Home Buyers need to know a whole bunch of things about buying a home. Here are seven ‘need to knows’ to start with.
Buyers need loan approval prior to looking for property.
There are a two good reasons for this. First, we hate for you to see a home you love and later find out it is out of your price range. Second, it is accepted practice that Realtors only show property to a buyer if they are approved for the purchase of said property. Sellers gets excited knowing a potential Buyer is previewing their home. It is not good practice to get a Seller’s hopes up unless an offer can be made.
Buyers need to know the numbers!
Buyers need to know how much money they will need to buy a home. This means the total of the down payment, escrow fees, and pre-paid items such as taxes, interest and insurance. A buyer needs to know what their monthly payment will be which will include mortgage payment, taxes, insurance and if a condo, HOA fees.
Buyers need to know the amount of upfront fees.
Buyers need to know how much money is needed for physical inspection reports and appraisal report. Remember this money will not be reimbursed if the transaction is cancelled. Typical fees for a physical inspection report vary from $300 to $700. Also you may want additional inspections such as sewer line scope which costs at least $200. Buyers should ask lenders how much money they need for non-refundable fees, such as application and appraisal. These lender fees can be as high as $1,000.
Buyers need to know to not change their financial status.
Under no circumstances buyers shouldn’t open or close a new line of credit. And of course do not quit or change jobs! If accepting a monetary gift you should definitely contact your lender and CPA on allowable guidelines.
Buyers need to be able to account for all their deposits.
If you are the type to keep cash under the bed (literally) don’t make that deposit right before making an offer on a house. All money going into your account and out of your accounts will to be investigated fully by the lender’s underwriter.
Buyers need to know that getting fire insurance is required and may take longer than expected.
Buyers need to know that getting the fire insurance that will be required by the lender may take longer than you think. Some companies want to do a physical inspection.
Buyers need to know that choosing the right Realtor can make all the ‘need to knows’ easier
A Realtor’s job is to walk buyers through each step of the buying process and talk to them, a lot. Let me, Michele K be the one to educate you. Call me anytime at 562-243-2171. Helping first-time buyers find their dream home is my dream come true!