Ohio Real Estate
Glossary
Plain-English definitions of every term you'll encounter — from appraisal to zoning.
Bookmark this page — your go-to reference for Ohio real estate terminology. Updated by the Glasshouse Realty team.
Abatement
A reduction in property taxes granted by a local government, often as an incentive for new development or home improvements in designated areas.
Adjustable-Rate Mortgage (ARM)
A home loan with an interest rate that changes periodically based on a benchmark index. ARMs typically start with a lower rate than fixed-rate mortgages but can increase over time.
Agent
A licensed real estate professional who represents buyers or sellers in property transactions. In Ohio, agents must work under a managing broker.
Amortization
The process of gradually paying off a loan through scheduled payments over time. Early payments go mostly toward interest; later payments go mostly toward principal.
Appraisal
A professional estimate of a property's market value, conducted by a licensed appraiser. Lenders require appraisals to confirm the home is worth the loan amount.
Appraisal Contingency
A clause in a purchase contract that allows the buyer to back out if the property appraises for less than the agreed purchase price.
Appreciation
The increase in a property's value over time, driven by market conditions, improvements, and neighborhood demand.
As-Is
A property sold in its current condition without the seller agreeing to make repairs or improvements. Buyers still have the right to inspect and may negotiate or walk away depending on contract terms.
Assessed Value
The dollar value assigned to a property by a county auditor for the purpose of calculating property taxes. In Ohio, assessed value is 35% of the property's market value.
Balloon Payment
A large lump-sum payment due at the end of some mortgage loan terms, covering the remaining principal balance. Balloon loans are less common in residential real estate.
Bridge Loan
Short-term financing used to "bridge" the gap between buying a new home and selling the current one. It provides temporary funds for the down payment on the new property.
Broker
A licensed real estate professional who has completed additional education and experience requirements beyond an agent license. In Ohio, brokers can own a firm or manage other agents.
Building Envelope
The physical separator between the interior and exterior of a building — including the foundation, walls, roof, windows, and doors — that controls air, moisture, and temperature.
CAP Rate (Capitalization Rate)
A metric used to evaluate the potential return on an investment property, calculated by dividing the net operating income by the property's purchase price.
CAUV (Current Agricultural Use Value)
An Ohio tax program that assesses eligible farmland based on its agricultural value rather than its full market value, resulting in significantly lower property taxes for farmers.
Certificate of Title
A legal document issued by a title company or attorney stating that the property title is clear of liens, claims, or defects — typically issued after a title search has been completed.
Closing
The final step in a real estate transaction where ownership is transferred from seller to buyer, documents are signed, and funds are disbursed.
Closing Costs
Fees paid at closing beyond the purchase price, including loan origination fees, title insurance, appraisal fees, escrow charges, and recording fees. In Ohio, closing costs typically range from 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, detailing the loan terms, monthly payments, and all closing costs.
Comparable Market Analysis (CMA)
A report prepared by a real estate agent comparing recently sold, active, and expired listings of similar properties in the same area to estimate a home's fair market value.
Condominium (Condo)
A type of housing where the buyer owns an individual unit and shares ownership of common areas — such as hallways, amenities, and grounds — with other unit owners through a homeowners association.
Conforming Loan
A mortgage that meets the loan limits and underwriting guidelines set by Fannie Mae and Freddie Mac, making it eligible for purchase by these government-sponsored enterprises.
Contingency
A condition written into a purchase contract that must be satisfied before the sale becomes binding. Common contingencies include financing, inspection, and appraisal.
Contingent
A listing status meaning the seller has accepted an offer, but the sale is still dependent on one or more contingencies being satisfied — such as the buyer securing financing or completing an inspection.
Conventional Loan
A mortgage not insured or guaranteed by the federal government. Conventional loans typically require higher credit scores and larger down payments than FHA or VA loans.
Co-Op (Cooperative)
A type of housing where residents do not own their individual units but instead own shares in a corporation that owns the entire building. Each shareholder has a proprietary lease to their unit.
Conditional Use Permit
A zoning approval that allows a property to be used in a way that is not normally permitted in that zoning district, subject to specific conditions — such as a daycare in a residential area.
Deed
A legal document that transfers ownership of real property from one party to another. The deed must be signed, notarized, and recorded with the county recorder's office.
Deed of Trust
A legal document used in some states (Ohio primarily uses mortgages) that places a property in trust as security for a loan. The trustee holds the title until the loan is paid off.
Designated Agency
A type of agency in Ohio where two agents from the same brokerage can represent the buyer and seller in the same transaction, with each agent acting as a designated agent for their respective client, maintaining confidentiality.
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 home price.
Dual Agency
A situation where the same real estate agent or brokerage represents both the buyer and the seller in a transaction. In Ohio, dual agency is permitted only with the informed written consent of both parties.
Due Diligence
The period during which a buyer investigates a property's condition, title, zoning, and other factors before finalizing the purchase. This includes inspections, title searches, and reviewing documents.
DTI (Debt-to-Income Ratio)
A measure lenders use to evaluate a borrower's ability to make monthly payments, calculated by dividing total monthly debt payments by gross monthly income. Most lenders prefer a DTI under 43%.
Earnest Money
A deposit made by the buyer to show good faith when an offer is accepted. The funds are held in escrow and applied to the down payment at closing. In Ohio, earnest money is typically 1% to 3% of the purchase price.
Easement
A legal right to use someone else's property for a specific purpose, such as utility companies running power lines or a neighbor using a driveway for access.
Encumbrance
Any claim or liability attached to a property that may affect its value or transferability — including liens, easements, deed restrictions, or unpaid taxes.
Equal Housing Opportunity
The federal policy, enforced by the Fair Housing Act, ensuring that all people have equal access to housing regardless of race, color, religion, sex, national origin, familial status, or disability.
Equity
The difference between a property's current market value and the amount still owed on the mortgage. Building equity is one of the primary ways homeowners build wealth.
Escrow
A neutral third-party account where funds and documents are held during a real estate transaction until all conditions of the sale are met. Escrow also refers to the account used by lenders to pay property taxes and insurance.
Escrow Account
An account set up by the lender to collect and hold funds for property taxes and homeowners insurance, paying them on the homeowner's behalf when due.
Exclusive Right to Sell
A listing agreement that gives one broker the exclusive right to represent the seller and earn a commission regardless of who finds the buyer — even if the seller finds the buyer themselves.
Fair Housing Act
The federal law that prohibits discrimination in housing based on race, color, religion, sex, national origin, familial status, or disability. Ohio also has state-specific fair housing laws.
FHA Loan
A mortgage insured by the Federal Housing Administration, designed for first-time buyers and those with lower credit scores or smaller down payments. FHA loans require as little as 3.5% down.
FICO Score
A credit score developed by the Fair Isaac Corporation, used by lenders to evaluate a borrower's creditworthiness. FICO scores range from 300 to 850; higher scores qualify for better interest rates.
Financing Contingency
A contract clause that allows the buyer to withdraw from the purchase if they cannot secure a mortgage loan within a specified timeframe, with their earnest money returned.
Fixed-Rate Mortgage
A home loan with an interest rate that remains the same for the entire term of the loan, typically 15 or 30 years. Fixed-rate mortgages offer predictable monthly payments.
Flip
The practice of buying a property, making improvements or renovations, and reselling it quickly for a profit. Flipping carries risks including market downturns and unexpected repair costs.
Government-Sponsored Enterprise (GSE)
A financial entity created by the U.S. Congress to expand the flow of mortgage credit. Fannie Mae and Freddie Mac are the two major GSEs that buy and guarantee mortgages.
Grace Period
The period after a loan payment due date during which the payment can be made without penalty or late fees, typically 10 to 15 days for mortgages.
Gross Rent Multiplier (GRM)
A quick valuation tool for investment properties, calculated by dividing the property's price by its gross annual rental income. A lower GRM generally indicates a better investment opportunity.
Highest and Best Use
The most profitable, legally permissible, and physically possible use of a property. This real estate concept is used in appraisals to determine the value a property could achieve under optimal use.
HOA (Homeowners Association)
An organization in a condominium, townhouse, or planned community that enforces rules and manages common areas. Homeowners pay monthly or annual dues for maintenance, amenities, and insurance.
HOA Dues
Regular fees paid by homeowners to their HOA for maintenance of common areas, amenities, insurance, and reserves. In Ohio, HOA dues vary widely from $50 to $500+ per month depending on the community.
Home Inspection
A professional examination of a property's condition, including its structure, systems, and components. An inspection is typically ordered by the buyer and is a common contingency in Ohio purchase contracts.
Homestead Exemption
An Ohio property tax reduction program for homeowners aged 65 or older, or those who are permanently and totally disabled. It reduces the taxable value of the home by up to $25,000.
HUD-1 Settlement Statement
The standard form used before October 2015 to itemize all closing costs. It has been replaced by the Closing Disclosure under the TILA-RESPA Integrated Disclosure (TRID) rule.
Inspection Contingency
A contract clause allowing the buyer to hire a professional home inspector and negotiate repairs, request credits, or withdraw from the contract based on the inspection findings.
Interest Rate
The percentage of the loan amount charged by the lender for borrowing money, expressed as an annual percentage rate. It directly affects the monthly mortgage payment.
Investment Property
A property purchased with the intent of generating income — through rental income, appreciation, or both — rather than as a primary residence.
Jumbo Loan
A mortgage that exceeds the conforming loan limits set by Fannie Mae and Freddie Mac. In most Ohio counties in 2026, the conforming limit is $766,550; loans above that are considered jumbo and typically have higher interest rates.
Junior Lien
A secondary loan or claim against a property that is subordinate to the first mortgage. Home equity loans and second mortgages are common examples of junior liens.
Key Money
A fee sometimes paid to secure a lease or rental — more common in commercial real estate. In Ohio residential leasing, key money is rare and may be regulated as an illegal deposit.
Lease Option
An agreement that gives a tenant the right to purchase the property at a predetermined price within a specified time frame, while renting it in the interim.
Lien
A legal claim against a property as security for a debt or obligation. Liens must be paid or resolved before the property can be sold with a clear title. Common liens include mortgages, tax liens, and mechanic's liens.
Loan Estimate
A three-page form provided by lenders within three business days of receiving a mortgage application, detailing the loan terms, projected payments, and estimated closing costs.
LTV (Loan-to-Value Ratio)
The ratio of the mortgage loan amount to the appraised value of the property. A lower LTV means more equity in the home and typically qualifies for better interest rates. LTV over 80% usually requires PMI.
Manufactured Home
A home built entirely in a factory under the federal HUD code, then transported to the site. In Ohio, manufactured homes can be titled as personal property or real property depending on the land ownership.
Market Value
The price a property would likely sell for in a competitive and open market, based on what comparable homes have recently sold for.
Median Home Price
The midpoint of all home sales prices in a given area — meaning half of the homes sold for more and half for less. It is considered a more accurate measure of market conditions than the average price.
Metes and Bounds
A system of describing land using physical features, distances, and angles. This is the oldest method of property description and is still used in Ohio for some older parcels.
Millage
A tax rate applied to a property's assessed value. One mill equals $1 of tax per $1,000 of assessed value. Ohio property tax rates are expressed in mills.
MLS (Multiple Listing Service)
A shared database used by real estate agents to list and search properties for sale. The MLS ensures that listings are visible to all cooperating agents and their clients.
Modular Home
A home built in sections in a factory and assembled on-site, meeting the same local building codes as site-built homes. Modular homes are financed and appraised similarly to traditional homes.
Mortgage
A loan used to purchase real estate, secured by the property itself. The borrower agrees to repay the loan over a set term, typically 15 or 30 years, with interest.
Mortgage Insurance
Insurance that protects the lender if the borrower defaults on the loan. Private mortgage insurance (PMI) is required on conventional loans with less than 20% down; FHA loans require MIP (Mortgage Insurance Premium).
Mortgage Broker
A professional who matches borrowers with lenders, originating loans for a fee. Unlike a loan officer, a mortgage broker does not lend their own money but acts as an intermediary.
Net Operating Income (NOI)
The total income from a property minus operating expenses (excluding mortgage payments). NOI is used to calculate the property's profitability and CAP rate.
Non-Conforming Loan
A mortgage that does not meet Fannie Mae or Freddie Mac guidelines, typically because the loan amount exceeds the conforming limit (jumbo loan) or the borrower's credit profile is non-standard.
Offer
A formal proposal from a buyer to purchase a property at a specified price and terms. Once accepted by the seller, it becomes a binding purchase contract.
Ohio Purchase Contract
The standard real estate purchase agreement form used in Ohio, issued by the Ohio Association of REALTORS®. It includes contingencies, timelines, and terms specific to Ohio real estate transactions.
Ohio Real Estate Commission
The state regulatory body that oversees real estate licensing, education, and discipline in Ohio. The commission enforces the Ohio Revised Code Chapter 4735.
Origination Fee
A fee charged by the lender for processing and underwriting a mortgage loan, typically expressed as a percentage of the loan amount — usually 0.5% to 1%.
Pending
A listing status indicating that an offer has been accepted and all contingencies have been satisfied or waived, and the sale is moving toward closing.
PITI (Principal, Interest, Taxes, Insurance)
The four components of a standard monthly mortgage payment. Many lenders require taxes and insurance to be paid through an escrow account as part of PITI.
Plat
A detailed map of a subdivision or parcel of land, showing boundaries, streets, lots, and easements. Plats are recorded with the county recorder's office.
PMI (Private Mortgage Insurance)
Insurance required on conventional loans with a down payment of less than 20%. PMI protects the lender and can be removed once the homeowner reaches 20% equity.
Points (Discount Points)
Prepaid interest paid at closing to lower the mortgage interest rate. One point equals 1% of the loan amount. Buying points can reduce monthly payments over the life of the loan.
Pre-Approval
A lender's written commitment to lend a specific amount to a borrower, based on a thorough review of credit, income, and assets. Pre-approval carries more weight than pre-qualification and shows sellers you are a serious buyer.
Pre-Qualification
An informal estimate of how much a buyer can borrow, based on self-reported financial information. Pre-qualification is not a commitment to lend and is less rigorous than pre-approval.
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 six years and updated every three years.
PUD (Planned Unit Development)
A type of community where homes are individually owned but residents share ownership of common areas through an HOA. PUDs can include single-family homes, townhouses, or condos.
Quitclaim Deed
A deed that transfers whatever interest the grantor has in a property — without any guarantees about the title. Quitclaim deeds are commonly used between family members, in divorce settlements, or to clear title defects.
REALTOR®
A licensed real estate professional who is a member of the National Association of REALTORS® (NAR). REALTORS® adhere to a strict code of ethics beyond state licensing requirements.
Recording
The act of filing a deed, mortgage, or other document with the county recorder's office, making it part of the public record. Recording establishes legal priority of claims against the property.
REO (Real Estate Owned)
A property that has been foreclosed and is now owned by the lender, typically a bank. REO properties are sold as-is and may offer opportunities for buyers willing to take on repairs.
RESPA (Real Estate Settlement Procedures Act)
A federal law requiring lenders to provide borrowers with clear disclosures about closing costs and settlement procedures. RESPA also prohibits kickbacks and referral fees in real estate transactions.
Right of Rescission
A federal right allowing borrowers to cancel certain types of loans within three business days of signing, without penalty. This applies to refinancing and home equity loans, but not to purchase mortgages.
Riparian Rights
The legal rights of property owners whose land borders a natural waterway, such as a river or stream. These rights may include access to and use of the water.
Setback
A zoning requirement that specifies the minimum distance a building must be located from property lines, streets, or other structures. Setbacks vary by zoning district and in Ohio are regulated at the municipal level.
Short Sale
A sale where the lender agrees to accept less than the full amount owed on the mortgage, allowing the homeowner to avoid foreclosure. Short sales require lender approval and can take longer to close.
Site-Built Home
A home constructed entirely on the property where it will stand, following local building codes. Site-built homes are the traditional standard and are financed and appraised differently from manufactured homes.
Special Assessment
A temporary tax or fee levied on property owners to fund improvements that benefit the area, such as road repairs, sewer lines, or sidewalks. Special assessments are common in Ohio subdivisions.
Subdivision
A tract of land that has been divided into individual lots for development, typically with recorded plat maps, streets, and utility infrastructure.
Tax Abatement
A temporary reduction or elimination of property taxes granted by a local government to encourage development, renovation, or homeownership in specific areas. In Ohio, abatements are often available through CRA (Community Reinvestment Area) programs.
Tax Lien
A government claim against a property for unpaid taxes. Tax liens take priority over most other liens, and the property can be sold to satisfy the debt.
Tax Roll
The official list of all taxable properties in a county, maintained by the county auditor. The tax roll shows assessed values, property ownership, and tax amounts.
TIF (Tax Increment Financing)
A public financing method used in Ohio to fund infrastructure improvements in a designated district. The increased property tax revenue generated by new development is used to pay for the improvements.
TILA (Truth in Lending Act)
A federal law requiring lenders to disclose the true cost of borrowing, including the APR, finance charges, and total payments over the loan term. TILA applies to most consumer mortgage loans.
Title
The legal right to ownership and possession of a property. A clear title means no other party has a valid claim, lien, or encumbrance against the property.
Title Insurance
An insurance policy that protects the buyer and/or lender against losses from title defects, liens, or claims that were not discovered during the title search. In Ohio, owner's title insurance is typically paid by the seller.
Title Search
A thorough review of public records to verify a property's legal ownership and identify any liens, judgments, easements, or other claims against the title.
Townhouse
A single-family home that shares one or more walls with adjacent homes, typically in a row of similar units. Townhouses are often part of an HOA and may have small private yards.
Transfer Tax
A tax imposed on the transfer of real property. In Ohio, the county transfer tax is $0.10 per $100 of the purchase price, and some municipalities add an additional tax.
Underwriting
The process by which a lender evaluates a borrower's creditworthiness, income, debts, and assets to determine whether to approve a mortgage loan and at what terms.
USDA Loan
A mortgage backed by the U.S. Department of Agriculture, offering 100% financing (no down payment) for eligible rural and suburban homebuyers. Many parts of Ohio qualify for USDA loans.
VA Loan
A mortgage guaranteed by the U.S. Department of Veterans Affairs, offering qualified veterans, active-duty service members, and surviving spouses 100% financing with no down payment and no PMI. Wright-Patterson Air Force Base makes VA loans especially common in the Dayton area.
Variance
A zoning exception that allows a property owner to deviate from current zoning requirements — such as building closer to a property line than normally allowed. Variances are granted by the local board of zoning appeals when strict enforcement would cause unnecessary hardship.
Warranty Deed
A deed in which the seller guarantees that the title is free of defects and that they have the legal right to sell the property. Warranty deeds provide the highest level of buyer protection.
Walk Score
A metric that measures the walkability of a property location, based on proximity to amenities such as grocery stores, schools, parks, and restaurants. Higher walk scores (out of 100) indicate more walkable neighborhoods.
Zoning
Local government regulations that control how land can be used, including residential, commercial, industrial, and agricultural classifications. Zoning rules in Ohio are set by city or county governments and cover lot sizes, building heights, and permitted uses.
Zoning District
A specific geographic area within a municipality where certain land uses and building standards are permitted. Common Ohio zoning districts include R-1 (single-family residential), B-1 (neighborhood business), and I-1 (light industrial).
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