For someone who is looking into purchasing their first home, it can be a difficult decision. Peak Home Loans is here to help you and give you information as you decide your course of action. Please note that Peak Home Loans are experts at getting our clients the hassle-free, low cost, easy approval first-time-home-owner purchase loans they desire. Another thing to remember, most people have better credit than they think, usually Fair Credit or better, keep this in mind while filling out our online form. When contacted by us, kindly ask our loan professional any question you may have. They will be more than happy to assist you in finding the best loan for a first time home owner and for your particular circumstance. Remember, all loans don't fit all people; if you need a mortgage loan, we will find the right one for you.
It begins with a simple question: Why should I buy a home instead of rent a property? The money you spend on rent is flushed away. You will never see it again. It does not give you anything back. But when you write that mortgage check every month, it's an investment. You can deduct your interest amount from your federal taxes.
You gain equity not just by paying down your loan, but also if your home value increases. This is your home, your corner of the world, and it can reflect your personal style. It is an exciting time for first time home buyers, according to HUD.gov; enjoy yourself, but stay within your budget. Peace of mind is a valuable asset for everyone.
Then there are the other questions. Who can help me find a home? What about a mortgage loan? Money down? What is the process? Slow down. Peak Home Loans can help you, the first time home buyer, with all those questions.
1. Are real estate brokers or realtors a good idea? The answer is yes. They know the ins and outs, the local available properties in your price range, and they can guide you through the process. Such individuals know all about neighborhoods, schools, and other items you may be concerned about. They can also advise you on loan types and help you make an offer when you find your dream home.
2. How much money do I have to put down as a down payment? The short answer to this is that it depends on the type of loan you pursue. It also depends on the price of the house that you want. Generally, expect to come up with three types of money - earnest money, which is the deposit you make when you put in an offer. It tells the person selling the property that you are serious about buying it. Second, the down payment and then third, the closing costs. When you make an offer on a home, the earnest money goes into an escrow account. If the offer is accepted, it then goes toward the down payment or the closing costs. Of course, if the offer is not accepted by the seller, then you just get that earnest money back.
3. Can I get a loan and how do I find out? Use a simple mortgage calculator available online to figure out your price range. Make sure it's a payment you can afford (no more than thirty five to forty three percent of your income, depending on loan type). Then check with a real estate broker, realtor or go to your nearest HUD office and talk to their specialists. They are the best judges of your loan potential, and may not some special types of loans you would qualify for based on your life circumstances.
4. Who do I apply for the loan with? Peak Home Loans. We can help you get any type of loan at rock bottom rates.
5. What other costs are there besides the mortgage? Good question. You will have your other bills (car payment, insurance, credit cards) plus utilities. You are going to have property taxes. You can include those in your mortgage payment - talk to your realtor or loan agent. Depending on where you buy, you may also have home owner or condo association dues too.
6. What makes up my mortgage? Mortgages have four parts: the principal, the interest, home owners insurance and property taxes. The way most loans are structured, for the first years of the loan, your payment is mostly made of interest. You pay mainly on the principal as the time on your mortgage loan runs out. Be prepared: you will pay a lot of interest on the loan, sometimes two or three times the amount of the loan. That is why it's important to get a good interest rate in the beginning and evaluate the rate during the life of your mortgage. You may find a good time to refinance, save money, and still pay off your home on schedule. Peak Home Loans can help with refinancing too.
7. When I apply for the loan, what do I need to take with me? If you take everything we list here, you will save time for both you and those assisting you in obtaining your loan: social security card (you and your spouse if applying joint), copies of ALL your bank statements for the previous six months, asset evidence, recent pay stubs), balances owed on outstanding loans, like for a car, copies of your income tax filings for the past two years, and finally, the name and address of someone who can provide proof of employment.
8. What is the process? Once you know your financing, you and your realtor can locate your perfect home. Put in an offer, which the agent will help you do. There will probably be some back and forth about items such as appliances, window treatments, price and the like. Do not be discouraged by a rejection - there is a home out there for you. Once an offer is accepted and you head to closing, your realtor will be there every step of the way. You will receive information on closing costs, "good faith estimate" of how much your closing costs will be, and a list of all the other documents you will need to bring to closing. Make sure you have those before your closing date - if not, notify your lender.
9. One more thing to mention is first time home buyer income tax credit from the IRS.gov website. Yes, you will save money on your taxes.
That is it. Is it a lot? Yes, especially to a first time home buyer. But you will have your realtor and Peak Home Loans to help you navigate the waters. Peak Home Loans is here to help.
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