Home Buying FAQs
What’s the first step of the home buying process?
The mortgage pre-approval.
Most buyers need to get a mortgage loan to purchase a home. To determine the amount of the loan and the terms, you’ll speak with a lender to get pre-approved. This is the first step in the home buying process. We are happy to provide a list of lenders to help with this process!
How long does it take to buy a home?
Around 30-60 days.
The timeline for finding a house varies greatly from buyer to buyer. Once you find your perfect home and have an accepted offer, it usually takes around 30-45 days to close. Some loan programs, such as USDA, may take up to 60 days. Each situation is different and we’ll be able to help narrow that window by guiding you through the process.
What does a REALTOR® do?
A realtor is your most valuable asset when buying a home. They will walk you through every part of the home buying process, educate you and inform you of all your options. Realtors are here to guide you throughout the transaction and make it as comfortable as possible.
There is a difference between a REALTOR® and a real estate agent. A REALTOR® is regulated by the National Association of REALTORS® and subscribes to a strict Code of Ethics. Work with a licensed REALTOR® to get the best service.
How much do I have to pay a REALTOR® as a homebuyer?
Nada! Zero! Zip!
In most cases, the sellers pay their realtor a listing fee to sell their home, and a portion of that fee is given to the buyer’s realtor for helping to facilitate the transaction.
What kind of credit score do I need to buy a home?
We recommend a credit score of at least 620.The higher your credit score, the better the lending terms. This is an ever-evolving topic, as loan requirements are constantly changing. There are some lenders who will approve buyers with a 580 score, sometimes even lower. Your loan officer will be the best source to give you a current answer for today’s lending requirements.
How much money do I need for a downpayment?
It depends on your loan type. Usually 3% to 5% down.
The most common answer is 3% to 5% of the purchase price. FHA loans just dropped their requirement from 3.5% to 3.0%. There are also some conventional loans that only require 3% down. Veterans are usually eligible for a VA loan, which requires no money down. Properties in rural areas are usually eligible for a USDA loan, which also requires no money down.
What other fees are there, besides the downpayment?
Mainly loan origination and closing costs.
The downpayment is usually the largest cost associated with buying a home. Lending fees are the second largest costs to homebuyers. Most lenders will charge between 2% to 4% of the loan amount for loan origination fees, depending on the loan type. Conventional loans usually have lower loan origination fees, but require more money down. Your lender will be able to help you determine how much you can expect to pay towards loan origination and closing costs.
What are closing costs?
Closing costs are the costs required to close the real estate transaction. These fees include, but are not limited to:
- Surveying fees
- Property taxes
- Title insurance
- Attorney fees
- Agent fees
- Loan origination fees
- Primary mortgage insurance (PMI)
- Balance of your down payment
Prior to closing, you should review your Settlement Statement to ensure that all the calculations are correct and that you have been given the correct credit for deposits and other agreed upon buyer and seller credits. Also recheck all lender, title and escrow fees to make sure they are accurate. (Fear not, we walk you through all that!)
When do I get the keys?
Under normal circumstances, you will get the keys at the closing. A closing is when final paperwork is reviewed and signed by all parties (buyer & seller). This process normally takes 60-90 minutes. There are special occasions when a closing isn’t completed until the next business day. For example, if you have a Friday evening closing and the loan cannot fund until Monday, you may not get the keys until Monday. Try to schedule closings earlier in the day if possible, to help prevent delays.
If your question isn’t listed above or you would like more information, call our office at 352-872-5757.