Buying a house is an exciting experience. But if you do not know the meaning of the terms used in the purchase of a house, this experience can become a difficult task. In fact, for some people, understanding the related terms can be the most complicated part of the process. Here we give you five common terms about real estate.
Appraisal
An appraiser can help you examine the property,considering the initial price of the house and comparing it with recent sales of similar properties. The appraisal can help ensure that the sale value of the house corresponds to its market value. In addition, the lender that issues the mortgage usually requires this appraisal to help determine the amount of your loan.
Title Insurance
Owner title insurance helps protect the purchase and sale of any problems you may have that are alien to potential new owners. For example,a debt not paid to a previous contractor or taxes that previous owners did not pay. Title insurance has two parts: one protects the buyer and another protects the lender. The safest thing is that you need a title insurance if you are going to take out a mortgage.
Contingencies
Contingencies are clauses in the sales contract that allow the parties to withdraw their proposal if certain pre-agreed requirements are not met. The contingencies generally help protect the buyer from certain risk sin case of unexpected events. For example, if the value of the appraisal is less than the bid price or if the home inspection is not satisfactory, the contract can usually be canceled without the buyer losing his money.
Closing costs
Depending on the state you are in, there are additional costs to the cost of the property that a buyer usually pays. These are known as the closing costs of the sale of a property. Closing costs may include appraisal costs, tax service provider charges, title insurance, and government transfer taxes. It is possible that some of these expenses can be financed and included in the mortgage loan, depending on the case.