FAQ’s for First Home Buyers and First Buyers In North Carolina
A Few Key Questions answered by Terry McDonald, NC/SC Real Estate Broker
Why is buying real estate so different than buying anything else? What makes it so complex?
The answer lies in what it is you are buying, and the complications that go with buying “real property.” Most of what we buy is “personal property,” stuff we can take with us as we move around. The “real” in real estate, is short for “real property” distinguished by its permanence, it’s immovability, and typically higher value.
Real property is usually less liquid- harder to resell, than personal property, so you would want to be more sure of your choice or choices. You can borrow substantial amounts of money pledging this asset as collateral-a mortgage.
However, when you take out that loan, the lender imposes a host of conditions, and some of these are quite complicated, from the details in the application process right through to the closing, the lenders are calling the shots. It is the other “Golden Rule”- he with the gold rules, at work. If they say they need A,B, and C to issue you a loan, they need all of those and without all three they won’t commit to loaning you the money. By the end it will be X, Y, and Z, or atleast feel that way. You’ll need W-2’s and if self-employed 2 years tax returns.
There is more…buying good title, surveys, closing costs, etc for the next post. But whether you are 25 or 45, buying your first home is a learning process. No one knows it until they do it.
How long does it take to “buy” a house? The time from accepted contract, to closing, the exchange of money and move-in time?
This is a term typically set by the buyer, based on certain minimums, for example it takes a full 30-35 days to process your loan application. It can be longer, for example VA loans frequently take 45 days, or shorter if you don’t need a loan you can buy and close within a few days. Generally it is 30-60 days, and more closings occur towards the end of the month.
How much do I need for a down payment?
You get your very best terms from the bank with a 20% down payment, however you can buy with a variety of insurance programs that allow you to buy with as little as 5% down, and through FHA 3.5% Down, or for a Veteran no money down.
What is PMI?
The short answer? PMI is the fee banks require when you have less than 20% DP. I’ll answer that in more detail in the next post.
Skilled Buyer Agents with Smart Buyers make great deals happen! We provide detailed analysis prior to all offers, and take a lot of the guess work out. Plus, we know where the steals and deals are! The McDonald Team 704-351-1519
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