Home Buyer FAQ's
Why should I buy, instead of rent?
Whether you’re buying a home for the first time, relocating, or moving up to your dream home, you probably have questions. Take a look at the real estate expert answers for home buyers below.
Why Buy Instead of Rent?
When you buy a house, you get something that’s totally yours. You can make it exactly what you want. On top of personal satisfaction, you also get financial benefits, like deducting the cost of mortgage loan interest from federal and state income taxes, as well as the property taxes you pay. With renting, that check is gone forever, but homeowners are investing money into something of value.
I'm a Single Mother. How Would I Go about Buying a Home?
While it’s easier to qualify for a loan with two incomes, you can still be a homeowner. Learn the process, get pre-qualified for a loan, and find a good real estate agent. Then, seek a lender who will look at your finances and help you decide which loan programs are best and how much house you should be able to afford.
How Much Money Will I Have to Come up with to Buy a Home?
That depends on the price of the house and which type of mortgage you get. Generally, you’ll have to cover three costs:earnest money - A deposit you make on a home when you submit your offer, proving you’re a serious buyer the down paymentA percentage of the home that you pay when you close on the homeclosing costsThe various costs of processing the paperwork to buy a house, usually about 1 to 3% of the price of the home
How Will I Know If I Can Get a Home Loan?
Using simple mortgage calculators online, you can get a sense of how much your mortgage payments would be at different loan amounts. If what you’re looking for is too expensive right now, you might wait and save a while longer. You might also contact a lender to see if they can offer any advice on affording your dream home.
How Do I Find a Lender?
Ask your family and friends if they know a good lender. You should also try to get referrals from banks, credit unions, or other financial institutions. Expect 3-4 weeks for the full loan approval process after you’ve found the right one.
On Top of the Mortgage Payment, What Other Costs Will There Be?
You’ll have monthly utilities, which might be new to you if your rent included them. You might also have homeowner or condo’s association dues. You’ll definitely have homeowner’s insurance and property taxes.
What Does a Mortgage Cover?
Your loan is divided into 4 parts: the principal, the interest, the homeowner’s insurance, and the property taxes. Your loan is likely to be 30 years, and its structured so that you pay mostly interest upfront, and mostly principal near the end of the loan term.
What Should I Take with Me When I Apply for a Mortgage?
You should bring:
1) Social Security numbers for you and your spouse
2) Checking and savings account statements from the past few months
3) Proof of other assets like stocks and bonds
4) A recent paycheck stub that details your earnings
5) A list of all your credit card accounts and what you owe monthly on each
6) A list of balances due on outstanding loans like car loans
7) Copies of income tax statements from the past two years
8) The name and address of someone who can verify your employment.
When I Decide to Buy A House, How Much Do I Offer?
There are several things to consider:
1) What is the asking price in relation to the prices of similar homes nearby?
Is the home in good condition or will you have to spend a substantial amount of money making it the way you want it? You probably want to get a professional home inspection before you make your offer. Your real estate broker can help you arrange one.
3) How long has the home been on the market? If it's been for sale for a while, the seller may be more eager to accept a lower offer.
4) How much mortgage will be required? Make sure you really can afford whatever offer you make.
5) How much do you really want the home? The closer you are to the asking price, the more likely your offer will be accepted. In some cases, you may even want to offer more than the asking price, if you know you are competing with others for the house.
What if My Offer is Rejected?
What Happens at Closing?
At closing, you and a closing agent will sit at a table, along with your broker, the seller’s broker, the seller, and your lender. You and the seller will both sign a stack of papers. You’ll have a good faith estimate of what you’ll need for to supply at closing, and then you’re on your way to a new home!
