As a first time home buyer, you probably have questions about purchasing your first home. If that the case, read the following most common questions ask by Buyers:
1. I am buying my first home, but I do not know where to start.
2. I have decided to buy my first home, what do I do next?
3. Where do I look for a home-loan?
4. What documents & information does lender need for a loan application?
5. What is the difference between fix & adjustable interest rate in a loan?
6. What kinds of loan programs are out there for first home buyers?
7. What is the minimum down payment to buy a first home?
8. How do I know if I am working with the right real estate agent?
9. How do I know if I am buying my first home at the right price?
Answers to common questions:
1. I am buying my first home, but I do not know where to start.
If you are planning ahead of time, find out if local real estate offices, schools, or colleges are offering seminars for homebuyers. Attending these seminars may help you to become more knowledgeable with the buying process, real estate terminology, and get informed about existing home-loan programs, etc. Other sources of real estate information may be newspapers, magazines, local real estate newsletter and internet.
2. I have decided to buy my first home, what do I do next?
Before homebuyers start looking for a property, I recommend homebuyers to contact first a lender to be pre-qualified for a loan.
3. Where do I look for a home-loan?
There are many sources, but you may contact your local Bank, Mortgage brokers, Saving & Loans, Credit Unions, visit lenders in the Internet, etc. Ask for appointments to find out more about their home-loan programs and rates. For the most part lenders are competitive, but shop around to compare interest rates, loan programs, and fees charge to process a loan. If you cannot find one in your own, a real estate agent may recommend one to you.
4. What documents & information does lender need for a loan application?
The required list of documents and information may vary from lender to lender and will depend in the circumstances of each borrower. For the most part in California, lenders require at least the following list of documents and information to process a home-loan application.
Documents:
-Most recent 2 years W-2 forms, (or 1099's if self-employed).
-Most recent 2 years of taxes.
-Most recent paycheck stubs (Less than 30-days old).
-Most recent 3-months bank statements.
-Social Security # and ID.
-If self-employed, year-to-date profit & loss statement, & balance sheet.
Information:
-Two-years of residence history.
-Two-years employment history.
-If renting, landlord information.
-List of outstanding debts.
5. What is the difference between fix & adjustable interest rate in a loan?
In a standard fix interest rate loan, the interest rate remains fixed (does not change) for the life of the loan. The most common ones are the 30-year fixed loan and the 15-year fixed loan.
For an adjustable interest rate, the interest rate changes certain percentage once or twice a year or as agreed under the loan terms. Normally, there is a cup in the interest rate, in other words, the interest rate will not go higher after reaching certain percentage.
6. What kinds of loan programs are out there for first home buyers?
Consult your local lender or agent, they are normally more aware about different government and city programs for local communities. In general, first-time home buyers may purchase a home through FHA. In In California there are some home buyers’ programs:
7. What is the minimum down payment to buy a first home?
This figure varies, and will depend in the type of loan, loan amount, and sale terms. For example, a standard conventional loan normally requires 20 percent down. On the other hand, a government secure loan (e.g., FHA-loan) a first-time buyer may buy with as little as 3.5 percent down up to certain loan amount.
8. How do I know if I am working with the right real estate agent?
The general rule is, before deciding to work with an agent, is always good idea to interview different agents to know more about their business experience, personality and type of services offered; work with the one you feel meet your requirements. You may also ask family or friends; they may recommend someone to you.
9. How do I know if I am buying my first home at the right price?
Ask your agent for a Comparative Market Analysis, a market analysis may help you to find recent sold properties in the area, and spot buying and selling trends in the area.
If you do not have a real estate agent, I can assist you with your first home purchase. As your Realtor, I will do guide you through the whole buying process and find the right home for you. Since 1995 I helped many families to realize their dreams of buying beautiful homes at the right price. If you need to get pre-approve for a mortgage loan, I can refer you a lender.