Why Buy With Us?
Purchasing a home is the largest investment you’ll ever make. It’s also the most exciting and potentially overwhelming. Fortunately, that’s where we come in. We begin by explaining the process from beginning to end, answering all questions and preparing our clients for what comes next. Picture Perfect Home Team works vigorously to provide the highest level of service while building lifelong relationships. Our goal is to make home ownership obtainable to everyone, regardless of ethnicity or economic status.
Homes For Sale
What is the importance of getting pre-approved for a mortgage? How do you go about getting pre-approved?
*First and foremost, in today's real estate market, most sellers expect buyers have one, and may only negotiate with people who have proof that they can obtain financing. Second, would-be homeowners learn the maximum amount they can borrow. They can also have an opportunity to discuss financing options and budgeting with the lender. Finally, if there is any problem with their credit, they'll get a heads-up about it. As you might suspect, the pre-approval process is more formal and involved. You'll complete an official mortgage application (and usually pay an application fee), then supply the lender with the necessary documents to perform an extensive check on your financial background and current credit rating. (Typically at this stage, you will not have found a house yet, so any reference to "property" on the application will be left blank). From this data, the lender can tell you the specific mortgage amount for which you are approved. You'll also have a better idea of the interest rate you will be charged on the loan and, in some cases, you might be able to lock in a specific rate.
How to get Pre-Approved
1. Proof of Income
These documents will include, but may not be limited to:
Thirty days of pay stubs that show income as well as year-to-date income
Two years of federal tax returns
Sixty days or a quarterly statement of all asset accounts including your checking, savings, and any investment accounts
Two years of W-2 statements
Borrowers also need to be prepared with proof of any additional income such as alimony or bonuses.
You will need to present bank statements and investment account statements to prove that you have funds for the down payment and closing costs on the residence, as well as cash reserves. If you receive money from a friend or relative to assist with the down payment, you will need gift letters which certify that these are not loans and have no required or obligatory repayment. These letters will often need to be notarized.
3. Good Credit
Most lenders today reserve the lowest interest rates for customers with a credit score of 740 or above. Below that, borrowers may have to pay a little more in interest or pay additional discount points to lower the rate. Most lenders require a credit score of 620 or above in order to approve an FHA loan, especially to qualify for a 3.5% down payment; borrowers with a credit score below 580 are required to make a larger down payment of 10% Lenders will often work with borrowers with a low or moderately low credit score and suggest ways they can improve.
4. Employment Verification
Your lender will want to see your pay stubs and will likely call your employer to verify that you are still employed and to check on your salary. If you have recently changed jobs, a lender may want to contact your previous employer. Lenders today want to make sure they are loaning only to borrowers with a stable work history. Self-employed borrowers will need to provide significant additional paperwork concerning their business and income.
5. Other Documentation
Your lender will need to copy your driver’s license or state ID card and will need your Social Security number and your signature allowing the lender to pull a credit report. Be prepared at the pre-approval session and later to provide (as quickly as possible) any additional paperwork requested by the lender. The more cooperative you are, the smoother the mortgage process will be.
Are you relocating to this area? Looking for more information to help you find the right city and neighborhood for your family?
Our relocation guide includes the most up-to-date and vital information for people looking to move to our area.
Do you work with first-time homebuyers often? Do you know about special programs to make home buying easier for the first time buyer? Why are you the best agent for the first time homebuyer?
What is a home warranty? Is it worth purchasing?
Many home purchasers erroneously assume that the Seller is always somehow liable when there is a defect or failure found in the home’s cooling, heating, plumbing, electrical and/or appliances after the Buyer moves in. Unless otherwise provided for in the contract, however, the risk of loss often falls on the Buyer. Even where the contract provides that heating, plumbing, pool & equipment, electrical, etc. be “operative” on or until the date of possession, disputes can always arise as to when the breakdown occurred, who is responsible, how the repairs are to be funded, and when they are to be made.
Home warranty plans go a long way to alleviate these risks and concerns. For a modest price (currently basic coverage is $335 to $450, slightly more for optional coverage), Seller can provide to Buyer a one-year warranty covering, specified heating, plumbing, electrical, water heater or appliance breakdowns. Coverage under most plans begins at closing (although some can be in effect during the listing period as well). In all cases, there are important limitations and exclusions (example: appliances/systems must be operative at the commencement of coverage).
Escrow and Closing Costs
What is escrow? Are there any closing costs that buyers should be aware of? What is the process of purchasing a home?
**In the home-buying process, escrow is a financial tool that allows you to set aside important items such as the buyer’s earnest money check and purchase agreement document in an impartial holding area, where it will stay until all of the details are worked out between a buyer and a seller.
The escrow officer is a third party—perhaps someone from the closing company, an attorney, or a title company agent (customs vary by state). How much does escrow cost? That varies too—as well as whether the buyer or seller (or both) pays—with the fee for this service typically totaling about 1% to 2% of the cost of the home.
***Closing costs are fees associated with your home purchase and home loan at the closing of a real estate transaction. The closing point is when the title of the property is transferred from the seller to the buyer. Closing costs are incurred by either the buyer or seller.
* (source: Investopedia)
***(source: What are closing costs?)