Common Real Estate Terms & Mortgage Terms Explained - Part 4

Continuing on in our series of definitions for commonly used real estate terms and mortgage terms (or terminology relating to the real estate/mortgage industry):

Contingencies
These are conditions written into Real Estate offers and contracts to prevent a buyer from being forced to buy a property that is unsatisfactory - either structurally or financially. Here are some examples of contingencies:

"This offer is subject to the buyer's obtaining adequate financing."
This could specify the maximum interest rate that you will pay or, that if the appraised value is less than agreed upon purchase price, the contract can be voided and full deposit refunded or the contract renegotiated.

"This offer is subject to a satisfactory home inspection and buyer's approval of that report."
The inspection should be completed within a designated number of days.

"This offer is subject to the buyer's approval of a title insurance policy to be obtained at the seller's expense."

"This offer is contingent upon the seller's providing the required survey certificate to the buyer at the seller's expense."

Please note - these are only examples and you should alway obtain proper legal advice from a real estate attorney before adding, removing or altering clauses or signing any real estate contract.

Condominium

This is housing (usually in a complex), where the owner owns only the unit in which they live (from the interior walls inward). A condo often includes a portion of the common area.

Debt to Income Ratio
The ratio of a borrower's total debt as a percentage of their total gross income.

Deed

The document that, when recorded with your local government, determines ownership of a property. A Deed is transferred from seller to buyer at closing.


Delinquent Mortgage

A mortgage where a borrower who is behind on payments. If the borrower fails to bring the payments up to date within a specified period, the lender (mortgagee) may begin foreclosure proceedings.

Duplex
A structure that consists of two separate family units.