Getting Started
1How Does Purchasing a Home Compare With Renting ?
don't really compare at all. The one advantage of renting is being generally free of most maintenance responsibilities. But by renting, you lose the chance to build equity, take advantage of tax benefits, and protect yourself against rent increases. Also, you may not be free to decorate without permission and may be at the mercy of the landlord for housing.
Owning a home has many benefits. When you make a mortgage payment, you are building equity. And that's an investment. Owning a home also qualifies you for tax breaks that assist you in dealing with your new financial responsibilities- like insurance, real estate taxes, and upkeep- which can be substantial. But given the long-term advantages, stability, and security of owning your own home, they are worth it.
Owning a home has many benefits. When you make a mortgage payment, you are building equity. And that's an investment. Owning a home also qualifies you for tax breaks that assist you in dealing with your new financial responsibilities- like insurance, real estate taxes, and upkeep- which can be substantial. But given the long-term advantages, stability, and security of owning your own home, they are worth it.
2How long should the home buying process take?
The timeframe can vary depending on the situation. It is best to plan about 3 months, from start to finish, to allow yourself time to find a home, negotiate and agree on a purchase price, work through inspections, and to obtain and close on a mortgage. Once an agreement to purchase a specific home is reached, 30-45 days will be needed to obtain the mortgage on a home depending on that mortgage type.
3How much money should I prepare to spend to buy a home?
In most situations, you need to come up with enough money to cover three costs: earnest money- the deposit you make on the home when you submit your offer, to prove to the seller that you are serious about wanting to buy the house; the down payment, a percentage of the cost of the home that you must pay when you go to closing; and closing costs, the costs associated with obtaining a mortgage and processing the paperwork to buy a house. A buyer should be prepared to pay about 3.5% in closing costs and prepaid expenses to the lending institution to obtain a mortgage. This amount is not included with the down payment which can vary depending on the mortgage type and lender.
4Where is the best place to find homes for sale on the internet?
This website provides the consumer with an up to date, comprehensive search engine that gives access to any and all homes for sale in the desired area. The user can tailor the search by selecting exact desired specifications!
Explaining forms, contracts, and agreements.
Suggesting contract contingencies to protect you, rather than the seller.
Assisting in the negotiations for a favorable price and terms.
Keeping all information confidential that could weaken your bargaining position.
Monitoring the entire purchase process, assisting with issues that arise through closing.
5What is my first step/How do I get started?
A good first step is to meet and interview agents to find a quality agent with whom you think is a good fit for you. It is also a good idea to contact a lender, this will help paint an accurate current financial picture of what type of home you may be able to afford.
Mortgages | Sales
1Am I free to choose my own lender?
A buyer’s agent can give recommendations based on past experience, but a buyer is always free to work with a lender of his/her choice. That being said, it may be a good idea to contact the lender that your agent recommends as that recommendation is built out of past transactions and relationships with that lender.
2Does a $0 down mortgage exist?
Yes! The USDA Rural Development mortgage offers $0 down financing for qualifying homes in rural areas. The Veteran’s Administration also offers a $0 down mortgage to qualifying veterans of the various armed forces.
Check out: Treadstone Funding Residential Mortgage Lender
3What type of mortgages are available to me?
Mortgage types and down payment amounts can vary but the most common are as follows:
- FHA: 3.5% Down Payment
- Conventional: 3%-20% Down Payment
- Rural Development: 0% Down Payment
- VA Mortgage: 0% Down Payment
4How should I prepare myself financially to buy a home?
It is best to consult with a reputable lender to discuss your credit score, mortgage options, estimated monthly payments, and how much cash you need to have available to put toward a down payment and closing costs. A lender can also help you get a better idea of where your debt to income ratio needs to be to qualify to buy a home.
5What should my monthly mortgage payment amount look like?
A good rule of thumb is that your monthly mortgage payment should not exceed 30% of your monthly take home pay. Your total
6What are prepaid expenses?
Prepaid expenses include prepaid first year’s property taxes, homeowner’s insurance, and mortgage insurance (if applicable). These expenses are deposited into the borrower’s escrow account and paid by the lender at the appropriate time of year.
7What is a short sale?
Simply put, a short sale occurs when a homeowner is selling their house and the monetary proceeds from the sale equal less than the amount of money that is currently owed on the home.
Buyer's Agent
1What services are provided by a buyer’s representative?
If you’ve established an agency relationship with a buyer’s representative, common services include:
- Helping to clarify your priorities.
- Suggesting sources of financing and other service professionals, such as inspectors and exterminators.
- Providing sources of accurate and lawful information on neighborhoods, schools, and communities.
- Selecting and arranging property showings.
- Evaluating particular properties.
2Do I need to be working with a buyer’s agent?
Simply put, no, but you will be missing out on nearly free representation. A proactive buyer’s agent can get you access to homes faster, give reliable advice, assist in negotiations on your behalf and help you make it through some of the frustrations of the home buying process. If you contact a listing agent to view a house, that person already represents the seller of the house and is first committed to the seller to help sell the house. In short, a buyer’s agent will represent a buyer’s best interest. A listing agent must prioritize their client’s best interest before the buyer’s best interest.
3 Do I have to pay my buyer agent’s commission?
In most real estate transactions the listing agent pays a buyer’s agent to bring a buyer by agreeing to share a commission with the buyer’s agent. This commission is usually paid for by the seller. Many brokers require a small transaction fee to be paid by the buyer. Again, one more reason it is a great idea to be represented by a buyer’s agent!
4 What is a buyer’s agency agreement?
A buyer’s agency agreement is a contract between a buyer and an agent that outlines the terms of service provided by the agent. A buyer’s agency usually gives the agent exclusive rights to work with that buyer.
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