Frequently Asked Questions
Am I Ready to Be a Homeowner?
Is Renting or Buying Better?
Buying instead of renting needs to make sense financially.
Run the numbers!
What Is the Lender's Formula?
What you’re really looking at (and what lenders are going to be very interested in seeing) is your DTI or Debt to Income ratio.
You’ll start with your gross annual income. Then understand any debt you currently owe, including car payments, student loan payments, existing mortgage payments that you will continue to owe, child support, alimony and minimum monthly payments on credit cards. Finally, know how much you’ve saved toward a down payment.
What Do I Look for in Homes?
While everybody knows that buyers shop based on price range, there are many additional considerations to make when looking for a home. And, most buyers end up refining their criteria once they start touring homes. Ultimately, your home criteria should depend on your personal lifestyle and needs.
Do I Need a Insurance or a Home Warranty?
You’ll need to have proof of a homeowners insurance policy before closing, so if you already own a home, ask your existing agent to help you open a new policy. If you don’t own a home, shop around for a policy that works best for you. Your lender may be able to help you coordinate a policy that can be paid through your monthly escrow account.
Is it worth it to have a home warranty? Purchasing a home warranty, though, can help alleviate some of the financial burden new homeowners face when a major appliance or home system goes out. Yes, you’ll pay for a warranty upfront but the savings could be worth the added expense.
A home warranty is not an insurance policy, but rather a service contract that pays the cost of repair or replacement of covered items, such as major kitchen appliances, as well as electrical, plumbing, heating and air conditioning systems. A warranty does not cover windows, doors or other structural features.
What Should I Expect at Closing?
During the 30- to 45-day escrow period, your lender will set various checkpoints in order for their underwriters to approve your loan. This will likely include items like a home inspection, appraisal and requests for additional documentation. This process may take longer if you’re getting an FHA or VA loan, which can require extra paperwork. If you’ve had a change to your credit or income since you were pre-approved, further verification may be required.
Either the morning of, or the night before closing, you’ll do a final walkthrough to visually inspect the condition of the home. This is especially important if you requested repairs after your home inspection. Next on closing day, expect to spend at least a few hours at the title company signing paperwork. You should also be prepared to bring funds to cover your closing costs, which typically range between 3-5% of the sale price.
Once the signing is complete and the sale is recorded, you’ll receive your keys. The house is yours!
You can now set up utilities for the new home — things like electric, cable and internet. If you’re buying a condo with an HOA that covers some utility costs, double check contract responsibilities with your real estate agent.
Finally, get ready to move and settle into your new home.
What Is Pre-approval?
Choose a lender or engage a mortgage broker to guide you through the financing process and help you find the right lender. Get pre-approved by your chosen lender so when it comes time to make an offer, sellers will know you’re serious.
To get pre-approved, you’ll need bank statements, paystubs and tax returns. Most pre-approval letters are good for 60 to 90 days.
What Should I Offer?
In a competitive market, where many buyers are competing for relatively few homes, you may have to put in offers on a handful of homes before you get an offer accepted. This can also happen if you’re buying using financing and are competing against many cash buyers.
It can take time for a buyer and a seller to come to an agreement in which both parties are satisfied. Multiple rounds of counter-offers and negotiations related to repairs and appraisals can be time-consuming.
Let's Find You the Place You Deserve
The home search is an exciting time, and there’s nothing like actually setting foot in for-sale homes to discover the features, locations, and layouts you love — and also finding out what you definitely don’t like. Whether you’ve got your eye on new construction, a fixer-upper, a vacation home, a foreclosure or an investment property, we can help.