FINANCE CENTER

Financing pertains exclusively to buyers although some of the information provided below does apply to refinancing an existing home or property. The first step in buying a home or property is to determine how much you can afford what you want to spend and what is the financing going to cost you. There is a difference between what you can afford and what you want to spend. The amount you want to spend should include the deduction of other expenses from day to day life, hobbies and future changes to family status. If you are planning on children or have elderly parents that may be in the future, make sure to consider those expenses and you should always leave yourself some breathing room so you're not house poor.

Many buyers are intimidated to talk to a mortgage specialist. This is understandable and not the first task considered when looking at buying a home however it is important to get started early.

Real estate agents can refer you to highly skilled and professional mortgage lenders they have done business with, trust and can deliver an on-time closing. Real estate agents do not get referral bonuses or any monetary exchange for connecting them to buyers however they do have an interest to utilize mortgage specialists that can provide valuable customers service and have a good reputation with clients. There are many lenders a mortgage specialist can use and should be able to provide you with options and a clear explanation of each loan offering.

GETTING QUALIFIED & APPROVED

Pre-approval will allow you to determine your price range and the financial obligation. An approval for a specific amount does not necessarily mean that is your price range. Consider hobbies, future changes or additions to your family that may impact financial stability and cash flow. When you are ready to provide a written offer, your pre-approval letter will need to accompany the offer.. When you are ready to provide a written offer, your pre-approval letter will need to accompany the offer. Lenders will have different programs and offerings that will affect the interest rate and down payment.

First time buyer & discount programs

There are many first time buyer and neighborhood incentive programs offered by the local, state governments and lending institutions. Many of these programs are only available in certain conditions and through specific mortgage lenders.

escrow

Most people just focus on their mortgage payment, but they also need to be aware of the other expenses such as property taxes, utilities and homeowner-association dues. Most of the time, your payment includes money that goes into escrow, for later payment of bills like homeowners insurance, property taxes and mortgage insurance. It’s critical that you know what bills are being paid by escrow and what bills for which you're responsible. Some mortgage lenders will require taxes and possibly insurance to utilize an escrow account, however you may decide to lower the monthly payment and pay these items yourself. If you decide to not use escrow, you must remember that the full tax amount and insurance will be your responsibility. 

One often overlooked addition to your loan payment, not part of escrow although worth mention is private mortgage insurance (PMI). If you are a first time buyer or down payment is less than 20%, you may be required to have PMI. PMI costs vary and depend on the loan rate and length. 

closing

At closing, the buyer has the majority of the papers to be signed. The majority of the documents are generated from your mortgage company. If you are purchasing a government foreclosure (VA, Fannie Mae, Freddie Mac), you will have even more papers than the average closing. Most closings take about an hour. Once you have signed all of the papers, the title company will submit the papers to the mortgage company and the mortgage company will then send the funds to complete the transaction. Some of our local lenders will fund the loan before closing and you can receive the keys as soon as you are done signing papers.

Most of the national banks will require a few hours to fund the loan. If you have a late afternoon or evening closing, the loan will not fund until the next business day. This means that you will not be entitled to the keys until then, so plan accordingly. Once the loan has funded, you will receive the keys and be the proud owner of your home!