Real Estate Terms

 
The process of buying and selling your home can be stressful, here are some terms you should familiarize yourself with: 


Appraisal:
 
Process for estimating the market value of a property.
Appreciation:
 
The increase in value of something because it is worth more now than when you bought it.
 
Certificate of status:
 
Also called an Estoppel certificate, it outlines a condominium corporation's financial and legal state. Fees may vary and may be capped by law (does not apply in Quebec).
Closing costs:
 
Costs in addition to the purchase price of the home, such as legal fees, transfer fees and disbursements, that are payable on closing day. They range from 1.5% to 4% of a home’s selling price.
Closing day:
 
Date on which the sale of the property becomes final and the new owner takes title to the home.
 
Conditional offer:
 
An Offer to Purchase that is subject to specified conditions, for example, the arrangement of a mortgage. There is usually a stipulated time limit within which the specified conditions must be met.
Contractor:
 
A person responsible for overall construction of a home, including buying, scheduling, workmanship, and management of subcontractors and suppliers.
Counteroffer:
 
If, for example, your original offer to the vendor is not accepted, the vendor may counteroffer. This means that the vendor has amended something from your original offer, such as the price or closing date. As this new offer varies the terms of the original offer, this rejects the original offer. If a counteroffer is presented, the individual has a specified amount of time to accept or reject.
Credit history or Credit Report:
 
The main report a lender uses to determine your creditworthiness. It includes information about your ability to handle your debt obligations and your current outstanding obligations.
Curb appeal:
 
How attractive the home looks from the street. A home with good curb appeal will have attractive landscaping and a well-maintained exterior.
 
 
Deposit:
 
Money placed in trust by the purchaser when an Offer to Purchase is made. The sum is held by the real estate representative or lawyer/notary until the sale is closed and then it is paid to the vendor.
Depreciation:
 
The decrease in value of something because it is now worth less than when you bought it.
Down payment:
 
The portion of the home price that is not financed by the mortgage loan. The buyer must pay the down payment from his/her own funds or other eligible sources before securing a mortgage.
 
Easement:
 
An interest in land owned by another person that benefits the person who has the easement, for a specific limited purpose (i.e. right of way permitting passage over a particular strip of land) such as with public utilities.
 
Fixed mortgage interest rate:
 
A locked-in rate that will not increase for the term of the mortgage.
Foreclosure:
 
A legal process where the lender takes possession of your property and sells it to cover the unpaid debt.
Freehold :
 
A freehold title is an interest in land that gives the holder full and exclusive ownership of the land and building for an indefinite period. A leasehold title is an interest in land that gives the holder the right to use and occupy the land and building for a defined period.

 
 
Home inspector:
 
A person who visually inspects a home to tell you if something is not working properly, or is unsafe. He or she will also tell you if repairs are needed, and maybe even where there were problems in the past.
Interest:
 
The cost of borrowing money. Interest is usually paid to the lender in regular payments along with repayment of the principal (loan amount).
Interest rate:
 
The price paid for the use of money borrowed from a lender.
 
Lawyer:
 
A legal advisor who is licensed to practice law and who assists people by representing them on legal matters.
 
 
Mortgage:
 
A mortgage is a security interest given in the property you are purchasing which secures repayment of the loan related to the property. That security interest is discharged on payment of the principal and interest owning on the loan in accordance with the mortgage document. In Quebec, “mortgages” are called “hypothèques”.
Mortgage approval:
 
Written notification from the mortgage lender to the borrower that approves the advancement of a specified amount of mortgage funds under specified conditions.
Mortgage broker:
 
The job of the mortgage broker is to find you a lender with the terms and rates that will best suit you.
Mortgage lender:
 
A morgage lender is an institution (bank, trust company, credit union, etc.) that lends money for a mortgage.
Mortgage payment:
 
A regular payment to the lender that includes both the interest and the principal.
Mortgage term:
 
Length of time that the mortgage contract conditions, including interest rate, is fixed.
MLS — Multiple Listing Service:
 
A multiple listing service that contains descriptions of most of the homes that are for sale. This computer-based service is used to keep up with properties that are listed for sale.
 
Offer to purchase:
 
A written contract setting out the terms under which the buyer agrees to buy the home. If the Offer to Purchase is accepted by the seller, it forms a legally binding contract that binds the people who signed to certain terms and conditions.
Open-house:
 
A period of time during which a house or apartment for sale or rent is held open for public viewing.
Property insurance:
 
Insurance that you buy for the building(s) on the land you own. This insurance should be high enough to pay for the building to be re-built if it is destroyed by fire or other hazards listed in the policy.
Property taxes:
 
Taxes charged by the municipality where the home is located, usually based on the value of the home. In some cases the lender will collect a monthly amount as part of the mortgage payment to cover your property taxes, which is then paid by the lender to the municipality on your behalf.
Realtor or real estate agent:
 
A person who acts as an intermediary between the seller and the buyer of a property.
Single-family detached home:
 
Free-standing home for one family, not attached to a house on either side.
Single-family semi-detached home:
 
Home for one family, attached to another building on one side.
Sustainable neighbourhood:
 
Neighbourhood that meets residents needs while protecting the environment.
 
 
Vendor:
 
The seller of a property.



**Definitions taken from Canada Mortgage and Housing Corporation 
http://www.cmhc-schl.gc.ca/en/co/buho/hostst/hostst_011.cfm
 
 

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Aris Kapasouris

Aris Kapasouris

Broker
CENTURY 21 Leading Edge Realty Inc., Brokerage*
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