My Top Ten 1st Time Home Buyer FAQ's Answered
How do I know if it’s time to buy instead of rent?
If you know where you want to live, have a steady and secure income, and are ready for the responsibilities of homeownership, then it’s a great time to invest in property.
Should I talk with a bank/lender before looking at homes?
YES! The market is hot and you need to get a pre-approval from the lender to understand your budget and to be able to act quick in this competitive market. As a first time home buyer you may also find some great incentives when chatting with a lender.
Do I need a realtor to buy a house?
I strongly recommend using a realtor when buying a home. 99% of the time you don’t pay me a commission as the commission comes from the seller. If there is anytime when you would be expected to pay, I always disclose that right away and discuss the best possible option available to you. Having a buyers agent helps protect your best interests and takes all the guess work about how to protect yourself for what may be the biggest transaction of your life.
How much do I need to save up for a down payment?
A conventional loan down payment is usually 20% of the sales price, but other types of financing require as little as 3.5% to 15%. A mortgage lender can tell you what types of loans you qualify for. You can also look into first-time home buyer incentives that can help you with the down payment.
How do I know if I qualify for a loan 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. I can provide with some referrals if needed.
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. Working with me as your buyer’s agent ensures that your 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 deposit 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.
Do I need an inspection?
We 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.
When can I start moving?
When you have the keys! When you are financing your purchase, it can take four to six weeks for your loan to be processed. Once the lender gives the all-clear, we will firm up your deal. 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. At closing, you will receive the documentation you need to provide utility companies with proof of your new residence.
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, but it does happen. 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. If your loan does fall through, talk with your lender about changing to a different loan type.