Tag: preapproval

Frequently Asked Questions: Real Estate Edition

Posted on by Jessica Ward

 

The Most Frequently Asked Questions in Real Estate:

Expert Insights for Oregon & SW Washington First Time Home Buyers 

Navigating the real estate market in Oregon and Southwest Washington can be complex. As an experienced real estate professional with deep knowledge of the local market, I’m here to provide answers to the most frequently asked questions I receive from clients. From understanding mortgage options, to tackling common buyer and seller concerns, this guide will equip you with the information you need to make informed decisions. Whether you’re buying your dream home in Portland, Vancouver, the scenic Willamette Valley, or anywhere else in the Metro area I’ve got you covered with expert advice tailored to the unique nuances of the Oregon and SW Washington real estate markets.

 

What is the first step in buying a home?

  • The first step is to determine your budget and get pre-approved for a mortgage.

How do I know how much I can afford?

  • Your lender will consider factors like income, debt, credit score, and down payment to determine your affordability.

What is a down payment?

  • A down payment is the upfront amount you pay towards the purchase price of the home. It typically ranges from 3% to 20% of the home’s price.

What is a mortgage pre-approval?

  • Pre-approval is when a lender evaluates your financial situation and gives you a loan amount you are likely to qualify for.

What additional costs should I budget for?

  • In addition to the down payment, consider closing costs, home inspections, property taxes, homeowners insurance, and maintenance.

What’s the difference between a fixed-rate and an adjustable-rate mortgage (ARM)?

  • A fixed-rate mortgage has the same interest rate for the entire loan term, while an ARM’s rate may change over time.

What is closing?

  • Closing is the final step in the home-buying process where you sign all the paperwork and officially become the homeowner.

Can I buy a home with student loans or other debts?

  • Yes, but your debt-to-income ratio will be considered by lenders when determining how much you can borrow.

What is a good credit score for buying a home?

  • Generally, a score of 620 or higher is considered good for most types of loans, but the higher your score, the better your loan terms will be.

What is the difference between pre-qualification and pre-approval?

  • Pre-qualification is an informal estimate of how much you can borrow based on basic financial information. Pre-approval is a more formal process that involves submitting financial documentation and allows you to get a specific loan amount from a lender.

How long does it take to buy a house?

  • From making an offer to closing, the home-buying process usually takes around 30-45 days. However, this timeline can vary depending on factors like negotiations, inspections, and financing.

What is a contingency, and should I include one in my offer?

  • A contingency is a condition that must be met for the deal to go through, such as a home inspection or financing contingency. It’s wise to include contingencies to protect your interests, especially as a first-time buyer.

What are the best mortgage options for first-time buyers?

  • FHA loans, VA loans (for military members), and conventional loans with low down payments are popular options for first-time buyers. The best loan for you will depend on your financial situation, credit score, and down payment.

What is earnest money, and how much should I offer?

  • Earnest money is a deposit that shows the seller you’re serious about purchasing their home. Typically, earnest money ranges from 1% to 3% of the purchase price. This money is credited toward your closing costs or down payment if the sale goes through.

What happens if I don’t get approved for a mortgage?

  • If you’re not approved for a mortgage, you can work with your lender to understand why and address any issues, like improving your credit score or reducing your debt. You may also explore other mortgage options or down payment assistance programs.

For more frequently asked questions, in depth information & a more personalized discussion please register for either a virtual or in person first time home buyers class https://www.livingroomre.com/stories/first-time-home-buyer-class-southwest-washington/

 

The Importance Of Getting Pre-Approved | Did You Know?

Posted on by Karim Alaeddine

Hey there, I’m Karim Alaeddine, Principal Broker at Living Room Realty.

Today, we’re diving into an essential step in your home buying journey, something you need to do before you even begin your search, this is getting a pre-approval letter.

So, why is this step so crucial, why does this step need to happen, and how does it serve you to get your ducks in a row now?

 

Why Is It So Important?

Imagine this…. you’ve found your dream home, the amazing kitchen, the cozy fireplace, a perfect floor plan, everything you’ve been dreaming of…..

But hold on! Before you can make an offer, the seller wants to know if you’re financially capable of buying their home. This is where the pre-approval letter comes in.

A pre-approval letter is like your passport to the world of home buying. It shows sellers that you’re serious and financially prepared to make an offer. Without it, you’re essentially saying to the sellers “just trust me… i got this.” Sellers want assurances that their prospective buyer can and will follow through.

Clarity & Confidence

But it’s not just about impressing sellers. A pre-approval letter also gives you clarity and confidence in your home buying journey. It helps you understand your budget, set realistic expectations, and focus your search on homes you can actually afford.

By getting pre-approved, you’ll save yourself time and frustration by avoiding homes that are out of your price range. Plus, when you do find the perfect home, you’ll be ready to make a confident offer in a timely manner, knowing that you’re already approved for financing.

So, before you start browsing listings and scheduling showings, take the time to get pre-approved. It’s a small step that can make a huge difference in your home buying journey. You will be thanking yourself later.

 

Make A Move

Are you ready to make a move? Call your agent today. We would love to help you find your next Living Room.

 

Did You Know?

Ready to level up your home buying knowledge? Delve into our “Did You Know?” series where we unpack essentials of the real estate process. From decoding home inspections to demystifying mortgages, we’re here to make your journey seamless. Explore more insightful tips tailored for your home buying adventure. Let’s make your real estate dreams a reality!

Did You Know – Building Your Home Buying Team

Posted on by Karim Alaeddine

 

Hey there, I’m Karim Alaeddine, Principal Broker at Living Room Realty.

Today, we’re discussing your home buying team, which consists of your lender of choice and your trusted realtor. So, what makes these two players so crucial in your quest for that unique home, that Living Room of your own?

Pre-Approval

Let’s first talk about the lender and the importance of the somewhat magical pre-approval letter. This document is your golden ticket in a competitive housing market. It establishes your commitment, and potential, to become a homeowner. It shows sellers that you’re not just serious, but financially capable of buying a home.

If you’re not familiar with who you’d like to use as your lender, talk with your agent. Most agents have a roster of trusted lenders they can recommend.

With a pre-approval letter in hand, you can confidently make offers, knowing your own boundaries and budget. And this helps your realtor tailor your home search to real and achievable options for you, saving time and energy. And critically, this self awareness builds the foundation for strong negotiations when making offers.

Finding The Right Agent For You

Now, let’s talk about your real estate agent. Beyond just finding & showing you homes, your realtor is your strategic partner on this journey. They’re your advocate and a knowledgeable touring partner who helps evaluate properties, potential, risks, and opportunities.

When that fateful day arrives and it’s time to write an offer on the home of your dreams, your realtor’s fiduciary duty and experience in the market will be the backbone for negotiating on your behalf.

Beginning with educating you on the nuances of purchase contracts and contingencies, guiding you through the complexities of crafting a winning offer strategy tailored to current market conditions, and seamlessly managing the transactional flow – including inspections, appraisals, timelines, and necessary documentation – your realtor remains an unwavering presence at every stage of the process.

So, whether you’re just starting to explore the market or you’re ready to make that leap into homeownership, remember to assemble your dream team: a trusted lender armed with a pre-approval letter and a savvy realtor by your side. Together, we’ll turn your homeownership dreams into reality.

Make A Move

Ready to make a move? Call your agent today. We would love to help you find your next Living Room.

 

Did You Know?

Ready to level up your home buying knowledge? Delve into our “Did You Know?” series where we unpack essentials of the real estate process. From decoding home inspections to demystifying mortgages, we’re here to make your journey seamless. Explore more insightful tips tailored for your home buying adventure. Let’s make your real estate dreams a reality!