I wouldn’t understand everything that was being said between employees at a Computer / Internet Company – and I don’t know why those of us in the Real Estate / Mortgage Industry expect someone from the “outside” to understand what we are talking about either!
I had an assistant earlier this year who was reading a description of a home for sale in Cary… after a few minutes of being quite she said, “Okay – I give – what’s a MBR??” (It’s the common abbreviation for Master Bedroom) and so, I thought I would do a quick First Time Home Buyer Tips To Understanding Real Estate Abbreviations for folks in NC who might find understanding the language, a little bit difficult to fully understand.
As a First Time Home Buyer in NC – it’s important to know that there are a couple of programs that are available to you that many banks and lenders in NC don’t have access to. There’s both a mortgage tax credit for First Time Home Buyers, and there’s a 3% down payment assistance program available. Both of these programs allow folks to get into a little larger house than they would normally be able to purchase – and we offer both of them!
Those who qualify for the First Time Home Buyer Programs we offer through NCHFA can receive up to a 3% Grant! This money can be used towards your Down payment, or your closing costs, has no monthly payments, and is forgivable over time. It is designed to help folks who have been renting for the last three years.
We can also help you structure your contract so that the Seller works with us to cover all, if not most of your closing costs on your first home! There are some of these closing costs, pre-paid items and fees that the Seller “can’t” pay, or won’t pay. You should be prepared to pay for the Inspection of the home, you will have to pay for your Home Owners Insurance, and your part of the taxes.
First Time Home Buyer Tips To Understanding Real Estate Abbreviations
It’s not like Real Estate Professionals have the market cornered on using unique terms and abbreviations – the Mortgage Industry has plenty of its own, so I’ll be including Mortgage Abbreviations in this Glossary of Real Estate and Mortgage Terms for First Time Home Buyers.
|1003||The document number for a loan application|
|Kit w/Hwds||Kitchen with Hardwood Floors|
|SS appls||Stainless Steel Appliances|
|Above Grade||Indicated how much of the house is above ground all the way around – could be a partial basement in the home.|
|BR’s w/JacknJill Bath||2 bedrooms with access from each bedroom to a common bathroom which is normally located between the 2 bedrooms|
|c/b||Normally refers to the Co-Borrower on the Loan|
|CC||Closing Costs – so $4000 in Seller paid CC is saying that the Seller has already agreed to pay for $4000 of the closing costs|
|Condo||A Housing unit that gives you ownership of the walls, ceiling and floor – but not the dirt that the building is on. Requires a managed HOA to keep the maintenance of the building in good working order|
|Crwn!||Crown Molding is somewhere in the home|
|DR||Usually means the Dining Room|
|DU, DO or LP||The Automated Approval Underwriting Engines for FHA, VA and Conventional Loans. You might hear a loan Officer say that the DU Findings required an additional Bank Statement (for instance). They are saying that when they ran the loan application through the initial Automated Underwriting System it asked for more documentation.|
|dual-sided FP||Two sided Fire Place|
|Fans in all BRs||Ceiling Fans in all Bedrooms|
|GFE||Good Faith Estimate of Closing Costs|
|GUS||The Automated Approval Underwriting engine for USDA Loans|
|HOA||Home Owner’s Association – usually has a monthly or quarterly dues associated with being part of the HOA.|
|HUD 1||The actual document that is used to show all of the charges and credits associated with a loan closing|
|HW flrs||Hardwood Floors|
|LR||Usually means the Living Room|
|LTV||The Loan To Value Ratio Is the ratio between the loan and the Sales Price. So a 95% LTV would mean you are making a 5% down payment|
|OvrszdShwr w/TleSrrnd!||Oversized Shower (somewhere) with Tile Surrounding the Shower|
|PITI||Principal Interest Taxes and Insurance – usually considered your total housing payment. However, you should be sure that the Mortgage Lender is / or is not / including mortgage insurance and Homeowner Association Dues in the housing payment|
|PMI||Technically this is Private Mortgage Insurance – but all loans that have less than a 20% investment or equity have some form of “Default” insurance, and most people refer to that insurance as PMI. FHA technically calls theirs MIP, VA and USDA loans refer to it as a Guarantee fee|
|pre-paids||The fees paid prior to closing, for instance: The appraisal fee, which is then credited back at closing. There are closing costs, and pre-paids that are sometimes called “Seller Paids.”|
|Price/sqft||The price per square footage could be one of the “equalizing” numbers you look at. A 3000 square foot home with all granite countertops and hardwood floors in every room will normally have a higher “price per square” than one that doesn’t.|
|Sq Ft||The Square Footage – this could include only “heated and air-conditioned” square footage, or it could include the unfinished square footage. Unfinished areas of a home do not get valued at the same price as finished, heated and air-conditioned space. So a home with an unfinished 3rd floor might have 2000 sq ft heated and 368 uf sqft in the description indicating what has been finished and what has not. The total Square footage might show as 2368 Total Sq Ft – another way you might see this is “Total Other Area Sqft: 368”|
|TIL or TILA||Truth in Lending document required on all mortgage loans. This is a disclosure the government came up with to make it easier to shop for mortgages, however, a recent survey said that it confused more than 89% of those who reviewed it.|
|Total DTI||The total debt to income ratio used to qualify borrowers for a home. It includes the housing payment plus all other monthly debts divided by gross monthly income|
|Townhouse||Normally with a townhouse you will own the ground underneath your unit, and some ground in front and behind the unit. The common walls and roof, the common grounds are maintained by the HOA|
|WIC’s||Walk In Closets|
|Zestimate||The Estimate that Zillow places on a home – in fine print on the page you can link through to find out how far off they’ve been in that neighborhood in the past year. In some areas they are off by over 23%, so we don’t put much “value” in the Zestimate.|
Again, in addition to understanding the different “terms” mentioned here – as a First Time Home Buyer in NC it’s important to remember that you might qualify for one of several programs that not all lenders and builders offer.
We don’t think the “lending package” is always the BEST deal. Just like the other custom options for your new home, you can choose something other than the “package” that your home builder is offering.
Sometimes – it IS the best deal… but at least 70% of the time, we are able to offer a BETTER (fill in the blank) solution. Normally, it’s because we can offer the NCHFA programs for your new home, that the Builder’s Mortgage Lender might not be offering.
There are two parts to the NC First Time Home Buyer Program – first, you might qualify for a mortgage tax credit. The Tax Credit (called MCC) can add up to an additional $2000 a year to your income, allowing you to qualify for a slightly bigger home. The NCHFA Program also offers 3% in a Down Payment / Closing Cost Assistance Grant that is forgivable, and carries no interest.
Both of these programs can be used in combination with the USDA Home Loan Program NC, FHA Home Loans and VA loans.
If you have more questions about First Time Home Buyer Tips, or terms you are seeing, or hearing about a home, or the mortgage process – please call us, or leave a note below! We try to answer all questions as soon as possible. Call Steve and Eleanor Thorne 919-649-5058
Many First Time Home Buyers are looking for Mortgage Rates Raleigh or the Best Mortgage Rates for your area in NC – there are several questions you should remember to ask besides just “what are your Cary NC Mortgage rates?”