The Home Loan
How much do I need to save up for a down payment?
5% is a good place to start. The average first time buyer puts down 7%. You can work with a mortgage lender to play around with numbers and see how your downpayment amount offsets your monthly payment, and especially with how PMI works.
How do I know if I qualify and how much I can afford?
Contact a mortgage lender to get pre-approval for a loan. The lender will ask you some basic questions about your income and debts and can tell you what amount you can be approved for, and how much your mortgage payments will be.
What does the lender need from me to give me a loan?
Usually, you are asked to provide your last two tax returns to show proof of income. You should also provide recent bank and credit card statements and proof of your current pay. You will also be asked for your SSN so they can run a credit check.
What's the difference between pre-approved and pre-qualified?
While often used interchangeably, these terms don’t mean the same thing. Pre-qualification is an estimate of what you may be approved for based only on the verbal information you provide. Pre-approval means the lender has verified your income and debt information and run a credit check.
How do I know which mortgage option is right for me?
Your mortgage lender is the best person to advise you on this question. Their products and qualifications change from time to time, so they would know best what products are available to meet your needs.
Do you have a mortgage lender I can talk to?
Yes, absolutely! I have a few that I work with that I can happily refer to you. Just ask and I'll connect you. You are welcome to use your own if you have someone in mind as well.
When should I get pre-approved?
About 3-6 months out from when you'd like to move. If that has already passed, no worries! Pre-approvals only take about 2-3 days, you just want to have that pre-approval before you begin shopping.
The Home Search
What should I do when I see a house online that I like?
Text me, your buyer’s agent: the agent you are working with to find your home. It’s best that you work with one real estate agent throughout your search. That agent learns what you like and dislike and will invest a lot of time vetting properties for you. That person also represents your best interests only. When you call the agent advertising the home, you are dealing with the seller’s agent, so, while they can assist you, they are also representing the seller’s best interest.
Can you show me a house if it's not your listing?
Absolutely. As a buyer’s agent, I can show you any house listed in our MLS system, and I will contact FSBO sellers on your behalf. As mentioned above, working with me as your buyer’s agent ensures that your best interests are protected.
How do we write an offer?
When you find the property you want to make an offer on, I will run a Comparative Market Analysis (CMA) to help you determine a fair offer amount. I will also guide you through the additional terms of the contract, such as the escrow amount, closing date, and any additional terms you want to be added to the offer. I will write the offer on a contract form and submit it to the seller’s agent.
What happens if there are other offers on the house I love?
If a seller receives multiple offers on their home, usually their agent will inform the buyer’s that multiple offers have been received and the buyers have another opportunity to alter their original offer to present their “highest and best” offer. Keep in mind that many factors may influence the seller in addition to the offer price, such as the down payment amount, closing date, and inspection terms.
What happens when my offer gets accepted?
Once both parties have agreed on all terms and signed the contract, your escrow deposit must be made and I schedule the home inspection. Your lender will receive a copy of the contract and will begin processing your mortgage application.
Under Contract
What does "under contract" mean?
Under contract means that all parties have agreed on terms, have signed the contract, and the signed contract has been delivered to both buyer and seller. Payment of the escrow deposit is expected but is not a requirement to make a binding contract.
What is EMD?
The earnest money deposit is money that is offered with an offer, or as soon as an offer is accepted, to show the seller that you are serious about moving forward with the purchase of the home. Because you forfeit this deposit if you back out of the purchase for any reason not allowed for in the contract, the larger the escrow deposit, the more seriously your offer is taken. This deposit is part of your downpayment, not in addition to.
Do I need an inspection?
I always recommend that you have a home inspection done. In the scheme of things, paying a few hundred dollars to have peace of mind that there are no hidden dangers or problems is well worth the money.
How much are inspections?
The cost of the home inspection depends on the size of the house and additional inspections requested, such as swimming pool, septic tank, termites, insurance four-point (HVAC, plumbing, roof, and electrical,) wind mitigation, and radon. An average home inspection, without additional inspections, is about $350-$600.
What if my loan doesn't get approved?
If you have gone through the pre-approval process and have been forthcoming with all the information requested by your lender, it’s unlikely you will be turned down. Make sure you do not change jobs, purchase big-ticket items on credit, take out a car or boat loan, or open any other new credit accounts while your mortgage is being processed. In most cases, your loan contingency will allow you to back out of the home if necessary.
When can I start moving?
When you have the keys! When you are financing your purchase, it takes about 3-4 weeks for your loan to be processed. Once the lender gives the all-clear, closing is scheduled. You will sign your loan documents and both parties will sign documents transferring ownership to you. Unless other arrangements have been agreed upon by both parties, the sellers should have completely vacated the home when they sign the closing papers. You can have your belongings ready to move, and a moving company scheduled before you go to closing.
Comments