Friday July 19, 2013
Every day, real estate professionals speak in a language that most new homebuyers would not understand. Because it is important to always be informed of every aspect in the home buying process, we have put together a quick reference guide for terms that are commonly misunderstood:
ARM: ARM is an acronym that stands for adjustable-rate mortgage. The rate of this type of mortgage is adjusted according to financial market conditions.
Convertibility: The ability to change a loan from an adjustable-rate schedule to a fixed-rate schedule.
Binder: When a deposit is paid and the homebuyer secures the right to purchase a home at terms agreed upon by the seller, they receive a receipt which is referred to as a binder.
Sales Contract: A contract between a buyer and seller which should explain, in detail:
What the purchase includes
Any guarantees made
The move in date
Repercussions if the contract is not fulfilled or if the buyer cannot get a mortgage commitment at the agreed-upon terms
Build Job: A build job refers to homes “to be built.” Homebuyers can purchase a to-be-built home from a builder or existing speculative home.
Elevation: A visual design of the front the home without landscaping.
Open Floor Plan: A floor plan where, commonly, the kitchen, dining and living room areas flow from one to the other without wall enclosures.
(Open floor plan in one of many homes in Las Colinas/Irving
Residential Development / Community
Greenbelt: Natural land that, by policy, is to remain undeveloped. There are various reasons this policy is put into place ranging from habitat preservation and air quality to aesthetic appeal.
Lot Premium: In some communities, there are certain lots that have unique, desirable features (such as a backyard view of a greenbelt). Builders usually have these particular lots priced at a premium because of a sought-after aspect that other lots don’t have.