Appraisal – A report highlighting the estimated value of the property completed by a qualified third party. This is typically done for the benefit of the buyer, and their lender, to ensure the property is worth what they are paying.
Association Fee / HOA fee – In addition to your mortgage, certain housing communities such as condos and townhomes have a monthly fee associated with maintaining the commons areas and amenities such as pools.
Closing Disclosure / CD / Alta Settlement Statement – A standardized disclosure form that is used to itemize and all of the costs and fees as well as the distribution of all of the funds to and from buyer and seller.
Closing Costs – Buyers and seller both have expenses associated with the home sales other than that of the actual cost of the home. For example, the buyer has a variety of fees connected to obtaining a new loan and the seller has commissions paid to real estate agents.
Counteroffer – The response from the sellers in regard to the buyers offer
Earnest Money – The deposit made from the buyer to the seller when submitting an offer. This deposit is typically held in trust by a third party and is intended to show the seller you are serious about purchasing their home. Upon closing the money will generally be applied to your down payment or closing costs.
Loan Approval (does not mean Loan Approved) A conditional approval or a loan approval letter means that the buyer has been approved for a loan once certain conditions are met. These conditions may be that they sell their current home, provide more documentation, pay off an account, or settle an outstanding balance.
Principal – The underlying amount of the loan which you actually borrowed separate from any accrued interest charges.
Title – A legal document proving current and proper ownership of the property. Also referred to as a Title Deed, this document highlights the history of property ownership and transfers. Learn more about title insurance.
Underwriting – For a mortgage, this is the process in which the potential home buyer is evaluated for their financial ability to obtain and repay a loan, normally consisting of a credit check and appraisal of the property. For title insurance, this is the process when historic documents are reviewed to determine if a title insurance policy can be issued and which conditions and exceptions will be included in that policy.
Jim is the author of Bullet Point Blog, a speaker, and real estate attorney who has been serving Nashville, Brentwood, Franklin and other Middle Tennessee cities for nearly 20 years. Jim’s law practice is focused practice in the areas of contracts, real property and real property transactions with a Vanderpool Law in Middle Tennessee. He has almost 2 decades of experience as a real estate attorney and is president of Vanderpool Law. It is this experience that allows him to handle all real estate related matters professionally and with confidence.
This blog is distributed with the understanding that the publisher and author are not engaged in rendering legal, accounting, or other professional service by its publication. If legal or other expert assistance is required, the services of a competent professional should be sought
By Jim R. Vanderpool , December 13, 2022
An easy and stress-free real estate transaction is based on years of training, hard work, passion, as well as familiarity with standard contracts used in Tennessee real estate transactions.You’ll find all that and more at Vanderpool Law.