Purchasing a home is a major investment. As such, it is important that you become educated about the legalities of a home purchase and that you understand what various terms mean. Here are some of the terms you should know before going through with a home purchase.
Joint Tenancy
If you are purchasing the home with someone else, you will likely enter into a joint tenancy. As a joint tenant, you and one or more other people are considered the owner of the home or property that you have purchased. If one of the people you enter into joint tenancy dies, that person's rights to the property are passed on to his or her survivors.
Land Tax
The tax that you are required to pay on the property you own in known as land tax. The amount of tax you are charged depends upon the value of the property. You need not pay land tax on the property that is your principal place of residence.
Liabilities and Liens
There should be no liens or liabilities on the home you are planning to purchase and this can be determined by looking at the title deed of the home you are planning to purchase. The outstanding debt that the previous owner may have had in relation to the home is termed as a liability. Liens, on the other hand, are claims that another person or business may have on the property. When someone else has the right to the home because they are owed money liens are put into place. Liens can be put into place by a bank that lent money to the previous homeowner as well as judgments or unpaid taxes.
Appraised Value
Once you decide on the home that you would like to purchase, you will need to have an appraiser visit the home in order to appraise its value. The amount that the lender is willing to loan toward the purchase of the home is generally the appraised value.
Appraisal is not the same as inspection. If you are interested in purchasing a home, it is important that you also have an inspection performed. This way, you can make sure you are fully aware of the condition of the home before you make a purchase. This inspection falls in line with another term you should be aware of, caveat emptor, which stands for "let the buyer beware." In accordance with caveat emptor, the burden is placed on you to be certain you are satisfied with the home before you make a purchase.
Joint Tenancy
If you are purchasing the home with someone else, you will likely enter into a joint tenancy. As a joint tenant, you and one or more other people are considered the owner of the home or property that you have purchased. If one of the people you enter into joint tenancy dies, that person's rights to the property are passed on to his or her survivors.
Land Tax
The tax that you are required to pay on the property you own in known as land tax. The amount of tax you are charged depends upon the value of the property. You need not pay land tax on the property that is your principal place of residence.
Liabilities and Liens
There should be no liens or liabilities on the home you are planning to purchase and this can be determined by looking at the title deed of the home you are planning to purchase. The outstanding debt that the previous owner may have had in relation to the home is termed as a liability. Liens, on the other hand, are claims that another person or business may have on the property. When someone else has the right to the home because they are owed money liens are put into place. Liens can be put into place by a bank that lent money to the previous homeowner as well as judgments or unpaid taxes.
Appraised Value
Once you decide on the home that you would like to purchase, you will need to have an appraiser visit the home in order to appraise its value. The amount that the lender is willing to loan toward the purchase of the home is generally the appraised value.
Appraisal is not the same as inspection. If you are interested in purchasing a home, it is important that you also have an inspection performed. This way, you can make sure you are fully aware of the condition of the home before you make a purchase. This inspection falls in line with another term you should be aware of, caveat emptor, which stands for "let the buyer beware." In accordance with caveat emptor, the burden is placed on you to be certain you are satisfied with the home before you make a purchase.
About the Author:
Jim Olenbush has been active in the Texas real estate industry since 1997. His team of experienced real estate agents specialize in The Courtyard Austin and other luxury neighborhoods around Austin, Texas.
