Rehabbing Real Estate Terms: What Every Newbie Needs to Know

Rehabbing Real Estate Terms: What Every Newbie Needs to Know

  • ARV: A property’s after-repair value is a measure of its value after it has been repaired and renovated. An investor uses this calculation to assess a renovation property’s profitability as part of deal analysis.
  • BRRR: Buy, rehab, rent, refinance, repeat is an acronym used by investors as a way to build passive income.
  • Distressed Property: Properties that are delinquent on mortgage payments, taxes, or are in disrepair will be considered distressed.
  • Flipping: When you flip a house, you buy it, make improvements to it, and then sell it at a profit.
  • Foreclosure: Repossession of a property when the owner is unable to pay the mortgage.
  • Hard Money Loans: An alternative to traditional lenders are hard money loans. Your credit score is not taken into account when you apply for hard money financing. It is generally necessary to make a large down payment and repay the loan within a short period of time with hard money loans.
  • Inspection: An inspection of a property is a method of determining the property’s condition. The cost of repairs and renovations can be estimated by an inspection for interested buyers.
  • Private Money: Loans made by private investors are referred to as private money loans. For deals that won’t qualify for a conventional mortgage loan or can’t wait the usual 30 days or so the loan needs to be approved, real estate investors turn to private lenders.
  • Real Estate Auction: Frequently, banks and other financial institutions offer public auctions for their repossessed property.
  • It is possible to negotiate a short sale with a lender when a homeowner owes more on their mortgage than the home is worth currently. The term short sale refers to this type of transaction.


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