Reference

Ohio Real Estate Glossary.

Plain-English definitions of every term you will encounter. Whether you are buying your first home, selling, or just researching, this guide covers the terminology you need to know.

Bookmark this page — your go-to reference for Ohio real estate terminology.

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
A
Abatement
A reduction or exemption of property taxes granted for a specific period, often used to encourage development or redevelopment in targeted areas.
Abstract of Title
A written history of all recorded documents and legal proceedings affecting a property, showing the chain of ownership and any liens or encumbrances.
Adjustable-Rate Mortgage (ARM)
A home loan with an interest rate that can change periodically based on a financial index. ARMs often start with a lower rate than fixed-rate loans but carry the risk of future payment increases.
Amenity
A desirable or useful feature of a property or community, such as a pool, clubhouse, walking trails, or updated kitchen.
Amortization
The process of paying off a loan through regular installments over time. Each payment covers both interest and principal, with the loan balance gradually decreasing to zero by the end of the term.
Annual Percentage Rate (APR)
The total yearly cost of borrowing, expressed as a percentage. APR includes the interest rate plus other lender fees, giving a more complete picture of loan costs than the interest rate alone.
Appraisal
A professional estimate of a property's market value, conducted by a licensed appraiser. Lenders require appraisals to ensure the home is worth the loan amount.
Appraisal Contingency
A clause in a purchase contract that allows the buyer to back out or renegotiate if the appraised value comes in lower than the agreed purchase price.
Appreciation
The increase in a property's value over time due to market conditions, improvements, or neighborhood development.
Arrears
The state of being behind on payments. In real estate, mortgage interest is typically paid in arrears, meaning you pay the interest that has already accrued rather than prepaying it.
As-Is
A property sold in its current condition without the seller agreeing to make any repairs or improvements. Buyers still have the right to inspect, but the seller will not fix issues discovered.
Assessed Value
The dollar value assigned to a property by a county auditor for the purpose of calculating property taxes. Assessed value is typically a percentage of the property's market value.
B
Balloon Payment
A large lump-sum payment due at the end of a loan term after a series of smaller regular payments. Common in certain types of seller financing or short-term loans.
Bridge Loan
Short-term financing used to "bridge" the gap between buying a new home and selling your current one. It provides temporary funds while you wait for your existing home to sell.
Broker
A licensed real estate professional who has completed additional education and experience beyond a salesperson license. Brokers can own brokerages, hire agents, and manage transactions independently.
Building Permit
Official approval from a local government allowing construction, renovation, or demolition to proceed. Permits ensure work meets building codes and safety standards.
Buyer's Agent
A real estate agent who represents the buyer's interests in a transaction. The buyer's agent helps find properties, negotiates offers, and guides the buyer through the purchase process.
Buyer's Market
A market condition where there are more homes for sale than buyers, giving purchasers more negotiating power and often leading to lower prices.
C
CAUV (Current Agricultural Use Valuation)
An Ohio-specific program that values farmland at its agricultural use value rather than its full market value, resulting in significantly lower property taxes for qualifying agricultural land.
Certificate of Title
A document issued by a title examiner or attorney stating that a property's title is clear of defects. In Ohio, this is typically issued before closing rather than after.
Chain of Title
The historical sequence of all owners of a property, from the original grant to the current owner. A complete chain shows every transfer of ownership with no gaps.
Clear Title
A title free of liens, disputes, or other defects that could affect ownership. A property with clear title can be transferred to a buyer without legal issues.
Closing
The final step in a real estate transaction where ownership is transferred from seller to buyer, all documents are signed, funds are disbursed, and the deal becomes official.
Closing Costs
Fees paid at closing beyond the purchase price, including lender charges, title insurance, appraisal fees, attorney fees, recording fees, and prepaid taxes and insurance. Typically 2% to 5% of the purchase price.
Closing Disclosure
A standardized five-page form provided by the lender at least three business days before closing. It details the final loan terms, projected monthly payments, and all closing costs.
Comparable Market Analysis (CMA)
A report prepared by a real estate agent comparing a subject property to similar nearby properties that have recently sold, are currently listed, or expired. Used to estimate market value.
Contingency
A condition written into a purchase contract that must be satisfied before the sale can close. Common contingencies include inspection, financing, and appraisal.
Contingent
A listing status meaning the seller has accepted an offer but the sale depends on one or more conditions (such as the buyer securing financing or selling their current home) being met.
Conventional Loan
A mortgage not insured or guaranteed by a government agency like the FHA, VA, or USDA. Conventional loans typically require higher credit scores and larger down payments, but often have fewer restrictions.
Counteroffer
A response to an offer that changes some of its terms. When a seller makes a counteroffer, the original offer is rejected, and the buyer can accept, reject, or counter again.
D
Debt-to-Income Ratio (DTI)
A measure of your monthly debt payments divided by your gross monthly income, expressed as a percentage. Lenders use DTI to assess your ability to manage monthly payments and repay a loan.
Deed
A legal document that transfers ownership of real property from one person (the grantor) to another (the grantee). The deed must be recorded with the county recorder's office.
Deed of Trust
A legal document used in some states (less common in Ohio) that transfers property title to a trustee as security for a loan, rather than using a traditional mortgage.
Default
Failure to meet the terms of a mortgage agreement, typically by missing payments. Default can lead to foreclosure if not resolved.
Designated Agency
In Ohio, a brokerage can assign different agents within the same firm to represent the buyer and seller separately. Each client gets dedicated representation while the brokerage itself remains neutral. Also called "designated representation."
Disclosure
The legal obligation of a seller or agent to reveal known material defects about a property to potential buyers. Ohio law requires sellers to complete a Residential Property Disclosure Form.
Down Payment
The portion of the purchase price paid upfront by the buyer, not financed through the mortgage. Down payments typically range from 3% to 20% of the purchase price depending on the loan type.
Dual Agency
A situation where a single agent or brokerage represents both the buyer and seller in the same transaction. Dual agency is legal in Ohio but requires written consent from both parties and limits the agent's ability to negotiate fully for either side.
Due Diligence
The period during which a buyer investigates a property thoroughly before committing to purchase. This includes inspections, title searches, reviewing documents, and verifying information provided by the seller.
E
Earnest Money
A deposit made by the buyer to show good faith when an offer is accepted. Typically 1% to 3% of the purchase price, it is held in escrow and applied toward the down payment at closing — or forfeited if the buyer backs out without a valid contingency.
Easement
A legal right to use someone else's property for a specific purpose, such as utility access or a shared driveway. Easements run with the land and transfer to future owners.
Encroachment
An unauthorized intrusion of a building, fence, or other improvement onto another person's property. Encroachments can cause title issues and must be resolved before or during a sale.
Encumbrance
Any claim, lien, charge, or restriction on a property that limits the owner's full rights. This includes mortgages, easements, and judgments.
Equity
The difference between a property's market value and the amount still owed on its mortgage. As you pay down your loan or the property appreciates, your equity grows.
Escrow
A neutral third-party account where funds and documents are held until all conditions of a real estate transaction are met. Escrow protects both buyers and sellers during the closing process.
Escrow Account (Impound Account)
An account set up by your lender to hold funds for future property tax and insurance payments. A portion of your monthly mortgage payment goes into escrow so those bills are paid on time.
Exclusive Right to Sell
A listing agreement that gives one real estate broker the exclusive right to earn a commission for selling the property, regardless of who actually finds the buyer.
F
Fair Housing Act
A federal law that prohibits discrimination in housing based on race, color, religion, sex, national origin, familial status, or disability. Ohio also has its own Fair Housing Law with the same protections.
FHA Loan
A mortgage insured by the Federal Housing Administration, allowing lower down payments (as low as 3.5%) and more flexible credit requirements. Popular with first-time buyers.
FICO Score
A credit score developed by the Fair Isaac Corporation, used by lenders to assess borrower risk. FICO scores range from 300 to 850; higher scores qualify for better interest rates.
Financing Contingency
A contract clause that allows the buyer to back out if they cannot secure a mortgage within a specified timeframe. This protects buyers from losing their earnest money if financing falls through.
Fixed-Rate Mortgage
A home loan with an interest rate that remains the same for the entire term, typically 15 or 30 years. Monthly principal and interest payments stay consistent.
Flood Insurance
A separate insurance policy required for properties in designated flood zones. Standard homeowners insurance does not cover flood damage. Your lender will determine if flood insurance is needed.
Foreclosure
The legal process by which a lender takes possession of a property after the borrower fails to make mortgage payments. The property is then sold to recover the loan balance.
G
General Warranty Deed
The most common type of deed in Ohio, providing the strongest protection for the buyer. The seller guarantees they own the property free of all claims, liens, and defects — past and present.
Good Faith Estimate (GFE)
An estimate of closing costs provided by the lender after receiving a loan application. Now largely replaced by the Loan Estimate under TRID rules, but still used informally.
Grace Period
The number of days a borrower has to make a mortgage payment after the due date without incurring a late fee. Most lenders offer a 15-day grace period.
Gross Rent Multiplier (GRM)
A valuation metric used by investors to evaluate rental properties. Calculated by dividing the property's price by its gross annual rental income.
H
Hazard Insurance
Insurance that covers damage to a property from specific perils like fire, wind, hail, and theft. Most lenders require hazard insurance as a condition of the mortgage.
Home Inspection
A professional examination of a property's condition, covering structural components, roof, plumbing, electrical, HVAC, and more. A home inspection is typically paid for by the buyer and is strongly recommended.
Homeowners Association (HOA)
An organization in a subdivision or condominium that enforces community rules and manages common areas. HOAs charge regular fees and can assess special charges for major repairs.
Homestead Tax Exemption
An Ohio tax relief program that reduces property taxes for senior citizens (age 65+), disabled veterans, and permanently and totally disabled homeowners. Eligible homeowners can exempt up to $25,000 of their home's market value from taxation.
I
Impound Account
Another name for an escrow account — a fund held by the lender to pay property taxes and insurance premiums on your behalf.
Inspection Contingency
A contract clause giving the buyer the right to have the property inspected within a specified timeframe and negotiate repairs, request credits, or back out based on the findings.
Interest Rate
The percentage a lender charges for borrowing money, expressed annually. The interest rate affects your monthly payment and the total cost of the loan over its term.
Investment Property
Real estate purchased primarily to generate income (through rent or appreciation) rather than as a primary residence. Investment properties typically require larger down payments and carry different loan terms.
J
Joint Tenancy
A form of co-ownership where two or more people hold equal shares of a property with rights of survivorship. When one owner dies, their share automatically passes to the surviving owners.
Judgment
A court-ordered debt that can become a lien against a property. Outstanding judgments must typically be paid before or at closing to deliver clear title.
K
Key Lot
A lot situated at a key position within a subdivision, often larger or with unique characteristics. Key lots sometimes have different setback requirements or HOA rules.
L
Lien
A legal claim against a property as security for a debt. Common examples include mortgages, tax liens, and mechanic's liens. Liens must be satisfied before the property can be sold with clear title.
Loan Estimate
A three-page form provided by the lender within three business days of receiving a loan application. It shows the estimated interest rate, monthly payment, and closing costs so you can compare offers.
Loan-to-Value Ratio (LTV)
The ratio of the loan amount to the property's appraised value, expressed as a percentage. A lower LTV generally means better loan terms. LTV helps lenders assess risk.
Lock-In (Rate Lock)
A lender's commitment to guarantee a specific interest rate for a set period, typically 30 to 60 days. A rate lock protects you from rate increases while your loan is being processed.
M
Market Value
The price a property would sell for in a competitive open market, based on what similar properties have recently sold for. Market value is determined by buyers and sellers, not by the county auditor's assessment.
Median Home Price
The midpoint of all home sale prices in a given area — half sold for more, half for less. Unlike the average, the median is not skewed by a few very high or very low sales.
Millage
The tax rate used to calculate property taxes. One mill equals $1 of tax per $1,000 of assessed value. Millage rates are set by local governments, school districts, and other taxing authorities.
MLS (Multiple Listing Service)
A shared database used by real estate agents to list and search properties for sale. The MLS provides broad exposure for listings and is the primary tool agents use to find homes.
Mortgage
A loan specifically used to purchase real estate, secured by the property itself. The borrower agrees to repay the loan over a set term, and the lender has the right to foreclose if payments are not made.
Mortgage Broker
A professional who matches borrowers with lenders for a fee. Mortgage brokers do not lend their own money but facilitate loans between borrowers and lending institutions.
Mortgage Insurance
Insurance protecting the lender if the borrower defaults. Required for conventional loans with down payments below 20% and for all FHA loans regardless of down payment.
N
Net Proceeds
The amount a seller receives from a home sale after subtracting the mortgage payoff, closing costs, commissions, and other expenses. Your agent provides a net sheet before you list.
Notary Public
A person authorized by the state to witness and verify signatures on legal documents. Many real estate closing documents require notarization to be valid.
O
Offer
A formal proposal from a buyer to purchase a property at specified terms, including price, contingencies, and closing date. When the seller accepts, it becomes a binding contract.
Ohio Purchase Contract
The standard form used for residential real estate purchase agreements in Ohio, approved by the Ohio Association of Realtors and the Ohio Real Estate Commission. It covers price, contingencies, closing details, and all terms of the sale.
Open House
A scheduled period when a listed property is open for public viewing without an appointment. Open houses allow potential buyers to tour the home and ask questions directly with the listing agent.
Origination Fee
A fee charged by the lender for processing a mortgage application, typically 0.5% to 1% of the loan amount. It covers administrative costs, underwriting, and processing.
P
Pending
A listing status meaning the seller has accepted an offer and all contingencies have been satisfied or waived. The sale is proceeding toward closing and the property is no longer actively marketed.
Plat
A detailed map of a subdivision showing individual lots, streets, easements, and public areas. Plats are recorded with the county and used to legally define property boundaries.
PMI (Private Mortgage Insurance)
Mortgage insurance required on conventional loans when the down payment is less than 20%. PMI protects the lender and can be removed once you reach 20% equity in the home.
Points (Discount Points)
An upfront fee paid to the lender at closing in exchange for a lower interest rate. One point equals 1% of the loan amount. Buying points can save money over the life of the loan if you plan to stay long-term.
Power of Attorney
A legal document authorizing someone to act on your behalf in financial or legal matters, including signing real estate closing documents. Often used when a buyer or seller cannot attend closing in person.
Pre-Approval
A lender's conditional commitment to lend a specific amount based on a thorough review of your credit, income, and assets. A pre-approval letter shows sellers you are a serious, qualified buyer.
Pre-Qualification
An informal estimate of how much you can borrow based on self-reported financial information. Pre-qualification is less detailed than pre-approval and carries no guarantee of loan approval.
Prepayment Penalty
A fee charged by some lenders if you pay off your mortgage early (e.g., through refinancing or selling). Most modern loans do not have prepayment penalties, but it is worth confirming.
Principal
The original amount of money borrowed in a mortgage, not including interest. Each monthly payment reduces the principal, building your equity in the property.
Property Tax Assessment
The process by which a county auditor determines the value of a property for tax purposes. In Ohio, properties are reappraised every three years (sexennial reappraisal) with an update in the interim (triennial update).
Q
Quiet Title
A legal action filed to resolve disputes or remove claims against a property's title, resulting in a court order that "quiets" all competing claims.
Quitclaim Deed
A deed that transfers whatever ownership interest the grantor may have, without making any guarantees about the quality of the title. Quitclaim deeds are commonly used between family members or to clear title defects, but not in standard home sales to third parties.
R
Rate Lock
A lender's promise to hold a specific interest rate and points for a set period while your loan application is processed. A rate lock protects you from market fluctuations.
Real Estate Agent
A licensed professional who assists buyers and sellers with real estate transactions. Agents must work under a managing broker in Ohio and complete continuing education to maintain their license.
Recording
The process of filing a deed or other legal document with the county recorder's office, making it part of the public record. Recording establishes legal notice of ownership and protects the buyer's interest.
REO (Real Estate Owned)
A property that has gone through foreclosure and is now owned by the bank or lender. REO properties are typically sold as-is and may offer value opportunities for buyers willing to make repairs.
RESPA (Real Estate Settlement Procedures Act)
A federal law requiring lenders to provide borrowers with clear disclosures about settlement costs and prohibiting kickbacks and referral fees. RESPA ensures transparency in the closing process.
S
Seller's Market
A market condition where demand exceeds supply, giving sellers the advantage. Homes sell faster, often above asking price, and buyers face more competition.
Setback
The minimum distance a building or structure must be from property lines, streets, or other boundaries. Setbacks are established by local zoning ordinances and vary by area and property type.
Settlement
Another term for closing — the final step in a real estate transaction where ownership is transferred and funds are distributed.
Short Sale
A sale where the lender agrees to accept less than the full amount owed on the mortgage because the property's value has dropped below the loan balance. Short sales require lender approval and can take longer than a standard sale.
Special Assessment
A charge levied against a property to pay for public improvements that benefit that property, such as new sidewalks, street paving, or sewer lines. Special assessments are typically paid over time.
Staging
The process of preparing a home for sale by arranging furniture, decor, and lighting to make it appealing to potential buyers. Professionally staged homes often sell faster and for higher prices.
Subdivision
A tract of land divided into individual lots for sale or development, often with shared infrastructure like streets, utilities, and common areas. Subdivisions are typically governed by covenants and HOA rules.
T
Tenancy in Common
A form of co-ownership where each owner holds a separate, transferable share of the property. Unlike joint tenancy, there is no right of survivorship — each owner's share passes to their heirs.
Title
Legal ownership of a property, including the right to possess, use, and transfer it. A clear title means there are no claims or liens that could prevent transfer.
Title Insurance
An insurance policy that protects buyers and lenders against losses from title defects, such as unknown liens, forgeries, or errors in public records. Lenders require a lender's policy; an owner's policy is highly recommended.
Title Search
An examination of public records to verify a property's legal ownership and identify any liens, encumbrances, or defects in the chain of title. Performed by a title company or attorney before closing.
Transfer Tax
A tax imposed when real property changes hands, calculated as a percentage of the sale price. In Ohio, the county conveyance fee and any local transfer taxes are typically paid by the seller.
TRID (TILA-RESPA Integrated Disclosure)
Federal rules that combine Truth in Lending Act and RESPA disclosures into the Loan Estimate and Closing Disclosure forms, giving borrowers clear, upfront information about loan terms and costs.
U
Underwriting
The process by which a lender evaluates your financial information, credit, and the property to determine whether to approve your loan. Underwriting is the final approval step before closing.
USDA Loan
A zero-down-payment mortgage guaranteed by the U.S. Department of Agriculture for eligible rural and suburban homebuyers. Clinton County is fully eligible for USDA loans, making them a popular option for local buyers.
V
VA Loan
A mortgage guaranteed by the U.S. Department of Veterans Affairs, available to eligible veterans, active-duty service members, and surviving spouses. VA loans require no down payment and have competitive interest rates.
Variance
Permission to deviate from local zoning requirements, such as building closer to the property line than normally allowed. Variances must be approved by the local zoning board, often requiring a public hearing.
W
Walk-Through
A final inspection conducted by the buyer shortly before closing to verify the property is in the agreed-upon condition, any requested repairs have been completed, and no new issues have arisen.
Warranty Deed
A deed in which the seller guarantees (warrants) that the title is free from defects and that they have the legal right to transfer ownership. The general warranty deed is the standard in Ohio home sales.
Z
Zoning
Local government regulations that control how property can be used in specific areas — residential, commercial, industrial, agricultural, etc. Zoning determines what you can build, how large it can be, and what activities are allowed on the property.
Zoning Variance
A special exception to zoning rules granted by a local board when strict enforcement would cause unnecessary hardship. A variance is not a rezoning — it is a one-time exemption for a specific property.

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