Have a Home Appraisal
As the home buyer, you will probably be requesting an appraisal. If you are getting a loan to buy your house, an appraisal will be part of the process. This is a professional appraisers estimated value. The appraiser will use recent properties that have sold in the area to help determine the value of the home you choose.
The appraiser will also consider the condition of your home, age, size and so forth in determining the value.
If the house is appraised high, your agent may suggest you make a lower offer with the attached appraisal to qualify for your loan. In some cases, the seller may still hold to their original asking price and ask you to pay the difference in cash. It is not likely to receive a loan amount for higher than the appraised value of the home for purchase.
Most residential purchase agreements are based on the appraisal and are negotiated at that time if there is a need to so so. For many, this can be a nerve wracking moment in the process.
The home appraisal process includes the following:
- A complete walk through of the house to get an idea of the overall condition and room count
- Documentation of the entire condition of the property, both inside and out.
- The Quality of construction and modernization of the home
- An evaluation of the value of the house
- Information on the house, including square footage, and the condition of the garage, carport, or other peripheral properties
- Estimates of the “contributory value,” which is any additions or repairs you have done to the home prior to listing
- Other attributes of the home which would add to the market value of it
HOME APPRAISER CREDENTIALS
The typical home appraiser has a state license or certification in home appraisal processes from an accredited school or real estate training. This means that they are highly qualified to make an assessment of the final market value of the house. This figure is highly influential to the buyer in communicating how much the home is worth and in determining how much they are willing to pay.
It is important to note here that an appraiser is NOT an inspector. For this reason, he or she cannot do structural assessments, termite checks, under the floor evaluations, or any of the other things the home inspection team can do. This is why it is important to have both a pre-home inspection and a pre-home appraisal completed prior to listing your house for sale.
Get A Home Inspection
Before purchasing a home in Nevada, a buyer usually turns to a home inspector to receive a qualified, unbiased account of the state of the property. A home inspection is a noninvasive, limited visual inspection of a home. It identifies the components of the home that are unsafe or not meeting performance expectations. The purpose of the inspection is to evaluate the home and enable the potential buyer to make an educated decision regarding its purchase. Many times, a contract to purchase a home includes a contingency clause stating that the contract is invalid until the buyer has had the opportunity to verify the condition of the home they are purchasing.
A home inspection is often a given in today’s Nevada real estate market, and can in fact make or break the sale. It enables the buyer to know exactly what they are purchasing, and can be a great source of anxiety for a seller that is unprepared.
The inspection is generally carried out by a professional home inspector that is trained and certified in home inspections. InClark County Nevada, home inspectors receive their certification and regulation through the Nevada Real Estate Division.
What Do Buyers Need to Know?
A thorough home inspection can take several hours and will reveal problems that may go unnoticed in an initial walkthrough. Because buying a home can be an emotionally charged experience, a realistic evaluation of the home is a crucial part of determining the wisdom of the purchase. The home inspection gives the buyer an accurate, unbiased view of what problems to expect and what issues must be addressed before moving into the home.
The home inspection includes the evaluation of many components, including:
- the heating and central air conditioning systems
- electrical systems
- the roof
- visible insulation
- the attic
- any other visible structure
Many inspectors also offer additional services, including radon testing, water quality testing and energy audits.
It is important to note that the home inspection does not tell you if the structure is in compliance with current building codes. It also does not ensure protection against future problems. A furnace may pass a home inspection, only to break six months later. In addition to this, a home inspection does not reveal the value of the home. The sole purpose of the home inspection is to ensure that the buyer knows what they are buying.
Once the home inspection is complete, the buyer should evaluate whatever issues the inspection brought to light. As soon as possible, the buyer should make a list of the issues he or she believes the seller needs to address before closing on the property, and present that list to their Real Estate Agent.
Repairs can be requested in writing and agreed upon by all parties.
What If The Home Inspection Reveals Problems?
No house is perfect, and just because a home inspection turns up problems, does not mean the house is an unwise purchase. If large repairs are necessary, further negotiations may be required. An issue that will require a costly repair, such as a cracked foundation or a roof that needs to be replaced, can result in further negotiations. The buyer may present the seller with an addendum, requesting that they fix the problems before the sale. The seller may counter by agreeing to fix some of the problems, or cover a portion of the expense of the repairs. Your Keller Williams agent can assist you in determining how to proceed with further negotiations, as attempting to save money may result in the loss of the property.
The best way to avoid an ugly situation is to have an inspection done before you actually put your home on the market with your Real Estate Agent or as soon as you do. The inspector can reveal to you privately what might come up during a home inspection. You can repair these items in advance to be better prepared when the buyer makes their offer.
In Nevada, it can be either way. Typically though, the buyer pays for their own home inspection. It is not uncommon to see buyers waiving home inspections when purchasing distressed properties since the homes will be sold ‘As Is’ quite often. A good Real Estate Agent such as The Ballen Group at Keller Williams Realty would suggest that you have the inspection anyway. During the Due Dilligence process, you would be able to choose not to buy the home due to condition. Better to know in advance what you are buying whenever possible.
Have your Final Walk Through
What is a walk through?
When you’re buying a home, there are so many things to make sure that you do. You have to hire a real estate agent, find the perfect home, make an offer, and get a mortgage loan along with a multitude of other to-do’s. Once you’ve finished all these things and the home is nearly yours, it’s important to do a final walk through. Before any closing documents are signed or you move any of your personal belongings in, this is the final step in a home purchase. These have to be done between a week and 48 before closing to ensure the house is what you expect as-is.
A final walk through is different from all of the earlier viewings because it is the buyer’s last chance to go through the house and make sure that it is in the condition that your contract specified. It allows to you make sure any requested repairs or changes have been made accordingly, and to make sure that the seller did not cause any additional damage when moving out.
Occasionally, a hasty seller or a reluctant tenant can damage the house while moving, leave a mess or leave behind some of their belongings that you don’t want. You also need to make sure that any appliances or other items that you negotiated for have been left behind and not accidently moved. The walk through is the best way to make sure that when buying your new home, that there are very few surprises lurking anywhere.
The walk through should occur close to the closing date, and preferably during daylight hours so that you can see everything in bright, natural light. Make sure that you also bring a flashlight for any tight spaces, closets, attics or basement areas. Bring both your real estate agent and a copy of your contract to review as you look through all the details in your home.
This will help remind you of everything that you and the seller agreed upon while you drafted up the final contract. It’s important because usually it has been weeks since you last saw the house and you may forget a few things. Once you do the final walk through and sign the final closing papers, you adopt every aspect of the home as-is and you can no longer hold the seller accountable.
Make sure that no matter how excited you are about your new home, that you take the time to examine every detail. Check every room and the outside property because once your new home exhilaration wears off, you’re stuck with everything – good or bad.
What is the difference between a home inspection and a walk through?
A home inspection is done by a professional home inspector and will look for major structural issues like crumbling foundations, outdated wiring and plumbing, or roof issues. The inspector then forwards his report to the buyer’s real estate agent or directly to the buyer and it can be used to negotiate repairs or lower prices. This can help the potential buyer to feel like they are making an informed decision before they make an investment in a new home. This way there are very few hidden defects that could be discovered after purchase.
This differs from a walk through because it’s usually done way before any offers are made and usually delves deeper into the home than a buyer with little construction knowledge can. The walk through is a last minute check before your final purchase.
When is the best time to schedule my walk through?
Usually, you want to schedule your walk through as close to the final closing as you can so that you see your new home at the last minute as possible. That way you can lessen the chance of any damage occurring before you sign on the house. In the Vegas real estate market, for example, it’s most common to do a walk through 24 hours before closing.
While typically for a walk through, later is better, if you’re contract states repairs that the seller is supposed to make, you should schedule two walk throughs. That way you can review the changes and still have time for any necessary negotiations or additional repairs if you are not satisfied. Don’t be afraid to be vocal about your concerns if something appears to not meet the conditions of your contract. Communication is vital between buyers, sellers and real estate agents to make sure everyone is happy with the settlement.
Gather Closing Costs
#1: Inspection Fees
The mortgage appraisal normally entails a visit by the lender’s surveyor to check the property is not being sold at a vastly inflated price, and that there are no obvious structural problems. A home inspection, on the other hand, tests the construction of the walls, ceilings, roof and other structural elements of the building, evaluates the driveway, landscaping, drainage and exterior, checks plumbing, electrical systems, HVAC equipment, furnaces, smoke detectors and even appliances. In other words, it’s a detailed report of the home’s condition that raises any red flags for potential buyers. In Nevada, you can Expect to pay $350 and up for a decent home inspection.
#2: Closing Costs
Closing costs are the fees charged by mortgage lenders and third parties related to the purchase of your home. They include a fee for checking your credit report, loan origination fee, government recording charges, appraisal fee, title service fee and title insurance. Some buyers are able to negotiate with the seller for a contribution toward these costs; otherwise, expect to pay between 2 and 5 percent of the purchase price in closing costs. According to a recent survey, on average buyers pay around $3,700.
#3: Property Tax
As a homeowner you pay an annual property tax to you county or municipality. The amount depends on the appraised value of your home; the more your home is worth, the more you should pay. Because taxes are set by local government, the amount you pay each month may go up, even though you have a fixed-rate mortgage. Any home improvements you make that increase the value of your home may also raise your tax bill.
#4: Mortgage Insurance
If you take out a conventional loan with a loan-to-value ratio (the amount you borrow compared to the value of your home) of 80 percent or more, then you likely will pay private mortgage insurance. PMI pays the mortgage company if you don’t make pay your mortgage. Typically, the insurance premium is added to your monthly mortgage payment, but that payment reduces as you pay down the loan and stops when you have 20 percent equity. FHA borrowers always pay mortgage insurance for the full lifetime of the loan.
#5: Homeowners Insurance
Homeowners insurance pays out if your home is damaged or destroyed by any of the calamities listed on the policy. The more risks the policy covers, the higher the premium. Homes in earthquake, flood or hurricane zones may need additional insurance.
In most cases, the mortgage company asks you to pay your property tax and insurance premiums into an escrow account each month. The lender, via an escrow company, takes money from the escrow account to pay your bills. This gives the lender peace of mind that your bills are being paid on time.
Most lenders ask for large escrow deposits up front, and this often throws first-time homebuyers a loop. Borrowers are often required to deposit a full years’ worth of homeowner’s insurance premiums, plus several months’ property tax, in advance. That can run to several thousand dollars, depending on where you live.
#6: HOA and Condo Fees
Homeowners association and condo fees pay for communal expenses, such as painting the lobby, landscaping and cleaning the communal pool. They are also money out of your pocket. Ask to see the HOAs financial document before you commit to buy, and check that you can afford the payments. Failing to pay an HOA bill has serious consequences. In most cases, the HOA can fine you. In serious cases of default, the HOA may foreclose your home.
#7: Moving Costs
Unless your family and friends are prepared to help you shift boxes into your new home, a moving truck is inevitable. Costs vary, depending on whether you hire a truck and move yourself, or call in a professional moving company. The further you have to travel, and the more stuff you have to move, the more you pay. Most companies can give you a quote over the phone.
When the keys are delivered you’re on your own: which means that if the pipes burst in the early hours of the morning, you’re the one who has to fix it. Having a few DIY skills can help keep the costs down, but there are some things, such as mitigating mold in a damp basement, that you may not be able to do yourself. Home maintenance costs run, on average, to 1 to 2 percent of the home’s value each year, though older homes may cost more. Aim to establish an emergency fund to handle any unwelcome surprises.
The Good News
It’s worth noting that most of the additional costs borrower’s face aren’t exactly hidden and, if you’re worrying about whether you can afford a home, you probably shouldn’t. Here’s why. By law, your lender must make sure that you can afford your mortgage. Before underwriting your loan, the lender adds up your monthly expenses, including your mortgage payment and all the costs listed above, and verifies that these expenses do not exceed a certain proportion of your income – a maximum of 43 percent, but most lenders look for a lower debt load of around one-third of your income. After all, they don’t want you to run into financial trouble and not be able to make the monthly payment.
Before you close, you’ll receive an estimate that sets out the costs associated with your home loan. In other words, you know up front what your closing costs are going to be and can budget for them. If you’re not sure about anything, ask your real estate agent (702)-604-7739 to reach Ballen Vegas and connect with a lender to guide you through the process.
Close on your home – Congratulations!
Here is where you will pay your final fees and sign all documents. In Nevada, you can assume about 45 days from escrow to close if you are getting a loan. In this state, you don’t get your keys until everything is signed and then recorded. It’s not done at the table as it is in some other states. Your agent will get you your keys once the home has recorded.
⁉️Frequently Asked questions
Can I buy a property without a Realtor®?
There are for sale by owner home listings in the market. You can deal directly with the seller. This being said, using a buyers agent in Nevada is generally paid for by the seller for you. It is in your advantage to have your own solid representation through this process.
Can I buy a home without a down payment?
It’s possible. It’s more probable that you will find a loan program with a low downpayment. Talking to a lender about today’s loan programs costs you nothing. Ask your agent to connect you with someone that can discuss the various types of loan programs on the market today.
How do I buy something with bad credit or no credit?
This one is going to be more challenging. You may want to consider finding a For Sale By Owner that will owner finance.
I’m buying my first home. Will I qualify?
Credit Score + Financial status will be the deciding factors. You’ll need a credit score in the 600’s and enough work history to prove your stability.
It it smart to be buying AS IS property?
When Southern Nevada became a primarily distressed market, we saw a lot of AS IS wording and agreements. ‘AS IS’ basically means the seller isn’t going to make any repairs. This was common in foreclosures and short sales. What’s important to note though is that it doesn’t mean you can’t have a home inspection during the due diligence period – which you should. It also doesn’t mean that the seller doesn’t have to provide a sellers disclosure which is a document to inform you of any known issues with the house.
Glossary of Frequently used Real Estate Terms
Acceleration ClauseThe acceleration clause in a mortgage contract states that the entire balance of the debt is due and payable in full should the mortgagee default on the mortgage.
The acquisition cost combines the purchase price with the estimated closing costs of the home.
Adjustable Rate Mortgage
An adjustable rate mortgage is also referred to as an ARM. This type of mortgage includes a lower initial rate of interest that changes after a predetermined time has passed and it is adjusted periodically. At that point, the interest rate increases according to predetermined conditions that were selected at the origination of the mortgage. This type of mortgage is also referred to as a variable mortgage.
Amortization is the scheduled payment of a loan or debt through systematic monthly payments that are equal in value and continue on a scheduled basis (monthly) until the entire mortgage is repaid in full. The details for each payment over the course of the mortgage are listed in an amortization schedule. Additionally, the payments are separated into the portions allotted for the principal balance and the interest charged.
Annual Percentage Rate
The annual percentage rate is also referred to as the APR. As required by the Federal Truth in Lending Law, lenders must present potential borrowers with the APR or annual cost of the mortgage. The annual percentage rate should accurately reflect the cost of obtaining and holding a mortgage for an entire year. The APR is designed as a comparison tool so that potential borrowers can select the mortgage that provides the lowest annual cost, provided that they qualify for it.
An application fee is the amount that a lender charges the borrower to process his mortgage application. This fee does not include all of the costs associated with obtaining a mortgage, nor does it guarantee the borrower approval for the mortgage.
Appreciation is the term used to indicate the increases in the value of a property due to fluctuations in the market or improvements and renovations.
An assumable mortgage is one in which the buyer can take over the existing mortgage when a property is sold.
A balloon mortgage is a mortgage that includes fixed monthly mortgage payments for a predetermined term or number of years. After this time has passed, the balance of the mortgage is due and payable in one lump sum or balloon payment. Typically, this final payment is very large. Borrowers who expect to come into a financial windfall years down the line might be interested in this type of mortgage.
A balloon payment is the final payment of a balloon mortgage. It is typically a sizeable amount.
Bill of sale
The bill of sale, a legal document, transfers the title to the property from one individual or entity to another.
A biweekly mortgage is a mortgage that requires the borrower to make mortgage payments biweekly or every two weeks. This practice leads to the equivalent of thirteen mortgage payments per year, reducing the principal balance of the mortgage more quickly than twelve payments a year would.
A blanket mortgage implements the use of more than one property as collateral for the mortgage.
A bridge loan is used for short-term financing issues such as the acquisition of a mortgage prior to the acquisition of the funds intended to pay for the mortgage.
A clear title is one for which no other owners have been found for the property and unexplained liens or legal issues do not exist.
The closing is the term that refers to the final transaction relating to the transfer of the property and its title.
Closing costs are those that are paid during the finalization of the purchase of real estate, which is also referred to as the settlement. Typically, closing costs include such fees as an origination fee, recording fees, document fees, points, the cost of the title insurance for the property, the payment of real estate taxes either in repayment to the seller or for the escrow account, the cost of the title insurance for the property, fees for any surveys that have been taken, attorney fees (if applicable), and the repayment of real estate taxes. Closing costs can also include other fees such as the payment of insurance on the home. In some cases, the seller might actually pick up some of the closing costs for the buyers, depending on the agreement.
Collateral is the property that is used to secure the mortgage. With home sales, the real estate property that has been purchased is used as the collateral for the mortgage. If the loan is not repaid in full, the home or real estate property is often repossessed by the lender to recover the debt.
A construction loan is one that covers the cost of construction. It is usually a short-term loan that advances funds to the builder during the time the home or building is under construction.
A conventional mortgage is one that has no additional guarantees for repayment beyond the property itself. This means that no guarantees have been offered through FHA or the VA.
Conversion options allow certain loans to be changed after their origination. Predetermined conditions must be met as required by the terms set up at the origination of the mortgage. Balloon loans and adjustable rate mortgages are examples of mortgages that have conversion options.
The borrower’s credit score is important since it is used to help determine the worthiness of the borrower as a credit risk. Credit scores are based upon the current and past credit histories of consumers. The credit report includes information from many areas including credit card usage, bill payment history, loan history, bankruptcies, employment, and more. Credit scores assist lenders with the difficult task of determining the risk factor associated with specific borrowers.
A deed is a legal document that indicates ownership of a piece of real estate. This document transfers the title of a property that changes hands from one owner to another.
Deed in Trust
A deed in trust is used in some states instead of the term “mortgage.”
Deposit as it relates to mortgages
Deposits are presented in advance of the closing. They are given as security or as a guarantee that the potential homebuyer is serious about purchasing the home. The deposit is also referred to as the “earnest money deposit.”
Depreciation is the term used to indicate the decreases in the value of a property due to fluctuations in the market or failure to maintain the property.
The down payment associated with a mortgage is the amount of money (whether cash or check) that the borrower pays towards the purchase price of the house or real estate property. Typically, the down payment is paid at the closing or settlement.
In some cases, a piece of real estate might refer to an easement in the deed. The easement gives someone other than the owner access to the property. If the neighboring property does not have direct road frontage, the deed might list an easement for this property owner so that he can gain access to his property.
The equity of a home is the difference between the current market value of the property and the total amount borrowed on the property.
In general, lenders set up an escrow account to hold money that has been collected each month along with the loan payment. It includes a percentage of the money that needs to be paid toward property taxes and insurance. The lender will then make the payments at the appropriate time. Learn more about escrow in the Nevada Home Buying Process.
Fannie Mae is a short way of indicating the Federal National Mortgage Association or FNMA. It is a large supplier of mortgages for the entire nation.
The FHA or Federal Housing Administration is an agency of the United States Department of Housing and Urban Development or HUD. It guarantees certain loans obtained by qualified buyers.
Obviously, the first mortgage is the one that the borrower has taken out on the property before any other mortgages or loans. This mortgage or loan holds the primary lien against the property and the holder of this mortgage has first claim for repayment of the mortgage should the home go into foreclosure.
Fixed Rate Mortgage
A fixed rate mortgage is also referred to as a traditional mortgage. This type of mortgage is one in which the mortgage payment is a specified amount that never fluctuates. The interest percentage charged against the borrowed amount remains the same throughout the term of the mortgage. The amount of the mortgage payment that goes toward the principal will gradually increase as the amount of the mortgage payment that goes toward the interest gradually decreases.
Floating is the term used to describe the borrower’s strategy not to lock in the interest rate for the mortgage he has applied for.
Good Faith Estimate
The Best Faith Estimate is an estimate provided by the lender to the borrowers. It delineates an estimate of the total costs of securing the mortgage.
Borrowers are usually permitted 15 days grace for making late mortgage payments without incurring a penalty such as a late fee.
The grantee is the individual who is receiving the property in question.
The grantor is the individual who is selling the property in question.
Homeowner’s insurance is usually required by mortgage lenders to protect their investment. They are typically listed on the homeowner’s insurance policy. The homeowner’s insurance provides hazard insurance as well as liability insurance.
Homeowners Warranty (Home Warranty)
A homeowner’s warranty is an insurance policy on the home that covers certain types of repairs for a predetermined time.
Typically, lenders require that homeowners obtain homeowner’s insurance as a way of safeguarding their investment. The lender is listed as the primary beneficiary on the insurance policy. Should the home be destroyed or damaged beyond repair, the lender can collect the balance of the mortgage from the insurance company.
The interest associated with a mortgage is the fee that the lender charges on a monthly or annual basis for loaning the money to the borrower. This fee is a percentage of the total amount that has been borrowed.
Interest Only Mortgage
In an interest only mortgage, the borrower pays only the interest that is due on the mortgage for the first term of the loan. This term is predetermined at the origination of the loan. Ten-year terms are very common for this portion of an interest only mortgage. After this term has passed, the mortgage converts to a fixed rate mortgage with fixed monthly payments that include both the principal and the interest portions of the mortgage.
A lender is the individual, bank, or company that is offering the mortgage to the borrower.
The LIBOR index stands for London Interbank Offered Rate Index. It refers to the average of the interest rates that international banks charge for borrowing United States dollars in the London market. It takes into consideration the rates charged by major banks only.
Late fees are monetary charges that are assessed on a mortgage debt to borrowers when they are late making their mortgage payments.
A loan balance is the amount of money that it would take to satisfy the loan debt in full. It is often referred to as the principal amount plus the interest that is due.
The loan term varies from one loan to the next. It is defined as the number of years that a loan is going to be held or amortized. The most popular loan terms are fifteen, twenty, or thirty years.
Merged Credit Report
A merged credit report is formulated from credit reports obtained from more than one credit bureau.
A mortgage is a binding financial agreement between two parties, the mortgagee and the mortgagor. This legal transaction is a loan from one party to the other, typically for a piece of real estate.
The mortgagee refers to the lender in a mortgage agreement.
A mortgage broker is the individual or company that originates a mortgage or loan between the borrower and lender.
The mortgagor refers to the borrower in a mortgage agreement.
Negative amortization occurs when a borrower pays less than the amount due on a loan or mortgage. As a direct result, the loan balance does not decrease as it would otherwise with proper payments.
Origination fees are those that the lender charges the borrower for processing his loan application.
Owner financing occurs when the seller finances the loan or mortgage. The mortgagor makes the payments for the loan to the seller who is also the mortgagee in this case.
PMI is short for private mortgage insurance. This type of insurance is often required by the lender in order to protect his investment. PMI protects the lender’s monetary investment in case the borrower goes into default on the loan. The payments for PMI are usually included with the monthly mortgage payment.
Points are typically charged when a borrower acquires a mortgage. It is simply one of the fees associated with the process. In most cases, a borrower can pay additional points in order to obtain a lower interest rate. Each point is equal to 1 % of the amount of the mortgage. One example would be the following scenario. The borrower acquires a mortgage for $100,000 at 3 points. Since each point is equal to 1 % of the amount of the mortgage, the borrower owes $3,000 or 3% of the mortgage. The lender charges the points. Points can be negotiated by the lender and the borrower for a specific interest rate and term within the limits that the lender is offering.
Prime rate is the term used to describe the best or lowest interest rate, which is typically offered to borrowers with excellent credit histories.
The term, principal, is used to indicate the total amount of debt, not counting the interest charges that are due on it.
Assessed by local or state governments, property taxes are assessed on the value of the home. Homeowners pay these taxes on an annual basis according to a predetermined timeline.
A quitclaim deed is one in which the grantor transfers whatever rights he has in the title to a property. It does not provide a guarantee that no one else has any claim to the title.
The recording fee is an additional charge that covers the cost to record the documents relating to the mortgage. Typically, this transaction takes place at a public office such as the recorder’s office.
A reverse mortgage is one in which the homeowners receive money from a lender based on the equity of their home, which is used as collateral. Initially, they do not need to repay the loan. In fact, the loan is not repaid until the home is sold or the homeowner no longer resides in it.
Refinance is the process that occurs when a borrower pays one loan off with the acquisition of a new one.
A secured loan is one that is acquired by offering collateral for the loan. In the case of home mortgages, the home is offered as collateral or security for the loan.
A senior loan is the loan that takes precedence over all other loans. In the event that the homeowner defaults, this loan is paid off first.
A tax lien is placed against a property when unpaid taxes are past due.
A title is a legal document that indicates an individual’s ownership of a specific piece of real estate.
A title company performs searches on titles to properties to ensure that the individual who claims title to a property actually has it.
Title insurance protects the homeowner against any errors that occur during the title search. This includes disputes that might arise over property ownership. A fee is required to obtain title insurance.
A title search is the actual process of checking records on the property in an effort to verify that the seller is the actual owner of the property.
Transfer tax is the tax that the state assesses when a title is transferred from one owner to another.
Truth in Lending
The Truth in Lending Law requires lenders to provide potential borrowers with the actual costs of borrowing money. The annual percentage rate is the figure that lenders provide to indicate the annual cost of obtaining a loan.
Variable rate mortgage?
A variable rate mortgage is another term for an adjustable rate mortgage. With this type of mortgage, there is a lower initial rate of interest that changes after a predetermined time has passed and is adjusted periodically.
Here are 10 Tips for First Time Home Buyers
- Don’t over extend your Mortgage Payments
- Be sure to check if there are multiple HOA payments
- Don’t make any big purchases before your property closes
- Take a lot of notes
- Choose a real estate agent who is patient withe process
- Don’t fall in love with the house in front of the seller
- Commit to the process
- Get everything your agent and lender need ASAP
- Ask for or Buy a home warranty
- Be sure you understand clearly what is included with the house
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