Real Estate Terminology - From Appraisals To Comps

When you're selling your house or other real chattels on your own, you don't have to know everything about the procedure. It does help to have a practical familiarity with the language that comes up during the process.

Keep in mind, these are not proposed as "be all - end all" explanations. They're working definitions for practical people.

1) Acceptance - A legal term referring to the acceptance of a buyer's offer by the seller. Acceptance is often preceded by a number of counter offers between the parties.

2) Appraisal - a professional opinion of the value of real property. Most jurisdictions have careful rules defining who may call themselves an appraiser, and most lenders have a "stable" of approved appraisers whom they use regularly. Typically, the lender making the new mortgage loan will require that the property evaluate for at least as much as the purchase price.

3) Bridge Loan - Short term loans used to "bridge" any time gap between the sale of a home and purchase of the next one. These loans can be valuable when escrow is delayed on the sale of a home and the seller has committed to the purchase of another home. Bridge loans are also known as "panic loans", but can be a life saver.

4) Coinciding Settlements - when a buyer needs the funds from the sale of his prior home (which is under contract to be sold) in order to purchase his next home, he may well make settlement under his sale a contingency for settling on the home he is purchasing. In reality, the sales don't usually coincide. They usually take place back to back. Funds from the first are often wire transferred to the second.

5) Closing - Depending upon the state you live in, Closing can have different meanings. Generally, the closing of a real estate transaction refers to the exchange of necessary documents, execution of the same and transfer of money.

6) Comps - This term refers to the sales prices of similar properties in the area of a house in question. Comps are used to help determine the fair market value of a property.

7) Conditions - any conditions which must be met before the sale can be consummated. Some typical conditions include things like the property's appraising for the purchase price or more, the property's being in good condition when a home inspection is done, the buyer's loan being approved.

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