Listed below are some of the most frequently asked purchase questions. If your question isn’t addressed here, please call and speak with one of our experienced lending officers who will be happy to answer any questions you have.
There are several factors that determine the home loan amount and purchase price that you can afford. For qualification purposes,
lenders look at income, debt, assets (how much money you have for the down payment, closing fees, points, and other funds necessary to close your home loan),
as well as credit. There are many different loan programs that offer different terms and rates, and some require lower down payments than others and offer
more flexibility in credit and income. The best thing to do is use an affordability calculator to find out what your payments would be and determine what purchase price and loan amount is comfortable for you.
Question: How much money do I need to buy a home?
Traditional conventional financing requires a down payment of 10 to 20% of the purchase price of the home; however, there are other home loan programs available such as our FHA program that allows you to buy a home with as little as 3.5% down. In addition to the down payment, you should be aware that there are other fees associated with purchasing a home. For example, there are closing fees, pre-paid interest, and prorated items such as property taxes and homeowner's insurance. Call and speak with one of our home buying specialists to get a better idea of what you can expect.
Question: Do I need a home inspection?
Although a home inspection is not required, it is a good idea to obtain the services of a professional qualified inspector to help you determine the condition of the home you are looking to purchase. A professional inspector will look for any structural issues as well as mechanical problems that may exist in the home that could cause problems in the future. In addition to a structural review, an inspector will also check faucets, toilets, appliances, and other items in the home to make sure everything is in working order. If something needs to be addressed, you can address them with the seller prior to closing.
Question: What type of documentation do I need for a purchase home loan?
Standard documentation collected for a purchase transaction includes information regarding your income such as paystubs covering the most recent 30 days and W-2s for the last two years, asset information such as bank or mutual fund stock statements covering the last 60 days showing source of funds for your down payment, closing fees, points, pre-paid items, and other funds needed to close your home loan. For a more detailed list of items, please take a look at our purchase document checklist.
Question: How long is the home purchase process?
A typical escrow period is 30, 45, or 60 days. The escrow period, defined on the purchase contract and agreed upon by both buyer and seller, is usually what dictates when your loan closes. If you have already entered escrow and are closing in less than 30 days, we can still close your loan on time if we are brought into the loop as soon as possible.
Question: What happens at the loan closing?
Typically, you will sign your loan documents at a designated settlement office such as an escrow office or attorney's office. In the presence of the signing authority, you will review and sign all your loan documents and then present a certified or cashier's check to pay the remaining down payment, closing fees and other applicable closing funds. You may also wire your funds directly into escrow. Your loan processor will guide you through the process and will advise you on what needs to be done when. Once the loan documents are signed and delivered back to us, your home loan will close in 2 to 3 days and you will get the keys to your brand new home! For more details, please visit our Home purchase process.