montgomery county realtor pre approval
Wednesday, November 25, 2009
Buying a home can be one of the most exhilarating and exciting times in ones life. It can also be a very emotional, difficult, & stressful time if you do not have the correct advice and process explained. The first step should always be to know where you stand financially if you are obtaining a loan in order to purchase the property. Getting a pre-approval and looking over a GFE(Good Faith Estimate) is increasingly important due to the strict loan approvals and all costs that are included in your monthly payment outside of just the principle & interest. A new buyer or even an experienced buyer, should speak to a loan officer as soon as they start to consider a purchase.
The Internet has made it easier and pretty much fun to look for homes. As a result buyers are looking at homes and wanting to shop before they even know what they are fully approved for, if they have the sufficient down payment, and if they would be comfortable with the monthly payment. Loans are more difficult to obtain, rates change regularly, there is no longer 100% financing options(Outside of VA loans & Rare Unorthodox Programs), and you must think about the other factors that make up the monthly payment. This includes not only the mortgage payment(Principle & Interest), but a few other important and often costly factors. First, if you’re putting less than 20% down you will need mortgage insurance. Home Owners Insurance will be required as well. Second, you have property taxes. Last, you have to consider home Owners and condominium association fees.
All of this can be broken down and illustrated by a loan officer on the Good Faith Estimate.If you’re thinking about buying, first see what loan amount you are approved for. Then have a loan officer run a GFE at that amount on a specific property that reflects what you desire. After that, you’ll be fully aware of your buying power and it will make the process a lot smoother.
Ben White, Montgomery County Realtor
Specializing in first time home buyers in Rockville
240-848-3322
Category : Blog
First-Time home buyers continue to thrive in this market. Historically low interest rates, new tax credits, large inventory, and aggressive pricing by sellers has attracted many people to the thrill of home buying and ownership. Recently, I have been working with a very large number of first-timers. I have found that most of these buyers are looking within a price range of $250,000 and less. Between 2004 and 2007 it would have been almost unheard of to find a detached home or even a town-home in Montgomery County within this price range. However, due to the reasons stated above, I am helping more and more people accomplish this dream and goal.
Of course, many of these homes are bank owned or are selling through the short sale process, but not all. Even “normal/conventional” sellers must compete with the aggressive pricing caused by the high number of foreclosure or distressed sellers. Not only are buyers getting great deals, but they are also finding out that they can purchase a home while having the sellers pay their closing costs. While it has become harder to find down payment assistance, it has become almost standard to have the seller pay all of the buyers closing costs. In some cases, buyers can get a seller subsidy even greater then their required cash to close. Usually, closing costs are about 3% of the sales price. Lately, I have helped buyers get up to a 6% seller subsidy and use the additional funds to buy down their already historically low interest rate.
As a friendly reminder to my readers and any first time home buyer it is imperative that you speak with a loan officer first and complete a loan application. The fun part of shopping for homes with a realtor cannot begin until you know what you are approved for and what you are comfortable on a monthly basis.
Category : Blog