A contingency is a clause in a real estate purchase contract that makes the sale conditional on a specific event occurring within a defined timeframe — giving the buyer a legal exit if that condition is not met, typically with full return of their earnest money deposit.

Comps are recently sold properties similar in size, condition, and location to a subject property — used by investors, agents, and appraisers to estimate fair market value and make data-driven offers.

Closing is the final step in a real estate transaction where ownership officially transfers from seller to buyer — documents are signed, funds are wired, the deed is recorded, and you walk away with the keys.

An easement is a legal right that allows a person or entity to use a specific portion of another owner's property for a defined purpose — such as crossing it for access, running utility lines underneath it, or maintaining a drainage channel across it.

A boundary dispute is a legal conflict between two neighboring property owners over where one parcel ends and the other begins — most often triggered when fences, driveways, structures, or landscaping are found to cross the official property line.

Radon is a naturally occurring radioactive gas that forms from the decay of uranium in soil and rock, seeping into buildings through foundation cracks, gaps, and porous materials. The EPA classifies it as the second-leading cause of lung cancer in the U.S. after cigarette smoke.

A structural engineer is a licensed professional who analyzes and certifies whether a building's framework — its beams, columns, foundations, and walls — can safely carry the loads placed on it. Investors hire one when a property has structural questions that a general contractor or home inspector isn't qualified to answer.

A sewer scope is a diagnostic inspection that sends a waterproof camera through a property's sewer lateral — the underground pipe connecting the house drain to the municipal sewer main — to identify blockages, root intrusion, pipe cracks, offsets, and collapse before a real estate transaction closes.

A comparable sale (or "comp") is a recently sold property with similar characteristics to a subject property, used to estimate the subject's fair market value through the sales comparison approach -- the most widely used valuation method in residential real estate.

A title contingency is a contract clause that gives the buyer the right to review the property's title report and raise formal objections to any defects — liens, encumbrances, easements, or ownership disputes — before closing. If defects cannot be resolved within the contingency period, the buyer can exit the deal and recover their earnest money.

A lien is a legal claim against a property that secures payment of a debt—giving the lienholder the right to force a sale (foreclosure) if the debt isn't paid.

Clear title means the property's ownership is free of liens, clouds on title, and disputes—the owner can sell or finance without unresolved claims against the property.

An inspection contingency is a clause in a real estate purchase contract that gives the buyer a specified period—typically 7 to 14 days—to have the property professionally inspected. If significant issues are found, the buyer can negotiate repairs, request a price reduction, or walk away with their earnest money intact.

A financing contingency lets you exit the deal and get your earnest money back if you can't secure a mortgage within the contract's deadline—typically 14–21 days.

An appraisal contingency is a contract clause that lets the buyer renegotiate the price or walk away and recover earnest money if the appraisal comes in below a specified amount—protecting you from overpaying when the lender won't finance the full price.

A lender is a bank, credit union, or mortgage company that provides financing—a mortgage—for real estate purchases.

A title company researches a property's ownership history, issues title insurance to protect against defects, and facilitates the closing by holding escrow and recording the deed.

Move-in ready describes a property that needs no repairs or renovations—it is in condition for immediate occupancy by tenants or an owner, with working systems, updated finishes, and no deferred maintenance.

A pro forma is a projected financial statement for a property—expected income, operating expenses, and resulting NOI—used to evaluate a deal before you buy.

Cash-on-cash (CoC) is the annual cash flow from an investment property divided by the total cash you invested—down payment, closing costs, and any initial capital improvements.

Risk tolerance is how much uncertainty, volatility, and potential loss you can stomach in pursuit of returns—shaping your choices on leverage, cash reserves, property type, and market.

Comparable sales (comps) are recently sold properties similar in location, size, condition, and features—used to estimate a subject property's market value via the sales comparison approach.

An asset is something you own that has economic value and can generate income or appreciation. In real estate, your properties are assets — the duplex, the single-family rental, the multi-family building. They sit on your balance sheet opposite your liabilities (the mortgage, the hard money loan).

Due diligence is the period between an accepted offer and closing when you verify the property's condition, title, and finances so you don't buy a lemon or inherit someone else's liens.

Turnkey means you buy a rental that's already renovated, tenanted, and managed — you "turn the key" and collect cash-flow without doing the rehab or finding the tenant yourself.

A licensed professional who evaluates a property's condition, comparable sales, and market data to determine its fair market value.

A deposit you put down when your offer is accepted—to show you're serious. It's held in escrow until closing and typically refundable if you back out for a valid reason under your contingencies.

Conditions in a purchase contract that must be met for the deal to close. If they're not satisfied, you can walk away—and usually get your earnest money back.

Replacing an existing loan with a new one—often to secure a lower interest rate, change terms, or extract equity.

A professional assessment of a property's fair market value, typically required by lenders before approving a loan.

Leverage is using borrowed money to control a larger asset than you could afford with cash alone—and it amplifies both returns and risk.

Cash flow is what's left in your pocket after a rental pays all its expenses — including the mortgage. NOI minus debt service. What actually hits your bank account each month or year.

Cap rate measures a property's annual net operating income as a percentage of its purchase price or current market value, assuming an all-cash purchase.

Cash-on-cash return measures your annual pre-tax cash flow as a percentage of the total cash you actually invested in a property.