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Adjustable Rate Mortgage (ARM): A loan whose interest rate is adjusted according to movements in the financial market.

ADOBE: unfired brick dried in the sun, commonly used for building in the American Southwest, Spain, and Latin America. Usually covered with stucco in home building.

Amortization: A payment plan by which a borrower reduces a debt gradually through monthly payments of principal and interest.

Annual Percentage Rate (APR): The annual cost off credit over the life of a loan, including interest, service charges, points, loan fees, mortgage insurance, and other items.

Appraisal: An evaluation to determine what a piece of property would sell for in the marketplace.

Appreciation: The increase in the value of a property.

Assessment: A tax levied on a property or a value placed on the worth of property by a taxing authority.

Assumption:  A transaction allowing the buyer of a home to assume responsibility for an existing loan on the home instead of getting a new loan.

Balloon: A loan which has a series of monthly payments (often for 5 years or less) with the remaining balance due in a large lump sum payment at the end.

BALUSTER: Short post or pillar in a series that supports a rail, thus forming a balustrade. May be curved or straight.

BARREL TILES: Rounded clay roof tiles most often used on Spanish-style houses. Usually red but available in many colors.

BASEMENT FOUNDATION: A basement is a usable foundation that typically has ceiling heights of 8' and is often finished off as living or storage space.

Binder: A receipt for a deposit paid to secure the right to purchase a home at terms agreed upon by the buyer and seller.

Buydown: A subsidy (usually paid by a builder or developer) to reduce the monthly payments on a mortgage loan.

Cap: A limit to the amount an interest rate or a monthly payment can increase for an adjustable rate loan either during an adjustment period or over the life of the loan.

CLERESTORY WINDOW: Window (usually narrow) placed in the upper walls of a room, usually at an angle, to provide extra light.

Closing: A meeting to sign documents which transfer property from a seller to a buyer. (Also called settlement)

Conditions, Covenants, and Restrictions (CC and Rs): The standards that define how a property may be used and the protections the developer has made for the benefit of all owners in a subdivision.

Condominium: A home in a multi-unit complex; each purchaser owns an individual unit, and all the purchasers jointly own the common areas, such as the surrounding land, hallways, etc.

Conventional Loan: A mortgage loan not insured by a government agency (such as FHA or VA).

Convertibility: The ability to change a loan from an adjustable rate schedule to a fixed rate schedule.

Cooperative: A form of ownership in a multi-unit complex; the purchasers own shares of the entire complex rather than owning individual units.

CRAWL SPACE:  The space between the ground and the first floor of a home, usually no higher than four feet.

Density: The number of homes built on a particular acre of land. Allowable densities are usually determined by local jurisdictions.

DORMER WINDOW: Window placed vertically in a sloping roof that has a tiny roof of its own. Most often seen in second-floor bedrooms.

Downpayment: The difference between the sales price and the mortgage amount on a home. The downpayment is usually paid at closing.

Due-on-Sale: A clause in a mortgage contract requiring the borrower to pay the entire outstanding balance upon sale or transfer of the property. A mortgage with a due-on-sale clause is not assumable.

Earnest Money: A sum paid to the seller to show that a potential purchaser is serious about buying.

Easement: Right-of-way granted to a person or company authorizing access to the owner’s land; for example, a utility company may be grated an easement to install pipes or wires. An owner may voluntarily grant an easement, or in some cases, be compelled to grant one by a local jurisdiction.

Equity: The difference between the value of a home and what is owed on it.

Fixed Rate Mortgage: A mortgage whose interest rate remains constant over the life of the loan. The payments are not necessarily level. (See Graduated Payment Mortgage and Growing Equity Mortgage).

Graduated Payment Mortgage (GPM): A fixed-rate, fixed-schedule loan which starts with lower payments than a level payment loan; the payments rise annually over the first 5 to 10 years and then remain constant for the remainder of the loan. GPMs involve negative amortization.

Growing Equity Mortgage (Rapid Payoff Mortgage): A fixed-rate, fixed-schedule loan which starts with the same payments as a level payment loan; the payments rise annually, with the entire increase being used to reduce the outstanding balance. No negative amortization occurs, and the increase in payments may enable the borrower to pay off a 30-year loan in 15 to 20 years, or less.

GUEST/IN-LAW QUARTERS: A main-floor bedroom and bath, except it can be located anywhere. Often seen on main floors but also can be found in daylight basements, providing more privacy from the family quarters.

HALF-TIMBERING: A method of construction featuring walls built of timber framework with the spaces filled in by plaster or brickwork. Often, some of the exposed planks are laid at an angle to create a pattern. In modern homes, half-timbering is usually not authentic, but used only as decoration in small areas.

Hazard Insurance: Protection against damage caused by fire, windstorm, or other common hazards. Many lenders require borrowers to carry it in an amount at least equal to the mortgage.

Housing Finance Agency: A state agency which offers a limited amount of below-market-rate home financing for low-and moderate-income households.

Index: The interest rate or adjustment standard which determines the changes in monthly payments for an adjustable rate loan.

Infrastructure: The public facilities and services needed to support residential development, including highways, bridges, schools, and sewer and water systems

Interest: The cost paid to a lender for the use of borrowed money.

ISLAND: A free-standing cabinet in the center of the kitchen that often includes an eating bar and room for bar stools. Can also include a smaller salad sink and/or cooking range.

Joint Tenancy: A form of ownership by which the tenants own a property equally. If one dies, the other would automatically inherit the entire property.

LATTICE WINDOW: Window with diamond-shaped leaded lights or glazing bars arranged like an openwork screen. Also, loosely, any hinged window, as distinguished from a sash window.

Level Payment Mortgage: A mortgage whose payments are identical for each month over the life of the loan.

LOGGIA: A gallery open on one or more sides, sometimes pillared. Also can be a separate structure, usually in a garden.

MANTELPIECE: The wood, brick, stone, or marble frame surrounding a fireplace, sometimes including a mirror on the wall above.

MASTER SITTING AREA: A space designed for reading with a chair and side table.

MEDIA ROOM: A space for all high-tech gadgets, big-screen TV, home theater, and video games. Space can be acoustically designed to accommodate a movie theater-like sound system.

Mortgage Broker: A broker who represents numerous lenders and helps consumers find affordable mortgages; the broker charges a fee only if the consumer fins a loan.

Mortgage Commitment: A formal written communication by a lender, agreeing to make a mortgage loan on a specific property, specifying the loan amount, length of time and conditions.

Mortgage Company (Mortgage Banker): A company that borrows money from a bank, lends it to consumers who want to buy homes, then sells the loans to investors. Mortgagee: The lender who makes a mortgage loan.

Mortgage Loan: A contract in which the borrower’s property is pledged a s collateral and which can be repaid in installments over a long period. The mortgagor (buyer) promises to repay principal and interest, to keep the home insured, to pay all taxes, and to keep the property in good condition.

Mortgage Origination Fee: A charge by a lender for the work involved in preparing and servicing a mortgage application (usually 1 percent of the loan amount).

MULLION: A vertical post or other upright that divides a window or other opening into two or more panes, sometimes only ornamental.

Negative Amortization: An increase in the outstanding balance of a loan when a monthly payment is not large enough to cover all of the interest due.

NICHE: A recess in a wall (interior or exterior), especially for a statue. Usually curved at the back.

NOOK/BREAKFAST: A space adjacent to the kitchen for casual dining and identified only when it is in addition to a formal dining room.

Note: A formal document showing the existence of a debt and stating the terms of repayment.

NURSERY: A bedroom for babies and small children, usually adjacent to and accessible from the master bedroom.

OPEN FLOOR PLAN: Open floor plans that accommodate the flow of today's casual lifestyles. Combines smaller single-purpose spaces to make large multifunction gathering areas, so, for example, the cooks aren't isolated in the kitchen while the rest of the family is in the next room socializing and playing games. Ideal for creating spacious, sunny rooms.

OVERSIZED GARAGE: Any garage space for parking, storage, or a workshop that can accommodate three or more cars.

PENTHOUSE: A separately roofed structure on the top of a tall block of apartments or condominiums. Also, the top-floor unit in a residential high-rise.

PERGOLA: A covered walk in a garden, usually formed by a double row of posts or pillars with joists above and covered by climbing plants.

PILASTER: A shallow pier or a rectangular column projecting only slightly from a wall that is primarily decorative.

PITI: Principal, interest, taxes, and insurance (the 4 major components of monthly housing payments).

Point: A charge of 1 percent of the mortgage amount. Points are a one-time charge assessed by the lender at closing to increase the interest yield on a mortgage loan.

PORCH: The roofed entrance to a house.

PORTICO: A roofed entrance to a house with columns, creating a temple-like facade.

PORTE-COCHERE: A roofed structure extending from the side or front entrance of a home over an adjacent driveway to shelter those entering or exiting a vehicle.

PRECAST CONCRETE: Concrete components cast in a factory or on-site before they're used in construction.

PREFABRICATION: The manufacture of entire buildings or their components cast in a factory or on-site before they're used in construction.

Prepayment: Payment of all or part of a debt prior to its maturity.

PRESTRESSED CONCRETE: Evolved from reinforced concrete by replacing the reinforcing steel with wire cables in ducts.

Principal: The amount borrowed in a loan, excluding interest and other charges.

Property Survey: A survey to determine the boundaries of your property. The cost will depend on the complexity of the survey.

QUOINS: Dressed stones at the corners of buildings, usually laid so their faces are alternately large and small. Most often in a contrasting color of brick from the rest of the wall. Common accent in Georgian homes.

Rapid Payoff Mortgage: (See Growing Equity Mortgage).

Recording Fee: A charge for recording the transfer of a property, paid to a city, county, or other appropriate branch of government.

Real Estate Settlement Procedures Act (RESPA): A federal law requiring lenders to provide home buyers with information about known or estimated settlement costs. The act also regulates other aspects of settlement procedures.

R-Value: The resistance of insulation material (including windows) to heat passing through it. The higher the number, the greater the insulating value.

REAR ENTRY GARAGE: A garage that has doors that are not visible from the front. This type of garage is well-suited to corner lots or lots with alley access.

REAR GARAGE: A garage that is located to the rear of the home regardless of the door location.

REINFORCED CONCRETE: The result of inserting steel rods in concrete beams to help them withstand longitudinal stress without collapsing. Enables the construction of very large structures using concrete beams.

RUSTICATION: Masonry cut in massive blocks separated by deep joints. Used to give a rich, bold texture to an outside wall. Common in Romanesque homes. Effect sometimes simulated in stucco and other building materials.

Sales Contract: A contract between a buyer and seller which should explain, in detail, exactly what the purchase includes, what guarantees there are, when the buyer can move in, what the closing costs are, and what recourse the parties have if the contract is not fulfilled or if the buyer cannot get a mortgage commitment at the agreed-upon terms.

SASH WINDOW: A window formed with sashes or sliding frames running in vertical grooves.

SCREENED PORCH/SUNROOM: Any space that either allows ample sunshine or protection from pests such as mosquitoes. Because most often it is not a heated or cooled space, it is not included in the total square footage.

Settlement: (See Closing).

Shared Appreciation Mortgage: A loan in which partners agree to share specified portions of the downpayment, monthly payment, and appreciation.

SHUTTERS: Window or door screens featuring horizontal slats that may be articulated, allowing control over air and light transmission. Usually made of wood. While they may be hinged, modern exterior shutters are often decorative and remain fixed to the wall alongside the window or door opening.

SIDE-ENTRY GARAGE: A garage whose doors are not located in front of the house. Can be located facing the side of the property, making them well-suited for a corner lot or one that is wide enough to allow a car to back up. Doors can also be located on the side facing inward so that cars pass the front entry to enter the garage.

SILL: The lower horizontal part of a window frame. Materials vary widely from wood to marble.

SKYLIGHT: A window set into a roof and ceiling to provide extra lighting. Sizes, shapes, and placement vary widely.

SOFFIT: The underside of any architectural element (for example, a building overhang or staircase). In modern homes, the wood or metal screening used to cover such areas.

SOLARIUM: A glass-enclosed porch or room, often used to display flowers and other plants; also called a sunroom or garden room.

SPLIT BEDROOMS: Master bedroom is on one end of the house and the secondary bedrooms are on the other. Typically, the next stop after the nursery.

STANCHION: A vertical supporting beam that is mainly steel.

STORAGE: Extra space ideal for seasonal storage: Christmas decorations, snow skis, sports equipment, and anything else you don't use everyday but want immediate access to if you need it.

STRUT: A roof timber, either upright and connected to the rafter above it, or sloping, connecting another post to the rafter.

STUCCO: A sturdy type of plaster used on exterior walls. Often spread in a decorative pattern.

STUDS: Smaller upright beams in a house, to which drywall panels, or laths for plaster, are attached.

TANDEM GARAGE: A garage most often used with homes that are to be built on narrow lots but where an oversized garage is still desired. Provides a similar amount of square footage as a three-or-more car garage, but the entrance is only two doors. The disadvantage is having to park cars behind one another.

TEEN SUITE: A bathroom that serves two secondary bedrooms. Can be accessible from hallway but not necessarily. Also refers to a secondary bedroom that has its own private bath.

Tenancy in Common: A form of ownership in which the tenants own separate but equal parts. To inherit the property, a surviving tenant would either have to be mentioned in the will or, in the absence of a will, be eligible through state inheritance laws.

TERRACE: A level promenade in front of a building. Usually made of stone and accented with plants, statuary, etc.

TERRACOTTA: Fired but unglazed clay, used mainly for floor and roof tiles. Can be fired in molds to produce a wide range of shapes. Usually red.

TERRAZZO: A sturdy flooring finish of marble chips mixed with cement mortar. After drying, the surface is ground and polished.

THATCH: A roof covering of straw, reeds, or even living grass. In modern homes, most thatching is only decorative, simulated with shingles.

THERMAL WINDOWS: Windows designed with multiple panes to trap air and provide greater insulation.

TIE-BEAM: The main horizontal beam in a roof, connecting the bases of the rafters, usually just above a wall.

Title: Evidence (usually in the form of a certificate or deed) of a person’s legal right to ownership of a property.

Transfer Taxes: Taxes levied on the transfer of property or on real estate loans by state and/or local jurisdictions.

TRANSOM: Small, usually rectangular or fanlight window over a door. Some transoms open to cross-ventilate a home, while others are only decorative.

TRIM: The framing or edging of openings and other features on the facade of a building or indoors. Trim is usually a different color or material than the adjacent wall.

TRUSS: A number of wood planks framed together to bridge a space, such as a roof truss.

TURRET: A very small, slender tower. In modern homes, usually only ornamental.

UNFINISHED BASEMENT: A full "dark" basement that is built under a home on a flat lot. Building codes require that this type of basement have at least one window for escape that is the same size as a typical bedroom window.

UNFINISHED/FUTURE SPACE: Any space, regardless of its location, that can be finished at a later date. Often refers to a bonus room or an unfinished daylight basement.

UPSTAIRS LAUNDRY: A laundry space upstairs.

UPSTAIRS MASTER: Two-story homes with the master bedroom suite on the upstairs floor.

Veterans Administration (VA): A federal agency which insures mortgage loans with very liberal downpayment requirements for honorably discharged veterans and their surviving spouses.

VOLUME/VAULTED CEILINGS: Any ceilings that are over 9 feet or sloping. Can range from being just enough higher to create a greater sense of spaciousness to defining a space from which you can look down onto a room from an upper floor.

WAINSCOTING: Decorative paneling covering the lower three to four feet of an interior wall. Usually wood in a plain design. May be painted or only varnished.


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WALK-IN CLOSET: A bedroom closet that you can walk into.

WALK-IN PANTRY: A generous storage area either in, or adjacent to, the kitchen. Unlike a cabinet attached to the others in the kitchen, a walk-in pantry can also include a baking area and provide an abundance of storage space.

Walk-Through: A final inspection of a home before settlement to search for problems that need to be corrected before ownership changes hands.

Warranty: A promise, either written or implied, that the material and workmanship of a product is defect-free or will meet a specified level of performance over a specified period of time. Written warranties on new homes are either backed by insurance companies or by the builders themselves.

WEEPING MORTAR: This decorative mortar appears to be dripping out between the exterior bricks.

WIDOW'S WALK: A small, railed observation platform built out from the roof. Once used to scout for returning ships, such walks are usually square, done in elaborately-worked wrought iron or wood.

WINE CELLAR: A special place for your wine collection. Today's wine cellars are often greatly embellished spaces that can even be climate controlled for the serious connoisseur.

WORKSHOP: A space usually adjacent to the garage but can also be located in an unfinished basement. Well suited for crafts and hobbies.

WRAP-AROUND PORCH: Porches that conform to the outside shape of the house, from the front to the side or sides, although it may not extend to the back to join a rear porch.  

Zoning: Regulations established by local governments regarding the location, height, and use for any given piece of property within a specific area.