If you are hoping to sell your house fast in Baltimore, there are some real estate terms you should become familiar with. Below, we’ve compiled some of the lesser-known terms you might hear when selling your house in Baltimore. Please feel free to reach out to us if there is anything else you would like to know about the selling process. We are happy to answer all of your questions. (410) 824-1687
– Appraised Price
An appraised value is an evaluation of a property’s value by a professional appraiser. This can be done during the mortgage origination process or by the buyer or seller privately to help determine the value of the property. An appraisal can also be used for tax purposes or after a divorce. If you are selling your house on the market with a buyer using financing, they bank will not finance more than the appraised value.
– Assessed Value
The assessed value of a property helps determine how much a homeowner will need to pay in property taxes. The property appraiser will take into account location information, inspection information for the home, any improvements you have made, and recent home sales in the area.
– Carrying Costs
The carrying costs are the costs you facing each month to own the home. This includes things like your mortgage, tax payments, insurance premiums, utility bills, and maintenance costs.
– Clear Title
A clear title means that there aren’t any other ownership claims to the property, nor are there any liens against the house. In Baltimore, the title company will investigate this for you.
– Comparative Market Analysis
A comparative market analysis, or CMA, provides information to help determine the value of the property. It takes into account recent sales to help you figure out what your house is currently worth. If you are listing your house on the market with a real estate agent, they will perform the analysis for you to help determine the market value of your house.
– Contingencies
A contingency is a stipulation in the contract that needs to be met before the contract is legal and binding. In Maryland, these are most often the appraisal, and inspection contingencies.
– Covenant
A covenant is a formal agreement in which one party gives the other certain assurances. An example would be covenants of warranty in a warranty deed. These are common in homeowner’s or condo associations.
– Delinquency
A delinquency occurs when a homeowner defaults on their loan. This is when a lender will actively begin the collections process, even initiating foreclosure.
– Disclosures
A disclosure is a document that the seller provides the buyer, letting them know about any problems, defects, or known issues with the property. Failing to disclose a problem with your home can be considered fraud. This is a huge no-no. You must disclose everything to your potential buyer.
– Encumbrance
An encumbrance is a claim against the property that restricts its transfer or use. A property lien is considered an encumbrance. Property liens can come from unpaid water bills, violations or non-payment from your homeowner’s association.
– Foreclosure
A foreclosure occurs when a homeowner fails to make their mortgage payment, typically for 90 days. The owner waives all rights to the property and the home becomes the possession of the bank.
– Inclusions
Inclusions are personal property that is included in the home sale. This can be things like appliances, furniture, or outdoor items. Basically, anything you are giving to the buyer when you sell the property. Items that are mounted to the walls like kitchen cabinets are considered fixtures and always convey.
– Market Value
Market value is a valuation of the property in which the parties are free of pressure to complete the transaction and all details of the house are known. It can be formulated by finding the average between the highest price a buyer would pay and the lowest price a seller would accept.
– Mechanic’s Lien
A mechanic’s lien is a lien against the property which will secure the payment of contractors, laborers, and those who provide materials. These are filed if you fail to pay a contractor at the time of service. This ensures they are paid before you collect any proceeds from the sale of the house.
– Negative Amortization
While amortization refers to paying off your loan, negative amortization happens when the payments you are making aren’t enough to cover the interest and the amount you owe becomes greater as opposed to less. In this case, most mortgage companies will increase your monthly payments to cover the loss.
– Quitclaim Deed
A quitclaim deed transfers the interest in real property from one person to another.
– Sale-Leaseback
A sale-leaseback occurs when a buyer purchases a property and then leases it back to the occupant. This is pretty common when the seller has not yet found a place to move. Oftentimes a buyer can only leaseback for a few months. Most mortgage companies do not like this as they want the buyer to be living in the home as their primary residence.
– Short Sale
A short sale occurs when an owner sells their property for less than what is owed, allowing the lender to recoup some of the cost of the loan as an alternative to foreclosure. This has nothing to do with the timeline. Short sales can often be quite a lengthy process, taking several months to process.
– Title
The title is a legal document that refers to who has legal ownership and who can legally use the property. Just like a car, it is how you claim ownership of the property. There are a variety of ways someone can hold title if more than one person owns the property.
– Title Defect
A title defect is when there is an adverse claim, somewhere in the chain of ownership. It can have an impact on who has legal rights to the property.
– Waiver
Voluntarily giving up a right, claim or privilege. It removes liability for the other party in the agreement.
When trying to sell your house fast in Baltimore, you will likely hear a lot of real estate jargon thrown your way. It’s important to know what is being said and how the terms used will impact you. Do your homework before selling your house fast in Baltimore so you don’t miss something you should have been aware of!