Real Estate Glossary —Plain English for First-Time Buyers

The upfront cash you bring to purchase a home. FHA loans require 3.5% minimum. Conventional loans require 3–20%. On a $460,000 home, 3.5% equals approximately $16,100. CalHFA programs can cover this amount — potentially bringing your out-of-pocket down payment to $0.

California's silent second mortgage, offered by the California Housing Finance Agency. It covers your down payment or closing costs as a deferred loan — no monthly payment while you live in the home. Repaid when you sell or refinance. Stackable with FHA loans for near-zero out-of-pocket costs.

CalHFA's shared appreciation loan — covers up to $150,000 or 20% of the purchase price toward your down payment. Repaid at sale or refinance, with California sharing a percentage of the home's appreciation. Lottery-based, not first-come-first-served. Primary qualifying factor: first-generation buyer status (parents never owned a home in the U.S.). Last cycle depleted in 11 days.

Federal Housing Administration-backed mortgage. Minimum 580 credit score, 3.5% down payment. No income cap — a family earning $60K qualifies on the same terms as one earning $150K. The most flexible qualification standards of any common loan type. Combinable with CalHFA MyHome for near-zero out-of-pocket cost.

Home loan benefit for eligible veterans, active duty service members, and certain surviving spouses. $0 down payment. No private mortgage insurance (PMI). Competitive interest rates. Edwards AFB is 20 minutes from Palmdale — many Antelope Valley military families qualify and don't know it.

A mortgage for buyers who use an Individual Taxpayer Identification Number instead of a Social Security Number. Legal and regulated in California. Offered by specialized lenders including Guild Mortgage. Typical requirements: 2 years of ITIN tax returns, 620+ credit score, 15–20% down payment.

State, county, city, or lender programs that help cover your down payment or closing costs. California offers among the most generous DPA programs in the country — including CalHFA MyHome (deferred loan) and Dream For All (shared appreciation). Most Antelope Valley buyers qualify for at least one program.

A second loan with no monthly payment while you live in the home. Repaid when you sell or refinance. Used by CalHFA MyHome and similar DPA programs to cover down payment costs without adding to your monthly obligations. 'Silent' because the lender doesn't require regular payments during your occupancy.

Money given (not loaned) by a family member to help with your down payment. Allowed on FHA loans and most California programs, provided the donor signs a gift letter confirming it's a gift and not a loan requiring repayment. Elizabeth reviews gift fund documentation during pre-approval to prevent closing surprises.

A 3-digit number (300–850) that lenders use to evaluate how likely you are to repay a loan. FHA minimum: 580. CalHFA minimum: 660. ITIN loans: 620+. A score of 660–680 that you think is 'bad' actually qualifies for multiple California programs. Don't assume the answer is no before checking your specific situation.

Your total monthly debt payments divided by your gross monthly income. Most loans cap DTI at 43–50%. Example: if your gross income is $6,000/month and your total debt payments (including new mortgage) are $2,400, your DTI is 40% — typically acceptable. Elizabeth calculates your DTI before pre-approval so there are no surprises.

A written commitment from a lender to loan you up to a specific amount, based on a review of your income, credit, and assets. Required before touring homes in a serious search. Stronger than a pre-qualification letter — sellers and listing agents treat pre-approved buyers as credible. Takes 24–72 hours with a qualified lender.

A preliminary estimate of how much you might borrow, based on self-reported information without full documentation review. Less binding than pre-approval. Useful for initial planning but insufficient for submitting competitive offers in the Antelope Valley market.

A credit check that lenders conduct when you apply for credit. Slightly lowers your score (typically 3–7 points) and stays on your report for 2 years. Multiple mortgage hard inquiries within a 45-day window are usually counted as one inquiry by scoring models — so rate-shopping doesn't multiply the impact.

The most widely used credit scoring model by mortgage lenders. Ranges from 300 to 850. The version used for mortgages (FICO 2, 4, or 5 depending on the bureau) may differ from the score you see on apps like Credit Karma, which often use a different scoring model.

The cost of borrowing money, expressed as an annual percentage. Fixed rate: stays the same for the life of the loan — your payment never changes. Adjustable rate (ARM): starts lower and adjusts periodically based on a benchmark index. For most first-time buyers in the Antelope Valley, a fixed-rate loan provides predictability and protection.

The true cost of borrowing, including the interest rate plus lender fees expressed as an annual rate. Always compare APR — not just the interest rate — when evaluating loan offers. A loan with a lower interest rate but higher fees can have a higher APR than a loan with a slightly higher rate.

Insurance required on conventional loans when you put down less than 20%. Typically costs 0.5–1.5% of the loan amount per year — on a $450K loan, that's $187–$562/month added to your payment. VA loans have no PMI. FHA loans have MIP (mortgage insurance premium) instead. Eliminated on conventional loans when equity reaches 20%.

Prepaid interest paid at closing to lower your interest rate. One point equals 1% of the loan amount. Paying 1 point on a $400K loan costs $4,000 upfront and typically reduces your rate by 0.25%. Whether points make sense depends on how long you plan to stay in the home — Elizabeth runs the break-even analysis for you.

A lender's written guarantee to hold a specific interest rate for a set period (typically 30–60 days) while your loan processes. Protects you from rate increases between application and closing. Essential in a rising-rate environment. Lock periods and extension fees vary by lender.

A neutral third party (escrow company or attorney) that holds funds and documents during the transaction. Protects both buyer and seller by ensuring that money and title only transfer when all conditions are met. Escrow typically takes 30–45 days in the Antelope Valley for standard transactions.

Legal proof of ownership of a property. When you purchase a home, title transfers from the seller to you. A title search is performed to ensure there are no liens, unpaid taxes, or competing ownership claims on the property before you receive clear title.

An independent valuation of the property ordered by your lender. A licensed appraiser compares the home to recent sales of similar properties to determine market value. Lenders will only loan up to the appraised value — if the home appraises below the purchase price, you'll need to renegotiate the price or cover the difference.

A professional review of the property's physical condition, hired by the buyer. Separate from and independent of the appraisal. Covers foundation, roof, plumbing, electrical, HVAC, and other systems. Inspection findings can be used to negotiate repairs or credits before closing. Never skip it.

A condition written into the purchase contract that must be satisfied for the sale to proceed. Common contingencies: inspection contingency (right to inspect), financing contingency (loan must be approved), appraisal contingency (home must appraise at purchase price). Contingencies protect you — removing them increases offer strength but increases risk.

Fees paid at closing in addition to the down payment. Typically 3–6% of the purchase price and include lender origination fees, title and escrow fees, recording fees, homeowners insurance prepayment, and property tax impounds. On a $460K home, expect $14,000–$28,000. CalHFA MyHome can cover some closing costs. Sellers can contribute up to 3–6% toward buyer closing costs.

A required document provided by your lender at least 3 business days before closing. Shows all final loan terms, monthly payment, closing costs, and cash required to close. Review it carefully against your original Loan Estimate — if anything changed significantly, ask why before arriving at the closing table.

A good-faith deposit submitted with your purchase offer to show the seller you're serious. Typically 1–3% of the purchase price in the Antelope Valley ($4,600–$13,800 on a $460K home). Deposited into escrow. Applied toward your down payment or closing costs at closing. At risk if you cancel without a valid contingency.

The real estate agent representing the seller. Paid by the seller from the proceeds of the sale. Their legal duty is to the seller — not to you. Having your own buyer's agent (like Elizabeth) ensures someone is legally obligated to represent your interests specifically.

The real estate agent representing the buyer. In California, the buyer's agent is typically compensated from the seller's proceeds — meaning buyer representation costs you nothing out of pocket as a buyer. Elizabeth represents buyers exclusively, which means her loyalty and legal duty run entirely to you.

When more than one buyer submits an offer on the same property. Common in the Antelope Valley for well-priced homes. In a multiple-offer situation, price matters but so does proof of financing, flexibility on terms, and how the offer is written. Elizabeth has a 94% offer win rate for buyers using down payment assistance — because she knows how to structure offers that compete.

When the seller agrees to pay a portion of the buyer's closing costs as part of the negotiated sale. FHA allows up to 6% in seller concessions. Conventional loans allow 3–6% depending on down payment size. Seller concessions can significantly reduce your cash-to-close — a strategy Elizabeth uses when appropriate.

Recent sales of similar properties used to determine what a home is worth. The basis for the appraisal and for evaluating whether a listing price is fair. Elizabeth reviews comps before you make any offer to ensure you're not overpaying in the current Antelope Valley market.

The price a willing buyer would pay a willing seller in an arm's-length transaction under current market conditions. Not the list price. Not the tax assessed value. The actual price the market will bear, determined by recent comparable sales. Understanding market value protects you from overpaying and helps you write competitive offers.