Buying a house for the first time can be extremely intimidating. While it might be considered the “American Dream”, it is important to find some who can help you navigate the process so it doesn’t become a nightmare instead. It is not to say you won’t hit things to overcome, but a skilled agent can help you problem solve because you will also be dealing with emotions from the process. It is exciting, but change can be hard and sometimes a little frightening.
How Much Down Payment Do I Need?
This a question we get asked often. The first answer I usually give is, you first need to talk to your lender. Your lender is licensed by the state to give more accurate information regarding your personal situation, however, there are loan product out there that offer 0% down if you qualify. For example, VA home loans and USDA loans have offered products like this. Be aware this doesn’t mean you won’t need money to close. There is a difference between down payment and closing costs.
What is the difference between down payment and closing costs? Down payments are the amount you put down on the loan toward the purchase. It comes directly off of the sales price once it has been agreed on. The term closing costs represents a variety of fees. This can include loan origination fees, recording fees, courier fees, attorney fees, brokerage fees, and other fees depending on the transaction and state you live in.
Where Do I Start the Process for Buying a Home?
You first call should be to your trusted Real Estate Agent. If you have a lender, you could also call them to get a prequalification letter. If you are not sure who to call or want guidance, your Real Estate Agent can recommend some lenders to consider and you pick one that you feel meets your needs best. This Is important because they are the ones that hold the numbers. Lenders will guide you in how much down payment you need to be ready for, what your current interest rates could be, estimate of closing costs, and how much your monthly payment would be estimated to be. If you call your lender first, ask them for a good faith estimate to get you started. This is an itemized list of what you can expect in charges for a home purchase.
These are just a few of the questions I get from buyers looking to get started. There are many other questions we field, and I am here to help. Feel free to send me an email or direct message and I would love to guide you through to your dream of homeownership. For more information, please visit my
website.
