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Things to Consider: Planning to move
out of the area in a couple of years? If so you may be better off not buying
a home now. The cost of selling a house generally falls in a range of 7% - 8%
of the sale price which may be more than the appreciation of the house.
Check out the Rent vs. Buying Home Calculators to compare the
advantages of each. Thinking about changing jobs? It might be best to wait
until after your purchase. Look at your work history. Is it sporadic or did
you just start a new job? Lenders like to see someone with a steady work
history and with job changes in the same line of work. Lenders will require
your work history along with past tax returns. Southern Pines commercial real
estate for sale.
Look at your credit report before you go to a lender. It is
not uncommon to find problems with reports, especially if you have a common
last name. If you find a problem, start with the reporting agency to clear it
up. It is common to have a late payment at some time or another. These
problems can usually be taken care of with a letter of explanation from you
to the lender.
FICO Scores: What They are and Why They are Important.
To
get copies of your credit report, start at:
Experian
My FICO Score
Banks/Savings and Loans vs. Mortgage Brokers:
·
Loan
officers at a bank work for the bank.
·
Mortgage
brokers work for you and have a fiduciary relationship.
·
Most
banks cooperate with mortgage brokers.
·
You
can go to a broker and obtain a loan through a bank.
·
Most
banks will offer you a menu of programs while a loan broker will offer a
menu of lenders. Banks and mortgage brokers are under different government
controls.
·
A
complaint regarding a bank would go to the State Department of Banking.
·
A
complaint regarding a loan broker would go to the State Department of Real
Estate.
Contact someone from each source to see what special programs they have to
offer.
Home Loan Pre-Approval:
·
Before
shopping for a home, get pre-approved for a home loan first.
·
Getting
pre-approved for a loan is a necessary step when buying real estate.
·
If
you are pre-approved for a mortgage first you will save considerable time
looking for a property.
·
You
will know how much a lender will commit so you won't waste time looking at
property you can't qualify for.
·
You
will have a better chance of having an offer accepted if it is accompanied
with a pre-approval letter.
·
The
best agents won't work with buyers until they are pre-approved.
A mortgage lender will let you know your maximum loan amount
after providing them:
·
Income from all sources.
·
Funds available for a down payment and closing costs.
·
Your monthly obligations (auto loans, credit card
payments, alimony, child support)
·
Price range of homes where you want to locate.
Selecting a
Mortgage Lender: You should pick a mortgage lender based on experience,
customer service and recommendations. Work with a mortgage lender who is
experienced in the business, knows the availability of the different type
loans and how to handle the demands of processing. Don't make the decision
based solely on which lender is offering the lowest rates. If a company is
offering a mortgage package that is well below market rates, you should
beware. All mortgage companies generally choose from the same pool of
investors. A company offering abnormally low rates might make up the
difference by increasing closing costs or tacking on additional settlement
fees. Determine how long you expect to live in the new home. This decision
will not only affect the houses you look at, but also will determine the type
and term of loan you choose. Get everything in writing and a copy of
everything you sign. Ask your mortgage lender at application what fees
typically are included in the finance charge computation, and what fees may
be charged separately at closing. Southern Pines NC commercial real estate.
How Much Can I
Qualify For? Most
mortgage lenders require your housing payments not to exceed 25-33%
(depending on your down payment) of your gross monthly income called
"housing expense ratio". Your total debt payments should not exceed
33-38%, figured on a monthly basis. This figure is called your "total
debt ratio". Pinehurst realestate.
How
Much Do I Need?
Besides setting aside money for a down payment, you will need money for
closing costs. Those costs can range from $3,000 to $10,000, depending on the
type of loan, the loan fees and the community the property is located in. The
smartest and most time efficient thing to do is get pre-approved up front,
before you start looking for a home. Next, find an agent familiar with the
area you want to live and you are comfortable with. Educate your self about
local property values and the current market trend. Pinehurst NC Realestate
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