MULTIPLE LISTING SERVICE (MLS)
This is a private database established by cooperating real estate brokers to provide and share data about properties for sale. This is where your listing agent will list your home, and it will feed into real estate websites like Zillow, Realtor.com, and others through a program called IDX. This system can only be accessed by licensed realtors, admins, and brokers. There are hundreds of MLS systems in the United States; our team only has access to one used in Connecticut. The MLS we use is called SmartMLS.
COMPARATIVE MARKET ANALYSIS (CMA)
This is a comprehensive report created by a real estate agent to determine your home’s value and potential list price based on recently sold properties in the area that are similar to your home in terms of square footage, style, number of bedrooms and bathrooms, and acres.
EXCLUSIVE RIGHT TO REPRESENT BUYER/SELLER PAPERWORK
These agreements, which are different for buyers and for sellers, cover all parties involved. They are contracts which need to be signed before submitting any offers or before listing your home on the market. Once paperwork is signed, we can move forward with prospecting, scheduling a photographer, or sharing your home with our network.
On the buyer paperwork, the contract states the time period we will be working with you, the towns/counties we will be helping you look for homes in, and the commission percentage your buyers agent will receive upon closing.
On the seller paperwork, the contract dates are listed, as well as the list price of your home, live date, seller agent commission, and if you plan on offering buyer agent commission, which we recommend and will discuss with you.
HOMEOWNERS ASSOCIATION (HOA)
An HOA is an association or corporation that manages common areas in a condominium, planned unit development, or cooperative complex. Owners participate in the association to some capacity and some are managed by a third party. HOAs typically have a monthly fee that owners pay into for management of the common areas (like trash and recycling pickup, grounds and road maintenance, snow removal, pool and tennis court service, front desk receptionist, security service).
“SUBJECT TO SELLER FINDING SUITABLE HOUSING” CLAUSE
This contingency protects the seller and can be written into any offer that comes their way. It means if the seller is not able to find “suitable housing,” they can back out of the deal with no repercussions. If this is written in, the seller wants to avoid selling their home and not being able to find a new home to move into.
RENT BACK/LEASE BACK
This is an arrangement and agreement between the buyer and seller where the seller is allowed to live in the property after closing. The seller typically pays the buyer rent and a deposit for a set time period, such as one or two months.
REFINANCING
When you have a mortgage/loan, you can replace your loan to one with better terms when mortgage rates decrease. We recommend this to buyers who have a mortgage with a high interest rate. Once rates decrease, they can refinance, which lowers their monthly payment.
EQUITY
This is a ratio that compares how much you owe on your mortgage vs what the property is worth. Equity can increase as you pay down your loan, as the house appreciates over time, and as you update or renovate your home with high-ROI investments or improvements.
DEBT-TO-INCOME (DTI) RATIO
This is a comparison of your monthly income to your debts (such as car payments, student loans, credit card balances, child support, etc). Expressed as a percentage, mortgage lenders use this ratio to measure your ability to pay your debts and to see if you can handle additional debt (your mortgage). It should not be higher than 36%.
CLOSING COSTS
Both buyers and sellers pay some form of closing costs. For sellers, closing costs can include agent commissions, recording fees, and attorney fees. For buyers, closing costs may include the above, as well as lender fees, home inspection, appraisal fee, and homeowners insurance. These are costs outside of the sales price and down payment that must be paid to cover the cost of the transaction.