Real Estate Jargon 101:
Every industry has it’s own jargon, and real estate is no exception. We’ve defined a handful of these terms below, and we’re introducing a few of our very own! For context, and to test your skills, we’ve also offered a sample conversation.
Accelerated Close: A rather short amount of days from under contract to closing, usually 14 days or less. This occurs mostly with cash buyers, but also buyers with ‘fully underwritten loans.’ (see below).
Acceptance Deadline: The day and exact time a buyer or seller has to agree to an offer or other transaction documents.
CMA: Comparable Market Analysis is an estimated property value analysis based on recent sales of comparable properties to yours. This analysis is typically conducted by a real estate broker. It is not an appraisal but takes considerable care and time to complete. A true CMA can easily require several hours to several days. Before the number-crunching begins, we’ve already made a personal visit to your property to better understand the property’s unique characteristics. We connect with other brokers, appraisers, title companies, and industry resources to secure the most accurate information about the comparable properties.
Did my hair: Presenting ourselves in professional attire to the public, instead of working in a messy bun, no makeup, and probably Vietnamese pho noodle-splash on our clothes.
DOM: Days on Market, how many days a particular home was actively for sale until it went under contract.
DOD: Delivery of Deed takes place at closing when the deed to the property is successfully transferred to the new buyer.
EM: Earnest Money is the amount of money a seller requests be deposited to the title company once buyer and seller are officially under contract.
Jason Bourne: Reconnaissance work including phone calls, social media snooping, public records information, and more.
MEC: Mutual Execution of Contract means all parties to a document have formally signed a document, and are in agreement.
MLS: Brokers’ professional Multiple Listing Service(s).
LO: Loan Officer from a mortgage company.
ReLo: A buyer/seller with a relocation package, OR buyer/seller moving in or out of state.
Home: This could be talking about an actual property OR referring to the nearest home base for us, which could be the closest Starbucks, our Erie office, pulled to the side of County Road 19, or our actual home.
Homeless: A buyer who has sold their home faster than anticipated, and needs to find a replacement, stat!
Motivated: “A seller of a property who is compelled to entertain reasonable offers. The motivation may come from economic or other personal circumstances.”
Conditional: Any element of an offer that “conditions” the purchase or sale. A home sale contingency is a good example of a conditional element. For example “I will purchase your home on the condition that my home sells first.”
Playing Poker: Identifying the leverage elements for our clients and communicating those to the other side with poise, grace, eloquence and professionalism. Also, knowing when to play the hand.
PCOA: Post Closing Occupancy Agreement. The buyer and seller agree to a short term agreement where the seller can rent the house from the buyer after closing.
Growing Old: Waiting for a signature, return phone call, reply e-mail, or text.
Fully Underwritten: More than a pre-approval or pre-qualification. If a buyer is fully underwritten the lender has officially approved the loan even before the buyer has identified their target home. A fully underwritten loan gives buyers huge leverage.
Went fetal: This is what happens when an out of the blue (and never a good ‘out of the blue’) surprise threatens a transaction.
Here’s that jargon in a typical office conversation:
Broker #1: Hey, where have you been?
Broker #2: So you know my out of state ReLo Buyer? Well they went U/C in 3 days on the sale of their home. Now they’re homeless. So, I did my hair and hit the road. Found a jewel, but it was buried because it was only listed in one MLS! Looked like it could be over-priced, so I crunched a CMA, ran recon on the listing agent and social snooped the sellers. I went full-on Jason Bourne.
The house showed 37% longer DOM than it’s comps, CMA hinting the seller is priced for a 3 car garage, theirs is a 2. The listing broker told me the sellers are ‘kinda’ motivated. Yeah, like I’m ‘kinda’ hungry. Anyway, my recon is saying it’s a new baby. Got back home, crafted an offer. 1 day EM, accelerated close, buyer’s LO is a superstar by the way, the file is fully underwritten, no conditionals, buyer possession at DOD, and 96% to list price.
Broker #1: How’d it go?
Broker #2: Well, sellers countered with a PCOA. Said they can’t physically move out that fast. We played some poker, ended up keeping the original offer on the table with the 7pm acceptance. I was growing old Thursday afternoon. Finally, at 6:50 we went MEC on the original offer. Friday morning, I did my hair, picked up EM and delivered to Title. Inspection is tomorrow. Gotta do my hair again. What’s up with you?
Broker #1: Oh, man, the Buyer’s lender on my listing called to tell me the buyer just changed jobs 3 weeks into this transaction! I went fetal.
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