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My brother didn't really talk before age 2. He just wanted perfect is words before saying them.

if he understands what you say, then he is probably ok. i know so many late talkers that had no words at 18 months. you can always pursue early intervention, but since he has some words and understands what you say, unless there are any other things you are concerned about, he might just be a bit of a late talker.

I don't know what state you live in but NJ has early intervention where children can be evaluated and if needed receive services to help them (speech etc.)

My eldest had a speech delay. My ped wanted us to wait til she was 2 yo to do anything about it, but I knew at 15-18 months that she was a bit behind. We got her evaluated with Early Intervention at around 19 - 20 months. The therapists who did her eval told me that she did have a speech delay, but it wasn't enough for state services at the time (because of decreased funding, it was just very difficult to qualify). So we eventually sent her to private speech therapy. When she was 2.5 yo, I had her re-evaluated with the state and she qualified.

Advice that was given to me when we first started noticing things...

Label everything and talk to your child constantly. Explain everything you are doing and describe everything he is playing with. Sing songs with him. Read lots of books... Play games with him that involve taking turns (teaches them the pattern of taking turns like in conversation).

I did all those things though, and she still had a speech delay... So it's not necessarily that those things will combat or prevent it, but they may help. It runs in my family though... I come from a long line of late talkers!

Try not to worry... It's a good thing your ped is being proactive about it!

@SWEET T I don't know how long he was in therapy for, but I know they worked with him on sign language and he had started before he was two.... I don't think he goes anymore, So maybe a year?

This is a great DVD on speech delay... Mrs Hide & Seek recommended the site:

http://teachmetotalk.com/2008/07/15/discover-the-best-approach-proven-to-teach-your-toddler-to-talk/

Uh, wow. 7-20 words I can see, although I think not counting mommy and daddy is a bit much. But two word sentences? My daughter started making those at about 13 months, and I knew she was crazy advanced. The average for 2 word sentences is closer to 2 years, and I think it's a bit alarmist to require them by 18 months or else refer to speech therapy.

Our son was very similar to your son. Very few words at 18 months and then even at his 2 year well check. He understood everything we were saying to him though. So shortly after turning 2 we had him evaluated. He's also slightly tongue tied so we thought it might be because of that. Turns out it wasn't.
He did qualify for early intervention so we did that for a year. By the time he was 2.5 years old, his speech improved a lot. So he just had a natural speech delay.
I'm glad we did EI though. They gave us the same tips as @SAHM0811 suggested. Narrating everything you do really helped give him words for all the actions. EI is also free for children under 3 so it really doesn't hurt if the concern is still their in 6 months.
He's 3.5 now. He's learning a second language at school and doing really well with that even though he didn't speak until way over 2.

My doctor asked for 5-7 words at her 18 month apt..... if that helps at all.

My LO has actually been slow on all of her milestones except speech. She didn't walk until 17 months. So I know how if feels when they're not right up there. But a few months later she's always caught up. She just likes to do things on her own time

shoot now you get me worried.

LO is almost 13 months now and I don't think he really understands me. He behaves like my cat... like if we tell him to come he wouldn't. we tell him to pass the ball he won't. I am not sure if he understood and disobeys or he just flatly doesn't understand.

He also doesn't have any real word according to me. He babbles a lot but I don't think he actually said anything that he does mean.

Our ped kept saying because we are bilingual there is nothing to worry about but he does need his first words and understands us by 15 months. Ai yai yai.

I am trying not to worry because I do believe all people eventually speaks but it is hard when we are always mapped onto a chart of what are you supposed to do when.