Real estate words, finally in plain English.

A 1031 exchange lets an owner of investment property defer paying capital gains tax on a sale by reinvesting the…

An absentee owner is someone who holds a property they don't personally live in, whether it's a rental, an inherited…

Absorption rate measures how quickly homes for sale are being bought up in a given market, usually expressed as months…

An accessory dwelling unit, or ADU, is a smaller secondary residence located on the same lot as a main home — common…

Adverse possession, sometimes called squatter's rights, is a legal doctrine that allows someone who has openly occupied…

An affidavit of heirship is a sworn legal statement identifying the legal heirs of a deceased property owner, and in…

After repair value is an estimate of what a property would sell for once it's been fully renovated to current market…

Amortization is the schedule that determines how each mortgage payment gets split between interest and principal over…

Ancillary probate is a second, smaller probate case opened in another state when someone who died owned real estate…

An appraisal is a licensed appraiser's written opinion of what your home is worth on a specific date. Mortgage lenders…

An appraisal gap occurs when a home's appraised value comes in lower than the agreed-upon purchase price, which becomes…

Appreciation is the increase in a property's value over time, driven by factors like rising demand, limited housing…

Selling a property "as-is" means it transfers to the buyer in its current state, with no repairs, credits, or…

Assessed value is the dollar figure your county assessor assigns to your property in order to calculate your annual…

An assignment is the transfer of one party's rights and obligations under a contract to a different party. In…

An assignment of contract is the legal mechanism a wholesaler uses to transfer their rights and obligations under your…

An assumable mortgage allows a qualified buyer to take over your existing loan, keeping its original interest rate and…

Avoiding foreclosure means resolving a mortgage default before the lender completes a forced sale of your home.…

A balloon payment is a large lump sum due at the end of a loan term whose regular monthly payments weren't structured…

A bridge loan is short-term financing that lets a homeowner tap into the equity of their current home before it sells,…

BRRRR stands for Buy, Rehab, Rent, Refinance, Repeat — a strategy where a buyer renovates a property, places a tenant…

Buy and hold describes a buyer's intention to purchase a property and keep it for the long term, earning rental income…

A buyer's market exists when the supply of homes for sale outpaces buyer demand, typically shown by more than six…

Capital gains tax applies to the profit made from selling a property, calculated as the sale price minus your original…

A cash buyer is someone who purchases property outright using available funds rather than borrowing from a bank.…

Cash for keys is a voluntary agreement in which an owner pays an occupant, often a tenant, a relative, or someone left…

A cash offer is a purchase offer where the buyer pays with funds already on hand instead of a mortgage. Because there's…

Cash reserves are the liquid funds a buyer has left over after a purchase closes, usually measured by lenders in terms…

"Cash for homes" is the broad, everyday term for companies that buy houses directly from owners for cash, as-is,…

A cash-out refinance replaces your existing mortgage with a new, larger one and gives you the difference in cash at…

A certificate of occupancy is a municipal document confirming that a building has been inspected and is legally safe to…

A certificate of title is a document, typically prepared by an attorney or title company after completing a title…

Chain of title is the recorded sequence of every owner a property has had, traced back through each transfer over time.…

Closing, sometimes called settlement, is the point at which ownership of a property legally transfers from seller to…

Closing costs are the various fees required to finalize a real estate sale, including title work, escrow or settlement…

A cloud on title is any unresolved claim, lien, judgment, or documentation error that raises doubt about a seller's…

A code enforcement lien is a claim a city or county records against a property to secure unpaid fines or the cost of…

A code violation is a citation issued by a city or county when a property breaks local standards, such as overgrown…

Commission is the percentage of a home's sale price paid to the real estate agents involved in the transaction,…

A comparative market analysis is a pricing report built from homes similar to yours that have recently sold, are…

Comps are recently sold homes similar to yours in size, age, condition and location, used to estimate what your own…

Condemnation has two distinct meanings that homeowners run into in real estate. It's the formal legal proceeding used…

A condominium is a form of ownership where you own the interior of your individual unit outright while sharing…

A contingency is a specific condition written into a purchase contract that must be satisfied, or the buyer has the…

A contract for deed, sometimes called a land contract, lets a buyer move into the home and make monthly payments…

The cost approach is a valuation method that estimates what it would cost to rebuild a property from scratch today,…

A credit score is a numeric summary of someone's borrowing history that lenders use to decide whether to approve a loan…

Days on market counts how many days a home has been publicly listed for sale before it goes under contract. It's…

Debt-to-income ratio is a borrower's total monthly debt payments divided by their gross monthly income, expressed as a…

A deed is the legal document that actually transfers ownership of real estate from one party to another. It identifies…

A deed in lieu of foreclosure is when a homeowner voluntarily signs the property over to the lender to settle the debt…

A deed of trust accomplishes the same basic goal as a mortgage, securing a loan against real estate, but it involves…

A deed restriction is a legally binding limitation written into a property's deed that controls how the land or home…

A deficiency judgment is a court order making a borrower personally responsible for the gap between what was owed on a…

Depreciation is a decline in a property's value, often caused by physical wear, outdated features, or a softening local…

A distressed property is one under significant financial or physical strain — this can include foreclosure, tax…

A double close is a transaction structure where a middle buyer purchases your house from you and then, often on the…

A down payment is the portion of the purchase price a buyer pays out of pocket at closing, with the remaining balance…

Downsizing means moving from a larger home into a smaller one, usually to cut monthly costs, reduce maintenance, or…

A due-on-sale clause is a standard provision in most mortgages giving the lender the right to demand full repayment of…

A duplex is a single building split into two independent living units, each with its own entrance, kitchen and…

Earnest money is a deposit a buyer puts down when signing a purchase contract to demonstrate they're serious about…

An easement grants someone else the legal right to use a specific part of your land for a defined purpose, without…

Eminent domain is the government's legal authority to take private property for a public use, such as building a road,…

An encroachment occurs when a physical structure — a fence, shed, driveway, or even a roof overhang — crosses over onto…

An encumbrance is any claim or restriction attached to a property that affects how it can be used or transferred. Liens…

Equity is the portion of your home's value that actually belongs to you once every debt against the property is…

Equity stripping is a predatory scheme that takes the built-up value of a home from an owner in distress. Common…

Escrow is the neutral holding arrangement where a third party manages money and documents while the terms of a real…

An escrow account is a neutral, third-party account used to hold funds or documents on behalf of both a buyer and…

The executor, sometimes called a personal representative or administrator depending on the state, is the person a…

A failed septic system is an on-site wastewater system that no longer treats and disperses sewage properly. Warning…

Fair market value is the price a willing buyer and a willing seller would agree to when neither party is under pressure…

The final walkthrough is the buyer's last opportunity to view the property, usually happening within a day or two of…

Fire, flood, and burst-pipe damage can leave a home unsafe, uninsurable, and unable to qualify for traditional mortgage…

Fix and flip describes a buyer's plan to purchase your property, renovate it significantly, and resell it for a profit…

A fixer-upper is a home that needs meaningful repairs or updates before it could sell at full retail value in its…

A flood zone is a geographic area designated by FEMA based on its risk of flooding, ranging from minimal-risk zones to…

Foreclosure is the legal process a lender uses to reclaim a home after the borrower stops making payments. Depending on…

A foreclosure auction is the public sale where a lender sells a home to recover an unpaid mortgage. Depending on the…

FSBO means selling your home yourself without hiring a listing agent, which allows you to avoid paying that side of the…

The grantee is the party receiving ownership of a property — the buyer in a home sale. The deed names the grantee…

The grantor is the party transferring ownership of a property to someone else — in the context of a home sale, that's…

A hard money loan is short-term financing secured by the property itself rather than the borrower's income or credit…

Heirs' property is land or a home passed down without a will or probate, so the title stays in the name of someone who…

A HELOC is a revolving line of credit secured by the equity in your home, functioning much like a credit card with your…

An HOA is the organization responsible for governing a subdivision, condo building or planned community. It collects…

An HOA lien is recorded by a homeowners association against a property for unpaid dues, special assessments, or…

A hoarder house is a property so full of accumulated belongings that it's difficult or impossible to show, inspect, or…

A holdover tenant is someone who stays in a rental after the lease term ends without signing a new lease. What happens…

Home equity is the share of your property you actually own outright — its current value minus any debts secured against…

A home inspection is a buyer-ordered walkthrough performed by a licensed inspector, who evaluates the roof, foundation,…

Homeowners insurance covers damage to the physical structure of your home and provides liability protection if someone…

A homestead exemption is a state or county program that reduces the taxable value of a home that serves as the owner's…

An iBuyer is a company that uses automated valuation models and algorithms to generate a quick online offer on your…

An inherited property is a home you receive after the owner's death, usually through a will, a trust, or your state's…

The interest rate is the annual cost of borrowing money, expressed as a percentage of the loan balance. For a seller,…

Intestate succession is the set of state laws that decides who inherits property when someone dies without a valid…

Inventory refers to the total number of homes actively for sale in a given market at any point in time, often described…

A job relocation sale happens when a homeowner needs to sell because work is requiring them to move, usually on a fixed…

Joint tenancy is a way for two or more people to co-own a property equally, with each owner holding an identical share…

A judgment lien is created when a creditor wins a lawsuit against you and then records that judgment, which attaches to…

A lease option rents your property to a tenant who also receives the right, but not the obligation, to purchase the…

Letters of administration are the court document that gives someone legal authority to manage an estate when the person…

Letters of testamentary are official court documents issued by a probate court that authorize a named executor to act…

A lien is a legal claim recorded against your property because of an unpaid debt. Mortgages, unpaid property taxes,…

A liened property carries one or more recorded claims against it — unpaid taxes, court judgments, contractor bills, HOA…

A life estate is a form of property ownership where one person, called the life tenant, has the right to live in and…

A lis pendens is a formal notice recorded against a property to alert the public that a lawsuit affecting ownership or…

The list-to-sale price ratio compares a home's final sale price to its last asking price, expressed as a percentage. A…

A loan modification is a permanent change to the terms of your existing mortgage, agreed to by the servicer, to make…

Loan-to-value compares your outstanding loan balance to the property's current market value, expressed as a percentage.…

A manufactured home is built almost entirely inside a factory and then transported to its final site, as opposed to a…

Market value is the price a property would realistically sell for under current conditions, assuming a willing buyer, a…

A mechanic's lien is a legal claim recorded by a contractor, subcontractor, or supplier who performed work or provided…

The median home price is the middle value of all homes sold in a given area during a given period — half the sales were…

Medicaid estate recovery is the federal requirement that states seek repayment from the estates of certain deceased…

A mixed-use building combines two or more types of space within the same structure — commonly a commercial storefront…

The MLS is the regional database that licensed real estate agents use to publish home listings and share them with…

A mobile home is a factory-built home constructed before June 1976, when federal HUD building standards for…

A modular home is built in large sections inside a factory, then transported to its site and assembled on a permanent…

A mortgage is a loan secured by real estate, meaning you borrow money to buy or refinance a home and the lender records…

Mortgage arrears are the total missed payments, late fees, and accrued interest a homeowner would need to pay to bring…

Mortgage forbearance is a temporary agreement with your servicer to pause or reduce payments for a set period during a…

The mortgage payoff is the exact dollar amount required to fully satisfy your loan as of a specific date, including…

A motivated seller is a homeowner who needs to sell for a specific reason on a specific timeline, rather than someone…

A multi-family property is a building with two or more separate living units under one deed and one owner — duplexes,…

A notice of default is the formal, publicly recorded document a lender files once a borrower has fallen far enough…

A notice of sale is a formal, often legally required document announcing that a property will be sold, most commonly…

Novation is a legal replacement of one party in a contract with a new party, done with everyone's agreement, so that…

An out-of-state owner holds property in a state different from where they currently live, often as a result of…

Owner financing describes the same arrangement as seller financing: the person who owns the property carries the loan…

A partition action is a lawsuit filed by one co-owner of a property asking a court to divide the property or force its…

A personal representative is the person a court authorizes to manage a deceased person's estate. It is the umbrella…

PMI is insurance a borrower pays for that protects the lender, not the homeowner, if the loan defaults. It's usually…

A pocket listing is a property that's marketed privately to a small group of potential buyers rather than being…

A postponement of sale moves a scheduled foreclosure auction to a later date. It can happen because the lender agrees…

A power of attorney is a legal document that authorizes one person to act on behalf of another, including signing real…

Pre-approval is a lender's conditional commitment to finance a buyer, issued after reviewing their income, assets, and…

Pre-foreclosure is the stage between the lender filing its first default paperwork and the actual foreclosure sale…

Price per square foot is calculated by dividing a home's sale price by its total living area, giving a rough way to…

Private money is capital lent by an individual or a small private group rather than a bank or an institutional hard…

Probate is the court process that validates a deceased person's will, settles their debts, and legally authorizes the…

A promissory note is the written promise to repay a debt, spelling out the loan amount, interest rate, payment schedule…

Proof of funds is documentation that shows a buyer genuinely has the money needed to close on your house. It's…

Property tax is the annual charge levied by your county based on the assessed value of your home, funding schools,…

Prorations are the adjustments made at closing to split ongoing costs, like property taxes, HOA dues or utility bills,…

A quiet title action is a lawsuit filed to resolve disputes or ambiguities about who legally owns a property,…

A quitclaim deed transfers whatever ownership interest the signer actually holds in a property, without making any…

A red-tagged property is a building a local official has posted as unsafe to enter or occupy, usually with a red…

A redemption period is a set window of time after a foreclosure sale or tax sale during which the former homeowner can…

Refinancing means replacing your existing mortgage with a brand-new loan, usually done to secure a lower interest rate,…

A reinstatement quote is a written figure from your mortgage servicer showing exactly what it would take to bring a…

Rent to own allows a person to lease your home while also having a path toward eventually purchasing it, usually with a…

REO, or "real estate owned," describes a property that a lender ends up owning after it went through foreclosure but…

A reverse mortgage is a loan available to homeowners typically 62 or older that lets them convert home equity into cash…

Right of survivorship is a legal feature attached to certain co-ownership arrangements, most commonly joint tenancy,…

Selling your house as-is means the buyer agrees to take the property in its current condition, and you're not required…

"Sell house fast" describes any approach that compresses the normal months-long home sale process into a matter of days…

Seller concessions are costs a seller agrees to cover on the buyer's behalf in order to make a deal happen or keep it…

A seller disclosure is the form on which you report known material facts about your property, such as past leaks,…

In seller financing, you take on the role of the lender: instead of receiving the full purchase price at closing, you…

A seller net sheet is an itemized estimate of how much money you will actually walk away with after a sale. It starts…

A seller's market occurs when buyer demand exceeds the supply of available homes, usually reflected in under about four…

Selling a house during a divorce means dividing what's often a couple's biggest shared asset, usually by selling it and…

A short sale happens when a lender agrees to accept less than the full amount owed on a mortgage so that a struggling…

A single-family home is a standalone house built for one household, sitting on its own lot with no shared walls, no…

A small estate affidavit is a simplified, sworn document that lets heirs collect or transfer a deceased person's…

A special assessment is an additional, often one-time charge imposed by a homeowners association, municipality, or…

In a subject-to deal, the buyer takes ownership of your home while your existing mortgage stays in your name and…

Surplus funds, sometimes called excess proceeds, are the money left over when a foreclosure or tax sale brings more…

A survey is a professional measurement and mapping of a property's boundaries, structures, and features, performed by a…

A tax deed is the legal document that conveys ownership of a property to a new owner after a government auction held to…

A tax lien is a government's recorded legal claim against a property for unpaid property taxes. Property tax liens…

A tax-delinquent property is one where the owner has fallen behind on property taxes, which then accrue interest and…

A teardown is a property where the real value lies almost entirely in the land itself, because the existing structure…

Tenancy in common is a form of co-ownership where two or more people hold title to a property, but each person's share…

A tenant-occupied property is a home with renters living in it at the time it's sold. Existing leases generally survive…

A tired landlord is an owner who's simply done with the day-to-day work of renting out a property — the tenant…

Title is the legal right to own, use and eventually sell a piece of property. When people say a home has "clear" or…

A title commitment is the title insurance company's written promise to issue a policy once certain conditions are met.…

A title company researches property ownership history, issues title insurance, holds escrow funds, and manages the…

Title insurance protects against financial losses caused by defects in a property's ownership history, such as forged…

A title search is a detailed review of public records conducted to confirm exactly who legally owns a property and what…

A townhouse is a multi-story home that shares one or two walls with the homes next to it, while the owner typically…

A transfer on death deed, also called a beneficiary deed in some states, lets a homeowner name who will receive the…

Underwriting is the lender's formal, detailed review of a buyer's finances and the property itself before the loan…

Unpermitted work is any construction, addition, or system change completed without the building permits and inspections…

A vacant lot is a piece of unimproved land with no habitable structure built on it, ranging from a small residential…

A vacant property is one that currently has no one living in it, whether because the previous owner moved out, passed…

A warranty deed transfers ownership of a property while also legally guaranteeing that the seller holds clear title and…

Wholesaling is when someone signs a purchase contract on your house and then sells that contract to a different buyer,…

Wholetail is a strategy that sits between wholesaling and a full renovation flip: the buyer purchases your home as-is,…

A wrap-around mortgage is a form of seller financing that “wraps” around an existing mortgage you still owe, which…

Zoning is the set of local government rules that dictates how a piece of land can legally be used — as single-family,…