Glossary of
Real Estate Terms

Your guide to common closing terms

Closing Costs

Closing costs are fees, commissions, and other charges paid at the settlement for the sale of a piece of property. These may include prorated property taxes, lender’s fees, and real estate agent or broker commissions.

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Closing Disclosure

What is a closing disclosure? A closing disclosure is a required five-page form that is provided to a buyer at least three days before the closing of a mortgage loan and provides details about the loan’s terms. What does a closing disclosure include? These include projected monthly payments, fees, and other details and are provided in order to allow buyers to ask any last-minute questions of their lender before settlement.

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Community Property State

The states of Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin (along with Alaska upon opt-in) are considered community property states. In these states, spouses receive an equal interest in any property that is acquired during the marriage, even if only one spouse is named in the deed. Exceptions generally include inherited property or ownership rights that are waived by a prenuptial agreement.

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Component

In some states, a component is considered an item of personal property that has become linked to a piece of property and thus is eligible to convey with that property. For example, a built-in piece of furniture or a lighting fixture that is hardwired into the home would be considered components and would convey with the home barring contract specifications to the contrary. In other markets, these items are called fixtures.

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Concession

What is a concession at closing? A concession is a benefit provided by either the buyer or seller during the negotiation process in order to close a deal. These may include funds provided towards closing costs, new appliances, or home repairs identified during the inspection process.

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