Basic Real Estate Terminology For Home Buyer

Buying a home can prove difficult for first-time home buyers. Having a basic understanding of important real estate concepts before you start the buying process will not only help you save a fortune in the future but also give you a peace of mind. Here are basic real estate terms and definitions used in the Philippines to help you when you start looking for a home.

Real Estate Agents

There are usually two agents involved when you buy a home; the “buyer’s agent,” who represents you, and the “listing agent,” who represents the home seller, brokerage firm, or a property developer. In most cases, you will find a real estate agent who is already established himself with different real estate developments and a member of a brokerage firm. You can easily approach an agent and to inquire current listings that you can look into if you’re planning to buy a property. If you’re a home buyer, you do not have to pay these agents, they earn through real estate development or seller’s commission as payment for their service in helping sell the property.

Tip: When buying a home, look for an agent who you already know and trust or ask some people you know for recommendations. Regardless if you know or if the agent is highly recommended  – always do a background check beforehand. You can also choose from the list of approved Filipino Homes agents who we already had an extensive background check of.


Real estate agents frequently refer to properties for sale as “listings.” A “listing” on a website shows properties up for sale, properties for rent, or foreclosed properties, information about it, like the price, land/floor area,number or rooms, and additional facilities in the property.

Tip: For the most up-to-date listings, use sites from real estate portals like Filipino Homes to get access to updated listings, and real estate services. The information is more accurate than sites who aren’t affiliated with a brokerage. In a competitive real estate market, you can miss out on a good deal if you use sites with limited listings.


When you apply for a mortgage, your lender will require an appraisal of the home you want to buy. An appraisal is the home’s current market value (real value) based on comparable homes that have sold in the area and an investigation of the current property’s status. A licensed professional real estate appraiser carries out the appraisal of the property involved.

Tip: If the appraised value of a property is less than it is being offered or sold for, your loan might not be approved for it. The bank doesn’t want to invest in a home that’s overpriced (and neither do you!). Before deciding to buy a property, ask your agent to do a comparative market analysis with a trusted  licensed professional real estate appraiser, which will tell you what comparable homes have sold for nearby, and the real value of the home you want to purchase. If you’re a seller, get an estimate on how much your home is worth as well as how to increase your home appraisal value.

Amortization, Term  & Schedule

Amortization is to repay a mortgage with regular payments that will cover both principal value of the property you’re buying and its interest. The amount of time required to amortize the mortgage loan is an Amortization Term and it is expressed as a number of months. For example, for a 10-year fixed-rate mortgage, the amortization term is 120 months. An Amortization Schedule shows the amount of each payment applied to interest and principal and shows the remaining balance after each payment is made.

Tip: Always ask for amortization term, and schedule to give you the estimated timeline of repaying your morgage. This will always help you decide on whether how long you plan to paying off the mortgage.


A mortgage, or a mortgage loan, is used by home buyer of real property to raise funds to buy it while putting a lien on the property being mortgaged. This is usually done through banks or housing loan insurance companies/institutions. The loan is “secured” on the home buyer’s  or borrowers property. This means that a legal mechanism is put in place which allows the lender (bank, etc.) to take possession and sell the secured property (“foreclosure” or “repossession”) to pay off the loan in the event that the borrower defaults on the loan or otherwise fails to abide by its terms.

Tip: Ask your agent the best way to secure a home loan, and which banks or housing loan insurance companies/institutions that can easily approve the property your interested in. The  banks or housing loan insurance companies/institutions will give you a predetermine monthly mortgage based on how long you plan to pay the loan you’re applying for. This will give you a plan of action on how to long, and how much you need to set aside to pay off the loan you applied to purchase the property.

An understanding of real estate concepts can be helpful especially when you already know the basic terms used. Buying a house should not be difficult, after all it’s the first step to fulfilling a dream of creating, and owning a home of your own.

Mortgage Term

The length of time a lender will loan mortgage funds to a borrower. Most terms run from six months to five years, after which the borrower will either pay off the balance or renegotiate the mortgage for another term. Payments are calculated using the interest rate offered for the term, the amount of the mortgage, and the amortization period.

Down Payment

The down payment is the amount of out of pocket money you pay toward a home before your lender provides you with a loan to cover the rest of the purchase amount. Your down payment can vary depending on the type of mortgage you take out. It can be anywhere from 3 percent to 20 percent of the total cost.

Usually 5-20% of the total cost of the home, this is the amount of money that the buyer pays upfront to purchase the property.

Camella Homes
Camella Homes

Camella is the largest homebuilder in Philippines real estate industry. As builders of top quality yet affordable housing in the Philippines, Camella has an enviable reputation. With 40 years and counting, Camella has already built more than 400,000 homes in 39 provinces, and 104 cities and municipalities across the country.