Environmental
In Maine, a Phase I Environmental Site Assessment is commonly required by lenders before financing a:
ASingle-family home purchase
BCommercial or industrial property purchase✓ Correct
CCondominium purchase
DVacant residential lot purchase
Explanation
Phase I Environmental Site Assessments are standard practice before financing commercial or industrial properties to identify recognized environmental conditions (RECs) that may affect value or create liability.
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Key Terms to Know
Purchase Agreement
A legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Comparable Sales (Comps)Recently sold properties similar in size, condition, and location used by appraisers and agents to estimate a property's market value.
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