SAVING YOU TIME AND MONEY.
SAVING YOU TIME AND MONEY.
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FAQ'S FOR HOME BUYERS
Buying a home is a process. From pre-approvals, market research, showings, to negotiations, the journey of buying a home can easily prove to be an upward battle.
We hope to help make that process easier and more efficient for you. Our goal is to help you save time and money, so that you can focus on the higher priority items in your life.
What is the first step for buying a home?
The most important thing to do before you actually go shopping for a home is getting pre-approved.
It's incredibly important to understand how much you can actually afford in order to create a better game plan.
Working with a trusted lender will help create an easier process for you in the long run, as many sellers may require buyers to be pre-approved before seeing the home.
The best place to find a lender is getting recommendations from a trusted real estate professional.
Should I sell my home before buying a new one?
Homeowners may have different reasons for selling their home. Maybe they are ready for something new or want to downsize. Other homeowners may just want to expand their portfolio or acquire an investment property.
If you want to put up a high downpayment and secure good interest rates on your next mortgage, selling is encouraged.
If you can afford the downpayment for your new home and want to wait until the market changes, you don’t have to sell your home.
Talk to a real estate agent about your options (or a financial advisor about turning your current home into an investment property.)
How much should I save for a down payment?
Aim for a down payment that’s 20% or more of the total home price.
This minimum is partially based on guidelines set by government-sponsored companies like Fannie Mae and Freddie Mac. Anything less than 20% is considered riskier for a lender.
To lessen that risk, lenders make the mortgage more expensive for you by adding things like private mortgage insurance (PMI).
If you haven’t saved 20% after two years of intense saving, it’s okay to lower your goal to 15% or 10%, especially if you’re a first-time home buyer.
But never buy a house with a down payment that’s lower than 10%—otherwise, you’ll be charged so much extra in interest and fees. It’s not worth it! You need that extra money to tackle home maintenance and your other financial goals.
What is an earnest money deposit?
Earnest money is put down before closing on a house to show you’re serious about purchasing. It’s also known as a good faith deposit.
When a buyer and seller enter into a purchase agreement, the seller takes the home off the market while the transaction moves through the entire process to closing. If the deal falls through, the seller has to relist the home and start all over again, which could result in a big financial hit.
Earnest money protects the seller if the buyer backs out. It's typically around 1% – 3% of the sale price and is held in an escrow account until the deal is complete. The exact amount depends on what’s customary in your market. If all goes smoothly, the earnest money is applied to the buyer’s down payment or closing costs.
THE JOURNEY OF BUYING YOUR HOME
BUYER'S ROAD MAP
MEET WITH A REAL ESTATE PROFESSIONAL
Discuss the type of home you're looking for, including style, price, and location.
As the home buyer, your agent's commission is paid by the seller of the home in almost all circumstances. This means your representation costs you nothing.
You will need pay stubs, W2's, and bank statements. Knowing what you can afford is critical to a successful home shopping experience.
SEARCH FOR HOMES
The fun part! Your agent will schedule showings and help you find the perfect home for you.
Not all real estate websites are the same. Your real estate professional has tools and systems to ensure you see every available home that meets your criteria.
MAKE AN OFFER
Your agent will prepare the offer based on the price and terms you choose.
NEGOTIATIONS & CONTRACT
It may take a few tries to get it just right, but hang in there. You're. on your way.
In most cases the contract provides you with a timeline to obtain financing, as well as time to inspect the physical condition of the home. Your real estate professional will inform you of all of your rights and responsibilities related to the contract.
You and the seller have agreed to the price and terms. The home is effectively held for you until closing.
Perform due diligence, order the appraisal, conduct an inspection, and review terms with the lender.
You will be finalizing your loan, reviewing documents and discussing the findings from the inspection. Your agent will be managing this entire process for you.
This is the transfer of funds and ownership.
A title company or an attorney typically acts as an independent third party to facilitate the closing.