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Real Estate Vocabulary

Welcome to our easy-to-understand glossary of real estate terms! Whether you're buying new construction in Lewes, relocating to Rehoboth Beach, or investing in Milton or Millsboro, this guide will help you navigate the journey with confidence.

General Real Estate Terms

  • Agent (Real Estate Agent): A licensed professional who helps buyers or sellers navigate a real estate transaction.

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  • Appraisal: An expert’s estimated value of a property—used by lenders during the mortgage process.

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  • Closing Costs: Fees and expenses (beyond the home price) due at the closing of a real estate deal.

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  • Comparative Market Analysis (CMA): A report comparing similar properties to help determine a home’s market value.

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  • Contingency: A condition in the purchase contract that must be met for the deal to go through.

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  • Down Payment: The upfront cash a buyer pays toward the purchase price of a home.

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  • Equity: The portion of your home that you truly "own"—your home's value minus what you owe.

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  • Escrow: A secure account where money or documents are held until all terms of the sale are met.

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  • Home Inspection: A professional checkup of the home's condition before finalizing a purchase.

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  • Mortgage: A loan used to buy a home, paid back over time with interest.

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  • Pre-Approval: A lender’s written commitment to loan you a specific amount, helping show sellers you're serious.

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  • Title Insurance: Protects buyers and lenders from legal claims or issues with property ownership.

New Construction-Specific Terms

  • Builder Incentives: Special offers like upgrades or closing cost help to encourage buyers.

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  • Certificate of Occupancy: Official document stating the home is safe and ready to live in.

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  • Custom Home: A one-of-a-kind home designed and built to a buyer’s exact specifications.

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  • Energy-Efficient Home: A home built to reduce energy use—think better insulation, windows, and appliances.

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  • Floor Plan: A layout of a home showing room sizes, locations, and flow.

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  • Home Warranty: A service agreement covering repair or replacement of certain systems and appliances.

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  • HOA (Homeowners Association): A neighborhood organization that enforces rules and maintains shared spaces.

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  • Lot Premium: An additional cost for a desirable lot—like one with a pond view or extra privacy.

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  • Model Home: A fully finished home that shows buyers what a builder can offer.

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  • Permit: Legal approval to begin building or remodeling.

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  • Punch List: A list of final fixes needed before closing—usually created after a walkthrough.

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  • Spec Home: A new home built by a builder without a specific buyer in mind.

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  • Subdivision: A planned residential community with multiple homes.

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  • Upgrade: Any optional enhancement to the standard home, such as premium flooring or appliances.

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  • Walkthrough (Final Walkthrough): The buyer’s last look at the home before closing.

Financing and Legal Terms

  • Amortization: The schedule showing how your mortgage is paid off over time.

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  • Closing Disclosure: A final breakdown of your mortgage terms and closing costs.

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  • Earnest Money: A deposit made to show you're serious about buying—applied to the purchase price later.

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  • Fixed-Rate Mortgage: A loan with a locked-in interest rate that never changes.

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  • Interest Rate Lock: A guarantee that your mortgage rate won’t increase before closing.

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  • Loan-to-Value Ratio (LTV): The ratio between the loan amount and the home’s value—used by lenders.

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  • Principal: The base amount of money borrowed (not including interest).

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  • Private Mortgage Insurance (PMI): Insurance often required if your down payment is under 20%.

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  • Seller Concessions: Costs the seller agrees to cover on the buyer’s behalf.

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  • Underwriting: The lender’s detailed process of reviewing your finances before loan approval.

Construction Process Terms

  • Blueprints: The architectural plans used to build your home.

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  • Break Ground: The start of construction on your new home.

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  • Foundation: The base structure that supports the home.

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  • Framing: The wood or metal skeleton that shapes the home.

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  • Insulation: Material used to keep your home warm in winter and cool in summer.

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  • Permit Process: The steps needed to get approval for home construction.

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  • Pre-Construction Meeting: A meeting with the builder before building begins to review your plans.

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  • Roofing: The installation of shingles or other material to protect your home from the elements.

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  • Structural Warranty: Coverage that protects against issues with the home's framework.

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  • Utilities Hook-Up: Connecting water, sewer, gas, and electric service to the home.

Community and Lifestyle Terms

  • Amenities: Features in a community like pools, fitness centers, and walking trails.

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  • Clubhouse: A central gathering place in many communities for social or recreational use.

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  • Common Areas: Shared spaces like parks, sidewalks, or community greens.

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  • Cul-de-Sac: A short, dead-end street—often quieter and safer for families.

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  • Master-Planned Community: A large-scale neighborhood with amenities, green space, and varied housing types.

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  • Resort-Style Living: Communities that offer luxury amenities and vacation-like settings.

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  • Walkability: How easy it is to get around a neighborhood on foot.
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  • Zoning: Local regulations that dictate how land can be used (residential, commercial, etc.).

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