Real Estate

How much money will I have to come up with to buy a home?

Home loans require a down payment (with the exception of a VA loan) as well as the loan fees also known as closing costs which are due at the time of closing. In addition, you will need earnest money—deposit money you submit at time of offer and the lender will most likely require you to pay for the appraisal at the time of application.
These amounts will be credited on the closing statement.

Depending on the type of loan you get will depend on the amount of down payment. There are several types of loans available including FHA, VA, and conventional.

FHA requires a 3-1/2% down payment, while VA does not require a down payment. Conventional loans can require as little as 5%. If you have 20% to put down on a home, you can avoid the PMI (private mortgage insurance, which will lower your monthly payment).
There are down payment assistance programs available for those who qualify. Qualifications are based on income guidelines, and most often include a requirement that you have not owned a home in the last three years. If you have not owned a home in the past three years you will be considered a first time home buyer.

Closing costs can vary based on the lender. They include lender fees, origination fees, appraisal, credit report, title fees, government fees, transfer fees and prepaids (interest to end of month, homeowners insurance, and escrows). The seller can help to pay closing costs for the buyer. VA and FHA will allow up to 6% of the sales price, while conventional loans generally only allow up to 3% of the sales price.

For many of my first time home buyers I can get them into a home for as little as $500-$1000 with down payment assistance and the seller paying their closing costs.
If you are looking into buying your first home, contact me a realtor who has made it her specialty to help first time home buyers purchase a home of their own.
Please feel free to visit my website at http://www.sandiwalker.net

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