Engel Volkers - Naples - Flipbook - Page 48
Common mortgage questions
Thinking of buying a new home?
We've got the answers to the questions everyone asks about mortgages.
Am I better o昀昀 renting or buying a home?
How much do I need for a down payment?
The decision to rent or buy a home differs for everyone, as
there can be benefits to both, depending on how long you plan
to live in your home. We can help you weigh the pros and cons
to see which option is best for you. If you decide buying a
home is in your future, we have amazing lender connections
throughout the area to refer you to.
Your down payment requirements will depend on your lender,
the type of home loan you choose, and the type of property
you are buying. Your required down payment can range
anywhere from 0-20% of the home’s purchase price. Lenders
offer a variety of different loan programs and each program
has different rules regarding the down payment required.
What are the advantages of a home purchase?
How long does it take to buy a home?
The American Dream, right? Buying a home gives you a sense
of investing in a community you love and pride for achieving
home ownership. Additionally, financial benefits come into
play such as tax savings, building home equity and no longer
paying rent to someone else. With many unique downpayment options available, a home purchase may be easier
than you think!
With newer guidelines designed to simplify and consolidate
some of the required loan disclosures, it changes the timing
of some activities in the mortgage process. 30 to 45 days is
the new normal, but each situation is different.
What’s my 昀椀rst step?
The Mortgage Pre-Approval. Unless you are paying cash, you
will need to get a mortgage. In order to know how much home
you can afford, you will need to get pre-approved for a loan.
Ask for recommendations, and meet with a lender to get the
process started.
How much can I a昀昀ord to borrow?
Everyone’s financial situation differs and it’s important to
recognize what you can comfortably afford to borrow. Your
loan officer will help you determine this while [in general]
factoring in:
• Your debt-to-income ratio (this is your total monthly
payments as a percentage of your gross monthly income).
• The amount of cash you have available for a down payment
and closing costs.
Your
credit history.
•
• The value of the property you want to purchase.
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What other fees can I expect, besides down
payment?
Mainly loan origination and the cost to close. The down
payment is usually the largest cost associated with buying a
house. Lending fees are the second largest costs to
homebuyers. Most lenders will charge between 2% to 4% of
the loan amount for loan origination fees, depending on the
loan type. Conventional loans usually have lower loan
origination fees, but require more money down. Your loan
officer will be able to help you determine how much you can
expect to pay towards loan origination and closing costs.
What are the closing costs?
Closing costs include items such as appraisal fees, title
insurance fees, attorney fees, pre-paid interest, and
documentation fees. These items are different for each
customer due to differences in the type of mortgage and the
property location, etc. You will receive an estimate of your
closing costs in advance of your closing date.
