Amortization - The length of time it takes to pay off a mortgage in full through regular payments.
Appraisal - An estimate of a property’s market value by a licensed professional, often required by lenders.
Bridge Financing - A short-term loan used to bridge the gap between buying a new home and selling your current one.
CMA - (Comparative Market Analysis) An evaluation of similar, recently sold properties to determine a home's market value.
Condominium - A property where individual units are owned separately, but common areas are shared.
Conditions - Specific requirements or contingencies that must be met before a real estate transaction is finalized.
Deposit - A sum of money paid upfront to show commitment to a purchase, held in trust until closing.
Down Payment - The initial payment made towards a property, usually a percentage of the total price.
Fixed vs. Variable vs. Adjustable - Types of mortgage rates: Fixed stays the same, Variable fluctuates amount paid to principal, and Adjustable changes your total monthly payment.
Freehold - A property where the owner has full ownership of both the building and the land it sits on.
High Ratio Mortgage - A mortgage where the down payment is less than 20%, requiring mortgage loan insurance.
Home Inspection - An examination of a property’s condition, typically done before finalizing a purchase.
Land Transfer Tax - A tax paid by the buyer upon transferring ownership of a property.
Months of Inventory - A metric indicating how long it would take to sell all available homes if no new homes were listed. Buyers/Sellers/Balanced Market.
Mortgage Loan Insurance - Insurance required for high ratio mortgages, protecting the lender if the borrower defaults.
Multiple Representation - When one real estate agent or brokerage represents both the buyer and seller in a transaction.
POTL (Parcel of Tied Land) - A freehold property that shares ownership of common areas with other properties, like roads or amenities.
Porting - Transferring an existing mortgage to a new property without penalties.
Pre-Approval - A lender's estimate of the maximum mortgage amount a buyer can qualify for, based on their financial situation.
Title Insurance - Insurance that protects against issues with the property’s title, like liens or ownership disputes.
Clauses vs. Conditions - Clauses are specific terms in a contract, while conditions are requirements that must be met for the contract to be finalized.
COMMON CLAUSES
Clean and Broom Swept - The Seller’s agree to leave the house clean and remove all personal belongings and trash.
Deposit Clause - Details the amount of the deposit, when it is to be paid, and the conditions under which it may be refunded or forfeited.
Warranty Clause - The seller provides assurances (warranties) about specific aspects of the property, such as the condition of major systems or the absence of encroachments.
Assignment Clause - Specifies whether the buyer can assign their rights and obligations under the contract to another party before closing. Pre-construction condos.
Right to Revisit Clause - Allows the buyer to revisit the property before closing, typically for final walkthroughs or to verify the condition of the property.
CCOMMON CONDITIONS
Appraisal Condition - Requires that the property’s appraised value meets or exceeds the purchase price, protecting the buyer’s financing.
Finance Condition - Gives the buyer time to secure mortgage approval, ensuring they can obtain financing before committing to the purchase.
Home Inspection Condition - Allows the buyer to have a professional inspection of the property to assess its condition before finalizing the deal.
Other/Custom - Buyers and sellers can negotiate and include custom clauses or conditions tailored to specific needs, making the offer flexible to unique situations.
Pool Inspection Condition - Similar to a home inspection, this condition allows the buyer to have the pool and its equipment professionally inspected before completing the purchase.
SOP (Sale of Buyer’s Property Condition) - Makes the offer dependent on the buyer successfully selling their current home before closing on the new property.
SOP Escape Clause - A clause that allows the seller to continue marketing the property and accept other offers while the buyer’s conditions are still in place, often leading to a time limit for the buyer to fulfill their conditions.
Status Certificate Review Condition - Specific to condo purchases, this condition gives the buyer’s lawyer time to review the Condo Status Certificate for any potential issues.