Glossary

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After Repair Value (ARV)

After Repair Value (ARV) is a real estate definition for the home-flipping business. ARV represents the future value of the property after repair. Investors often calculate the value of the repaired house to similar homes sold in the area.

Appraisal/Appraiser

A home appraisal is an impartial professional estimate of the real estate value. To determine the amount of mortgage, the loan lender issues appraisals. An expert assessing the home’s worth is the appraiser. The base of the evaluation process is comparable sales in the area.

Appreciation

Appreciation is the increase in home value over time. The value can be natural and forced. Natural value comes from the sudden increase in property value in the neighborhood. Forced value implies any upgrades made to the home.

Assessed Value

The assessed value of a home is the worth of the property issued for taxation. A professional opinion given by the tax assessor is the assessed value of the property. The document specifies how much the homeowner owes in state tax.

Appreciation

Appreciation is the increase in home value over time. The value can be natural and forced. Natural value comes from the sudden increase in property value in the neighborhood. Forced value implies any upgrades made to the home.

Amortization

Amortization is an accounting term. Amortization by definition represents the decrease in the total balance of the loan. The borrower’s monthly repayment of the debt decreases the final sum of the loan. The payments of the existing debt include both the principal and interest.

Adjustable-Rate Mortgage (ARM)

Adjustable-Rate Mortgage (ARM) is a mortgage loan in which the interest rate is not fixed. Meaning, that during the lifespan of the loan, the interest rate changes. ARM payments are for five, seven, and ten years period.