FAQs |

Frequently Asked Questions

How do I know if I’m ready to buy a home?A

You can find out by asking yourself some questions:
Do I have a steady source of income?
Have I been employed on a regular basis for the last 2-+3 years? Is my current income reliable?
Do I have a good record of paying bills?
Do I have money saved for a down payment?
Do I have few outstanding debts, like car payments?
Do I have the ability to pay a mortgage every month, plus additional costs?
If you answer yes to these questions, you are probably ready to buy your own home.

I'm a first-time home buyer, what should I do first?A

Before looking for a home, determine your price range, down payment amount, and estimated settlement charges. Lenders use different variables including income, debt load and credit scores to determine how much a potential buyer can take out as a mortgage knowing what you can afford makes finding the right home easier.

How does the lender decide the maximum loan amount that I can afford?A

The lender considers your debt to income ratio, which is a comparison of your gross income to housing and non-housing expenses. Non-housing expenses include such long term debts as car or student loan payments, alimony, or child support. The lender also considers cash available for down payment and closing costs, credit history, etc. when determining your maximum loan amount.

What are the benefits of having a buyer's agent?A

The home-buying process from looking through listings to actual settlement has many steps to be fulfilled and deadlines to be met. Your agent can guide you through the process, whether you are looking at your first home, transferring to the area, or searching for investment property.
Additionally, a buyer’s agent is familiar with past home sales in the area and can help buyers decide on a fair offering price for a home.

Why should I be pre-approved with a lender before I look at homes?A

Before you start looking for a home, knowing what loans are available to you and their rates and terms lets you focus your search on getting the best home for your money. A pre-approval letter is also part of the buyer’s offer on a home. Having this letter in advance ensures that the seller will take the buyers offer seriously an important factor anytime, but especially if there are multiple offers.

What is a foreclosure?A

“Foreclosure” is a legal process through which the bank, mortgage company, or other secured creditor takes back your house (or other real estate) because you have not repaid your mortgage as promised in the mortgage contract.

What is a preliminary title report and how much attention should I pay to it?A

A preliminary title report is a document prepared on real property once an escrow is opened, but prior to closing. It provides all kinds of information about the property that is essential for a buyer to see, such as how title is currently held and what kind of exceptions to title are currently of record (for example, easements, liens and encumbrances). The preliminary title report then becomes the final title report, on which title insurance is based. In addition to specific exceptions to title that will be listed on a title report, it will also list standard exclusions from coverage.
In virtually every real estate transaction, the buyer has the right to approve or object to the preliminary title report and back out of the deal unless the seller can provide clean title by eliminating certain exceptions to title prior to closing. But a buyer will only have a short period of time during which to act on the preliminary title report. So it’s extremely important for a buyer to carefully review a preliminary title report immediately and to take appropriate action if there are any unacceptable exceptions to title.

Why Do I Need a Title Insurance?A

Title insurance is an insurance policy or contract issued by a title company. It protects you, the purchaser or owner, against a loss that may arise by reason of a defect in your ownership or an interest you have in real property.
In addition, the title insurance company agrees to defend you in court if there is an attack on your title. It will cover attorney and court expenses or pay a loss caused by the defect in title up to the face amount of the policy subject to the terms listed in your policy.

What Is an Escrow?A

An escrow is an arrangement in which a neutral third party, called an escrow holder, holds legal documents and funds on behalf of a buyer and seller and distributes them according to the buyer’s and seller’s instructions.

People buying and selling real estate often open an escrow for their protection and convenience. The buyer can instruct the escrow holder to disburse the purchase price only upon the satisfaction of certain prerequisites and conditions. The seller can instruct the escrow holder to retain possession of the deed to the buyer until the seller’s requirements, including receipt of the purchase price, are met. Both rely on the escrow holder to carry out faithfully their mutually consistent instructions relating to the transaction and to advise them if any of their instructions are not mutually consistent or cannot be carried out. An escrow is convenient for the buyer and seller because both can move forward separately and simultaneously in providing inspections, reports, loan commitments and funds, deeds, and many other items, using the escrow holder as the central depositing point. If the instructions from all parties to an escrow are clearly drafted, fully detailed and mutually consistent, the escrow holder can take many actions on their behalf without further consultation. This saves much time and facilitates the close of a transaction.