Home Buyer Tips Archives – Page 18 of 66 – Fred Gruber

07

Oct

Home Buyer Tips

Closing Costs: Understanding What It Costs to Close on a Home and What You Can Expect to Pay

Closing Costs: Understanding What It Costs to Close on a Home and What You Can Expect to Pay If you’re in the process of buying a new home, you’ve likely heard the term “closing costs” in regards to the many different fees and taxes that you’ll be required to pay during the purchase process.

In this post we’ll look at a number of these closing costs and what you will be expected to pay when you buy that next dream home.

Taking out a Mortgage? There Will Be Fees Attached

If you’re taking out a mortgage to finance the cost of buying your home you’ll end up incurring a variety of fees. Nearly all lenders will charge a mortgage application fee, which covers the cost of processing your application and all of the necessary paperwork.

You’ll likely have to pay for a professional appraisal of the home as well, as the lender will want to ensure that they aren’t lending you more than the house and property are actually worth.

Inspection And Insurance Costs Will Add Up

If you’re buying a pre-owned home you’ll need to pay for a home inspection to gain an understanding of the home’s condition and if you’ll need to make any repairs in the near future. You’ll also need to purchase homeowner’s insurance on the property to protect yourself in the event that something does go wrong with the home.

If you put less than 20 percent down on the cost of the home, your mortgage lender may also require that you purchase private mortgage insurance; this will vary depending on which state or province you are buying in.

Don’t Forget About Escrow Fees and Taxes

As with any major financial transaction you’ll need to satisfy the tax man by paying various taxes on your purchase. These will vary depending on where you are buying your home, but might include sales taxes, property taxes, transfer taxes, recording fees, title transfer fees and more.

If you used a third-party escrow service to manage these fees or to hold your deposit during the closing process you’ll also need to pay escrow fees prior to signing the final paperwork.

If you have other questions about the closing process and fees or costs that you’ll need to pay when you purchase a home, contact your local real estate agent. They’ve assisted many individuals just like you with their home purchase and will be able to provide expert advice.

20

Aug

By First Rate Financial Group

Home Buyer Tips

The Pros and Cons of Buying a New Home Versus Buying Pre-owned

The Pros and Cons of Buying a New Home Versus Buying Pre-owned Are you thinking about buying a new home? Congratulations!

Buying a house, condo or townhouse is an exciting and rewarding time which tends to be a lot of fun. However, along the way you’ll need to make a number of decisions – including whether you want to buy a pre-owned home or one that has been built recently and is brand new.

Let’s take a quick look at some of the pros and cons of buying a new home versus buying pre-owned.

New Homes Tend To Have Fewer Problems

One of the major upsides of buying new is that newly-built homes tend to have very few problems within the first few years of ownership.

While you’ll still be required to make regular maintenance on a new home, when you buy pre-owned you’re buying a house that has seen years or decades of weather and regular wear-and-tear.

New Construction Allows For Customization

If you want to be able to customize certain aspects of your home, it might be better to buy brand new as the builder will be able to incorporate your requests as they’re building the home. Of course, you can always renovate and upgrade a pre-owned home but if you have significant needs you may find it easier to get them built into the home as it’s being developed.

The Major Downsides To Buying New: Cost And Location

While there are a number of upsides to buying new, there are some downsides that you’ll need to know.

First, new homes almost always cost more than an equivalent pre-owned home. Brand new homes are filled with new appliances, fixtures and modern building materials which add to the overall cost of the home. Unless the pre-owned home is on a larger lot or property, you’ll generally be able to save a bit when you buy pre-owned.

Depending on where you’re buying, you may also find that the location where brand new homes are being constructed is much further from the downtown or urban area. In many cities, the only available space for new construction is in suburban areas, which means that you may be in for a lengthy commute to and from work each day if you choose to buy new.

These are just a few of the factors that you’ll need to consider when buying your next dream home.

29

Jul

By First Rate Financial Group

Home Buyer Tips

Three Ways That Your Credit Score Affects Your Mortgage and Your Chance of Obtaining One!

If you’re thinking of buying a home, you’ve probably been thinking a lot about your credit score as well. Credit scores control so much of what we do in the world of finances, but what does your credit score really have to do with your mortgage? Here are three ways that your credit score could impact your mortgage application.

Your Credit Score Affects Your Ability To Get A Mortgage

The first thing your credit score tells a lender is whether they should lend to you at all. In some cases, if you have a very low credit score, you may not be able to obtain a mortgage at all.

Different lenders will have different criteria for determining safe and unsafe lending situations. Typically, if you have a score below the 600 mark, you’ll have trouble obtaining a mortgage.

If you’re worried about a low credit score, don’t despair – you can still get a mortgage, you just might have to work a little harder to get one. Some lenders will still lend to people with lower credit scores (just make sure you’re approaching legitimate lenders and not mortgage scam artists). Or, if time is on your side, you can work toward building up your credit score so that when it comes time to take out a mortgage, your score will be more appealing to lenders.

Your Credit Score Affects What Types Of Mortgages You Can Obtain

The second thing a lender learns from your credit score is which types of mortgages you qualify for. If a lender sees you as a higher risk, they won’t necessarily be willing to offer you just any old mortgage.

In most cases, if you have a credit score of less than 620, you won’t qualify for a conventional mortgage. In addition, if you have a lower credit score, you may have to make a larger down payment in order to qualify for the type of mortgage you want.

Your Credit Score Affects Your Interest Rate

The final thing that a lender learns from your credit score is what type of interest rate they’re willing to offer you. As a general rule, the higher your credit score, the lower the interest rate.

However, just because you have a high credit score, that doesn’t mean you’ll automatically get a great mortgage rate. There’s more that goes into the price of a mortgage than just the interest rate, so watch out for additional factors like extra fees, mortgage insurance, lock-in periods, and so on.

Your credit score tells a lender a lot about what type of borrower you are. Ultimately, a higher credit score means that you’ll be able to borrow money at a lower interest rate. But if your score is low, don’t worry – there’s a lot you can do to bring up that score before you apply for a mortgage, so don’t throw in the towel just yet!

Every financial situation is different, so if you want to find out more about how your credit score will affect your mortgage in your specific circumstance, talk to your mortgage professional.