Can you help your clients speak real estate?

Translate this page
A red keychain in the shape of a house is attached to a single silver key and sitting on a wooden floor.

04/06/2016 | Author: Editorial Staff

Your clients will hear a lot of abbreviations and acronyms when buying, selling, or leasing property ... but can you explain what they all mean? Here are six chances to see how well you know real estate industry lingo. 

1. What does PITI stand for?
a. principal, inspection, title insurance, and interest
b. principal, interest, taxes, and insurance
c. property taxes, insurance, title fees, and interest
d. none of the above

2. True or false? The interest rate for an ARM loan remains the same for the life of the loan.

3. What does a borrower’s LTV indicate?
a. his long-term view for the property’s value
b. the expected lifetime value for a property
c. a comparison of the loan amount to the value of the property
d. the Texas-specific value of the loan

4. True or false? You may charge a fee to produce a CMA or BPO for a prospective seller.

5. Which of the following is covered in an HOA’s CC&Rs?
a. the minimum price a buyer must pay for a property
b. rules about property maintenance
c. a process for collecting dues
d. when the board of directors meets 

6. True or false? A consumer’s FICO score measures his or her credit risk.

Answers
1. b. Remind your buyers to factor these and other expenses, like utilities and maintenance costs, into their budgets when determining the price range they can afford.  
2. False. The interest rate for an adjustable-rate mortgage (ARM) changes periodically.
3. c. LTV is a borrower’s loan-to-value ratio.
4. True. The Real Estate License Act and TREC rules permit a broker to charge a fee for providing a comparative market analysis or broker price opinion.
5. b, c, and d. A homeowners association’s covenants, conditions, and restrictions (CC&Rs) are the governing documents that dictate the rules and operation of the HOA.  
6. True. The Fair Isaac Corporation issues FICO scores to help lenders determine the likelihood that a borrower will repay a loan.

Categories: Benefits, Legal, Buyers, Sellers
Tags: quiz, business tips, legal


Comments

Rick DeVoss on 04/07/2016

One has to wonder how many agents begin by unlocking a door and showing a house to a buyer before they have even discussed the process of buying a house…

It is my firm belief that our first duty to a buyer is to educate them to the realities of the real estate market.    That comes right after we give them the information dictated by the IABS form.  A serious discussion should be held before ever showing houses, and therefore, I will Never meet a buyer “at the house”, like most of them want you to do.

According to my philosophy, it’s not about “a house”.  It is about getting qualified first, and outlining the buyer’s goals and needs, so that Both you and the Buyer are aware of what sort of properties you should be looking at.  ~I am really getting tired of the buyers who think that all they need is the address to the magic property.  ...As agents know, the house will be “pending” before they even get qualified!

Let’s do our part to educate the public to the proper protocols for the Real Estate industry.

Mark McNitt on 04/06/2016

I always provide the TAR “General Information and Notice to Buyer”.  4 pages of real estate definitions for my Buyer clients to review.  It prompts many questions.


Leave a Comment

Read our commenting policy



advertise with us

Legal disclaimer

The material provided here is for informational purposes only and is not intended and should not be considered as legal advice for your particular matter. You should contact your attorney to obtain advice with respect to any particular issue or problem. Applicability of the legal principles discussed in this material may differ substantially in individual situations.

While the Texas Association of REALTORS® has used reasonable efforts in collecting and preparing materials included here, due to the rapidly changing nature of the real estate marketplace and the law, and our reliance on information provided by outside sources, the Texas Association of REALTORS® makes no representation, warranty, or guarantee of the accuracy or reliability of any information provided here or elsewhere on texasrealestate.com. Any legal or other information found here, on texasrealestate.com, or at other sites to which we link, should be verified before it is relied upon.

Advice for REALTORS®

How TREC’s new proposal affects unlicensed assistants

How social media savvy are you?

Why you should come to Austin in February

Have you seen the REALTOR®-only artifical intelligence safety tool?

Subscribe

More advice for REALTORS®