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Real estate jargon & glossary

Here is our growing, plain-English, list of real estate terms that might help you, especially if you’re a first time home buyer!

Appraisal

Not to be confused with ‘inspection’. The appraisal is the lender’s inspection of the home to make sure that it’s worth what they’re is lending for it.

Closing

This is when the buyer and seller sign all the paperwork, and the transfer of ownership takes place. The buyer gets the keys to their new house!

Disclosures

The document that the seller fills out disclosing any known facts about the condition of the home. When a buyer makes an offer, they sign off on the disclosure document, acknowledging that they accept it.

Earnest money

When a buyer makes an offer, they need to offer some funds in good faith. The earnest money is ususally 1-2% of the offer and is held in an escrow account at the seller’s real estate brokerage. The funds are credited to the buyer at closing. If the buyer backs out on their offer, the earnest money may go to the seller as liquidated damages.

Inspection

Not to be confused with ‘appraisal’. The inspection is the home-buyer’s chance to hire an inspector, see what issues the house has, if any, and negotiate with the seller on any items that they want fixed. This is also the buyer’s last chance to make sure that they really want to buy the home. The inspection period is negotiable, but is often 7-10 calendar days.

MLS

In the Twin Cities, this is Northstar MLS that only Realtors have access to. MLS is the only site with up-to-date information on houses for sale.

Listing

Realtor refer to a house for sale as a ‘listing’.

Purchase agreement

This is the document used to make an offer on a house. The ‘PA’ is usually several documents put together and is often 30+ pages long, when all collected together. 

TISH or Truth In Sale of Housing

Several municipalities, including Minneapolis and St Paul, have an inspection that a homeowner must have done before listing the house for sale. If the city has required repairs, the homeowner or new buyer has to fix them. The city issues a certificate when the property is ok’d for sale.

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