Buying or selling a home can sometimes feel complicated because of unfamiliar terminology being used by experts in the field. Learning a few keys terms before you get fully involved in the process will allow you to feel knowledgeable and capable of handling the task of buying and selling a home.
A property marketed in as-is condition usually means the seller is unwilling to perform most, if not all, repairs and often indicates that no warranty or certification is being provided. This term often implies that the property is in less than optimal condition.
A conventional sale is when the property is owned outright (has no mortgage remaining) or the owner owes less on their mortgage than what the market indicates the owner could sell their property for. Conventional sales are often smoother transactions than non-conventional sales, such as foreclosures or short sales.
Days on market (DOM)
DOM is defined as the number of days from the date on which the property is listed for sale on the local real estate brokers’ multiple listing service (MLS) to the date when the seller has signed a contract for the sale of the property. A low average DOM indicates a market that favors sellers. A high average DOM signals a market that favors buyers.
Mortgage pre-approval letter
A mortgage pre-approval letter is issued by the lender and identifies the terms, loan type and loan amount the buyer qualifies for. Getting a mortgage pre-approval letter is important because it gives home buyers an idea of what they can afford.
Purchase and sale agreement (PSA)
A purchase and sale agreement is a written contract between the buyer and seller which outlines the terms to sell and purchase property. When a home is said to be under contract, it usually means that the buyer and seller have formalized their commitment to sell and purchase property.
A title search examines public records for the history of the home including sales, purchases, taxes and other types of liens. A title examiner will conduct a search using title plants and county records to see who is listed as the record owner of the property.
While these are just a few terms that you may come across during the process of buying or selling a home, working with a Mel Foster Co. agent will guarantee an expert is handling your business.
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