Real Estate, Explained
Real Estate Terms Every LA Buyer Should Know
Nobody hands you a glossary before your first offer. Here's the language, explained the way I'd actually explain it to you.
Buying a house means getting handed a whole new vocabulary at the exact moment you have the least bandwidth to learn one. Before your first tour or offer, it also helps to understand what a buyer-agent agreement actually means. Then here's the language, in plain terms, the way I'd actually walk a client through it over coffee.
Escrow
The neutral third party holding your money and paperwork between the moment your offer is accepted and the day you actually own the house. Nobody gets paid and nothing changes hands until every condition of the deal is met. Think of it as the referee, not a step to be nervous about.
Contingency
A condition that has to be satisfied before the sale can close, most commonly inspection, appraisal, and loan approval. If one isn't met, it typically gives you a documented way out without losing your deposit. Waiving the wrong one to win a competitive offer can cost you real protection.
Earnest money deposit
The good-faith deposit you put down shortly after your offer is accepted, usually a percentage of the purchase price, held in escrow and credited back to you at closing. It's how a seller knows you're serious, and it's part of your purchase price, not an extra cost on top of it.
Pre-approval vs. pre-qualification
A pre-qualification is a quick, informal estimate based on what you tell a lender. A pre-approval means a lender has actually verified your income, assets, and credit. In Los Angeles, a pre-qualification almost never gets taken seriously on a competitive offer. Come with a real pre-approval letter.
Appraisal
An independent, licensed professional's opinion of what the home is actually worth, ordered by your lender so they're not lending more than the home supports. If it comes in under your offer, that gap becomes something you, your agent, and the seller work through together.
Comps (and your CMA)
Comps are comparable homes, similar in size, condition, and location, that recently sold nearby. A CMA, or comparative market analysis, is the full report an agent builds from those comps to help you understand whether a price actually makes sense, before you ever write an offer.
Request for Repairs
After your inspection, this is the form where you formally ask the seller for repairs, credits, or a price reduction based on what the inspector found. In California, the seller can accept all, some, or none of it, and their silence isn't automatically a no, it's just silence. This is usually where the real negotiating happens, not the original offer.
Disclosures
In California, sellers are legally required to tell you about known issues with the property, from past repairs to neighborhood hazards, through a set of disclosure forms. Read these closely. They're often the most honest document in the entire transaction, because the seller is legally on the hook for what's in them.
Natural Hazard Disclosure (NHD) report
A required California document that tells you whether the property sits in a designated hazard zone, wildfire, flood, or earthquake fault among them. It's a real, required disclosure, not a scare tactic, and worth actually reading closely rather than skimming past.
Title insurance
This protects you and your lender against a problem with the property's title nobody caught before you bought it, an old lien, a forged signature somewhere in the chain of ownership, a boundary dispute. You pay for it once, at closing, and it covers you for as long as you own the home.
HOA fees & CC&Rs
If the home is part of a homeowners association, you'll pay a regular HOA fee, and you'll want to actually read the CC&Rs, the covenants, conditions, and restrictions that spell out what you can and can't do with the property. Paint colors, parking, renovations, all of it can live in there.
Closing costs
The fees and expenses beyond your down payment, think title insurance, escrow fees, and loan origination charges, due when you actually close. I already broke down what you may actually need to buy a house in Los Angeles, closing costs included, so you're not caught off guard at the finish line.
Buyer-agent agreement
The contract you sign with your own agent before they can start showing you homes, spelling out their compensation and how long the agreement lasts. I already walked through what that agreement actually means before your first tour, including how to ask for a release if it's not the right fit.
"Best and final"
In a competitive multiple-offer situation, a seller may ask every buyer to submit their best and final offer by a set deadline, meaning there's no more back and forth after that. It's the moment your agent's read on the market matters more than almost anything else.
Days on Market (DOM)
Exactly what it sounds like, how long a home has been actively listed. A low number usually means real demand. A high number isn't automatically a red flag, sometimes it just means a price got adjusted, but it's always worth asking your agent why.
None of this is meant to be memorized. It's meant to make the next conversation with your agent feel like a conversation, not a lecture.
I've Got You.