The 10 Most Common Homebuyer Questions
Posted By Winston Bowdre
Buying real estate is exciting and terrifying, all at the same time. There are so many steps to the home buying process and each step creates a new set of questions.
Knowing the answers to the 10 most common home buying questions can alleviate some of the stress that comes with buying real estate.
This article was designed to help you understand the basics of purchasing real estate, in simple, bite sized steps. Buying a home may seem intimidating, but a good REALTOR® will make it much easier.
They will take care of you through each step of the process, and make your experience as smooth as possible.
Unless you are paying cash for a house, you will need to get a mortgage. In order to know how much home you can afford, you will need to get pre-approved for a loan. This is the very first-step in the home buying process.
The timeline for finding a house varies greatly from person to person. Once you find a house and have an accepted offer, it usually takes around 30 days to close.
A REALTOR® is your most valuable asset when buying a home. They will walk you through every part of the home buying process. Realtors® will educate and inform you of all of your options.
They will represent you throughout the transaction and beyond. To fully understand what that means, you can read our article entitled “What Does it Really Mean to be “Represented” by a REALTOR®?”
There is a difference between a REALTOR® and a real estate agent; many people do not know this. A REALTOR® is regulated by the National Association of REALTOR® and subscribes to a strict code of ethics.
A real estate agent does not. It is recommended that you work with a licensed REALTOR® to avoid potential problems.
In most cases, you do not have to pay your REALTOR® anything to help purchase a home. The seller pays their REALTOR® a fee, and then that listing agent pays the buyers agent for bringing the buyer and facilitating the transaction.
Beware of advice from people who do not work in the industry. Real estate is a popular topic and almost everyone feels like they have some great insight to offer. In reality, the people who know best are the people that work in the the business.
Good REALTORS® have sold hundreds of properties. We know what to expect and what to look out for. Friends and relatives have only bought and sold a few homes, if any at all.
Buying and selling a couple of homes does not make someone a well-rounded source of information. I’ve seen too many first-time home buyers become persuaded by well-meaning friends and family, only to be disappointed later.
Be confident in your decisions and trust the professionals.
A 620 credit score, or higher, is recommended. As you are probably aware, a higher credit score offers better lending terms. This is an ever-evolving topic, however, 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.
There are some great home buying programs to research. The main ones would be Conventional loans, VA loans, USDA loans, and FHA loans. Knowing the difference amongst these loan types is very important.
Other local options would include the SETH down payment assistance program for home buyers of a primary residence. Check with your loan officer for availability and details.
The most common answer is 3% to 5% of the purchase price. FHA loans just dropped their requirement from 3.5% to 3%. 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.
The downpayment is usually the largest cost associated with buying a house. Lending fees are the second largest costs to homebuyers.
Most lenders will charge between 2% to 4% of the loan amount for origination fees, depending on the loan type. Conventional loans usually have lower loan origination fees, bu require more money down.
Your loan officer will be able to help you determine how much you can expect to pay towards loan origination and closing costs.
Under normal circumstances, you will get the keys at the closing. A closing typically takes about an hour. In some cases, the lender will need time to fund the loan and you will get your keys and garage remote controls from your REALTOR® after the loan funds.
If you have a Friday evening closing and the loan cannot fund until Monday, you may not get the keys until Monday. Make sure to coordinate your closing to get the keys on the same day, if that is what you need.
Do you have a real estate question that you would like answered? Feel free to contact me directly, or leave a comment. Remember, a good REALTOR® is your best source of information when buying a home. Once you have a REALTOR® that you trust, start asking as many questions as possible. They will gladly inform and educate you through each step of the home buying process.
Remember to have fun. Buying a home is an exciting achievement!
Hey There! I’m Winston Bowdre, founder of Winston Alan Realty and creator of the content on my website. Thank you for taking the time to read this article. Please feel free to leave a comment in the contact us box below, or to share this article on social media with someone who might benefit from it. I appreciate your time here on this site and am always open to suggestions and ideas from our readers. Feel free to contact me any time at [email protected]