​Real Estate & Mortgage Glossary (A–Z)

 Amortization – The breakdown of loan payments over time, showing how much of each payment goes toward the loan’s principal and how much goes toward interest.

Annual Percentage Rate (APR) – The annual cost of borrowing, including both the interest rate and lender fees, expressed as a percentage.

Appraisal – A professional estimate of a property’s value, usually required by a lender before issuing a mortgage loan.

Buyer’s Agent – A real estate professional who represents and advocates for the buyer’s interests throughout the home purchase.

Closing – The final stage in a real estate transaction when all paperwork is signed and the buyer takes legal ownership of the property.

Closing Costs – Expenses paid at the closing of a real estate deal, including attorney fees, lender charges, title fees, taxes, and insurance.

Conventional Loan – A mortgage not insured by the government, typically requiring higher credit scores and larger down payments.

Contingency – A condition that must be met in order for a real estate contract to be binding, such as a home inspection or financing approval.

Down Payment – The portion of the home’s price that the buyer pays upfront, usually between 3% and 20%.

Due Diligence (North Carolina) – A negotiated time period in which the buyer investigates the property (e.g., inspections, loan approval). A non-refundable due diligence fee is paid to the seller; if the buyer backs out during this time, they forfeit the fee but may keep their earnest money.

Earnest Money Deposit (EMD) – A deposit made by the buyer to show serious intent to purchase. It's typically held in escrow and may be refunded depending on contract terms.

Escrow – A secure, neutral account that holds funds and documents until all terms of a real estate agreement are met.

FHA Loan – A government-backed mortgage loan insured by the Federal Housing Administration, designed to help buyers with lower credit or smaller down payments.

Fixed-Rate Mortgage – A loan with an interest rate that remains the same for the entire duration of the mortgage term.

Home Inspection – A detailed evaluation of a property’s condition by a licensed inspector. Common inspections include general home, HVAC, septic, termite, and well.

Interest Rate – The cost of borrowing money from a lender, expressed as a percentage of the loan amount.

Listing Agent – The real estate agent who represents the seller and is responsible for marketing the property.

Loan Estimate – A standardized document that outlines the terms of a mortgage, including interest rate, monthly payment, and closing costs.

MLS (Multiple Listing Service) – A shared database where real estate agents list properties for sale and access property details.

Mortgage – A loan used to purchase real estate, secured by the property itself.

Mortgage Insurance (PMI) – Insurance required by lenders on loans with less than 20% down. It protects the lender if the borrower defaults.

Offer – A buyer’s written proposal to purchase a property, including price and terms.

Pending – A property status indicating that an offer has been accepted and the transaction is underway but not yet closed.

Pre-Approval – A letter from a lender confirming how much a buyer is qualified to borrow, based on a review of credit and income.

Principal – The amount of money borrowed in a mortgage, not including interest.

Refinancing – The process of replacing an existing mortgage with a new one, typically to secure better loan terms or a lower interest rate.

Term – The length of time over which the mortgage is scheduled to be repaid, commonly 15 or 30 years.

Title – A legal document proving ownership of a property. A title search is conducted before closing to ensure a clear title.

Under Contract – A home that has a signed purchase agreement but has not yet closed.

VA Loan – A mortgage guaranteed by the U.S. Department of Veterans Affairs, available to eligible veterans and active-duty service members, typically requiring no down payment.

Walk-Through – A final visit by the buyer before closing to ensure the home is in agreed-upon condition and any requested repairs are completed.