Robb Realty VIP Buyer Packet

VIP BUYER PACKET

B E R K S H I R E H AT H AWAY H O M E S E R V I C E S G E O R G I A P R O P E R T I E S

C O N T E N T S

Mission, Vision, Values | PG 2 Our Story | PG 3 Meet The Closing Team | PG 4 14 Critical Questions to Ask | PG 5 Before Hiring an Agent We Handle The Complexities So You Can Focus on You | PG 6 Robb Realty Group Website and Mobile App | PG 7 Best Search at Your Fingertips Financing Your Dreams | PG 8 Mortgage Pre-Approval Process | PG 10 Making The Offer | PG 12 Robb Realty Group VIP Buyer Advantage | PG 13 A Buyer’s Agent is On Your Side | PG 14 Robb Realty Group VIP Buyer Agreement | PG 15 HSA Home Warranty Info & Plan | PG 16 Satisfaction Guarantee /Cancellation Policy | PG 17 Real Estate Defined Pages | PG 18

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OUR MISSION

To Glorify God by putting our clients interests above our own inspiring a positive, lasting impact in all we do.

STATEMENT

OUR VISION To be a top of mind, trusted residential real estate team in the Southeast

OUR CORE VALUES Honesty - We will be positive and virtuous in all our affairs to build trustworthy relationships with everyone we come in contact with on a daily basis.

Integrity - We promise to always do the right thing for our team, clients and our business, even when no one is watching.

Servant’s Heart - We think not less of ourselves but put ourselves less and put the needs of others before our own to help them achieve their goals above ours.

Passion - We are committed to a superior customer experience and creating raving fans through exceeding expectations.

Commitment - We are committed to providing the highest level of service by being solution-based and always finding a way to meet our clients needs.

Charity - We want to give back what has been freely given to us to make a positive impact in our community by helping those in need.

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OUR STORY

All of our agents have in-depth ongoing knowledge of the Greater Atlanta communities we serve.

Eric Robb grew up in upstate New York and took his hospitality and management skills as a professional chef into Real Estate in 2014. In 2015 he sold $12 million dollars worth of real estate and helped 48 clients sell or purchase a home.

Hanging his chef’s hat paid off - in 2016 Eric moved into a leadership role as the buyer team director for one of the largest real estate teams in the country where he helped double the production in less than a year. After growing his buyer team from 240 transactions to 520 within an 18 month time span, Eric decided to branch out on his own and form Robb Realty Group.

In early 2017, Robb Realty Group was formed. Since then we have grown to a team of listing consultants, buyer consultants and experienced support staff who have established our reputation of integrity.

All of our agents have in-depth ongoing knowledge of the Greater Atlanta communities we serve.

Our agents’ ability to remain engaged with the external real estate community through various affiliations, organizations and the Atlanta Board of Realtors sets us apart. We are experts in focusing on our clients’ needs, marketing and market analysis, contract negotiations, and are top agents in sales with over 98% of our listings selling in less days on market than the average.

Today, our team is proud to be ranked nationally in the top 1% for Berkshire Hathaway HomeServices Real Estate Division.

We welcome you to our office in the heart of downtown Alpharetta in Liberty Hall.

Don’t hesitate to stop in during the day to say hi and grab a coffee.

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MEET THE PEOPLE

“ That I trust with my life and Yours”

At Robb Realty Group we believe that every client at every price point deserves the same level of service and marketing. This is the internal team that delivers on that promise.

We’re on Your Side. With a Servant’s Heart, We Aim to Please.

LAURA CASON | EXECUTIVE ASSISTANT Laura joined Robb Realty Group in 2018 as Eric’s first team hire and administrative assistant. As Eric’s only employee at the time, she learned the many aspects of the real estate industry from the ground up. She now serves as the right hand for Eric and her responsibilities include client concierge, administrative manager, listing manager, marketing manager. Before moving to the real estate industry she worked as an event planner in the technology software sector for close to eight years.

Laura received a B.A. in Communication with a concentration in Public Relations from Berry College and is a graduate of the Institute on Philanthropy and Volunteer Service at Georgetown University. She married her college sweetheart John shortly after graduating from Berry and in her free time she enjoys running, spending time with her two daughters and hanging out in downtown Duluth, where she calls home.

KRISTINE HOOGACKER | TRANSACTION COORDINATOR Kristine is excited to be joining the Robb Realty Group this year as our Transaction Coordinator. Eric was her agent back in 2015 as a first time home buyer, and is pleased to be working alongside him again as she starts her career in the Real Estate industry.

She spent three years doing the accounting for a real estate appraisal management company, after spending ten years as a private nanny. Kristine attended Gainesville State College for a few years until she married her husband, Jay. They share two adorable little boys and enjoy spending their time at Disney World every chance they get.

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CRITICAL QUESTIONS

TO ASK BEFORE HIRING AN AGENT

1: How long have you been selling real estate?

Eric Robb full time since 2014, our team members experience varies, but we have over 30 years of combined experience. We’ve handled hundreds of successful transactions from starter homes to estates. No lawsuits :) 2: What are your qualifications?

Our team is in the top 1% of agents within Berkshire Hathaway’s worldwide network. We hold ourselves and our team members to a very high standard.

Every agent on our team is a member of the Atlanta Board of Realtors and practices their craft fulltime.

3: What neighborhoods do you specialize in?

Your agent should be well-acquainted with the areas you’re interested in, so search for someone who can rattle off key info about your desired neighborhood, including home prices, schools, safety, public transportation, and cultural amenities. Our team specializes in areas and subdivisions all over metro Atlanta but our sweet spot is North Fulton and Gwinnett counties.

4: Can you give me a list of client references?

Of course, we have references from clients, agents, mortgage brokers, title companies, etc. We have over 100 reviews on Zillow, Google and Facebook.

We invite you to look us up.

5: Can you show examples where you were successful when other agents were not?

Absolutely, in fact there are several through this guide and in our testimonials. With our proven VIP buying plan we will help you navigate the process effectively, negotiate fiercely and maximize our communication together for a successful closing.

6. Can you recommend a home inspector/ handyman/real estate attorney in the area?

Local expertise matters not only with the real estate agent you hire, but also with the other professionals you could meet as you negotiate this real estate deal. So, if you need recommendations for a home inspector, handyman, real estate attorney, or anyone else on your home-buying journey, our agents can answer your questions and make recommendations to boost the odds that it will be smooth sailing from here on in.

7. What’s your schedule and availability?

Many real estate agents work only part time, which presents a lot of problems: What if a bidding war has just begun on the home you just have to have, or you encounter last-minute closing snafus? Our team of full-time agents ensures no balls are dropped and that each client has access to us 24/7.

8. How will you keep in contact with me during the buying process, and how often?

We will keep in contact via whatever method you prefer. We are nearly always available via phone, text and email. We talk with most of our buyers daily, so we don’t miss out on anything in this fastmoving market.

9. Do you work independently or with a team?

We are a team made up of Eric Robb as our Team Leader and Listing Specialist as well as multiple buyer agents, a transaction coordinator and an administrative assistant.

10. What percentage of your business is working with home buyers?

When you buy a home with Robb Realty Group, you will be assigned a buyer’s agent who is specifically focused and professionally trained to help clients find and close on their dream home. About 60% of our business comes from buyers and 40% from listings.

11. How long does it typically take buyers you’ve worked with to find and purchase a home?

Buying a house takes time. In general it takes an average of 30 to 60 days to shop for a house, and 14 to 60 days to go from contract to closing. However, this number varies widely from area to area. In the Atlanta market, our buyer clients normally go under contract within 30-60 days of looking.

12. How will you determine what homes may match my wants and needs?

We will set you up on an advanced search on our website www.robbrealtyatlanta.com that is directly linked to the MLS (multiple listing service), with homes that meet your criteria so that we can quickly pinpoint the homes that you are most interested in.

13. How many homes did you help buyers close in the past year?

We helped 53 families in 2019 find new homes last year. That’s over 1 per week!

14: What happens if I want to fire you? How many times have you been fired?

Simply pick up the phone. Twice in 30 years of combined experience. The first time was with a client who thought “exclusive agency” meant that we would cancel our other listings. The next time was about 4 years ago when I told a buyer to simply stop offering $450,000 on homes listed at $650,000. He fired me right on the spot. Either way I was happy both times.

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WE’LL HANDLE THE COMPLEXITIES

SO YOU CAN FOCUS ON YOU

Buying and selling a home can often be a stressful experience even among the best of situations. We have systems and processes in place to keep everything organized and simple. Put our experience to work for you, that way you can focus on the most important aspects of your new transition.

THE BUYING PROCESS FIND A REALTOR YOU TRUST

ACCEPT THE CONTRACT INSPECTIONS

COMPLETE LOAN REQUIREMENTS

RECEIVE THE KEYS

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ANALYZE YOUR NEEDS IN A CONSULTATION

OBTAIN FINANCIAL PRE-APPROVAL FROM LENDER

WRITE OFFER TO PURCHASE EARNEST DEPOSIT

SECURE UNDERWRITING

SELECT AND VIEW HOMES

OBTAIN LOAN APPROVAL

CLOSE AND RECORD

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LOAN FUNDS

THE BEST SEARCH AT YOUR FINGERTIPS ROBB REALTY GROUP MOVE TO APP - Take Buying a Home on the Go - Use Any Device, Anywhere, Anytime - More Details, Faster Updates - Search Listed properties, New Homes, Rentals, Commercial, Recently SOLD properties from the MLS and more - Set up Custom Searches based on areas, schools, neighborhoods etc.

- Use Full RobbRealtyAtlanta.com desktop website, mobile website or mobile app Here are Your RobbRealtyAtlanta.com credentials to find the home of your dreams and search the most recent, up-to-date accurate listings from your phone.

Email: ___________________________ Password: ___________________________ To Download the MoveTo app, search for MoveTo by Real Geeks in your phone’s app store.

Click the link to download and sign in using your RobbRealtyAtlanta.com credentials.

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FINANCING YOUR DREAMS Getting Pre-Approved…

HOW CAN PRE-APPROVAL HELP YOU?

1. Generally, interest rates are locked in for a set period of time. You will know in advance exactly what your payments will be on offers you choose to make.

2. You won’t waste time considering homes you cannot afford.

3. A seller may choose to make concessions if they know that your financing is secured

4. You can select the best loan package without being under pressure

Qualifying for the Mortgage Most lenders require that your monthly payment ranges between 25%-28% of your gross monthly income. Your mortgage payment to the lender includes the following items:

• The principal on the loan (P)

• The interest on the loan (I)

• Property taxes (T)

• The Homeowners insurance (I)

Your monthly PITI and all debts (from installments to revolving charge accounts) should range between 33%-38% of your gross monthly income. These key factors determine your ability to secure a home loan: Credit Report, Assets, Income, and Property Value.

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Numbers to Know PURCHASE AMOUNT This is the amount you have agreed, with the seller, to pay for the home. It is inclusive of the earnest money and down payment you have offered. It is not inclusive of your closing costs.

EARNEST MONEY When you make an offer in writing you will also pay a deposit called an earnest money deposit, which is usually about 1-3% of the purchase price. Paid by the buyer, earnest money is a portion of the purchase amount that is held by the escrow company as a good faith from the buyer to the seller. When the transaction closes, the earnest money is transferred to the seller as a portion of the original purchase amount. It is not an additional fee.

DOWN PAYMENT The down payment is a portion of the purchase price that the buyer is paying in cash.

Down payments can range between 3.5% and 100% and each buyer determines the best scenario for their particular purchase.

CLOSING COSTS Closing costs are not part of the purchase amount, but rather charges associated with the buyer’s loan, the transaction itself and any pre-payment required by the lender such as taxes, insurance and HOA dues. Closing costs are an assortment of fees based on the transaction between the seller and the buyer of a home. These fees are collected by the escrow company at the end of a transaction.

WHO PAYS CLOSING COSTS? Some closing costs, such as the fee the escrow company charges, are split between the buyer and the seller. Many of the closing costs are related to the mortgage and are therefore the buyer’s responsibility. One of the largest costs associated with the closing costs is the loan origination fee. This is the fee your lender is charging you to provide the loan. The fee varies from lender to lender and should be considered when shopping for a good loan. You can expect to pay 1-3% of the purchase price in closing costs.

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MORTGAGE PRE-APPROVAL PROCESS For many home buyers, mortgage pre-qualification is the first step to buying a house. But you shouldn’t put your feet up after the first step and expect everything to just fall into place: There’s plenty more to be done. Here’s a straightforward guide of the pre-approval process.

STEP 1: MORTGAGE PRE-QUALIFICATION The mortgage pre-qualification process is quick and free. It should take less than an hour. During the process, you speak with a loan officer and answer questions about your financial situation.

Mortgage pre-qualification will give you a rough estimate of how much house you can afford. It’s not a binding agreement — it’s simply something you can use to gauge your buying capability.

Mortgage pre-qualification can be especially useful if you’re not sure you can afford a mortgage.

STEP 2: MORTGAGE PRE-APPROVAL After you’re pre-qualified, your next step is to get pre-approved. This is an in-depth process. You’ll need to submit paperwork about your income, assets, employment history and residency status to a lender.

Getting pre-approved is almost like applying for a real loan, but it happens before you select a home.

STEP 3: SHOPPING FOR A HOME Now it’s time for the fun part: home shopping. Using your pre-approval amount as a guide, shop for homes within your budget.

Since sellers and Realtors view pre-approved buyers more favorably, shop with confidence. You’ll come across as a much more serious buyer than any non preapproved competitors.

STEP 4. MAINTAIN YOUR FINANCIAL PROFILE Be aware that changes in your financial situation can affect pre-approval. When you’re in the process of obtaining a loan, do not do the following: • Take out on any new debts or make big purchases.

• Switch jobs.

• Change careers.

• Make any big life changes that could put your financial capabilities in question.

If you’re looking to change jobs or buy something expensive, wait until after closing.

If all goes well, you will be cleared to close — meaning you are fully approved. You’ll get a date for closing. During closing, you’ll sign and double-check mortgage documents.

If anything looks different than you were promised, don’t be afraid to back out; it’s better to leave a bad deal than to be locked into one. We will be here along the way for you during this process.

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GET PRE-APPROVED WITH ONE OF OUR

PREFERRED LENDERS TODAY!

Reid Clark Branch Manager and Construction Specialist NMLS 220536 | GRMA 2587212660

Amy Buynoski Vice President - Mortgage Banker CenterState Bank NMLS# 403455

Doug Mooney Prosperity Home Mortgage

NMLS# 453246

2249 Roswell Rd Marietta, GA 30062 O:678-448-4195 C:770-298-3113 ReidClark@silvertonmortgage.com

32 Magnolia Street Roswell, GA 30075 O: 678-249-7457 Amy.Buynoski@centerstatebank.com

33 South Main Street Suite 201 Alpharetta, GA 30009 C: 864-320-5180 O: 770-475-0505 Doug.Mooney@phmloans.com

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MAKING THE OFFER Once you find a home you want to buy, the next step will be for us to put in an offer to the listing agent on your behalf. Using your pre-approval as a guideline, you will need to determine what offer you are willing to make for the home. It is important to remember that the more competition there is for the home, the higher your offer should be.

Sometimes this means it should exceed the asking price. Remember, be realistic. Our team will help you make an offer that will get accepted.

THE CONTRACT – REJECTED, ACCEPTED OR COUNTERED After we present your offer to the seller, it will either be accepted, rejected or the seller will make a counteroffer. This is when we will negotiate terms of the contract if necessary to create a win-win for both the seller and the buyer.

EARNEST MONEY DEPOSIT When we are writing your offer, we will offer an earnest money deposit. Generally this is 1-3% of the purchase price of the home. The amount you offer is based on several factors that our team will help guide you through. This money is held in escrow during the transaction period as a sign of good faith that you will be moving forward in the purchase of the home. This money is normally due 3 days after acceptance of the offer.

OFFICIALLY APPLY FOR THE LOAN If your offer is accepted, you’ll need to apply for a loan with the lender you choose to obtain a mortgage with. The mortgage process can take some time, but since you’ve been pre-approved, the process may be faster because the lender will have all or almost all of your needed documents. We will work hand-in-hand with your lender and the attorney to make sure each deadline is met before closing.

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ROBB REALTY VIP BUYER ADVANTAGE After years in the business and hundreds of properties sold, we know exactly what it takes to get you from where you are to where you want to be.

As experts in residential real estate transactions, we’ll make your home buying process far more enjoyable AND we’ll show you how to save a ton of money along the way.

Hire us for FREE as the buyer and experience world class service from the #1 Real Estate Brand in the World – Berkshire Hathaway Home Services.

AS YOUR REALTOR, WE ARE DEDICATED TO: • Helping you determine how much home you can actually afford. We will suggest additional ways to accrue the down payment and explain alternative financing methods.

• Introducing you to a mortgage counselor and arranging to have you pre-approved, which will improve your negotiating position and enable you to achieve your home-buying objectives faster and with less stress.

• Securing you the best mortgage rates through our preferred lenders - not every broker will offer the same programs and rates.

• Helping you work out a realistic idea of the home best suited to your needs - size, style, features, location, accessibility to schools, transportation, shopping, and other personal preferences.

• Getting you access to a listing of all available homes in the multi-list system (MLS) and evaluating them in terms of your needs and affordability, which avoids wasting your time showing you unsuitable homes.

• Suggesting simple, imaginative changes that could make a home more suitable for you and improve its utility and value.

• Supplying information on real estate values, taxes, utility costs, municipal services and facilities, and possible proposed zoning changes that could affect your decision to buy.

• Familiarizing you with the closing process and obtaining closing figures in advance of closing for your review.

• Providing you with a list of qualified home inspectors, pest inspectors, surveyors, and help to coordinate inspection appointments.

• Putting you in a winning position if competing for a home when a backup offer is needed.

At Robb Realty Group, we consider it our privilege to share with you the ins and outs of buying real estate. From your initial search to the moment you get the keys to your new home, we will be there, guiding you through the process. With a servant’s heart, we aim please!

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START YOUR SEARCH WITH AN AGENT

A BUYER’S AGENT WORKS FOR YOU!

Home buyers should always have their own agent. Buyer’s agents work to negotiate the best terms and price for the buyer. Best of all, the buyer’s agent services are free to the buyer. Most people think that buyers have to pay a sales commission. Only the seller pays the commission. Whether a buyer uses an agent of not, the seller still pays the commission.

The parties that may win when buyers are not represented by an agent are the listing agent and potentially the seller.

The buyer should sign an agency agreement, an Exclusive Buyer Brokerage Agreement.

It outlines their services, how they are compensated, and how the two parties will work together. This is the legal document that allows us to represent you and give professional advice as a client. Remember, you wouldn’t hire your spouse’s attorney to represent you in your divorce. The same goes for real estate. Why use the seller’s agent to negotiate your best interests? There is an inherent conflict of interest. The home buying process is stressful enough without worrying about who you can and cannot trust. Your buyer’s agent is your trusted advocate.

WHAT DOES A BUYER’S AGENT DO? Our service begins with getting to know your needs, preferences and requirements to focus the search on the properties that best meet your needs. The buyer’s agent will protect the confidentiality of your financial and personal information. The buyer’s agent will provide information and professional advice that is reserved only for our clients.

Real Estate transactions can be very complex. Our proprietary information and knowledge of local communities, schools and the latest market trends can help you find the right home and negotiate the best possible price and terms. Our goal is to help you make the best decisions and begin making new memories in your new home.

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ROBB REALTY VIP BUYER AGREEMENT As a Robb Realty Group VIP Buyer, we will provide you with the following services: • We

will assist you in securing the best financing program for your specific situation with the lowest interest rate and least expensive closing costs and have a pre-qualification/approval certificate generated to give you the best competitive advantage in purchase negotiations.

• We’ll provide you with regular updates of all the new properties that match your home buying criteria. This will allow you to drive by and determine which properties you want to see.

• We’ll

research and locate properties not readily available online and contact you when one or more match your home buying criteria (unlisted properties, bank foreclosures, new construction, for sale by owners, etc.)

• We’ll

arrange a private showing of any property you want to see.

• We’ll

discuss the best strategy with you regarding offer price, financing terms, interest rate, cost to close, possession date, inspection details, termite, pest and other environmental reports, and anything else you want to know when you are ready to purchase.

• We’ll

help you prepare the offer with terms, provisions, special stipulations, amendments, exhibits and addendums weighted in your best interest.

• We’ll

present the offer on your behalf and negotiate in your favor to help you secure the property at the best possible price and terms.

• We’ll recommend extremely competent affiliates with respect to your total home purchase: including legal expertise, home inspection, appraisal, warranties, homeowner hazard and title insurance.

• We’ll

be available for you to answer any questions you might have.

• You

will receive a one-year HSA Home Warranty ($574 value). We will negotiate the warranty on your behalf at no cost to you.

• You

can cancel this agreement at any time prior to making an offer on a home if we do not live up to our promises.

•A Buyer Agency fee of at least 3.0% of the purchase price will be paid to us by the Seller of the property You (Buyer) purchase, at the close of sale, from any previously agreed upon commission agreement with Sellers Agent and/or Seller paid closing costs and/or stipulated proceeds of sale. You (Buyer) agree to Notify us of any property you wish to view; inform other agents, for sale by owners and builders We are representing you as your exclusive buyer’s agent. This agreement automatically expires 12 months from today’s date unless cancelled earlier by either party in writing.

• Performance

of the services stated here are conditioned upon Broker being remunerated (paid) as dictated above.

YOU ARE NEVER UNDER ANY OBLIGATION TO PURCHASE ANY PROPERTY! _______________________________________________ Broker or Broker’s Authorized Representative

_______________________________________________ Buyer

_______________________________________________ Buyer

__________________________ Date

__________________________ Date

__________________________ Date

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HSA HOME WARRANTY When you purchase a resale home, we guarantee to negotiate a home warranty into your contract paid for by the seller valued at $574 to protect you against most ordinary flaws and breakdowns for at least the first year of occupancy. We have partnerships with multiple home warranty programs that will give you peace of mind knowing that the major covered components in your home will be repaired if necessary.

THE PROTECTION AND CONVENIENCE YOU NEED. A home is one of the largest investments a person will ever make, so it’s important to keep it protected. With an HSA Home Warranty you can do just that. The home warranty is a service contract that will help safeguard against the cost of covered repairs or replacement to the major components of home systems and appliances that fail due to normal wear and tear.

HSA Home Warranty removes the worry and time-consuming task of having to find a service company. When there’s a failure, you simply call us and we’ll dispatch a qualified home repair professional to take care of you.

HSA Home Warranty’s committed to delivering exceptional service every step of the way. When you’re in need of a repair, you’ll find HSA’s commitment to quality throughout the process

REQUESTING SERVICE IS EASY. CONTACT US. If the item is covered in your contract, visit www.onlinehsa.com to place a service reequest or call or 24/7 customer service toll-free 800-367-1448.

You will pay trade service fee, per trade.

HOME REPAIR PROFESSIONAL ASSIGNED. HSA Home Warranty will assign a local qualified home repair professional to handle your covered request.

SCHEDULE SERVICE. A local home repair professional will contact you by phone to schedule an appointment time during normal business hours to visit your home and diagnose your covered item.

RELAX. The local home repair professional arrives at your home and your covered item is repaired or replaced. If there are any costs incured not covered under the warranty contract, you would be responsible for these repair costs.

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SATISFACTION GUARANTEED OUR TEAM POLICY If you’re not completely satisfied with our service as promised, you can cancel your agreement with Robb Realty Group at any time. We’re so confident that our real estate system will work for you that we guarantee you the right to cancel our agreement at any time prior to an offer on a home, with no penalties or obligations, if you feel our service doesn’t live up to our promise.

Choosing a Real Estate agent is the first step along the road to home ownership and we appreciate you taking the time to consider us.

We invite you to contact us with any questions you have about our services that will help ease the decision-making process.

We look forward to working with you. With a servant’s heart, we aim to please!

Thank you,

ERIC ROBB REALTOR®

Cell: 770.331.1590 Broker: 770.475.0505 EricRobb@RobbRealtyAtlanta.com RobbRealtyAtlanta.com R O B B R E A LT Y R E A L E S TAT E S E R V I C E S

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REAL ESTATE “DEFINED” We hope our resources are helpful throughout your buying process.

If any questions are not answered, please let us know.

Adjustable Rate Mortgage (ARM) An adjusted interest rate mortgage is a type of loan that offers a low introductory interest rate that adjusts or changes every year according to market conditions, for the life of the loan.

Credit Report A credit report is a record of an individual’s history of borrowing and repaying debts. A credit report is used to assess how much of a risk a potential borrower is when applying for a loan.

Amortization Amortization is the paying off of a debt with a fixed repayment schedule in regular installments over a period of time.

Down payment A down payment is a percentage of the total purchase of a home paid at the beginning of a mortgage loan. A down payment is typically between 5 percent and 25 percent of the total value of a home.

Annual Percentage Rate (APR) The Annual Percentage Rate, or APR, is the average annual finance charge (including fees and other costs) divided by the amount borrowed.

Closing Closing (or settlement) is the legal process of transferring ownership of a home from one person to another.

Equity Equity is essentially stock or ownership in a property. In terms of a home, the borrower gains equity in their home as they pay off their mortgage.

Closing Disclosure This form is designed to provide disclosures that will be helpful to consumers in understanding all of the costs of the transaction. This form must be provided to consumers at least three business days before consummation of the loan.

Earnest Money Earnest Money is a showing of commitment from the buyer to the seller. The buyer will entrust a dollar amount, usually 1-3% of the asking price, to a neutral party. If the seller rejects the buyer’s offer, the buyer will get their money back. If the seller accepts the offer and the buyer backs out for any reason, the buyer loses that money.

Cooperative Housing Development (Co-Op) A co-op is a housing development where buyers own shares in the corporation that runs the housing development. Shareholders pay a monthly fee that covers their proportionate share of the expense of operating the entire cooperative. This includes the underlying mortgage, taxes, management, maintenance, insurance, utilities and contributions to reserve funds.

Escrow Escrow is essentially an account where funds / assets in the purchase of a home are held until all the specified conditions of the purchase are met.

Usually property taxes and insurance funds are held in escrow. Lawyers commonly act as escrow agents in mortgage transactions, securing the property and examining documents to ensure the terms of the sale are met on both ends.

Condominium A condominium or condo is a housing development where a homeowner owns a specified piece of real estate, usually an apartment, in a housing development.

Fixed-Interest Mortgage A fixed-interest mortgage is a type of loan that has a fixed interest rate that borrowers will pay over the term or length of the loan.

Credit Line A line of credit is any credit source extended to a person. This includes a car loan, personal loan, credit cards or any situation where you have borrowed money for the purchase of an item.

Foreclosure A foreclosure is a home that has been reclaimed by the lender because the homeowner failed to pay back their loan. These homes are advertised at a discounted price, but come in “as-is” condition.

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Homeowner’s Association Fees Homeowner’s Association (HOA) fees are fees associated with living in a housing development or condo. These fees cover the costs to maintain common areas and other amenities.

Home Appraisal A home appraisal is a survey of a home used to determine current the market value.

Home Inspection A home inspection is a survey of a property to assess any issues with the condition of the property or systems including water damage, foundation damage, faulty heating or wiring, appliances, and other systems.

Homeowner’s Insurance Homeowner’s insurance protects property against loss caused by fire, some natural causes, vandalism, theft, and other coverages depending on the terms of the policy. The lender will expect the borrower to have a home insurance policy in effect by the closing.

HUD HUD is the Department of Housing and Urban Development.

HUD Home A HUD home is a 1-to-4 unit residential property acquired by HUD as a result of a foreclosure action on an FHA-insured mortgage. HUD becomes the property owner and offers it for sale to recover the loss on the foreclosure claim.

Listing Agent/Listing Broker A listing agent represents the interests of the property owner selling their home. It is their duty to share information about the property with potential buyers and provide guidance to the seller during the process of marketing + selling their home.

Loan Estimate This form is designed to provide disclosures that will be helpful to consumers in understanding the key features, costs and risks of the mortgage loan for which they are applying, and must be provided to consumers no later than the third business day after they submit a loan application.

Private Mortgage Insurance Private Mortgage Insurance (PMI) protects the lender in case the borrower defaults on the loan. PMI is required when the down payment is less than 20 percent. PMI must be paid until the borrower has at least 20 percent equity in the home. The Homeowner’s Protection Act established rules that mortgages automatically terminate PMI after a borrower has reached 22 percent equity in the home, based on the original property value.

Realtor® A realtor® is a real estate professional who acts as an agent for the sale and/ or purchase of property.

A Realtor® is a member of the National Association of Realtors and is required to be a member of a local association or board and a state association.

Selling Agent/Selling Broker A selling agent represents the interests of the client buying the property. It is their duty to provide guidance to the buyer during the process.

Short Sale A short sale is a situation where the lender agrees to let a property owner sell their property for less than the amount owed on the mortgage.

Title Insurance Title insurance protects the lender or owner against loss in the event of a property dispute. Lenders often require title insurance. In fact, most title insurance only covers the lender, while paid for by the borrower. The borrower in many cases must purchase a separate policy.

TRID (TILA-RESPA Integrated Disclosure) This new rule consolidates four existing disclosures required under TILA (Truth in Lending Act) and RESPA (Real Estate Settlement Procedures Act) for closed-end credit transactions secured by real property into two forms: a Loan Estimate that must be delivered or postmarked no later than the third business day after receiving the consumer’s application, and a Closing Disclosure that must be provided to the consumer at least three business days prior to consummation.

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