Real Estate Terms

Posted on 14 avr. 2010 by IPC Inc.

 

Single family homes

 

A single-family home or detached house, is a free-standing residential building. Most single-family homes are built on lots larger than the structure itself, adding an area surrounding the house, which is commonly called a yard in North American English or a garden in British English (From: Wikipedia).

 

 

Condos

A condominium, or condo, is the form of housing tenure and other real property where a specified part of a piece of real estate (usually of an apartment house) is individually owned while use of and access to common facilities in the piece such as hallways, heating system, elevators, exterior areas is executed under legal rights associated with the individual ownership and controlled by the association of owners that jointly represent ownership of the whole piece. Colloquially, the term is often used to refer to the unit itself in place of the word "apartment". A condominium may be simply defined as an "apartment" that the resident "owns" as opposed to rents.

 

 

Townhomes

A townhome is one of a row of homes sharing common walls. Differing from condominiums, townhome ownership does include individual ownership of the land. There can also be common elements, such as a central courtyard, that would have shared ownership (From: about.com).

 

Townhome/Townhouse - Pros

  • Less expensive than single family homes

  • No neighbors above or below.

  • Often has a small fenced yard

  • Low maintenance lifestyle – HOA may cover roof repair and replacement, exterior maintenance, common area maintenance, and other expenses

  • Often includes amenities such as a community pool

Townhome/Townhouse - Cons

  • Noise from neighbors through shared walls

  • Homeowners’ association fees and politics, and restrictions

  • A townhome or townhouse will typically have a small yard or no yard

  • Might have common stairwells

Short sales

A short sale is a sale of real estate in which the proceeds from the sale fall short of the balance owed on a loan secured by the property sold (ref. Wiki).

In a short sale, the bank or mortgage lender agrees to discount a loan balance because of an economic or financial hardship on the part of the mortgagor. This negotiation is all done through communication with a bank's loss mitigation or workout department.

 

The home owner/debtor sells the mortgaged property for less than the outstanding balance of the loan, and turns over the proceeds of the sale to the lender, sometimes (but not always) in full satisfaction of the debt.

 

In such instances, the lender would have the right to approve or disapprove of a proposed sale. Extenuating circumstances influence whether or not banks will discount a loan balance. These circumstances are usually related to the current real estate market and the borrower's financial situation (From: Wikipedia).

 

 

Foreclosures

Lenders can recover the amount owned on a defaulted loan through the process of a foreclosure. The owner's property is in foreclosure when he cannot make principal or interest payments on the mortgage, resulting in the lender seizing and selling the property as stipulated within the mortgage contract. The process begins when the property owner is unable or unwilling to make loan payments and thus defaults on the mortgage. In response, the lender will file a public default notice.
 

Ending the foreclosure

There are four ways that can conclude the foreclosure process. First, the owner of the property can pay off the default amount during the pre-foreclosure grace period. In doing so, the owner will have reinstated the loan. Though late fees may be charged within a month of the missed payment, mortgage companies are often aware that the owners may be facing temporary financial hardships and thus may choose to delay the foreclosure process. The owner has thirty days to contact the lender to discuss different alternatives and solutions.

Second, the owner can sell the property to another party during this grace period. The owner can pay his debts to the creditor and his credit history will not document his having had a foreclosure. Considerable damage to the owner's credit rating will thus be prevented.

Third, another party can purchase the property at a public auction. This will occur at the end of the pre-foreclosure period and the owner will no longer have any stake or equity in the property. These auctions generally take place on the steps of the county courthouse in which the foreclosed property belongs. Here, the highest bidder must pay with an immediate deposit and the remainder within 24 hours of the sale. When a bidder purchases foreclosed property at a foreclosure sale, all junior liens, with the exception of property taxes, are wiped out. The priority of liens is determined by the date of recording.

Finally, the lender can retake ownership of the property through either an agreement with the owner during the pre-foreclosure grace period or by purchasing the property at the auction. The lender will generally buy back the property with the intent to resell it at a later date(From: Foreclosure Deals).