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Glossary of Real Estate Terms

Forced Sale

Definition A forced sale is a real estate transaction in which a property owner is legally required to sell their property, often due to foreclosure, court orders, tax liens, or other financial or legal obligations. Unlike voluntary sales,...

Foreclosure

Definition Foreclosure is the legal process by which a lender takes possession of a property after the homeowner fails to make mortgage payments. Once the borrower defaults on their loan, the lender can seize the property, sell it, and use the...

Gap Financing

Definition Gap financing is a short-term loan used to cover temporary funding shortfalls in real estate transactions or development projects. It is commonly used when a borrower needs immediate capital but is waiting for permanent financi...

Gift Funds

Definition: Gift funds refer to money given to a homebuyer by a family member, close relative, or approved donor to assist with the down payment, closing costs, or other home purchase expenses. These funds are typically used to help buyers qual...

Good Faith Estimate (GFE)

Definition A Good Faith Estimate (GFE) was a document provided by mortgage lenders outlining the estimated costs and fees associated with obtaining a home loan. It included details such as loan terms, interest rates, closing costs, and pr...

Hard Money Loan

Definition A hard money loan is a short-term, high-interest loan secured by real estate, typically used by real estate investors, house flippers, or borrowers who don’t qualify for traditional financing. These loans are issued by privat...

Home Inspection

Definition: A professional evaluation of a home’s condition and safety before purchase. Explanation: A home inspection helps buyers identify potential issues such as structural damage, faulty wiring, plumbing leaks, or roofing problems. Wh...

Homeowner’s Association (HOA)

Definition: A Homeowners Association (HOA) is a governing organization that manages and enforces community rules, regulations, and amenities for a planned neighborhood, condominium, or townhouse community. Homeowners in an HOA-managed community...

Housing Ratio (Front-End Ratio)

Definition The Housing Ratio (Front-End Ratio) is a financial metric used by mortgage lenders to determine whether a borrower can afford a home loan. It measures the percentage of a borrower's gross monthly income that goes toward housing expe...

Land Lease

Definition A land lease, also known as a ground lease, is a real estate agreement in which a tenant or homeowner leases the land but does not own it, while they may own or build structures on the property. This arrangement is common in mob...

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