Chapter 12 Real Estate Latest Updated Rated A+

Adjustable-Rate Mortgage (ARM) Mortgage in which the interest rate changes periodically (e.g. annually) A way for banks to transfer the risk of higher interest rates to the consumer Equity The value of a piece of property over and above any mortgage or liabilities related to it Fixed Rate An interest rate that does not change over time Inflation Hedge An asset rising in value, which helps one to keep up with the risking cost of inflation Real estate can be a great inflation hedge Multiple Listing Service (MLS) Computer programs used by real estate agents to search frequently updated listings of available properties in order to find prospective homes for their clients Mortgage A loan secured by the collateral or real estate property, which obligates the borrower to make a predetermined series of payments Principal The original amount of money invested, excluding any interest or dividends Also called the face value of the loan Real Estate Agent A real estate professional who receives a commission for arranging and facilitating the sale of a property for a buyer or seller Also referred to as a real estate broker