Real Estate Terms Explained

Buyer’s Agent: 

A Buyers Agent is a real estate agent that represents a buyer exclusively. When shopping for a home we recommend you hire a real estate agent to represent you exclusively. Why? Because you deserve a dedicated professional to help achieve your goals.   

Seller’s Agent: 

A Seller’s Agent is a real estate agent that represents a seller exclusively- same principle as a Buyers Agent. It comes highly recommended that you hire a realtor to represent you exclusively. A local expert will be able to provide counsel on what items should be complete before listing your home to increase the value and ease of the sale and provide guidance on what you can expect the process to look like. 

Dual Agent:  

A Dual Agent is a real estate agent that represents both the buyer and the seller for the purchase and sale of a home. Dual Agency is legal in the state of Washington, but it is something that fewer agents are choosing to do now (self included) because of the responsibility to serve both parties cannot be complete in the capacity it should, when representing both parties. 

REALTOR® vs Real Estate Agent:

A REALTOR® and real estate agent are different! A REALTOR® pays dues to the local, state and National Association of REALTOR®. The funds that REALTORS®  pay to be a REALTOR® are used to uphold homeownership rights (among many other things).  REALTORS® must also abide by the Code of Ethics and are held to a higher standard. REALTORS® are the largest lobbying party in the nation – think of working with a REALTOR® like shopping at a local store vs big box retail. We are licensed REALTORS® and are proud to work behind the scenes to consistently advocate for homeownership rights.

For example, in 2019 when excise tax was increasing across the board for homeowners, the National Association of REALTOR® stepped in and successfully negotiated down excise tax so the majority of homeowners would actually pay less in excise tax when selling. This is just one of the examples of how hiring a REALTOR® vs real estate agent impacts more than just your home purchase or sale. The role that a REALTOR® and Real Estate Agent are the same; they help people buy and sell real estate. 

Commission: 

The commission is the cost of service you pay your realtor for buying and/or selling real estate. The commission in Washington State for Buyer’s Agents was made public in 2020. As a local realtor, I’m proud that our association chose to do this and make important information like this available to the public. Withholding information from our clients is not how we gain their trust and it’s certainly not where our value comes in. 

Brokerage: 

A Brokerage is another term for a Real Estate Office. If I refer to “my Brokerage” I am referring to my office where I hang my license. 

Independent Contractor: 

Most real estate agents act as Independent Contractors. Like home builders and general contractors, we create our own hours and run our own business. Because of this, it’s even more important that home buyers and sellers do research on who they are going to hire to represent them on the purchase or sale of their home. 

 

Managing Broker: 

A managing broker is someone who has the credentials to run their own office (Brokerage). I am a licensed Managing Broker but do not run my own office. Many real estate agents (like myself) studied and obtained their Managing Brokers license not to run their own office, but to further their skillset as a realtor. More on my Managing Broker license HERE!

 

Designated Broker: 

Every real estate brokerage has a Designated Broker (DB for short). The Designated Broker is responsible for the correct filing and paperwork of all real estate agents at their office. 

 

Days on Market: 

The number of days it takes for a home that is for sale to receive AND accept an offer. Average days on market is a general indicator used to gauge the competitiveness of real estate market. The higher the average days on market the less competitive the market is. This is referred to as a Buyer’s Market. Fewer days on market indicates that it is a competitive (Sellers) Market. 

 

Appraisal:

The estimated value of a piece of real estate, based on similar properties in the area. An appraisal is typically required in order to obtain a mortgage loan from your lender or bank.

 

Closing Costs:

Both buyers and sellers are typically required to pay for “closing costs” which are usually 2% to 3% of the final sales price. These fees and costs are paid to the mortgage lender, title and escrow companies that work on your transaction. As a buyer, you pay for your total closing costs and down downpayment simultaneously, usually the day before you officially get the keys to your home. Learn more about the details of closing costs HERE!

 

Debt-To-Income Ratio

The ratio the mortgage lender uses to determine how much you can afford to pay as a monthly payment.

 

Do you need a different term explained? CALL/TEXT Realtor Jenny Wetzel at 253-381-9788.

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Get In Touch

Tacoma Realtor - Jenny Wetzel

Jenny Wetzel

Call or Text: 253.381.9788

Email: jenny@jennywetzelhomes.com

Fax: 253.381.9788