Now that you’re looking into buying and/or selling a new home, you will be faced with a lot of jargon. This can be overwhelming, but a good first step is to familiarize yourself with key terms. I have provided a basic glossary, but if you still have questions, just ask!
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AGENT: A person who is authorized by a broker to trade real estate. For example, I am an agent; my broker is Chestnut Park.
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AMORTIZATION: Refers to the period of repaying a debt through periodic payments on the principal and interest.
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APPRAISAL: An estimated value. Financial institutions appraise properties to determine the amount of a mortgage.
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APPRECIATION: The amount a property increases in value.
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BUYER'S MARKET: Refers to a market where there are more properties for sale than there are buyers – the lack of demand drives prices down, which is good for buyers.
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CAPITAL GAIN: Refers to the difference between the original price paid for a property and the price for which it is sold.
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CHATTELS: Refers to removable items that would not normally be included in the sale of a home, such as portable dishwashers, laundry appliances, or portable microwaves.
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CLOSING DATE The date on which the real estate transaction is complete.
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COUNTER-OFFER Used in price negotiation. One party may accept an offer, or make a counter-offer of a different price.
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DEBT SERVICE RATIO Refers to the percentage of a borrower’s gross income that can be used to service mortgage payments and realty taxes.
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DEED: The document that states ownership of a property.
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DEPOSIT: A payment made to ‘hold’ a property until inspections are performed. Usually 5-10% of the total price.
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DOWN PAYMENT: A cash amount that makes up the difference between the price and the amount being financed.
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EQUITY: The difference between the market value and the mortgage or liens against a property.
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FIXTURES: Permanent improvements or items become fixtures when they are attached to the property, becoming part of it. Wall to wall carpeting is an example.
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LAND TRANSFER TAX: payment to the Provincial Government for transferring ownership of a property.
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LIEN: A claim on a property to ensure payment of a debt.
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LISTING AGREEMENT The contract between a seller and their broker authorizing the broker to list his/her property for sale.
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LISTING BROKER: The realtor that represents the seller.
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MORTGAGE: A contract between a borrower (buyer) and a lender (usually a bank). The borrower puts the property up as collateral against the mortgage debt. There are many types of mortgages and terms-ask your realtor for details.
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MORTGAGE TERM: Refers to the amount of time the borrower has to repay a loan to the lender.
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MULTIPLE LISTING SERVICE (MLS): A computerized networking system for realtors.
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PRINCIPAL: the amount originally borrowed.
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REALTOR: A trademarked name that describes agents who have membership in their local real estate board as well as the Canadian Real Estate Association.
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SELLING BROKER: The realtor that represents the buyer.
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SURVEY: A document with all the details about a given property. A survey will include the boundaries, legal description, and any improvements.
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TITLE: The legal evidence of ownership of a property.
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VENDOR: The seller.
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ZONING REGULATIONS: Governmental guidelines that regulate how a property may or may not be used.
