Rex and Kary Galloway
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Creating Clients for Life

Real Estate Terms

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Term Definition

A business or organization that provides a particular service, especially the mediation of transactions between two parties. In a real estate environment, agency refers to the business of providing service to sellers, buyers, landlords, and organizations, most of which are clients, but some are customers, to facilitate and expedite the sale and closing of real property. Agency relationships are defined by the presence absence of a representation agreement. This agreement defines what activities are allowable under the auspices of agency for both parties and it dictates whether client or customer level service is provided. Agency exists between a client and a broker (typically the Broker-In-Charge or BIC) and one of the agency's licensed agents.


Features of a home or property such as a fireplace, jacuzzi, outdoor living space, garden, mountain view or swimming pool. Amenities can also exist within a neighborhood or community. These types of amenities would typically be a community pool, clubhouse, fitness trails, exercise facilities, golf course, playground or lake.


A written justification of the price paid for a property, primarily based on an analysis of comparable sales of similar homes nearby. The appraised value is an appraiser's opinion of a property's fair market value, based on an appraiser's knowledge, experience, and analysis of the property. Since an appraisal is based primarily on comparable sales, and the most recent sale is the one on the property in question, the appraisal usually comes out at the purchase price. An appraiser is an individual qualified by education, training, and experience to estimate the value of real property and personal property. Although some appraisers work directly for mortgage lenders, most are independent. Most banks or lenders select appraisers for transactions based on a rotation system containing approved/certified appraisers. Some lenders use appraisal services, which aren't as popular with Realtors, due to the occasional assignment of an appraiser to a property that might be somewhat out of their area of expertise (geographically). This usually only happens in rural areas where approved appraisers are not as readily available.

Call Center

With the real estate market what it is today, real estate agents and their agencies need all the help and support they can get. Granted, there are a lot of homes on the market. The good news is; great deals exist for qualified buyers. Having a real estate answering service is good. Having a real estate call center service is even better. Using a real estate call center service, both inbound and outbound calls can be cost-efficiently managed and you won't miss an important call regardless of the day or time, since a call center can operate on your behalf 24/7 and 365-days a year if you want them to.
There's a good many important duties a real estate call center service can do.

They can take and place incoming calls, take RSVP information for that seminar or open house your agency is having, and call upon your prospects and buyers to see if a new property is of an interest, especially since the price has been reduced and is available now at a great price. A real estate call center can benefit your real estate business sales efforts by providing excellent phone coverage when you need it. You won't have to bother with the phone system equipment or those necessary related support services. A real estate call center service will provide these essentials since they're simply part of the service.

A real estate call center can successfully handle a variety tasks upon request and as-instructed. A friendly and well spoken operator can provide property information and or provide sales or customer support better than an e-mail can. Sure, a picture on the web helps, but it can't interact and talk assertively like a live and well-trained professional operator can, at any time of day.
In a real estate market like this, every call represents an opportunity and not one can be missed. Having a real estate call center service will go a long way to increasing your opportunities considering all that they can do to help generate more business.

Capital Gains

A capital gain is the difference between what you paid for an investment and what received when you sold that investment. Investments include mutual funds, bonds, stocks, options, precious metals, real estate, and collectibles. If you sold an investment for more than what you paid for it, then you have a gain. If you sold an investment for less than what you paid for it, then you have a capital loss. Your capital gains and losses are reported on IRS Form 1040 Schedule D (PDF), with the result carried to Form 1040.


This term has different meanings in different states. In some states a real estate transaction is not consider "closed" until the documents are recorded at the local recorders office. In others, the "closing" is a meeting where all of the documents are signed and money changes hands. In most states, both definitions apply when a transaction for the sale and purchase of real estate is deemed as "closed".

Closing Attorney

The attorney, usually assisted by a paralegal, that coordinates the various closing activities, including the preparation and recordation of closing documents and the disbursement of funds. The closing attorney often acts as an escrow agent or settlement agent holding earnest money (or binder deposits). Typically, the closing attorney represents the buyer in a real estate transaction, but executes loan documents and seller documents, such as deed transfers and mortgage satisfactions or releases.

Closing Costs

Closing costs are separated into what are called "non-recurring closing costs" and "pre-paid items." Non-recurring closing costs are any items which are paid just once as a result of buying the property or obtaining a loan. "Pre-paids" are items that recur over time, such as property taxes and homeowners insurance. A lender makes an attempt to estimate the amount of non-recurring closing costs and prepaid items on the Good Faith Estimate, which they must issue to the borrower within three days of receiving a home loan application. Realtors should always be able to provide their customer or client with a reasonably accurate (as opposed to a lender's good faith estimate) closing cost estimate at any time.


An evaluation of similar, recently sold homes (called " comparables" ) that are near a home intended to be bought or sold. It establishes a price range based on current market activity that can be used as a guide for pricing a home. Buyers, sellers, and real estate agents perform a CMA when they are preparing to buy or sell a home.


Recent sales of similar properties in nearby areas used to help determine the market value of a property. Also referred to as "comps."

Comparative Analysis

An evaluation of similar, recently sold homes (called " comparables" ) that are near a home intended to be bought or sold. It establishes a price range based on current market activity that can be used as a guide for pricing a home. Buyers, sellers, and real estate agents perform a CMA when they are preparing to buy or sell a home.


A type of ownership in real property where all of the owners own the property, common areas and buildings together, with the exception of the interior of the unit to which they have title. Often mistakenly referred to as a type of construction or development, it actually refers to the type of ownership.


A condition that must be met before a contract is legally binding. For example, home purchasers often include a contingency that specifies that the contract is not binding until the purchaser obtains a satisfactory home inspection report from a qualified home inspector.


An oral or written agreement to do or not to do a certain thing. In a real estate transaction, contracts are almost always written. Many states deem oral contracts as legal, but unenforceable. The contract for sale typically directs all the activity and events leading up to the conclusion or closing of a contract. It typically contains the contracted price, closing date, closing attorney's name, amount of down payment, type of loan, inspection periods, possible contingencies (such as the contract being subject-to appraisals, home inspections, termite inspections or loan approval, among others) and – most importantly – a description of the parties (who are the buyers and sellers).

Conventional Mortgage

Refers to home loans other than government backed loans (VA and FHA). Conventional loans typically require a buyer down payment of a minimum of 5% (95% max. loan-to-value or LTV).

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