One of the first things on your home-buying checklist is deciding whether to buy an…
Making the decision to purchase a home also means you’re about to make one of the biggest financial investments. But starting the process can be overwhelming and comes with many questions and concerns. Therefore, having knowledge of what to expect is key! Here are some of the most asked questions by home buyers.
Most Asked Questions When Purchasing a Home for the First Time
1. I’m ready to start house-hunting. When should I talk to a lender?
Unless you’re paying with cash, you should talk to the lender before you begin looking at homes and work on getting pre-approval. Talking to the lender first will give you a clear idea of what to expect as far as the costs associated with the purchase of a home. Plus, this will let you know the price range of what you can afford to buy.
2. Do I really need to have a Realtor? If so, how much do I need to pay them?
It is highly recommended that you have a Realtor for your home-buying process. Realtors represent your best interests and make the experience a lot easier. They also educate and inform you about your options. In most cases, the sellers are the ones who pay for the Realtor’s fees.
3. Are there special loan programs that I should be aware of?
Yes! There are some great programs and knowing the difference between them is essential. The main loan programs are VA, USDA loans, and FHA loans. Additionally, there are programs specifically for first-time home buyers and for frontline workers looking to purchase their first property.
4. How much is the down payment for buying a home?
This will mainly depend on your loan type but it’s commonly between 3% to 5% of the purchase price. Properties in rural areas may be eligible for USDA loans that don’t require any money down, as well as veterans who are eligible for VA loans without any down payment.
More Things to Know
5. Besides the down payment, what other fees/costs should I be prepared to pay?
Apart from the down payment, there are loan origination fees and closing costs. These will depend on the amount and type of loan. In addition, you must be prepared for the home inspection cost which can be around $300 to $500.
6. What is the difference between being pre-qualified and pre-approved?
This is one of the most commonly asked questions. While these terms sound similar, they have a key difference. With a pre-qualification, you are given an estimate of what you may be able to borrow. On the other hand, getting pre-approved means that a financial institution has agreed to work with you after taking a thorough look at your finances.
7. How long does it take to finalize the home-buying process?
On average, once you find a home and your offer is accepted, the process usually takes around 30-45 days.