate. The LTV is calculated by a lender or financial institution before they approve your loan for purchasing a commercial property. Loans with higher LTVs are riskier and tend to have higher interest rates.
9. What is an Encumbrance in Real Estate
An encumbrance is any sort of claim, liability, or limitation on a property. For example, liens, deed restrictions, easements, and encroachments are all encumbrances. These situations can lessen the property’s value and restrict the owner’s ability to transfer the property’s title.
10. What is NOI in Real Estate
NOI stands for net operating income. This metric is used to analyze the profitability of a real estate property. It is calculated by determining all the revenue generated by the property and subtracting all the operating expenses. NOI indicates whether the cost of a property is worth the expense of owning and maintaining it.
11. What is an Easement in Real Estate
Easements are defined as someone’s right to use a property, even though they are not the owner of that property. The easement relates to a specific purpose and is limited to whatever that purpose is. For example, utility companies can use easements to access roads on a property.
12. What is Blockbusting in Real Estate
Blockbusting is an illegal practice that occurs when a real estate agent convinces a homeowner to sell a property for a lower price based on the incorrect assumption that the neighborhood’s socioeconomic status is changing and that property values are decreasing. This is a discriminatory practice that then results in the new home buyer buying the home for an inflated price.
13. What Does MLS Stand for in Real Estate
The MLS, or Multiple Listing Service, is a collection of 580 regional databases that display all the property listings in that area. It can only be used by real estate agents, who must pay an annual fee in order to access these databases. The MLS is necessary for agents to know the most up-to-date information about their market.
14. What is CAM in Real Estate
CAM stands for common area maintenance and it’s a charge that tenants may have to pay on top of their base rent for shared areas of a multi-tenant building. Examples of CAM fees include pest control services, security services, and insurance.
15. Proof of Funds in Real Estate
A Proof of Funds letter is a document that the buyer shows to the seller when purchasing a home. It proves that the buyer can successfully cover all the purchase costs of a home, including the down payment, escrow, and closing costs.
16. What is Earnest Money in Real Estate
Earnest money is a small fee paid by the buyer to the seller right after the seller accepts the offer on the home. Earnest money acts as a deposit, and it is held in escrow until the closing is completed. At that point, the earnest money is applied to the down payment and closing costs.
17. What is ADU in Real Estate
ADU stands for an accessory dwelling unit. It is the legal and regulatory term for a second residential building that occupies the same lot as the primary home. For example, a guest house or detached garage. ADUs cannot be bought or sold separately from the primary home. They can either be attached or separate from the main building.
18. What Are Comps in Real Estate
“Comps” is one of the real estate terms you’ll encounter when preparing your listing presentations. It is shorthand for the phrase “comparable sales.” Comps refer to the homes in a single area that have comparable size, condition, and features. Homebuyers look at comps when deciding what offer to make on a home, and sellers look at comps to figure out what price to list their home.
19. What is HOA in Real Estate
HOA stands for homeowner’s association. A homeowner’s association is a group of homeowners in a particular subdivision or condominium complex who form an association in order to deal with shared issues that the neighborhood faces, such as maintenance issues.
20. What is Redlining in Real Estate
Redlining is an illegal discriminatory practice that categorizes certain neighborhoods as not worth investing in, usually based on the race or ethnicity of the groups of people living in that neighborhood. This practice leads to the denial of financial services, such as mortgages, loans, and insurance.
21. What Does NNN Mean in Real Estate
A triple net lease is an agreement that says the tenant or lessee is responsible for paying all of a property’s expenses, including real estate taxes, building insurance, and maintenance costs, on top of rent and utilities. This is a great investment strategy because it gives investors a source of low-risk income.
22. What is PMI in Real Estate
PMI stands for private mortgage insurance. Private mortgage insurance is a type of insurance a lender requires if a home buyer is unable to afford at least a 20% down payment. This type of insurance protects the lender in the event that the buyer defaults on their mortgage.
23. What is a Variance in Real Estate
A variance in real estate refers to a property that does not meet the zoning law requirements in the area. You’ll need to obtain a variance from your local government if you want to make any changes to your property that go against the zoning laws, whether it’s related to the lot or topography of the area or the structure itself.
24. What is AVM in Real Estate
AVM stands for automated valuation model. This is a metric that determines a property’s estimated fair market value. Automated refers to the fact that this estimate is produced by a machine learning model, based on sales prices and property data that are inputted into its system. One example of an AVM is Zillow’s Zestimate.
25. What is RVM in Real Estate
RVM stands for Realtors valuation model. It is a more accurate and in-depth valuation model than the AVM and is available as part of the Realtors Property Resource, a product exclusively offered to members of the National Association of Realtors. The RVM uses the same publicly available information as AVMs, in addition to exclusive MLS and off-market data.
26. What is a CRM in Real Estate
CRM is another one of the most common real estate terms you’re likely to encounter. It stands for customer relationship management. A CRM in real estate is a software system that helps individual agents and brokerages manage their leads and keep track of their marketing and sales funnels, all in one place. A CRM is a necessary automation tool for any real estate agent looking to scale their real estate business.
27. What is Novation in Real Estate
A novation occurs when changes are made to an existing contract. The old contract is replaced with a new one that reflects the changes. A novation can occur in commercial and residential transactions, and you will need one anytime a party wants to make changes to the original contract, whether large or small.
28. What is Eminent Domain in Real Estate
Eminent domain refers to the local, state, or federal government’s right to seize private property. The property is usually taken for the benefit of the community, such as turning the area into a public park or expanding a road. The owner of the property receives fair compensation for their land.
29. What is a 1031 Exchange in Real Estate
A 1031 exchange refers to Section 1031 in the Internal Revenue Service code. This section of the code relates to the exchange of one investment property for another, which allows capital gains taxes on the property to be deferred. It is one of the real estate terms you’ll see most often when dealing with commercial properties. There is no limit to how many 1031 exchanges can be made.
30. What is Underwriting in Real Estate
Underwriting is another one of the real estate terms you should know related to loans. It involves a lender looking into the creditworthiness of a potential customer. The underwriter looks into the applicant’s finances, the property’s sale price compared to its appraisal value, and other factors in order to determine how much risk the lender will assume by approving the loan.
31. What is Probate in Real Estate
Probate is a legal process that ensures the will of a deceased person is followed accurately. Any real estate that the person owned is included as part of this process, as long as they were the only owners. Probate in real estate is handled by the courts, which are responsible for approving any sale of the property.
32. What is REO in Real Estate
This acronym stands for real estate owned. Real estate owned, or bank-owned, is a term that describes what happens to a residential property after it has been foreclosed on. In this event, the lender takes possession of the property and hires a real estate agent to handle its sale to a new home buyer.
33. What is a Fixture in Real Estate
A fixture in real estate is any item that is attached to the property and can only be removed with the help of tools or through a professional service. It’s important to know the difference between a fixture and personal property when it comes time to sell your home.
34. What is Steering in Real Estate
Steering is an illegal practice under Fair Housing Act. It refers to a discriminatory process where a real estate agent will steer their client towards certain towns or neighborhoods based on their race. The agent will also refrain from showing their client homes that are outside of these areas.
35. What is a BPO in Real Estate
BPO stands for broker price opinion. This is an estimate for a property’s value, determined by a qualified broker or real estate agent. A BPO is usually ordered by a lender or other financial institution as an alternative to a property appraisal.
36. What is IRR in Real Estate
This acronym stands for internal rate of return. This is a metric that measures the rate at which a real estate investment grows or shrinks. More technically, it’s defined as the discount rate at which the net present value of a set of cash flows equals zero.
37. What is EMD in Real Estate
EMD stands for earnest money deposit, which is a small fee paid by the buyer to the seller right after the seller accepts the offer on the home. An earnest money deposit is held in escrow until the closing is completed. At that point, the earnest money is applied to the down payment and closing costs.
38. What is a Covenant in Real Estate
A covenant is a restriction that applies to a residential property. It is often put in place by a homeowner’s association. A covenant prevents you from building, altering, or using your land in a certain way. For example, rules against raising livestock on your property.
39. What is Estoppel in Real Estate
Estoppel is a legal document that both parties need to sign in a real estate transaction. It prevents someone from asserting something that contradicts what they previously said or agreed to by law. Estoppel protects both parties from potential inconsistencies.
40. What is DOM in Real Estate
DOM stands for days on market. This metric keeps track of how many days a property has been listed on the housing market. DOM begins from the point the property is entered in the MLS and ends once it goes under contract, and reflects only current listing information.
41. What is a PUD in Real Estate
This acronym stands for planned unit developments. These are communities of homes, usually single-family homes, that are under the control of a homeowner’s association. If you consider purchasing a home in a PUD, you will have to make sure your lender knows this because a PUD loan is often more complex than a typical loan.
42. What is GRM in Real Estate
The gross rent multiplier is a formula that investors use to compare the rental income of multiple rental properties at once. This formula is a simplified way of comparing properties without doing a full analysis. It helps investors decide which properties are worth investing in and which aren’t.
43. What is Real Estate Syndication
Property syndication is one of the real estate terms associated with investing. It occurs when a group of real estate investors forms a partnership to purchase and manage a property that they wouldn’t be able to afford if they were on their own. The group will combine their skills, resources, and capital to effectively manage the property.
44. Statute of Frauds Real Estate
The statute of frauds in real estate means that everything related to the purchase and sale of a property must be in writing in order for it to be enforceable. If you ever end up needing to pursue legal action over a property, you’ll need to have a written contract signed by the other party to prove anything.
45. What is an Appurtenance in Real Estate
Appurtenance applies to an object that is attached to a property and stays with it over time, even if the property’s ownership changes. Appurtenance applies to objects like exterior buildings, fences, ceiling fans, cabinetry, and fixtures.
46. What is a Real Estate Trust
A real estate investment trust (REIT) is a company that owns and operates income-generating properties. REITs make it possible for individual real estate investors to benefit from the investments, without having to buy or manage the properties themselves. Investors earn a steady stream of income, however, they will not benefit from capital appreciation of the property.
47. What is GLA in Real Estate
GLA stands for the gross living area, and it measures the total amount of indoor living space in a residential property, excluding areas that don’t have heating, lighting, and ventilation, such as a porch or balcony. GLA is the standard measure for determining how much space a residential property has.
48. What is an Option in Real Estate
An option in real estate terms is a legally binding contract that an interested buyer signs with the seller of a property. The buyer is given the exclusive option to purchase that property for a certain period of time. During this option period, the seller cannot make transactions with other prospective buyers.
49. What is Puffing in Real Estate
Puffing occurs when a real estate agent or seller makes an exaggerated claim about a property in order to increase the chance of selling it. Puffing is a common practice and is generally acceptable as long as none of the claims are fraudulent. However, in certain circumstances, puffing can be illegal.
50. What is a Bridge Loan in Real Estate
Bridge loans are short-term loans used for home buyers looking to purchase a new home before they’ve sold their current one. Bridge loans use the value of the buyer’s current home as collateral to finance the purchase of the new home.
51. What is Condemnation in Real Estate
Condemnation is closely related to eminent domain. While eminent domain refers to the government’s right to seize property, condemnation refers to the legal process by which the government carries out that right. Condemnation can occur for an entire property, a portion of the property, or can even just be temporary.
52. What is Escheat in Real Estate
Escheat refers to the government’s right to take ownership of unclaimed property and estate assets. This commonly happens when a property owner passes away without a will and no heirs. When this occurs, escheat means that ownership of the property will revert to the state.
53. What is Basis in Real Estate
Basis refers to the amount a property is worth for tax purposes. There are two types of basis: cost basis and adjusted basis. Cost basis, or starting basis, represents the amount that you initially paid for your property. Adjusted basis shows how much the original basis has changed over time, either due to appreciation or depreciation.
54. What is Subject-To in Real Estate
“Subject-to” is when a real estate investor purchases a home, but the existing mortgage stays in the name of the seller. The property is subject to the current financing, even though it has new ownership. Subject-to typically occurs with foreclosures or in a situation where the homeowner is behind on their mortgage payments.
55. What is Dual Agency in Real Estate
Dual agency occurs when a real estate agent represents both the buyer and seller in a single transaction. This practice isn’t permitted in every state, but some allow it as long as it is disclosed to both parties. While dual agency can streamline the home-buying process, it can have a number of downsides for both parties involved.
56. What is GRI in Real Estate
GRI is a special real estate designation that is offered by the National Association of Realtors. It stands for Graduate, Realtor Institute. Agents who earn this designation gain specialized, in-depth knowledge on a variety of technical subjects in addition to the foundational knowledge that every agent knows.
57. What is a CDA in Real Estate
CDA stands for commission disbursement authorization. This document is similar to a payment request. It provides instructions on how the commission will be distributed once a deal has closed. It is sent to either the escrow company, title company, attorney or whoever is in charge of handling the closing.
58. What is FSBO in Real Estate
FSBO, or for sale by owners, is a home that is being sold by the homeowners without the help of a professional real estate agent. Homeowners typically decide not to work with a real estate agent in order to avoid paying commission.
59. What is Subagency in Real Estate
Subagency is an uncommon practice where a real estate broker or agent brings in a buyer to purchase a property, even though they are not the property’s listing agent. The agent who brings the buyer is considered a subagent of the listing broker or agent. As a result, the subagent will pay fiduciary duties to the seller instead of the buyer and will usually earn a portion of the listing agent’s commission.
60. What Does HUD Stand For in Real Estate
HUD stands for the Department of Housing and Urban Development and in real estate, it refers to the HUD-1 Settlement Statement. This is a government document that acts as a closing statement at the end of a deal. It itemizes every financial transaction that took place between all the parties involved in the property’s closing.
61. What is CDOM in Real Estate
CDOM stands for cumulative days on the market. It measures the number of consecutive days that a property has been listed on the MLS under any listing agent. It includes a collection of all historical listing data for that property.
62. What is an Encroachment in Real Estate
Encroachment is a term that refers to a situation when the owner of one property builds or extends a structure and it ends up on their neighbor’s property. This usually occurs in cases where property lines are disputed, or the property owner is not familiar with their property’s boundaries.
63. What Does COE Mean in Real Estate
COE stands for Close of Escrow. This refers to the date that the funds in escrow and other important documents are successfully processed. At this point, the buyer officially becomes the new owner of the home.
64. What is Situs in Real Estate
Situs is a Latin word that means the site or location where something exists or originates. Situs is used by real estate agents to refer to the geographical location of a property, usually for taxation and other economic purposes. It can also be used regarding legal rights, such as questions involving government housing.
65. What is Boot in Real Estate
Boot is a tax term that refers to a 1031 property exchange. If you sell your original property and then buy another one of lesser value, the difference is known as a boot. A boot can turn your tax-free 1031 exchange into a taxable trade, depending on the capital gain you earn from the deal.
66. What is a Pocket Listing in Real Estate
A pocket listing in real estate is also known as an off-market listing or exclusive listing. The term refers to a listing that is handled by a single real estate agent on their own. The agent will not share the listing on the MLS or make it publicly available.
67. What is HOPA in Real Estate
HOPA stands for Housing for Older Persons Act of 1995. This act exempted housing intended for people 55 years of age older from familial status discrimination laws. Housing facilities that claim this exemption can legally refuse to sell or rent a property to families with minor children.
68. What is an APN in Real Estate
Assessor Parcel Number is a unique number that a county tax assessor assigns to every parcel of land. This number is used by the local government to keep track of who owns the land for tax purposes.
69. What is a General Agent in Real Estate
A general agent has the ability to do more actions on a client’s behalf, and may even have the power of attorney in some cases. For example, a general agent may be hired to carry out a number of tasks for a company. The general agent is not limited in the actions they can take for the company.
70. What is a Special Agent in Real Estate
On the other hand, a special agent is a type of real estate agent who is hired to do a specific task or job for a client. The special agent is limited to the specific job they were assigned to, and once they complete it, they are no longer employed by the client.
71. What is TLC in Real Estate
TLC is one of the most easily recognizable real estate terms. It stands for tender loving care. You might see a home advertised as needing TLC, which is another way of saying that it needs an extensive amount of repairs and renovations. Potential buyers should be aware that TLC homes will need a significant investment of time and money.
72. What Are Emblements in Real Estate
Emblements refer to the crops that a tenant grows on a piece of property that they are leasing from the landowner. Even though the tenant does not own the land, legally they own the crops. In cases of a tenant’s death, the crops go to the next of kin.
73. What Does MOL Mean in Real Estate
MOL stands for more or less. It is one of the real estate terms used when measuring the acreage of a property. MOL is used to acknowledge the fact that sometimes the exact acreage of a property is not easily determinable, for example, if part of the property is on a slope.
74. What is Conversion in Real Estate
Conversion is an illegal practice that occurs when a real estate agent is entrusted with funds that are intended to be used for repairing or renovating a property. When the agent uses those funds to make personal purchases, he has committed conversion. Conversion also occurs regarding the removal of property within a home.
75. What is Subrogation in Real Estate
Subrogation is one of the real estate terms that references a legal principle you should be familiar with in real estate transactions. It relates to substituting one person or business for another, with the substituted person gaining the same legal rights and obligations as the original.
The right of subrogation gives the substituted person the right to pursue the original person’s claim. It applies to cases such as leases, mortgages, and insurance policies.
76. What is Plottage in Real Estate
Plottage in real estate occurs when two or more pieces of property that are adjacent to each other are combined into a single, larger property. The practice is most common in urban areas when firms buy up many small, individually owned parcels of land and then combine them together.
77. What is a Binder in Real Estate
A real estate binder refers to the earnest money deposit in escrow or mortgage binder in a property transaction. While a binder isn’t legally binding, it acts as an informal agreement between the buyer and seller to indicate strong interest in the property transaction. Binders can also be used in the context of titles, title insurance, and property insurance.
78. What is FIRPTA in Real Estate
FIRPTA stands for Foreign Investment in Real Property Tax Act. It is a tax law that makes sure that foreign taxpayers pay income tax on any U.S. real estate that they sell. It applies to nearly every sale where a foreign property owner decides to sell their land, though there are a few exemptions depending on the state.
79. What is Hypothecation in Real Estate
Hypothecation is a process where someone pledges an asset as collateral when taking out a home loan from a lender. The asset can include a vehicle, house, or commercial property. The collateral helps to ensure that the loan is a secured loan.
80. What Are CDD Fees in Real Estate
CDD stands for community development district. A CDD is similar to a homeowner’s association, but it is created under state law. It has the power to charge fees to everyone living in the district, which are often used to cover building community amenities or infrastructure-related costs.
81. What is SFR in Real Estate
This acronym stands for single-family rentals, which is one of the most popular real estate terms you’ll encounter as a real estate investor. A single-family rental is a great investment for anyone looking to begin investing in real estate because they are affordable, profitable, easier to manage, in high demand, and in plentiful supply across the country.
82. What is a Material Fact in Real Estate
A material fact is a key fact that is important for a potential buyer to know when deciding whether or not to buy a property, and at what price to pay for it. Knowingly concealing a material fact in a transaction can result in legal consequences.
83. What Does CCR Stand For in Real Estate
CCR stands for covenants, conditions, and restrictions. It refers to certain restrictions or limitations regarding the use of a piece of land. For example, a CCR could prevent a homeowner from keeping their boat on the property. Potential homebuyers should make sure to know whether a property has any CCRs before purchasing it.
84. What does MSA Stand For in Real Estate
MSA stands for metropolitan statistical areas. This refers to urbanized areas that have a minimum population of at least 50,000, as determined by the U.S. Office of Management and Budget. Many real estate investors use MSA data to study housing trends and population movement.
85. What is Commingling in Real Estate
Commingling in real estate terms has to do with the way one party in a property transaction deposits the money they received from the other party. Commingling can be legal or illegal, depending on the context.
For example, one example of legal commingling is when joint venture partners pool their money together in one account to invest in a rental property. An illegal example of commingling is when a landlord deposits their tenant’s security deposit in their personal bank account and mixes it with their other funds.
86. What is FAR in Real Estate
Floor area ratio is a ratio that measures a building’s total constructed floor area compared to the land area. FAR determines the maximum floor space that can be safely constructed on a piece of land.
87. What is Vesting in Real Estate
Title vesting refers to the process of someone taking official ownership and rights of a property title. Vesting is necessary when there is more than one individual that appears as the property owner on the title. If you are the sole owner of a property, vesting is not necessary.
88. What Does PA Stand For in Real Estate
PA stands for Professional Association, which is a business designation that is only available to certain professions. Real estate agents may choose to be recognized as a PA rather than an LLC in order to get better tax deductions for their business.
89. What is LTC in Real Estate
The loan-to-cost ratio is a metric in commercial real estate that is used when constructing a new building. It measures the financing of the project through a loan and compares it to the cost of building the project. LTC helps lenders determine the risk of giving a loan for the project.
90. What Does Et Al Mean in Real Estate
You might see the real estate terms et al on different real estate legal documents, such as property deeds. Et al is a legal term that serves as a shorter way to refer to everyone on one side of a case. In relation to property deeds, et al appears in legal documents to refer to the multiple parties that have an ownership interest in the property title.
91. What is RPA in Real Estate
RPA stands for robotic process automation, which applies to various real estate-related processes. For example, mortgage applications, credit checks, and background checks can all be automated with RPA software bots. One benefit of RPA is that it helps reduce errors and increase quality control.
92. What Are Prepaids in Real Estate
In the home buying process, “prepaids” are fees related to the home itself, not the real estate transaction. These can include property taxes, homeowner’s insurance, and mortgage interest. Prepaids are paid at the time of closing, which is before they’re officially due.
93. What is Bird Dogging in Real Estate
Bird dogging is a practice in real estate where someone searches for off-market or undervalued properties. They then present those properties to interested real estate investors in exchange for a fee or percentage of the net profit from the deal. Bird dogs are not real estate agents themselves.
94. What is Alienation in Real Estate
Alienation is one of the real estate terms that relate to the mortgage or trust deed of a home. It allows the lender to say the remaining balance of the loan is immediately due if the owner decides to sell the property or transfer the title to someone else. It prohibits the transferring of the loan to the new buyer.
95. What Does SF Mean in Real Estate
SF stands for square feet, which is one of the real estate terms you’re likely already familiar with. It is a common measurement that helps determine the size of a home. The definition of square feet is a unit of area equal to the area of a square, where each side is one foot long.
96. What Are Entitlements in Real Estate
Entitlements are specific permissions that a governing agency grants to a property that relates to the ways the owner can use it. These permissions typically refer to unimproved or vacant land. Entitlements can also appear when redeveloping a property or confirming the allowable use of the existing developments on the property.
97. What Does NOD Mean in Real Estate
NOD stands for notice of default. It is a public notice filed in a court of law that states a mortgage borrower has defaulted on a loan. A notice of default is the final action a lender takes before starting the foreclosure process of a home.
98. What is Rescission in Real Estate
Rescission is the process of unmaking or rescinding a contract. The goal of rescission is to put the two parties back into the original positions they were in prior to making the contract. The process requires that the entire contract be canceled and remade, not just parts of it.
99. What is GBA in Real Estate
GBA stands for gross building area. This measurement represents the sum of all the areas in a building, at all floor levels. It is often calculated from external wall lengths and is used for commercial real estate buildings, such as offices, industrial, and agricultural buildings.
100. What Does TBD Mean in Real Estate
TBD stands for to be determined. In real estate terms, this references a TBD loan approval. This is a type of approval where a buyer gets their income, assets, credit, and more examined in advance before identifying a property. TBD approvals are great for real estate agents because it shows the buyer is serious.
101. What Does Et Ux Mean in Real Estate
Et ux is one of the more outdated real estate terms on this list. You might find it on property deeds, tax assessment rolls, and other legal documents in real estate. It’s an abbreviation for the Latin words et uxor, which means “and wife.” It indicates that a wife jointly owns the property alongside her husband.
102. What is a Warranty Deed in Real Estate
A warranty deed is a document between a buyer and seller that provides a home buyer the greatest amount of protection in a real estate property transaction. The deed ensures that the buyer is free of any liens, mortgages, or other claims on the property.
103. What is a Subagent in Real Estate
A subagent is a real estate agent or broker who brings in an interested home buyer to purchase a property, even though they are not the property’s listing agent. The subagent works on behalf of the listing broker, and therefore the seller. As a result, they usually earn a percentage of the listing agent’s commission.
104. Procuring Cause in Real Estate
Procuring cause is one of the real estate terms you should know in case you’re ever involved in a transaction with more than one buyer’s agent. It helps the agents and buyers figure out which agent will receive the commission. For example, if one agent helps a home buyer find a house, and another agent helps the buyer put together the offer.
The agent who gets the commission is the one who was the procuring cause, or the agent who first inspired the home buyer’s interest in the home that led to them purchasing it.
105. What is a POA in Real Estate
POA stands for power of attorney, which is a legal document that allows one individual to stand in and make decisions on behalf of another individual, with that individual’s consent. In real estate terms, POA lets an agent manage or sell their client’s property, usually in the event that the client is unable to do so themselves.
Final Thoughts on Real Estate Terms
It’s important to at least have a basic understanding of all these real estate terms in case they ever come up in your day-to-day work as an agent. In addition, you’ll also be able to better guide your clients in case they ever have any questions about the meaning of these terms.
Did you learn any new real estate terms? Know any that I should add to this list? Let me know in the comments below!
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