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Buy Your First Home

Even If You Don't Know Where to Start!

Don't be daunted by the leap into unknown waters!  Buying a home for the first time may seem like an overwhelming process, especially when you have no idea where to start, but that's why I am here for you.  Learn more about the process of obtaining a mortgage, finding the perfect home, and making an offer, and you'll be on your way to owning your very own home in the Greater Triangle Area!


Understanding Your Mortgage

First and foremost, let's talk about mortgages. Most buyers need one, and there are a lot of options that vary greatly from lender to lender and from buyer to buyer. This means it's important to understand what you're looking for to ensure you're getting the best deal possible.

Types of Mortgages

There are four basic types of mortgages used by the majority of home buyers.

Conventional Mortgage:

This is the standard loan used by buyers with good to excellent credit who make down payments of at least 10%. However, there are programs that offer options for lower down payments based on buyer credit and location.

FHA Mortgage:

These loans often apply to buyers with less cash to put down or lower credit scores, as they offer a down payment as low as 3.5% and lower interest rates. However, FHA mortgages do also require mortgage insurance premiums, which can result in higher overall costs.

VA Mortgage:

All veterans and active military members qualify for VA loans. These offer up to 100% financing, simplified loan approvals, and lower interest rates. They can be much lower than conventional loans.

USDA Mortgage:
These loans are available to buyers in rural or low-density areas and offer up to 100% financing and below-market interest rates. Additionally, because of the government's definition of the term "rural," some buyers in the smaller communities surrounding the Raleigh area may qualify for this type of loan.

What Do Mortgages Include?

There are four main components to a mortgage payment, often abbreviated as "PITI."

Principal:

This is the repayment of the initial amount you borrowed from your lender (in other words, the price of your home).

Interest:

This is a payment to the lender for the money borrowed (and is then added on to the initial price of your home).

Taxes:

Your annual city and county taxes assessed on your property are divided by the number of mortgage payments you make in a year and added into your mortgage.

Insurance:

Your monthly homeowner's insurance payment covers you against various hazards and is added to your mortgage payment.

Going Loan Shopping and Understanding Your Options

Before you decide on any particular loan or lender, it's important to do your research. That means meeting with AT LEAST two different lenders to ensure that you're getting the best rate possible. It's also important to understand two different types of interest rates offered by mortgage lenders.

Fixed-Rate Mortgage:

The interest on an FRM will not change, so your monthly payments won't change, making them very predictable.

Adjustable-Rate Mortgage:

The interest rate on an ARM will often be lower initially, but as interest rates do fluctuate with the market, they can be somewhat unpredictable or even result in higher payments.


Calculating Your Monthly Budget

Now that you know what loan options are available to you, what you can expect to pay as a down payment, and what your likely interest rates will be, it's time to determine how much you can afford to pay every month, which will then be used to calculate the price range of your home.

Keep in mind that your mortgage costs will be based both on the price of the home and the CURRENT interest rates. A home's affordability can vary from one day to the next based on the current rates.


Finding a Great Real Estate Agent in the Greater Triangle Area

Look no further - you found a great agent!  That's why you are here on my website!  I am a full-service REALTOR® working for a full-service Real Estate Firm.  We are here to help you every step of the way and then some.  My specialty is finding families the home of their dreams while meeting their family needs, as well as assisting sellers through the process with negotiating the highest price for their home in the shortest amount of time.  My goal is to provide my clients with the high level of service they deserve and past clients refer me for.  Your home is your largest financial investment and you need to have experienced, trustworthy and caring representation.  rust, an expert in real estate in your area and neighborhood, and very proficient in working with buyers of your experience.

Real Estate is my passion and my profession.  As a full-time Realtor®, it would be an honor to serve you and the people you care about the next time you're in the market for real estate.


Shopping Homes for Sale in the Greater Triangle Area

Now it's time for the fun part! You get to start shopping! This is where you get to decide exactly what you want and need in a home, from the type of house or townhouse to the location of the neighborhood to all the exciting interior and exterior amenities you just have to have! Make sure you keep detailed records of the homes you visit, noting things you liked, didn't like, pros and cons, etc. Taking pictures can also help keep your memory fresh.

 


Making an Offer

You found the perfect house, and now it's time for your and your agent to sit down and discuss your offer. It's important to work together to determine a price you can comfortably afford but will also be a realistic offer for the seller to accept and will not be dismissed against any competing offers the seller might receive.

What Will I Pay Upfront?

Due Diligence fees: 

Think of Due Diligence as a payment to the seller to allow you to decide if you want to move forward on buying a home, without loosing your place in line to purchase.  While you meet with various inspectors, and your loan officer has the appraisal done, the seller will mark the home as "contingent" ie:  under contract.  In most cases, the Due Diligence Fee is non-refundable but it gives the Buyer the right to terminate the contract before the Due Diligence Date.

Earnest money:

Think of this as your security deposit. It's paid when you submit your offer to show the seller that you are serious. When your offer is accepted, it is applied to your down payment or closing costs.

Down Payment:

This is determined by your loan, or possibly any government programs or assistance you have requested.  Your loan officer will give you these figures.

Closing Costs:

These represent the fees associated with paperwork and lender charges.

Requesting a Home Inspection

If the seller accepts your offer, it's time for a home inspection.  I will give you several recommendations for types of inspections and contact information for several professional inspectors.  The Offer to Purchase and Contract Real Estate in North Carolina is an "as is" contract but in many cases we will be able to negotiate repairs with the seller.


Closing

If everything looks good, it's time to sign the paperwork, make final negotiations and payments, and get your keys!

Review Your Contract

Before you sign any paperwork, it's important that you carefully read over the contract with your agent or lawyer.

Finalize Your Mortgage

Work with your chosen lender to submit your mortgage application, have your home appraised, and review predicted closing costs. There are costs commonly associated with closing, including attorney fees, title insurance, appraisal fees, home inspection fees, courier fees, government recording fees, and taxes.

Pay, Close, and Get Keys!

It's time to close! Meet with your agent, lender, and the seller to finalize the paperwork, sign your contracts, and pay your down payment and closing costs. Finally - the keys to your new home!


Still Have Questions About Buying Your First Home in North Carolina?

Buying your first home is no simple process, and though I have tried to provide as many important details as possible, there's still much to ask and learn. So don't wait - contact me today and ask away!  Want to do some more reading?  I have plenty of resources to help you out. Learn more about buying a home today!

Greater Triangle Area Home Buying Resources


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