Buying a home in Louisville? Relocating to Kentucky? We're here to help.


What? You don't speak realtor-ese?

It's easy to get lost in the jargon of the real estate world. Here are some definitions you might find helpful...

  • Earnest Money (or Good Faith Deposit)

    You will pay an earnest money deposit when you reach mutual acceptance on your home purchase. Earnest money is typically 1% of the home's price. The amount you pay in earnest money will be subtracted from your closing costs — reducing the total amount you owe at closing.

  • Private Mortgage Insurance (PMI)

    Private mortgage insurance is required if your down payment is less than 20%. FHA and VA loans may also require you to pay an upfront fee for private mortgage insurance at closing in exchange for allowing you to have a lower down payment. Private mortgage insurance is typically included as part of your monthly loan payment. However, some loans will allow you to pay your private mortgage insurance upfront as a one-time fee at closing. It's up to you to decide if you want to pay more at closing or a higher mortgage payment each month.

  • Home Warranty

    Similar to any warranty, sellers and buyers can pay a fee to protect the home against future issues, like plumbing or heating.

  • Title Insurance

    Title insurance is a one-time fee paid as part of your closing costs. As the homebuyer, it's common for you to pay for the lender and your own title insurance policies.

  • Closing Costs

    All of the miscellaneous expenses and fees paid by the buyer (and sometimes seller) when a deal closes. Some examples of these expenses include commissions, mortgage fees, recording fees, title insurance, and more.Typically, closing costs will amount to 2-5% of the purchase price of the home.

  • CMA (Comparative Market Analysis)

    Sometimes these are also referred to as ‘comps.’ This is a report of similar homes in the area that were recently sold or are currently on the market. This is used to help determine an accurate value for your home.

  • Contingency

    A clause in an agreement that keeps things from being legally binding unless a condition is met. The most common contingencies on a purchase contract are the right to have a home inspection before buying the home or obtain acceptable financing from a lender.

While we've tried to give you a lot of information already, you probably have a few more questions before diving into the home buying process. If it's not answered below, please schedule a consultation with one of our knowledgeable REALTORS and they'll guide you along the way.