ACCEPTANCE - (aka Ratification) The time the offer or final counter offer is accepted in writing by a party and is delivered to and personally received by the other party or that party's authorized agent in accordance with the terms of the offer.
AGREEMENT - The terms and conditions of the accepted Purchase Agreement and any accepted counter offers and addenda.
APPRAISAL - A written justification of the price paid for a property that is primarily based on an analysis of comparable sales of similar homes nearby.
CLOSING COSTS - Buyer's costs that usually include lender's fees, points, appraisal as well as escrow and title fees. Seller's closing costs are typically transfer tax, commission, expenses or any reports ordered on property, and pro-rated taxes accordingly.
CLOSE OF ESCROW - The date the grant deed, or other evidence of transfer of titles, is recorded. If the date falls on a non-business day, then the close of escrow shall be the next business day after that date.
CONTINGENCY - A condition that must be met before a contract is legally binding. For example, home purchasers often include a contingency that specifies that the contract is not binding until the purchaser obtains a satisfactory home inspection report and/or formal loan approval from a qualified home inspector.
DEED - The legal document conveying title to a property.
EARNEST MONEY DEPOSIT - A deposit made by the potential home buyer to show that he or she is serious about buying a house.
EQUITY - A homeowner's financial interest in a property. Equity is the difference between the fair market value of the property and the amount still owed on its mortgage and other liens.
ESCROW - An item of value, money, or documents deposited with a thid party to be delivered upon the fulfilment of a condition. For example, the earnest money deposit is put into escrow until delivered to the seller when the transaction is closed.
ESTATE - The sum total of all the real property and personal property owned by an individual at time of death.
EXCLUSIVE LISTING - A written contract that gives a licensed real estate agent the exclusive right to sell a property for a specified duration of time.
EXECUTOR - A person named in a will to administer an estate. the court will appoint an administrator if no executor is named.
FAIR MARKET VALUE - The highest price that a buer would pay, and the lowest price a seller would accept.
LIEN - A legal claim against a property that must be paid off when the property is sold. A mortgage or first trust deed is considered a lien.
NOTE - A legal document that obligates a borrower to repay a mortgage loan at a stated interest rate during a specified period of time.
PITI - This stands for Principal, Interest, Taxes and Insurance. If you have an "impounded" loan, then your monthly payment to the lender includes all of these and probably includes mortgage insurance as well.
POWER OF ATTORNEY - A legal document that authorizes another person to act on one's behalf. A power of attorney can grant complete authority or can be limited to certain acts and/or certain periods of time.
PRE-APPROVAL - Generally taken to mean that a borrower has completed a loan application and provided debt, income, and savings documentation which a bank underwriter has reviewed and approved. A pre-approval is usually done at a certain loan amount and making assumptions about what the interest rate will actually be at the time the loan is made, as well as estimats for the amount that will be paid for property taxes, insurance and others.
PRE-EMPTIVE OFFER - An offer that can be accepted by the owner prior to the bid date.
TITLE INSURANCE - Insurance that protects the lender (lender's policy) or the buyer (owner's policy) against loss arising from disputes over ownership of a property.
TRANSFER TAX - State or local tax payable when title passes from one owner to another.
