So when you are getting started in real estate and real estate investing or you even might have been doing it for awhile. You might not understand all the lingo that is being thrown around. So here is a quick cheat sheet to help you understand.
DTI– Debt to Income (this is primarily used to determine how much a lender will lend you)
PITI– Principle, Interest, Taxes, and Insurance
As-Is– No repairs will be made
FSBO– For Sale By Owner
POF– Proof of Funds
ARV– After Repair Value
Earnest Money – deposit for real estate contract
TLC– fixer upper
GRM– Gross Rent Multiplier (The Ratio of a property’s purchasing price to its gross annual rental income)
LTV– Loan to Value Ratio
Cap Rate– Capitalization rate, it is used to measure the annual rate of return on a real estate investment based on the profit the property expects to generate.
NOI– Net Operating Income
CapEx– Capital Expenditures
Equity– The current market value minus the current loan on the property
Turnkey– Movie in ready
IRR– Internal Rate of Return
FMV– Fair Market Value
RTO– Rent To Own
SFH– Single Family Home
PMI– Private Mortgage Insurance
This is a growing list and this are just a few terms in real estate. I hope this helps you all.
Recent Comments