7 Things You Need To Know Before Buying A Home
When deciding to buy your home in the Central Florida area I would be honored to help you through the entire process from beginning to end. There are some important things that you should know before making your purchase. At Central Florida Prime Real Estate we will help you with all your real estate needs.
1. Getting Pre-approved
You will want to get pre-approved, both of your credit and income will be verified in order to determine:
- How much you will have to spend on a home
- Your credit score- is it good enough to qualify for a loan
- How much you will need to save for a down payment
- How much you will you need to bring to the closing
- Which type of mortgage is best for you
*Be sure to get a real pre-approval.
2. Mortgage Companies
- Bank Mortgage Departments- This type of instituttion is usally only able to offer limited types of loans
- Mortgage Bankers- can tailor certain loan programs that can be specific to your needs
- Mortgage Brokers- Can usually find the best rate and loan for your needs. Have the ability to look at other banks, loan companies and other mortgage institution rates to make sure you get the best one.
3. Loan Options
- 30 Year Fixed Mortgage
- 15 Year Fixed Mortgage
- VA Loan
- Reverse Mortgage
- Jumbo Loans
- Adjustable Rate Mortgage
4. Mortgage Insurance
If you buy a home and your down payment is less than 20% of the appraised or sale price than you must get mortgage insurance. Mortgage insurance can also be referred to as PMI- private mortgage insurance. This type of coverage is intended to protect lenders against default by the borrower. In the case that the borrower stops paying the mortgage the insurance company would essentially pay the lender in full.
5. Funds For The Down Payment
If you are looking to become a homeowner you are probably already putting money away for a down payment. If you have not started saving then you may want to look at some options to get your started.
- Do you have income or tax refund check
- Borrow against an asset such as a vehicle
- Take money out of your 401k or IRA account
- Review funds that you have in your checking or savings accounts
6. Qualifying For Homeownership Assistance
Always ask to see what offers are available. It is not unusual for the federal government, state or even your city housing agencies to offer tax credit for first time homebuyers. Take a look at things like Florida Department of Community Affairs which offer homeowners and renters help from local agencies. Always be sure to ask what is available and if you have any questions don’t hesitate to contact me.
7. Closing Costs
Closing costs are usually something a first time homebuyer doesn’t consider until already getting involved in a real estate transaction. Taxes, fees, and all costs required to close a real estate transaction are all things that make up closing costs. Closing costs differ from the seller and buyer. Usually the buyer would pay more in fees as the fees are directly associated to their financing. So what are some items that make up these closing costs?
- Escrow or attorney fees and recording fees
- Recording the deed within the county this shows who has ownership
- Seller usually takes care of paying both the buyer and sellers commission
- The transfer or document taxes will be paid to the state, county, city or combination
- Homeowners and taxes that are due will be pro-rated
- The title company will take care of putting together the preliminary HUD -1 statement that outlines the costs for both the buyer and the seller. Its very important for both sides to review costs and anything that is split between the sides should be written in the contract offer.
If you are still left with wondering how you can be a homeowner and what steps you have to take to get started please don’t hesitate to contact me. If you don’t think you can get pre-approved for a loan right now then let me help find ways for you to start making steps in the right direction to get approved.