Buy Alexandria Real Estate: Abbreviations & Acronyms: The New Language of Real Estate

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Abbreviations & Acronyms: The New Language of Real Estate

You Need a Dictionary for Real EstateIf you're just getting in the market for real estate, chances are you're hearing a lot of unfamiliar terms these days, especially on the mortgage side of things.  Real estate introduces you to entirely new language.  One filled with lots of words that are thrown around by your mortgage lender, REALTOR, and even your friends and family, who may sometimes make the assumption that you know what they are discussing.

 

Don't be afraid to pull back for a second and say "Hey, I have no idea what you are talking about."  Just as George Washington coming back to the present day would need many things to be explained to him, when you start your home search you'll be encountering uncharted territory and can make use of a glossary.

 

Good Morning VietnamNever is this more true than with all the abbreviations and acronyms used in the real estate lingo. 

 

 

It sometimes reminds me of that famous scene in the movie Good Morning, Vietnam when Robin Williams, fed up with all the military jargon, jokingly asks:

 

    “Excuse me, sir. Seeing as how the VP is such a VIP,

     shouldn't we keep the PC on the QT? 'Cause if it leaks

     to the VC he could end up MIA, and then we'd all be put

     out in KP."

 

I remember a real estate sale I had several years ago.  A Navy Admiral was purchasing a home from an Army General.  During the final walkthrough of the home, the two of them got to talking military and the acronyms and abbreviations were flying left and right, but mainly they were flying right over my head.  That's when I spent the rest of the time talking with their wives and looking through the kitchen and bathrooms to make sure all the appliances were working.

 

 

Wondering about all these real estate abbreviations?  Here's clarification of a few of them:

APR:  Stands for Annual Percentage Rate -- shows the cost of a loan expressed as a yearly interest rate, including the interest, points, mortgage insurance, and other associated fees.

ARM:  Adjustable Rate Mortgage -- a mortgage loan that can be subject to changes in interest rate

EMD:  Earnest Money Deposit.  Money put down by a buyer to show that they are serious about purchasing the home.  Learn more here: Bring Your Checkbook With You on Your Househunt

FHA:  Federal Housing Administration.  Assists home buyers by providing mortgage insurance encouraging lenders to make loans to borrowers who might not qualify for conventional mortgages.

GFE:  Good Faith Estimate.  This estimate of all closing fees must be given to the borrower within 3 days after submission of a loan application.

HUD:  U.S. Department of Housing and Urban Development

HUD-1:  The settlement statement provided at closing that itemizes all the closing costs for both seller and buyer.

LTV:  Loan-to-Value ration.  This is a percentage calculated by dividing the amount borrowed by the sales price or appraised value of the home to be purchased.

MIP:  Mortgage Insurance Premium

PITI:  Principal, Interest, Taxes, and Insurance.  These are the four elements of your mortgage payment.

PMI:  Private Mortgage Insurance  -- can be required for borrowers with down payments of less than 20% of a purchase price.

VA:  Department of Veteran Affairs.  Guarantees loans made to veterans.

VHDA:  Virginia Housing Development Authority.  Virginia's state mortgage finance agency.

 

Now, when someone asks:

"Did you get the GFE for your ARM?  What's the APR and PITI and will you need PMI according to the HUD-1?  How about your EMD?" 

You'll know what they're talking about.

When deciding on a Northern Virginia REALTOR to help you learn the language of real estate, why not work with one with lots of abbreviations and acronyms after their name?

Brian Block, ESQ., ABR, CRS, EPRO, GRI, SRES 

 

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Comment balloon 53 commentsBrian Block • April 27 2008 01:06PM

Comments

Sounds like you're swearing lol!  Or maybe some kind of medication or treatment for your arm lol! Great breakdown ....
Posted by Celeste "SALLY" Cheeseman, (RA) AHWD CRS ePRO OAHU HAWAII REAL ESTATE (Liberty Homes) about 10 years ago
Acronyms everywhere!  It seems like every profession gets them.  They serve their purpose, i guess.
Posted by Tony Fantis, Realtor,Principal Broker - Salt Lake City (Fantis Group Real Estate) about 10 years ago

Brian,

I just took a partner and a real estate newbie.....that I have to calm his frustration by apologizing every-time he dosen't know what something is......we all needed help at one time....and it is a great way to learn the business.......NEVER be afraid to ask  questions.

Posted by Daniel J. Brudnok, REALTOR, SRES, e-PRO,ABR,GREEN,CSP (Berkshire Hathaway Home Services Fox & Roach, REALTORS - Exton - PA License #RS-225179-L / Delaware License #RS-0025038) about 10 years ago
Brian, Thanks for the post.  We all get caught up in using Acronyms too frequently.  Our audience changes so frequently from the office, to our business partners to different client levels that we forget to change our speach to our audience. I wonder how much we turn off our clients when we do this an effective lose business. AJ
Posted by Alan 'AJ' Nisen California Contra Costa Mortgage Officer (A Large Bank in America) about 10 years ago

Brian,

I try to avoid acronyms when working with customers.  I don't want them to feel that I know something they don't and it puts them in a position to have to ask what I mean.   Better to explain as you go unless they say they know exactly what a HUD-1 is.

The Kochster

Posted by Tom Koch (Tom Langseth & Associates Real Estate) about 10 years ago

Brian - You make a great point, and this is a well-written post.  You know how much I love acronyms! 

Posted by Jason Crouch, Broker - Austin Texas Real Estate (512-796-7653) (Austin Texas Homes, LLC) about 10 years ago
Great post! It does get a little crazy an sometimes I'm put on the spot when a buyer asks "what does this mean?" and I'm drawing a blank!
Posted by LaNita Cates (REMAX of Joliet) about 10 years ago
I live this everyday, so it is easy to forget that the public may not always know what we are talking about.
Posted by Randy Prothero, Hawaii REALTOR, (808) 384-5645 (eXp Realty) about 10 years ago
Brian, most important, are there GFI's in the kitchen and baths?  If it's a FSBO, you can't be too sure!
Posted by Patricia Kennedy, Home in the Capital (RLAH Real Estate) about 10 years ago
We just have to make sure we don't use them in front of our clients because we might confuse them to a point they they get discouraged on the process. Thanks.
Posted by Terry & Bonnie Westbrook, Westbrook Realty - Grand Rapids Forest Hills MI Re (Westbrook Realty Broker-Owner) about 10 years ago
I also try and be sure not to use acronyms with my clients as not to confuse them.
Posted by Gene Allen, Realty Consultant for Cary Real Estate (Fathom Realty) about 10 years ago
Brian you are right there are so many abbreviations in Real Estate. I swear too that some agents make up their own. Sometimes reading the MLS description can be a nightmare!
Posted by Bill Gassett, Metrowest Massachusetts Real Estate (RE/MAX Executive Realty) about 10 years ago

Brian Block, ESQ., ABR, CRS, EPRO, GRI, SRES 

 Don't forget those Mr. Block.....   lots o' stuff after your name :)
Posted by Desiree Daniels (RE/MAX Tri County) about 10 years ago
Sometimes its easy to forget that buyers dont always know what the acronyms stand for.  If Im emailing a buyer-Ill catch this and list out the abbreviation but in general conversation I dont always remember unless they have a confused look.
Posted by DeAndrea "Dee Dee" Jones, The NorthernVARealEstateLady & DMVRealEstateChick (Home Buyers Marketing II, Inc.) about 10 years ago

Brian... I love that line from Good Morning Vietnam.....  you are so correct when it comes to certain abbreviations.  Nice job here...  or should I have said, NJ?

jeff belonger
Posted by Jeff Belonger, The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans ( Social Media - Infinity Home Mortgage Company, Inc) about 10 years ago
Jeff, good information for all buyers.  There were a few I had forgotten.  Thanks for the refresher course.
Posted by Kay Van Kampen, Realtor®, Springfield Mo Real Estate (RE/MAX Broker, RE/MAX Solutions) about 10 years ago
Brian, it looks like you have spent a lot of time text messaging that to people!
Posted by Jeremy Blanton, Myrtle Beach REALTOR®- myrtlebeachhomesblog.com (Myrtle Beach Homes Blog) about 10 years ago

Brian,  it is true about what you say in regards to the acronyms!

There is a fun game, is it Balderdash? Where you have to make up definitions and fool the guesser into picking your as the right one... the acronym "fake answers" get me laughing so hard every time! Most of the time we make up bad answers just to be silly!

Posted by Julianna Hind, REALTOR, 206-679-4768, Tacoma Federal Way, Auburn, Kent, WA (eXp Realty) about 10 years ago
Brian, great post.  Thanks for the list of acronyms.  I'll study them hard and hopefully know them for the pop quiz.  LOL. 
Posted by Bob Cumiskey, US Army Retired, Your Sun City Center, Florida ~ Realtor (A1 Connection Realty, Inc.) about 10 years ago
Classic....how about the FSBO who doesn't know what you are talking about when you call them the FSBO:)
Posted by Neal Bloom, Realtor CRS-Weston FL Real Estate (eXp Realty) about 10 years ago
Great informative post as usual!  Thanks for sharing!
Posted by Jim Crawford, Jim Crawford Atlanta Best Listing Agents & REALTOR (RE/MAX Paramount Properties) about 10 years ago
Good points here, Brian.  I'm reminded of Adam's post from some months back on the subject.  We throw these terms around like the public knows what the heck we are talking about.  Many times the user doesn't even know what the acronym stands for.
Posted by Paul Slaybaugh, Scottsdale, AZ Real Estate (Realty Executives) about 10 years ago

Hello Brian, 

I have a client that had used a HELOC to hire a GC that built them a FROG.

-Mark

Posted by Mark A. Moore, Virginia Beach Real Estate (RE/MAX Alliance - Referral Co.) about 10 years ago

Brian...

I have never used the acronyms on customers.

I mean honestly when we use them aren't we really just showing off? :)

TLW...ROAR! (Shall we tell the world 'r o a r' is an another acronym? :)

Posted by "The Lovely Wife" (Broker Bryantnulls Wife) The One And Only TLW. (President-Tutas Towne Realty, Inc.) about 10 years ago
Great post.  I try to speak as plainly as possible with clients.  I remember that first real estate class and thought what in the world is the instructor talking about.  I decided that day to keep it simple. 
Posted by Karen Gentry>>Charlottesville, Virginia Real Estate Professional (RE/MAX Excellence-Charlottesville VA) about 10 years ago
SALLY:  Thanks for your comment.  Real estate can certainly sound like another language sometimes.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
TONY:  The acronyms can make it easier or harder for us to communicate.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
DAN:  I agree.  Never be afraid to ask questions whether you are new or old.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
AJ:  We always have to be mindful of our audience.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
TOM:  Thanks for your comment.  I agree wholeheartedly.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
JASON:  Yes, I know you love those acronyms!  Thanks for your comment.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
LANITA:  Lots of abbreviations and acronyms.  At least I've got a handle on most of these!
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
RANDY:  Very true.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
PATRICIA:  There you go -- adding a few more to the mix!
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
TERRY:  That's very true.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
GENE:  Thanks for commenting.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
BILL:  Yes, don't even get started on some of those MLS descriptions.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
DESIREE:  Yes, that's a whole other blog post that I wrote some time ago!
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
DEE DEE:  Thanks for your comment.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
JEFF:  I love that line from Good Morning Vietnam as well!
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
KAY:  You are very welcome!
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
JEREMY:  Abbreviations are certainly necessary when texting!
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
JULIANNA:  I've never played Balderdash!
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
BOB:  Pop quiz!!  Just kidding.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
NEAL:  Would you actually call them a FSBO in front of them?  Maybe unrepresented seller?
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
JIM:  Thanks!  I appreciate your comment.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
PAUL:  It could be a case of the blind leading the blind.  Do acronyms make the speaker sound more intelligent?  I am not sure.  Thanks for your comment.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
Since you're a subscriber, you may already have seen that I put a link to this post in my blog today on Focus On Crofton.
Posted by Margaret Woda, Maryland Real Estate & Military Relocation (Long & Foster Real Estate, Inc.) about 10 years ago
MARK:  Thanks for a few extra abbreviations.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
TLW:  Even your moniker here is an abbreviation or acronym!
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
KAREN:  KISS.  You know what that means!
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago
MARGARET:  Thanks!  I appreciate the recognition.
Posted by Brian Block, Northern Virginia & D.C. Real Estate (RE/MAX Allegiance, Managing Broker/Branch Vice President) about 10 years ago

When researching the initials PB I ran across your blog.  Great job!  By the way, any idea what PB means in an MLS listing?  I see it fairly often.  DA - I think means Dining Area (as in breakfast nook) - but PB?  Anyone?

Posted by Deb Salkeld almost 10 years ago

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