Condos for sale in Boston – real estate terms explained

Condos for Sale in Boston

Condos for sale in Boston – real estate terms explained

• Master Deed: The foundational legal document that defines the entire condominium, including individual unit boundaries and common areas.
• Declaration of Trust: The document that establishes the condominium association and outlines how the board of trustees governs the property.
• Bylaws: Specific rules included in the Declaration of Trust that govern board operations, such as elections and voting responsibilities.
• 6(d) Certificate: A critical Massachusetts document provided at closing by the association, certifying that the unit is current on all condo fees and assessments.
• Condo Questionnaire: A form completed by the association for your lender to assess the building’s financial health, insurance coverage, and litigation status. 
   

  Boston Luxury Condos for Sale

• Common Areas: Shared spaces (roofs, hallways, elevators) owned collectively by all unit owners based on their percentage interest.
• Exclusive Use: A common area, such as a private balcony or parking spot, that is owned by the association but designated for only one owner’s use.
• HOA/Condo Fee: The monthly payment made to the association for building maintenance, insurance, and shared utilities.
• Special Assessment: An extra, one-time fee charged to owners for major unexpected repairs or improvements when reserve funds are insufficient.
• Reserve Funds: Money set aside by the association for long-term maintenance and emergency repairs.
• Owner-Occupied Ratio: The percentage of units lived in by owners versus renters; lenders often require a specific ratio to approve a mortgage. 
  Bostonreb.com

• Offer to Purchase: The initial, legally binding contract in Massachusetts used to secure a property before the more detailed P&S.
• Purchase and Sale Agreement (P&S): The comprehensive contract that replaces the Offer to Purchase, typically signed 10–14 days later.
• Earnest Money/Deposit: Funds (often 5% of the price) held in escrow to demonstrate the buyer’s commitment to the transaction.
• Contingencies: Conditions that must be met (e.g., home inspection, mortgage commitment) for the buyer to withdraw without losing their deposit.
• Mortgage Commitment Date: The deadline by which your lender must officially approve your loan; missing this can put your deposit at risk.
• Walkthrough: A final inspection shortly before closing to ensure the unit is in the agreed-upon condition. 
  Ford Realty Inc. 

• Caveat Emptor (“Buyer Beware”): Massachusetts law places the burden on the buyer to discover property defects, making professional inspections vital.
• Dual Agency: When one agent or firm represents both the buyer and seller in the same transaction, requiring written consent from both parties.
• Residential Exemption: A significant property tax discount offered by the City of Boston for homeowners who use the condo as their primary residence. 

Condos for sale in Boston – real estate terms explained

If you’re a first-time homebuyer, chances are you’ll come across some terms you’re not familiar with. And that can be overwhelming, especially while going through one of the biggest purchases of your life. 

The good news is you don’t need to be an expert on real estate jargon. That’s your agent’s job. But getting to know these basic terms will help you feel a lot more confident throughout the process.

Terms Every Homebuyer Should Know

Once you’re familiar with this terminology, you’ll have a better understanding of important details – from contracts to negotiations. So, when those big conversations happen, you’ll feel informed, in control, and able to make the best decision for your unique situation. As Redfin puts it:

“Having a basic understanding of important real estate concepts before you start the homebuying process will give you peace of mind now and could save you a fortune in the future.”

Here’s a breakdown of a few key real estate terms and definitions you should know, according to the Federal Trade Commission (FTC) and First American.

Appraisal: A report providing the estimated value of the home. Lenders rely on appraisals to determine a home’s value, so they’re not lending more than it’s worth.

Contingencies: Contract conditions that must be met, typically within a certain timeframe or by a specified date. For example, a home inspection is a common contingency. While you can waive these to try and make your offer more competitive, it’s generally not recommended.

Closing Costs: A collection of fees and payments made to the various parties involved in your home purchase. Ask your lender for a list of closing cost items, including attorney’s fees, taxes, title insurance, and more.

Down Payment: This varies by buyer, but is typically 3.5-20% of the purchase price of the home. There are even some 0% down programs available. Ask your lender for more information. Chances are, unless specified by your loan type of lender, you don’t need to put 20% down.

Escalation Clause: This is typically used in highly competitive markets. It’s an optional add on in a real estate contract that says a potential buyer is willing to raise their offer on a home if the seller receives a higher competing offer. The clause also includes how much a buyer is willing to pay over the highest offer.

Mortgage Rate: The interest rate you pay when you borrow money to buy a home. Consult a lender so you know how it can impact your monthly mortgage payment.

Pre-Approval Letter: A letter from a lender that shows what they’re willing to lend you for your home loan. This, plus an understanding of your savings, can help you decide on your target price range. Getting this from a lender should be one of your first steps in the homebuying process, before you even start browsing homes online.

Condos for Sale in Boston and the Bottom Line

You don’t need to have all these terms memorized, but a little knowledge goes a long way. Brushing up on the basics now means fewer surprises later – and more clarity when start your search for condos for sale in Boston