Whether you're a first-time investor or looking to scale your portfolio, understanding the terminology of U.S. real estate is essential. This glossary breaks down key terms you'll encounter on your investment journey through SHARE.

Business & Tax Terms

EIN (Employer Identification Number)
A tax ID issued by the IRS for businesses, used like a Social Security Number for your LLC or other entity.

LLC (Limited Liability Company)
A business structure that protects your personal assets and offers flexible tax treatment. Frequently used to hold U.S. real estate.

C-Corp
A corporation that is taxed separately from its owners. Less common for real estate investors due to double taxation but may apply in unique structures.

Limited Partnership (LP)
An entity structure often used for asset protection and estate planning. Includes at least one general partner and one or more limited partners. Often used alongside LLCs.

Canadian Holdco
A Canadian corporation that holds shares in a U.S. entity (often an LLC or LP). Common for Canadians investing in U.S. real estate to optimize tax efficiency.

ITIN (Individual Taxpayer Identification Number)
Used by non-U.S. residents who need to file U.S. taxes but aren't eligible for a Social Security Number.

Annual Report
A state filing that keeps your entity in good standing. Required yearly (or biennially) depending on the state of registration.

State Filing Fee
The initial fee paid to the state when forming a business entity, such as an LLC, LP, or C-Corp.. It varies by state and is a one-time cost paid upon registration.

State Fees
Ongoing costs associated with keeping your entity compliant and in good standing. These may include:

• Annual Report Fees: Required filings to maintain active registration.
• Franchise Taxes: Annual taxes based on business income or assets, imposed by some states.
• Other State-Mandated Filings: Vary depending on your business type and location.

Beneficial Ownership Report
A voluntary federal filing that discloses individuals who ultimately own or control an entity. 

Nil Returns
A tax return filed even if there was no income. Required to maintain compliance for U.S. entities, even when no property has been acquired.

Foreign Qualification
The process of registering your entity (such as an LLC or LP) to do business in a state other than the one it was originally formed in. Required to operate legally in the state where your investment property is located.

Registered Agent
A designated person or service responsible for receiving legal documents and government notices on behalf of your entity. Required in every state where your entity is registered or foreign qualified.

Virtual Mailbox
A digital mail service that provides a U.S. business address. Useful for non-U.S. residents to receive mail, government correspondence, and business-related documents without needing a physical office.

Financing & Mortgage Terms

Mortgage
A loan used to purchase property, repaid over time with interest.

Pre-Approval
Preliminary green light from a lender indicating your borrowing capacity.

Down Payment
The upfront cash contribution when buying property, typically 20-25% for investment homes.

Interest Rate
The cost of borrowing money. Expressed as a percentage and applied to the loan amount.

Amortization
The process of gradually paying off your mortgage over time.

Principal
The original loan amount borrowed. Decreases with each payment.

LTV (Loan-to-Value Ratio)
The percentage of the property’s value being financed by the loan.

Closing Costs
Final expenses paid to complete a real estate transaction, including title, lender, and legal fees.

Escrow
An account used to hold funds for taxes and insurance, funded via monthly mortgage payments.

Refinance
Replacing your existing loan with a new one—used to lower payments, access equity, or adjust loan terms.

Default
Failure to meet mortgage obligations, which can lead to foreclosure.

DSCR Loan (Debt-Service Coverage Ratio Loan)
An investment-focused mortgage that qualifies borrowers based on the property's rental income—not personal income. Commonly used by investors to scale faster.

HELOC (Home Equity Line of Credit)
A revolving credit line secured by your primary or investment property. Used to fund down payments or renovations without liquidating assets.

Investment Metrics

Cap Rate (Capitalization Rate)
A metric that evaluates a property’s potential return if bought all-cash. Calculated as Net Operating Income divided by property value.

IRR (Internal Rate of Return)
The annualized rate of return on an investment, factoring in both cash flow and appreciation over time.

Underwriting
The process of evaluating the financial viability of a property. SHARE provides detailed underwriting on each home to assess risk, cash flow, and overall return.

Property Search & Strategy

Buy Box
Your investment criteria, including budget, property type, market, and risk tolerance. At SHARE, we define your buy box to ensure we're sourcing the best opportunities for your goals.

Legal & Compliance

Title
Legal documentation proving ownership of a property.

Deed
The official legal transfer of property ownership from seller to buyer.

Appraisal
A professional valuation of the property's market worth, usually required by lenders.

Home Inspection
A detailed property review that identifies potential issues before purchase.

Lien
A legal claim on a property due to unpaid debts, such as taxes or contractor fees.

Foreclosure
The legal process where a lender repossesses a property after loan default.

Have more questions or want to dive deeper into any of these topics?

Our team at SHARE is here to guide you at every step of your investment journey.