Buyers - Frequently Asked Questions
How much of a down payment will I need to buy a home?
There are many different loan programs available... 20%, 5%, 3.5%, 3% or even NO DOWN PAYMENT loans. Your unique situation will determine which programs are available to YOU. There are a combination of factors considered in determining what loan programs you will qualified for:
1. Credit Score and History
2. Debt
3. Income
3. Job History
4. Cash Reserves
If you would like to explore your financing capabilities, reach out to us and we will refer you to one of our preferred lenders.
What are the advantages of owning vs. renting?
Home ownership is still the "American Dream".
Currently, owning is cheaper than renting.
The opportunity to "lock-in" your cost of hosing is very attractive. Rental currently are, and projected to continue, to outpace inflation.
Both house prices and interest rates are on the rise
You are paying for housing whether you own or rent
Owning is usually a form of "forced savings".
There are substantial tax benefits to owning.
A homeowner's net worth is over thirty-six times greater than that of a renter.
Stability for your family
And so much more...
I want to own a home but don't even know where to start?
Before anything else, you need to do is reach out to a lender. Until you know what financing options are available to you , how can you start shopping? More important than the "purchase price" of a home is the COST. Your total payment including; principal, interest, taxes, insurance (as well as HOA fees and mortgage insurance, if applicable) will determine the PRICE you can pay for your home.
The next thing you should do is set up a consultation with a competent professional that can walk you through the entire process.
How does the interest rate of my loan affect the price of a home I can afford?
Whatever price range you are in, you will loose 10% of your purchasing power for every percentage point the interest rate increases.
What is the best website to use to search for homes?
There are a lot of great websites out there. There is also a lot of confusion.
Many websites syndicate with the Multiple Listing Service (MLS). The MLS is a Broker-to-Broker listing service where Realtor's advertise their listings to other Realtor's in hopes that other Realtor's will have a buyer that will buy their listing. Websites that have syndication with an MLS feed can show you the ACTIVE properties for sale based on your search criteria. Many websites also pull data from public records. This means that if a person is in "default" on their mortgage it is public record, and some sites may have this property listed as a FORECLOSURE or PRE-FORECLOSURE listing. This property may not even be "for sale". (confusion)
Property value estimates are a whole different topic. Because ONLY REALTOR'S have access to the SOLD data on the Utah MLS, websites like Zillow must rely on public data when assessing a properties value. Let's just say they are not very accurate. Nationwide, Zestimates are currently within 5% of the final sale price ONLY 38.4% of the time. That means the other 61.6% of the time the valuation/Zestimate is 5-20% off. So, you do the math.
The only accurate source of information about available properties in your area will come from a competent Realtor.
If I can't qualify for a loan, do I have any other options that will allow me to bUy vs. rent?
If you have a "down payment" to work with we may be able to entice a seller to accept a creative financing solution to get you into home ownership. A Lease/Option, Contract for Deed or Seller Finance transaction may work for you. If you need some time before you can qualify for conventional financing, CONTACT US to discuss other alternatives.
I have ZERO money available for a down payment, can I still buy a home?
There are programs available, if you qualify, to be able to finance your new home with NO money out of pocket. If this is something you would like to explore, please reach out to us and we will match you up with one of our preferred lenders.
