Real Estate FAQs For Buyers

Q: Is now a good time to buy a home?

A: Instead of trying to time the market, focus on your personal situation. The real estate market is made up of many micro markets — not one national trend. Mortgage affordability, credit score, down payment funds, and how long you plan to stay in the home matter more than headlines.

Work with a lender to understand your financing options today and then together we can assess whether you can realistically compete in current conditions.

Q: How much of a down payment do I need?

A: It might surprise you but you don't need 20% down. Depending on the loan type and location, you might qualify for a zero down loan or as little as 3% down. There are also down payment assistance grant programs that can help you with funds for purchasing if you qualify.

*Note: The more money you're able to put down, the cheaper your monthly payments will be. You and your loan officer can work together to determine what works best for you.

Q: How do I get pre-approved for a mortgage?

A: Before looking for a house online or elsewhere, it's best to get pre-approved for a mortgage. You need to know how much you can afford monthly to see if what you want to buy is possible. You want to be comfortable with whatever your monthly payment is so you need to know that first. You also need a pre-approval letter before even making an offer on a house. A homeowner needs to know that you'll be able to take possession of the house so that they can move onto their next home.

I highly recommend a local loan officer that you can meet with in person if needed to go over your loan options. They also have local knowledge of the market and they also know how the local real estate attorneys and title companies work. This makes the process go smoothly.

Q: What does the pre-approval process involve?

A: A loan officer will ask you for the following: permission to pull the credit report for everyone who will be involved with the purchase, tax returns and bank statements. Those documents will be submitted into underwriting to see how much you're able to afford, what your monthly payments will be, and what your interest rate will be. It will also determine which type of loan program might be the best for your home buying success.

Q: Ok I'm pre-approved for a loan now what?

A: Now we determine how much you want to spend each month. Once you know what your comfort zone is, we determine which area(s) you will have success finding a home in that your budget will support. 

Q: What if I'm buying a house with cash?

A: There's no pre-approval process for buying a house with cash. Whatever amount of money you have, that you want to spend, is what your budget is. We still have to stay within an area that your budget will support. 

Q: Do I need a home inspection?

A: For certain loan programs and down payment assistance grant programs, a home inspection and other certain inspections could be required. For other loan programs you don't have an inspection requirement but you will still be subject to an appraisal (unless you qualify for an appraisal waiver). 

*Note: No matter what, Due to potential unknown issues that can be found during a home inspection, I highly recommend NOT skipping one! Pay a small amount for peace of mind vs paying for expensive repairs later on. 

Q: What does a home inspector do?

A: The basic job of a home inspector is to make sure that the house is structurally sound and they check the health and safety of the home. They're looking for potential structural issues, pests/insect damage, mold/mildew, plumbing issues, electrical issues and more. They can perform air tests for mold, radon tests (air & water), septic inspections, pool inspections, chimney inspections, sewer inspections and much more. 

*Note: There are quite a few things that can go wrong so having a licensed inspection company and/or other appropriate contractors inspect the house, septic, well, pool, etc. could cost you less than having to make expensive repairs later on. I highly recommend NOT skipping inspections of any kind when buying a home. 

Q: How long does it take to buy a home?

A: It depends on your budget, location and how much inventory vs how many buyers are looking at the same home. The goal is to find something that you like and in an area that you want to be that isn't going to break your budget. Once we find a home and have an accepted offer signed by you and the seller, it could take anywhere between 30-60 days to close depending on the loan program and the seller's moving plans.

Q: What is earnest money?

A: This is the deposit that you're going to make to put into escrow. This tells the seller that you're serious about buying the home. The amount will depend on your loan program but sometimes the more you put into escrow, the better it makes your offer. We will work together to determine what can make the  strongest offer that we can that will make the seller consider you as a strong buyer candidate for their home. 

Q: Who pays your commission? 

A: Everything is negotiable. Sometimes the seller pays my buyer's agent commission and sometimes the buyer pays my commission. Sometimes a combination of both buyer and seller pay my commission.

Q: What closing costs should I expect?

A: Closing costs typically run 2–5% of the purchase price, on top of your down payment. On a $400,000 home, that is $8,000–$20,000. Common items include appraisal fees, attorney's fees, title insurance, loan origination fees, prepaid property taxes, and homeowner's insurance.

Some costs are negotiable, and sellers can sometimes contribute via seller concessions. Always budget for both your down payment and closing costs so you are not caught short before the finish line. 

*Note: If you have the option to waive title insurance, I highly recommend NOT waiving title insurance. It doesn't cost much and if something pops up on the title after you close, you can go back to your closing attorney with the issue(s) that may have arisen and they will work with the title insurance company to remedy the situation. There are A LOT of scams going around with scammers attempting to claim property that's not theirs so having title insurance is extremely important!

Ready to get started on your home buying journey and need to know where to start? Click here to book a FREE consultation with me and we'll meet to discuss your wants, needs and everything in between!