Home Buying 101
If only they offered a class in home buying! A home purchase may be your largest financial transaction to date, so it's important to make the right decisions and to keep an eye on the details. With the assistance of your real estate agent and loan officer, it should be an efficient, pleasant and ultimately rewarding experience.
Roles & Responsibilities
Three main players contribute to the home buying process – each has an important role to get you into the home of your dreams. Hint: you have a crucial part!
Count On Your Real Estate Agent To:
- Preview available homes to weed out those that are overpriced, or undesirable in some other way.
- Present the homes that suit your needs as you've defined them.
- Help you determine the difference between a "good buy" and a property which, because of its nature (neighborhood, market appeal, etc.), might have to be discounted if you decide to sell in the future.
- Negotiate the best deal for you. With a pre-qualification letter from us in hand, your real estate agent will be able to demonstrate that you are a qualified and capable borrower. This will strongly influence the seller, and may make the difference between the seller accepting your offer or someone else's – even if your offer is lower!
Count On Your Loan Officer To:
- Assist you in selecting the best loan to meet your personal situation and goals. (This single decision can save you thousands of dollars throughout the years!)
- Keep you informed of your loan status throughout the entire process.
- Keep your real estate agent informed of our loan progress (note: your personal information is always kept confidential between you and us; only deal points and progress are shared).
- Get the appropriate loan for you at the best rates and fees. This will save you significant money "up front" and throughout the years to come.
Count On Yourself To:
- Keep your real estate agent informed of any questions or concerns as they develop.
- Keep the process moving by providing documentation and decisions as soon as reasonably possible. By doing so, many of the details are taken care of early in the process so you can comfortably concentrate on any last-minute details or events that require your attention.
- Enjoy purchasing your home, but do remain objective throughout – to make the business decisions that are best for you.
- Make sure you are pre-approved as early as possible. This will put the power of financing behind you so you can concentrate on selecting your home.
When you choose Five Points Bank for your home loan, you'll get responsive service from a local expert who will be with you every step of the way. You'll get regular updates, and your loan officer is always just a call, visit or email away.
Things to Avoid During the Home Loan Process
Some new homebuyers make the mistake of rushing out to buy things to fill their home soon after the seller says "yes" and the loan is approved. A few major hurdles still remain to jump through before the keys are handed over. We have given you a list of actions below we suggest you stay away from when waiting for closing.
Don't make expensive purchases.
Although you will be listing ways to turn your new home into a castle, try to stay away from major purchases like appliances, electronics, or expensive furnishings. You will also want to avoid vacations and vehicle purchases until your loan closes. Financing new stainless steel appliances with a store card or a bank credit card could jeopardize your credit worthiness during the time it means the most. It is even not recommended to make those large purchases with cash. Lending institutions are looking at your cash on hand when considering your loan.
Don't go on a career search.
Lenders like to see a consistent career history on your application. Finding a new career (especially one with a better paycheck) may not affect your ability to qualify for your loan. However, for some, switching jobs during the mortgage loan approval process may bring concern and hinder your application.
Don't move money around or change banks.
Bank statements from the last few months for all your accounts (checking, savings, money market and others) will be analyzed as the lender considers your approval. To avoid potential fraud, most loans require a thorough paper trail to verify the source of all funds. Changing banks or transferring money to another account – no matter the purpose – may make it difficult for your lender to review your funds.
Mortgage Escrow Account
A mortgage escrow account is established to pay ongoing expenses while there is a loan on the house. These expenses include property taxes, home insurance, mortgage insurance and other escrow items. Generally, the escrow account is partially funded at closing, and the home buyer makes ongoing contributions through their monthly mortgage payment.
Contact your Five Points Bank mortgage loan specialist to learn more.