Financing Your Home Purchase

 

  • TYPES OF MORTGAGES: Most buyers obtain mortgages from Mortgage Companies/Brokers, Credit Unions or local banks or savings & loan associations. The qualifying guidelines and required down payment vary with different types of loans. It is best to consult a lender well in advance of purchasing to be sure you know exactly what you can afford.
  • TYPICAL BUYER’S CLOSING COSTS INCLUDE: (Associated with borrowing money)
  • Discount Points: Each point equals 1% of the loan amount and is used to lower interest rate.
  • Origination Fee: Most lenders charge 1% of the new loan amount as a fee for processing the loan.
  • Survey: A plot plan showing the lot and the location of structures, easements or encroachments.
  • Appraisal Fee (+/- $300): An assessment of value done by a certified appraiser selected by the lender.
  • Credit Report ($50-$75): A report of buyer’s credit history ordered by the lender.
  • Attorney ($450-$600): The buyer’s attorney oversees the closing.
  • Mortgage Insurance Premium (MIP): Required on mortgages with a loan to value ratio of 80% or more. Insurance policy protects the lender from loss due to payment default.
  • Title Insurance: $2 per $1,000 of coverage – based on sales price.
  • Recording Fees (+/- $100): Buyer fee portion for recording deed, deed of trust, and other documents.
  • Revenue Stamps ($2 per $1,000): Transfer taxes computed on the selling price and are paid by the seller.

LOAN PROCESS:

  • Application: The buyer can expedite the loan process by having all pertinent information with him at the time of application: Assets and liabilities; bank and credit card account numbers; rental history and other credit references; 2 years of personal and business history (W-2’s and P&L statements and balance sheets if self-employed).
  • Assumptions: Most existing mortgages are “due on sale” and assumptions are not allowed without the lender’s approval. Only certain FHA and VA loans are assumable and most require buyer qualification. An assumption can save the buyer thousands of dollars in closing costs if he/she can qualify and may be preferable to a new loan even if the interest rate is higher than the current market rate available.
  • Bridge Loans/Owner Financing: Some banks might make a bridge loan to a well-qualified buyer whose present home is not sold before the closing of his new purchase. This is usually a short-term situation to “bridge” from one closing to the next.

Owner Financing is not typical in this marketplace though it may be done in periods of tight money or on a short-term basis like a bridge loan or a second mortgage.

 

Our specialty is helping home buyers and sellers in the following towns in and near Wake County, North Carolina: Apex NC Real Estate, Cary NC Real Estate, Chapel Hill NC Real Estate, Durham NC Real Estate, Fuquay Varina NC Real Estate, Garner NC Real Estate, Holly Springs NC Real Estate, Knightdale NC Real Estate, Morrisville NC Real Estate, Raleigh NC Real Estate, Rolesville NC Real Estate, Wake Forest NC Real Estate, Wendell NC Real Estate and Zebulon NC Real Estate.