Real Estate Acronyms & Abbreviations

What APR, ARV, DSCR, DTI, LTV, NOI, PITI, PMI and other real estate acronyms stand for - with links to full explanations.

AcronymStands forIn plain English
AFFOAdjusted Funds From OperationsAFFO refines FFO further by subtracting recurring capital expenditures and leasing costs needed to maintain the properties — intended to approximate the cash actually available to distribute to shareholders, often shown per share as "AFFO per share."
APRAnnual Percentage RateAPR (annual percentage rate) is the yearly cost of a loan including the interest rate and certain lender charges, such as discount points and origination fees. It is used when comparing loan offers of the same type and term, and matters because two loans with the same rate can cost very different amounts.
ARMAdjustable-Rate MortgageAn ARM is a mortgage with an interest rate that starts fixed for an initial period, then adjusts periodically based on market rates — potentially rising or falling over the life of the loan.
ARVAfter-Repair ValueAfter-repair value (ARV) is the estimated market value of a property once planned renovations are finished, based on recent sales of comparable renovated homes. It is used when budgeting a flip, BRRRR or renovation loan, and matters because the purchase price, repair budget and profit are all measured against it.
AVMAutomated Valuation ModelAn AVM is a software-based estimate of a property's value generated from public records, tax data, and recent comparable sales — fast and free, but less precise than a licensed appraisal.
BRRRRBuy, Rehab, Rent, Refinance, RepeatBRRRR (buy, rehab, rent, refinance, repeat) is a rental investing strategy: buy a property that needs work, renovate it, rent it out, then refinance at the higher value to recover cash for the next purchase. It matters because it can recycle capital, but only if the appraisal and the rent support the new loan.
CAMCommon Area MaintenanceCAM charges are a tenant's pro-rata share of the cost to maintain a commercial property's shared spaces — parking lots, lobbies, landscaping, and shared utilities — typically billed on top of base rent.
CapExCapital Expenditures (reserve)A CapEx reserve is money set aside from rental income to cover eventual big-ticket replacements — roof, HVAC, water heater — that don't happen every year but are certain to happen eventually.
CDClosing DisclosureThe Closing Disclosure is a standardized form lenders must give you at least three business days before closing. It lists the final loan terms, projected payments, closing costs and cash to close, so you can compare it with your Loan Estimate and question any change before you sign.
CMAComparative Market AnalysisA CMA is an agent-prepared report estimating a property's value by comparing it to similar recently sold, active, and pending listings in the area — commonly used to help set a listing price.
COCertificate of OccupancyA certificate of occupancy is a document issued by a local government confirming a newly built or renovated property meets building codes and is legally safe to live in.
CoCCash-on-Cash ReturnCash-on-cash return is a rental property's annual pre-tax cash flow divided by the total cash invested, such as the down payment, closing costs and initial repairs. It is used when comparing financed investments, and matters because it shows what the investor's own money earns after mortgage payments.
CTCClear to CloseClear to close (CTC) is the point at which a mortgage underwriter has confirmed every condition of the loan approval, so the lender can prepare final documents and schedule closing. It is the last lending milestone before you sign; until you have it, the loan can still be delayed or denied.
DOMDays on MarketDays on market is the number of days a property has been actively listed for sale, from listing date to going under contract — a key indicator of how a property is performing relative to the local market.
DSCRDebt Service Coverage RatioDSCR (debt service coverage ratio) is a property's net operating income divided by its annual loan payments. It is used when lenders size or approve rental and commercial loans, including DSCR loans that qualify on property income, and matters because a ratio below 1.0 means the income does not cover the mortgage.
DSTDelaware Statutory TrustA Delaware Statutory Trust is a legal structure that lets multiple investors each own a fractional, passive interest in a larger property, while still qualifying as "like-kind" real estate for a 1031 exchange.
DTIDebt-to-Income RatioDebt-to-income ratio (DTI) is the share of your gross monthly income that goes to debt payments, including the proposed mortgage payment. It is used when lenders decide how much you can borrow, and matters because a high DTI can limit or block approval even with good credit and steady income.
EGIEffective Gross IncomeEffective gross income (EGI) is the rental income a property is expected to actually collect: gross potential rent, minus vacancy and credit losses, plus other income such as parking or laundry. Operating expenses are subtracted from EGI to arrive at net operating income.
FARFloor Area RatioFloor area ratio is a zoning limit expressing how much total building floor space is allowed relative to the size of the lot it sits on.
FFOFunds From OperationsFFO is a standard REIT profitability metric that adds depreciation and amortization back to net income and removes gains or losses from property sales — designed to better reflect real estate cash flow than GAAP net income, since real estate depreciation rarely matches actual value decline.
FHAFederal Housing Administration (loan)An FHA loan is a mortgage insured by the Federal Housing Administration, allowing lower down payments and credit scores than most conventional loans in exchange for mandatory mortgage insurance.
FSBOFor Sale By OwnerFSBO describes a home sale where the seller lists and markets the property directly, without hiring a listing agent — potentially saving on listing-side commission, but taking on the agent's pricing, marketing, and negotiation work themselves.
GLAGross Leasable AreaGross leasable area is the total floor space in a retail or commercial property designed for tenant occupancy and rent generation — the standard denominator for measuring a shopping center's size and rent per square foot.
GPGeneral PartnerThe general partner is the party that sources, acquires, and actively manages a real estate syndication's investment — typically taking on legal liability and earning fees plus a carried-interest profit share for doing so.
GRMGross Rent MultiplierThe gross rent multiplier (GRM) is a quick screening ratio that divides a property's price by its gross annual rent, before any expenses. A lower GRM means more rent per dollar of price, but because it ignores vacancy and operating costs, it only ranks listings for a closer look.
HELOCHome Equity Line of CreditA HELOC is a revolving line of credit secured by a home's equity — similar to a credit card, letting a homeowner borrow, repay, and re-borrow up to a set limit during a draw period, usually at a variable interest rate.
HOAHomeowners AssociationAn HOA is an organization that manages shared amenities and enforces community rules in a neighborhood or condo building, funded by mandatory fees paid by residents.
HOIHomeowner's Insurance"HOI" is a common abbreviation for homeowners insurance, frequently used as a line item on mortgage, escrow, and closing documents.
IRRInternal Rate of ReturnIRR is the annualized rate of return an investment is expected to generate over its full holding period, accounting for the timing and size of all cash flows — including the eventual sale.
LELoan EstimateThe Loan Estimate is a standardized form a lender must give you within three business days of a mortgage application. It shows the estimated interest rate, monthly payment, closing costs and cash to close in the same format at every lender, which makes competing offers easy to compare.
LPLimited PartnerA limited partner is a passive investor in a real estate syndication who contributes capital but isn't involved in day-to-day management, with liability generally limited to the amount they invested.
LTCLoan-to-Cost RatioLoan-to-cost (LTC) is a loan amount divided by the total cost of a project - purchase price plus renovation or construction costs. Construction and fix-and-flip lenders use it to size loans, because the finished value does not exist yet; it is usually checked alongside loan-to-value or loan-to-ARV.
LTVLoan-to-Value RatioLoan-to-value (LTV) is the loan amount divided by the property's value - for a purchase, usually the lower of the price and the appraisal - shown as a percentage. It is used when lenders price and approve a mortgage, and matters because it decides mortgage insurance, rate tiers and how much you can borrow.
MAOMaximum Allowable OfferMAO is the highest price an investor should pay for a fix-and-flip property to hit their target profit, calculated from the after-repair value, renovation costs, and desired margin.
MIPMortgage Insurance PremiumMIP (mortgage insurance premium) is the mortgage insurance required on FHA loans. It is charged as an upfront premium, which can be financed into the loan, plus an annual premium paid monthly, in most cases regardless of down payment size. It protects the lender and adds to the borrower's monthly cost.
MLSMultiple Listing ServiceThe MLS is a database where real estate agents share listings of homes for sale, giving buyers and their agents access to comprehensive, up-to-date property data within a market.
NNNTriple Net LeaseA triple net lease (NNN) requires the tenant to pay property taxes, insurance, and maintenance in addition to base rent — shifting nearly all operating costs from landlord to tenant.
NOINet Operating IncomeNet operating income (NOI) is a property's yearly income from rent and other sources minus its operating expenses, before mortgage payments, depreciation and income taxes. It is used when valuing and financing rental property, and matters because cap rate, DSCR and loan size are all calculated from it.
PITIPrincipal, Interest, Taxes & InsurancePITI stands for principal, interest, taxes and insurance - the four parts of a typical monthly mortgage payment. Lenders use the full PITI amount, plus any mortgage insurance and HOA dues, to judge affordability, so property taxes and insurance can change how much home a buyer qualifies for.
PMIPrivate Mortgage InsurancePrivate mortgage insurance (PMI) is insurance most conventional lenders require when a borrower puts down less than 20%; it protects the lender, not the borrower, if the loan defaults. The borrower pays it, usually monthly, and it matters because it raises the payment until it is cancelled or ends.
POCPaid Outside of ClosingPOC, marked next to a line item on a Closing Disclosure or settlement statement, means that fee was already paid before closing — such as an appraisal fee paid directly to the appraiser — so it isn't collected again as part of the funds due at closing.
PUDPlanned Unit DevelopmentA planned unit development is a zoning designation for a project designed as a single, cohesive development — often mixing housing types, shared amenities, and common areas — governed by its own set of rules rather than standard lot-by-lot zoning.
QOFQualified Opportunity FundA Qualified Opportunity Fund is an investment vehicle that channels capital gains into designated Opportunity Zones in exchange for federal capital gains tax deferral and, if held long enough, potential exclusion of gains on the new investment.
RCNLDReplacement Cost New Less DepreciationRCNLD is the cost approach's core calculation: the cost to build the improvements new today, minus accumulated depreciation from age, wear, and obsolescence — added to land value to estimate total property value.
REITReal Estate Investment TrustA REIT is a company that owns, operates, or finances income-producing real estate and trades on public markets like a stock, letting investors gain real estate exposure without buying property directly.
ROIReturn on InvestmentROI (return on investment) measures the total gain from an investment relative to its cost, expressed as a percentage. In real estate it can include cash flow, loan paydown, appreciation and sale proceeds, so check what a quoted ROI counts and what it divides by before comparing figures.
STRShort-Term RentalA short-term rental is a property rented out for brief stays — typically under 30 days, as on Airbnb or Vrbo — as opposed to a traditional lease, often generating higher nightly income but with more variable occupancy and higher management effort.
TITenant Improvement AllowanceA tenant improvement allowance is a dollar amount, usually expressed per square foot, that a commercial landlord contributes toward customizing a space for a new tenant — build-out, flooring, walls, and fixtures.
TICTenancy in CommonTenancy in common lets two or more people own a property together in unequal or equal shares, each free to sell or will their share independently — with no automatic right of survivorship to the other owners.
USDAU.S. Department of Agriculture (loan)A USDA loan is a mortgage guaranteed by the U.S. Department of Agriculture for eligible buyers purchasing in designated rural and suburban areas, often with no down payment required.
VADepartment of Veterans Affairs (loan)A VA loan is a mortgage guaranteed by the U.S. Department of Veterans Affairs for eligible service members, veterans, and surviving spouses, often requiring no down payment and no ongoing mortgage insurance.
VOEVerification of EmploymentA verification of employment is a lender's direct confirmation with a borrower's employer of their job status and income, typically performed both during underwriting and again just before closing.

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Definitions are provided for general educational purposes and are not financial, legal, tax, or real estate advice. Rules vary by transaction and location - verify important decisions with qualified professionals.