What language is my Realtor talking? Real Estate Lingo Made Simple: Your Guide to Buying and Selling Homes

Ever felt like your Realtor is speaking a different language? You're not alone. Terms like APS, NOF, BRA, and CMA can be confusing, and it's easy to feel overwhelmed. But don't worry, I've got your back! Every industry has its own jargon, and real estate is no exception. In this blog, I'll break down the most common real estate terms in plain English, so you can move forward with confidence. No jargon, no fluff—just straight talk about buying and selling homes.

Buying Terms Made Easy

Preapproval vs. Prequalification

Let's start with the basics. When you're looking to buy a home, you'll hear about prequalification and preapproval.

• Prequalification: Think of this as a quick estimate of how much you can afford. You can find online calculators where you input your income and expenses, and they give you a rough idea of what you can buy. It's a good starting point but not set in stone.
• Preapproval: This is a deeper dive into your finances. You'll sit down with a mortgage broker and provide documents like T4s, notice of assessments from CRA, letters of employment, and bank statements. A preapproval shows sellers that you're serious and ready to buy.

APS: Agreement of Purchase and Sale

An APS is your proposal to buy a property. It's a big deal, so let's break it down:

• Conditional Offer: This means your offer is valid only if certain conditions are met. These could include a home inspection, securing financing, or getting insurance. It's like saying, "I want to buy this house, but only if everything checks out."
• Firm Offer: This is an offer with no conditions. If the sellers accept, it's a done deal—you've just bought yourself a house! It's a bit riskier because you're committing without any outs, but it can make your offer more attractive to sellers.

Deposit vs. Down Payment

• Deposit: When you make an offer, you might put down a deposit to show good faith. If the offer is accepted, this money is exchanged. It's like saying, "I'm serious about buying this property."
• Down Payment: This is the portion of the home's price you pay upfront. The rest comes from your mortgage. The size of your down payment can affect your mortgage terms and interest rate.

Closing Costs

These are extra costs that come up at the end of the buying process. They can include legal fees, land transfer tax, title insurance, and more. It's a good idea to plan for roughly 1.5% to 4% of the home price to cover these costs. Trust me, you don't want to be caught off guard by these expenses.

Title Insurance and Title Search

• Title Search: This ensures that the home actually belongs to the seller and that there are no liens on the property. You want to make sure the title is free and clear when you take possession.
• Title Insurance: This protects you from any legal issues tied to the property's ownership. It's like an insurance policy for your home's title.

Amendment

Sometimes, after an offer is accepted, things change. Maybe you need to extend the conditions, change the closing date, or add/remove buyers or sellers. As long as both parties agree, an amendment can be made to the agreement.

Seller Terms Explained

Listing Agreement

This is the contract between you and your real estate agent. It gives them permission to sell your property and includes details like the start and end dates, price, commission, and all other sale-related information.

CMA: Comparative Market Analysis

Your Realtor will do a CMA to estimate your home's sale price. They'll look at recent sales, competition, and expired listings to come up with a fair market value.

Staging

Staging is all about making your home look its best for showings and potential buyers. It's like dressing up your house to make a great first impression. Trust me, it makes a big difference!

Days on Market

This tells you how long a home has been listed. If a house has been on the market for a long time, it might be overpriced or have some issues. It's a good gauge to see how long a property has been for sale.

Conditional Sale or House Under Contract

This means the seller has accepted an offer, but it's not a done deal yet. The buyer still needs to meet certain conditions, like getting financing or doing a home inspection. Once everything is fulfilled, they'll write a notice of fulfillment to firm up the deal.

NOF: Notice of Fulfillment of Conditions

This is the paperwork that confirms the buyers are removing all their conditions. It means your house is now officially sold. Congrats!

General Real Estate Terms

MLS: Multiple Listing Service

The MLS is the database where all homes for sale are listed. It's what you see on websites like realtor.ca. It's a great resource for both buyers and sellers.

Appraisal

An appraisal is an unbiased estimate of a home's value. Lenders often require it to make sure the purchase price makes sense. It's like a reality check for the home's worth.

Home Inspection

A home inspection is when a professional checks the house for issues. They'll look at plumbing, electrical, roof, foundation, and everything in between. It's a crucial step to avoid any surprises.

Trust Account

A trust account is a third party that holds your money safely until the deal closes. It could be at the lawyer's office or where your deposit goes when you have an accepted offer. It's like a neutral zone for your money.

Closing Date or Possession Date

This is the day ownership of the property officially transfers from the seller to the new buyer. You get the keys, they get the money—it's a done deal! Time to celebrate!

The real estate process can feel overwhelming, but once you understand the language, it gets a lot less intimidating. That's why I always recommend sitting down with a Realtor to go through the process of buying and selling. It'll make your life so much easier and smoother.

Now you're equipped to walk into a deal and understand what everybody is talking about. Happy house hunting or selling! If you have any questions or need further clarification, feel free to reach out. I'm here to help!