Maturity– The date on which the principal balance or amount of a financial/debt instrument becomes due to be paid and payable. Examples of financial instruments that have a maturity date are:
The maturity date informs the investor/lender of how long interest payments will be received and at what date the principal is expected to be paid in full.
For homebuyers, when you take out a mortgage loan you’re responsible to pay your investor/lender an assured amount of money every month for an agreed period of time. After the full amount is paid back as promised, the loan matures and the interest payments discontinue. When the maturity date is reached, the principal is paid back in full and the debt is completely satisfied, your lender will no longer have a claim on your property that you now own.
The short answer is that Real Estate Agents get paid a commission when the deal is sealed; they get paid after a property transaction is complete. You will almost always hear this process being referred to as a closing.
A real estate transaction typically involves two different agents. Let’s look at the two types of Real Estate Agents and how each of them is paid.
1. One agent is the Listing Agent/Broker:
For property owners wanting to sell their home, a listing agent is the most essential. This agent will come into an agreement with a property owner to represent them in the sale of their property. The agent has several key responsibilities to the property owner which he/she must accomplish in order to effectively sell the property. The entire real estate commission is being compensated by the seller. Remember, a real estate transaction can be negotiated in numerous ways. This means that the buyer could even end up paying some or all of the sales commission.
2. The other agent will be the Buyer’s Agent, also referred to as the Selling Agent:
A buyer’s agent is required to call attention to the buyer, any flaws they realize or identify about involving the property. However, a buyer can request that the home have an inspection by a licensed home inspector. If it’s written in as part of the offer, seller will pay for the inspection. The agent writing up the offer will assist you with that. Also the seller can check with neighbors regarding the history of the home; sometimes certain things aren’t disclosed, but may be required bylaw. However, they are also paid by commission.
Commission fees vary from state to state and can fall anywhere from 5%-10% of the sale price. The agents may negotiate these fees which are shared between the two of them.
Now, I hope this gives you a better understanding of how your agent is paid when you’re buying or selling your home.
Jumbo Loan: A non-conforming loan that exceeds the maximum loan amounts deemed by the Federal National Mortgage Association (includes Fannie Mae and Freddie Mac). It is generally the type of mortgage that is used for the purchase of luxury homes. Jumbo loans often carry higher interest rates than other types of loans.
Conventional Loan: A loan that is not guaranteed or insured through FHA or VA. Conventional loans often require a percentage down payment is made on the purchase of a property.
FHA Loan: A loan that is open to all homebuyers and insured by the Federal Housing Association. FHA loans have mortgage amount limits and are designed to assist borrowers who cannot otherwise afford a conventional loan.