Buying A Home In Upstate NY
First Time HomeBuyers
If you’re a first time homebuyer, buying a home can be exciting, yet scary, all at the same time. Its normal to feel buyers remorse when you find a home you like and its time to make an offer. Take a deep breath and understand that once your past the initial stages of the offering and you and the buyer have agreed on a deal, it gets much easier.
Many buyers today can afford a home but don’t have the proper savings for closing costs. Seller Concessions can help by covering some of those costs and still allowing the payment to be within budget. Seller Concession happens when a seller will actually give you money at closing to help purchase their home. An FHA loan will allow up to 6% and Fannie Mae 3% of the purchase price. Gifts from family members are also allowed but the money must be handled properly and their must be a paper trail from and to your bank account. Make sure you talk to a mortgage consultant about both of these two items.
Seller Concessions: Money allowed by seller to go towards your closing costs. This normally comes out of the seller proceeds of the sale. The amount allowed depends on the type of loan you use to purchase the house.
Gifts: Gifts can come from family members that would like to help you buy a home. This transaction must be properly documented and there are limits on how much you can receive. Make sure before any money is transferred to you that you talk to your mortgage consultant first.
Contingencies: A contingency happens when something MUST be done by either party before one can close. For instance, many buyers must sell a previous home before they can buy the new one. That is a contingency that must be entered into the contract to notify the seller there is a chance the buyer may not be able to close if they don’t sell their other home.
Appraisal: An appraisal will be required on any home that is purchased using bank financing. This appraisal is for the bank PAID by you. If your offer is more than the appraisal figure, renegotiation between both parties must happen or the deal will be cancelled.
Home Inspection: The home inspection is for YOU paid by YOU. This is a very important step in any purchase and highly recommended. The Home Inspector will make note of any issues that the home may have and since this report usually makes its way to the bank, anything of major importance must be fixed by the seller before the transaction can move forward. Note: The seller doesn’t have to fix them so be forewarned.
Buy The Rate Down: Occurs when you pay money UPFRONT to your mortgage company for a lower rate. If you pay an extra $1000 today but can save $10,000 during the life of the loan it may be worth it. If you plan on moving in 7 or 8 years, it may not be worth the extra money. A good mortgage consultant should be able to explain this in detail and show you the numbers why it does or doesn’t makes sense.
The Premium Buyers Program & Buying Process
My Premium Buyers Program works great for those with very little time in their schedule. First, our initial interview will help us pinpoint what style home you would like, area, price range, mortgage approval (if any) and more. This is a very critical step for any Realtor to help you find your dream home. Without this information the process can be long and drawn out and tiresome for all parties.
Another critical part of this first step is to sign you up to automated emails based on the criteria above. You get instant notification when a home hits the market or if a price change occurred on a existing listing.
Second, we plan a time each week to visit houses that fit your criteria. You can also freely visit open houses on Sunday with a list provided by me if you so choose.
Third, when you find a home you like and can see yourself living in it… we make an offer. It takes approximately 1-hour to draw up the paperwork and usually we can know that same day if our offer was accepted. Every so often there are counter offers by the seller, especially if the offer presented was much lower than the asking price, has seller concessions or their are contingencies on your part that must happen before you can buy.
Fourth, once the offer has been accepted by both parties, its now up to the mortgage company and attorney’s to finalize the deal. I make sure the process runs smoothly between all parties and will keep you up to date any changes. Closing will take approximately 60 days.
Thats it!! You’re a homeowner!
What Mortgage Company Should I Use?
To be honest, it won’t matter much. The main thing to compare is the APR… A higher APR means they have higher closing costs or fees in their loan. But just because you pay a little more in closing costs doesn’t mean that loan is better. What if the rate was lower? Would it be worth it to pay a few hundred dollars more up front in closing costs if you can save thousands during the loan term? Yes it would!
So check Rate, APR, and ask if there are any deals or specials on the appraisal fee. Also ask if it would be worth it to buy the rate down. This occurs when you pay extra money up front for a lower rate and sometimes its well worth the added cost. Also make sure the rate they give you over the phone is for Zero Points. If not, they are giving you a Buy Down Rate which means it may not be apples to apples with another company.
Also be careful in trusting APR Rates on websites or even in the Sunday paper. They are basically meaningless and can be manipulated just like a Car Commercial. Being Pro-active is the only way to ensure you pay less money up front and for the term of the loan.