New H.O.M.E.

Terms to Know

Terms you should know

When you’re buying a new home, sometimes it can feel like everyone is speaking a foreign language. We have provided a list of key terms you should know before moving forward with your purchase. For more information, please ask your Bella Vista Homes Sales Professional.

Closing Costs

Costs in addition to the price of the home, which are paid at closing. These include taxes, title insurance, financing costs, and items that must be prepaid or "escrowed" and other costs.

Escrow

An account held by the mortgage lender into which a homeowner pays money at the time of the periodic mortgage payments to cover annual property taxes and insurance.

Earnest Money

The deposit money given to the seller by the potential buyer when signing the sales contract.

Good Faith Estimate

An estimate of charges which a home buyer is likely to incur in connection with their home purchase, including closing costs and monthly investment.

HOA (Homeowner’s Association)

The governing body of a community, which enforces the covenants, conditions, and restrictions of managing the common amenities of the development.

Homestead Exemption

A concession made by local taxing authorities to provide a reduction in property taxes by exempting a portion of the valuation of the homeowner’s principal residence from taxation.

Select Home

A home on which construction has already begun or is complete before a home buyer signs a contract on that home. Also known as a inventory or spec (speculative) home.

Mortgage

A pledge of real property given by the buyer to the lender as security for the repayment of money borrowed.

MUD (Municipal Utility District) Tax

A fee homeowners pay to provide water, sewage, drainage, and other services to their area. MUD rates generally decline over time as the district is built out and operating and debt service costs are shared by more homeowners.

Owner’s Title Policy

Insurance policy that protects the buyer/owner of real property from successful claims of ownership to the property by others.