Where cozy means tiny and charming means needs work.
A financing technique where someone pays upfront to reduce the interest rate on a mortgage, either temporarily or permanently. It's like paying for a discount on your discount.
Strategies employed by lenders to avoid foreclosure when borrowers can't make payments, including loan modifications, short sales, or forbearance. The bank's damage control department.
The tax rate used to calculate property taxes, expressed as dollars per $1,000 of assessed value. Because 'taxes per thousand' sounds friendlier than the actual tax bill.
The minimum time you must own a property or have a mortgage before certain transactions are allowed. Real estate's way of preventing you from flipping too fast.
Specific conditions that must be met for a contract to proceed, the legal equivalent of 'but first...'
Annual net income divided by annual debt payments, basically whether you're making enough money to pay your mortgage.
The percentage of your gross monthly income that goes toward debt payments, used by lenders to determine if you can afford a mortgage. It's basically a mathematical judgment of your life choices.
A mortgage exceeding conforming loan limits set by Fannie Mae and Freddie Mac, typically requiring better credit and larger down payments. It's called 'jumbo' because both the loan and the payments are supersized.
When your mortgage payment doesn't cover the interest due, causing your loan balance to actually increase over time. It's like running on a treadmill that's going backwards—you're making payments but falling deeper into debt.
A secondary loan that 'wraps around' an existing mortgage, where the new lender pays the original loan. It's financial inception—a loan within a loan, typically used when someone can't refinance.
In real estate, it refers to the property and land you own; in legal terms, it's everything you leave behind when you die for relatives to argue over. Estate can mean anything from a sprawling mansion with manicured grounds to your accumulation of assets and debts that someone has to sort through. Basically, it's either where you live large or what lawyers divide up after you're gone.
The deed section beginning with 'to have and to hold' that defines the extent of ownership being conveyed. Medieval legal poetry that survived into modern contracts for no good reason.
Co-ownership where each party owns a specific percentage share that can be sold or willed independently, without right of survivorship. The 'we own this together but I want out of this relationship' ownership structure.
A single loan that covers multiple properties, popular with developers and investors who find getting individual mortgages tedious. It's the financial equivalent of buying in bulk, often with a release clause letting you sell properties individually.
Ongoing expenses of property ownership including mortgage, taxes, insurance, utilities, and maintenance while holding property for investment. These costs literally 'carry' you financially from purchase to sale, often eating profits investors forgot to calculate.
A quick property valuation metric calculated by dividing sale price by annual gross rental income, used to compare investment properties. It's the back-of-napkin math real estate investors use before getting serious with cap rates and cash flow analysis.
A long-term lease (often 99 years) where the tenant owns the building but rents the land beneath it, common for commercial properties and some condominiums. It's the real estate equivalent of building your castle on someone else's sand.
A short-term, high-interest loan from private investors secured by property rather than creditworthiness, typically used by house flippers who need fast cash. It's called 'hard money' because of the asset-based collateral and the hard hit your wallet takes from those interest rates.
The four horsemen of monthly housing payments: Principal, Interest, Taxes, and Insurance. It's the total amount you'll shell out each month to keep a roof over your head and the bank off your back.
A performance metric showing the annual pre-tax cash flow divided by the total cash invested, expressed as a percentage. It's how rental property investors measure whether they're getting a decent return or just being a charity for tenants.
A euphemistic phrase suggesting the current owners maintain their property immaculately, or more cynically, that they've over-improved it beyond what the market will bear. Translation: someone really loves their home, possibly too much.
A property requiring operational or physical improvements to increase its income and value, typically involving renovations, better management, or repositioning. It's the investment thesis that assumes you're smarter than the previous owner—sometimes correctly.
An offer with no escape clauses—no inspection, no appraisal, no financing contingencies. It's the real estate equivalent of skydiving without checking if there's a parachute in the backpack, popular in markets where desperation trumps common sense.
Real estate euphemism for a building that's either foreclosed, about to be foreclosed, or looks like it should be condemned. The fixer-upper's troubled cousin who really needs an intervention.