A Complete Guide of Home buying Process and Loan Procedure
Buying a home is your dream but you don’t know home buying process and loan agreements. Georgia Realtor & Real Estate Expert Viral Chhadua will help you to buy your desire home that you want. Let’s discuss about the complete home buying process and procedures
Analyze Your Credit Report and Credit Score
Getting loan is the first step of home buying process. In order to better understand the terms of the home loan that you may qualify for; you need to know your credit score. It is extremely important to have a good enough score so that you won't be stuck at a high interest rate when you take out a home loan. First, start off by taking a look into the three major credit reporting agencies: Experian, Equifax, and Transunion.
As stated before low credit score may hurt your chances of getting in with a good interest rate but that isn't the worst thing, it may prevent you from receiving financing at all.
Create a Set Budget
The second step of home buying process is creating a set budget. In order to understand the amount of money that you will be able to spend on buying a home, through Gainesville Real Estate or Oakwood Real Estate, you need to better understand what you are currently spending and how that will factor into what you have left over to spend on a monthly mortgage payment as well as property taxes, repairs, etc. A useful tool that you can use to give you a general starting point is looking up online mortgage calculator. You can find several online but a simple to use calculator go by clicking the link http://www.mortgagecalculator.org/
Being able to put aside enough money to make a sizable down payment will help you out in the future by making your payments smaller and easier to handle. As a general rule to follow, your monthly home payments should not exceed 36% of your pre-tax monthly income.
Be cautious if you are thinking of putting down a down payment of less than 20%. If you do this, you will more than likely wind up having to pay for private mortgage insurance which is an extra .5%. Private mortgage insurance benefits the bank in case you fail to make your payments.
Don't forget the additional fees:
An extra 5% of the mortgage amount which can add up to more than $10,000 in some cases will be spent on the appraisal fee, loan fees, attorney's fees, inspection fees, and the cost of a title search for the property.
Find an Agent, like Gainesville Real Estate Oakwood Real Estate, Search for Your New Home, and Make an Offer
In order to get the best deal on the buying of your new home, you would want to work with an exclusive buyer agent. Buyers agents can be paid either one or two ways. They are paid directly by you on an hourly or contracted fee or they split the commission that the seller's agent receives upon the sale of the property. A buyer's agent is advantageous as his or her allegiance is solely to you, the buyer and you can save the 5 to 7% of the purchase price that would be spent if you chose to go through the seller's agent instead.
You need "exclusive buyer agent." Sometimes buyer agents are paid directly by you, on an hourly or contracted fee. Other times they split the commission that the seller's agent gets upon sale. A buyer's representative has the same access to homes for sale that a seller's agent does, but his or her allegiance is specifically to you.
Enter into a contract, Secure a Loan, Get an Inspection, and Close the Deal
Once you, your agent from Gainesville Real Estate or Oakwood Real Estate, and the seller's agent reach a mutually agreed upon price, the seller's agent will draw up the paperwork for the offer to purchase. This document includes an estimated closing date which can be anywhere from 45 to 60 days from the acceptance of the offer.
This offer is contingent upon three main things:
1. your ability to obtain a mortgage/home loan
2. a completed home inspection that shows a lack of significant defects
3.a walk-through inspection that takes place 24 hours before closing.
Don't forget that you need to make a good-faith deposit. Ask your agent what this is; it is anywhere between 1% to 10% of the purchase price.The seller will receive this money after the deal has closed but if on the off chance for some crazy reason the deal falls through, you will get the money back.