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Buying a Home: Do You Know the Lingo?

To confidently point you in the right direction,here is a list of some of the most common terms used in the home-buying process.

Appraisal – A professional analysis used to estimate the value of the

home. A necessary step in validating the home’s worth to you and your

lender to secure financing.

Closing Costs – The costs to complete the real estate transaction. Paid at

closing, they include: points, taxes, title insurance, financing costs, and

items that must be prepaid or escrowed. Ask your lender for a complete

list of closing cost items.

Credit Score – A number ranging from 300-850 that is based on an

analysis of your credit history. Helps lenders determine the likelihood that

you’ll repay future debts.

Down Payment – Down payments are typically 3-20% of the purchase

price of the home. Some 0% down programs are also available. Ask your

lender for more information.

Mortgage Rate – The interest rate you pay to borrow money to buy your

home. The lower the rate, the better.

Pre-Approval Letter – A letter from a lender indicating that you qualify

for a mortgage of a specific amount.

Real Estate Professional – An individual who provides services in buying

and selling homes. Real estate professionals are there to help you

through the confusing paperwork, find your dream home, negotiate any

of the details that come up, and to help you know exactly what’s going

on in the housing market.

"The best way to ensure your home-buying process is a confident one is to find a real

estate pro who will guide you through every aspect of the transaction with

‘the heart of a teacher’, putting your family’s needs first."

Freddie Mac – My Home Section

~Information taken from Keeping Current Matters, Things to Consider When Buying a Home, Fall 2019 Edition

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