Real Estate Terms you should KNow

Amortization: length of time over which your mortgage/debt will be repaid.

Appraisal: an assessment of a property's market value conducted by a professional appraiser.

Appreciation: the increase in value because it is worth more now than when you bought it.

Closing Costs: expenses incurred by the buyer and seller during the finalization of a real estate transaction, which can include legal fees, title insurance, and inspection fees.

Closing day: the date the sale of the property becomes final and the new owner takes title to the home.

CMHC: Canada Mortgage and Housing Corporation. A Crown corporation that administers the National Housing Act for the federal government and encourages the improvement of housing and living conditions for all Canadians.

Conditional offer: an Offer to Purchase that is subject to specified conditions. For example, the arrangement of a mortgage, inspection of the property, well water test etc. There is an agreed-upon time limit to satisfy the specified conditions.

Condos (Condominiums): a type of residence within a multi-unit building where individual units are owned privately, while common areas are shared among all residents.

Conventional Mortgage: a mortgage loan up to a maximum of 80% of the lending value of the property. Mortgage insurance is usually not required for this type of mortgage.

Counteroffer: If the 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.

Deposit: money placed in trust by the purchaser when an Offer to Purchase is accepted. The sum is held by the real estate broker representative or lawyer/notary until the sale is closed and then it is paid to the vendor. The deposit forms part of your downpayment.

Down Payment: the portion of the purchase price paid upfront by the buyer, typically expressed as a percentage of the total cost.

Easement: an interest in land owned by another person that benefits the person who has the easement, for a specific limited purpose (for example, the right of way permitting passage over a particular strip of land) such as with public utilities.

Equity: the value of a homeowner's interest in a property, calculated by subtracting the outstanding mortgage balance from the property's current market value.

Fixed mortgage interest rate: alocked-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.

Home Inspection: a comprehensive evaluation of a property's condition conducted by a qualified inspector.

Interest rate: the price paid for the use of money borrowed from a lender.

Land surveyor: a professional who can survey a property in order to provide a certificate of location.

Lien: a claim against a property for money owed. A lien may be filed by a supplier or a subcontractor who has provided labour or materials but has not been paid.

Lump sum prepayment: an extra payment to reduce the principal balance of your mortgage, with or without penalty.

MLS (Multiple Listing Service): a database system used by real estate professionals to share property listings, allowing them to collaborate and access a wide array of real estate listings.

Mortgage: an agreement between you and a lender that gives the lender the right to take your property if you don't repay the money borrowed plus interest.

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 payment: a regular payment to the lender that includes the interest and the principal.

Offer to Purchase: a written contract outlining the terms under which the buyer agrees to buy the home. When accepted, it forms a legally binding contract that binds the people who signed to certain terms and conditions.

Open mortgage: a flexible mortgage that allows you to pay part before the end of its term.

Open House: a period of time in which a property for sale is held open for public viewing.

Pre-Approval: a lender's conditional commitment to provide a mortgage loan based on an applicant's creditworthiness and financial status before they make an offer on a property.

Property taxes: taxes charged by the municipality, typically based on the assessed value of the property. In Manitoba, there are also school taxes that form part of your property taxes.

REALTOR®: a licensed real estate professional who is a member of the Canadian Real Estate Association (CREA) and adheres to its code of ethics.

Reserve fund: a fund required to be set up by the condominium corporation for major repair and replacement of common elements and assets of a corporation. This amount is set aside by the homeowners monthly so that funds are available for emergency or major repairs.

Term: a mortgage term is the length of time that the mortgage contract conditions, including interest rate, are in effect.

Title: 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.

Title Insurance: protects against financial loss from defects in a property title, such as liens or claims against the property.

Variable mortgage interest rate: fluctuates based on market conditions but the mortgage payment remains unchanged.

Vendor: the seller of a property.

Zoning: regulations that dictate how land can be used in certain areas, including restrictions on building types, densities, and purposes.