Glossary of Real Estate & Auction Terms

A

Appraisal

An estimate of a property's fair market value, conducted by a professional appraiser.

As-Is

A property sold in its current condition, without any warranties or representations from the seller.

B

Bank-Owned (REO)

Real Estate Owned by a lender, typically after an unsuccessful foreclosure auction.

Bid

A formal offer made by a potential buyer to purchase a property at auction.

C

Closing

The final step in a real estate transaction where ownership is transferred from the seller to the buyer.

Closing Costs

Fees paid at the closing of a real estate transaction, including loan origination fees, title insurance, and attorney fees.

Contingency

A condition in a purchase agreement that must be met for the contract to become binding.

D

Deed

A legal document that transfers ownership of a property from one party to another.

Due Diligence

The research and investigation a buyer conducts before purchasing a property to confirm all facts and details.

E

Easement

A right for someone to use another person's land for a specific purpose (e.g., for utilities or access).

Escrow

A neutral third party that holds funds and documents on behalf of the buyer and seller during a real estate transaction.

F

Fair Market Value (FMV)

The price a property would sell for on the open market under normal conditions.

Foreclosure

A legal process in which a lender takes possession of a property after a borrower fails to make mortgage payments.

L

Lien

A legal claim against a property for an unpaid debt, such as a mortgage or unpaid taxes.

Listing Agreement

A contract between a property owner and a real estate broker, authorizing the broker to represent the seller and find a buyer.

T

Title

A legal document that establishes ownership of a property.

Title Insurance

Insurance that protects the buyer and lender against losses from defects in the property's title.