HOMEBUYER WORKSHOP

Live Well, Everywhere

Why Buy a Home

LocationGrowing family

More SpaceSchool District

LifestyleLegacy Investment

2 Years of federal income tax returns with W-2s

Two to three months of paycheck stubsCredit Report

Bank Statements two to three months Assets documentation – mutual funds,

other real estate, stocks, pension funds,

child support, other assets

Get Preapproved

Gather the following documents for your loan review

As important as your credit score DIR is the amount of debt you owe compared to your overall income is just as important

Lenders like to see the ratio at or below 36%

Calculate your DIR

Debt to Income Ratio (DIR)

What you should know about FICO

Get your annual free credit report Free Credit Report

Credit Score

Minimum acceptable credit score for most lenders is 620 or better.

Types of Mortgages

Fixed rate – monthly payment remains the same in terms of 10, 15 years or 30 years.

Adjustable rate loans – interest rate changes at specified periods agreed upon at the beginning of the loan.

Balloon Mortgage – monthly payments are initially low, but a huge payment is due at a specified time at the end of the loan.

Types of Loan Programs

Conventional – down payment is 5% to 20%. Requires excellent credit.

FHA Mortgage – Federal Housing Administration aids in the issuance of mortgages and is the world’s largest insurer or mortgages enabling millions of Americans to realize their dream of home ownership. FHA underwrites multifamily, single family, or manufactured homes. Down payment is 3.5%.

VA –Veterans Administration loans limited to US military personnel only. No down payment required. Contact a VA specialist in your command to find out.

Mortgage Application

Compile all your financial data – bank account numbers, credit card , and other financial data. This will help you complete your loan application. With some companies you can do this online.

See sample mortgage application

•

Closing Costs

RESPA - Real Estate Settlement Procedures Act – designed to help consumers become better shoppers for settlement/closing services.

Good Faith Estimate – An itemized list of fees and costs associated with a loan.

Sample Settlement Statement – summarizes all the fees and charges for both buyer and seller during closing on a property transaction.

Be sure to take a look at these documents

Your Real Estate Agent

Helps you find the right lender

Helps you select a loan product

Helps you get a pre-approval letter which states lender will provide financing for the mortgage, at a certain amount, at a certain interest rate for a specified number of years; also states how long the letter is valid.

Finding a Property Know how much you can afford work with agent and lender

Know where you want to live and why- location – school, work, family, lifestyle

Know what type/style of home you prefer http://architecture.about.com/od/periodsstyles/ig/House-Styles/

Making a Wishlist Selecting a home

Square footage (size) Number of bedrooms

Number of bathsKitchen – open/eat in Living Room/Family Room Bonus Room, GarageFinishes Other features

Realtor Assistance

Help determine location (radius to work, schools, family, friends, neighborhood amenities).

Search for homes with desired features in your price range -agent has access to Multi-Listing services, and special key access to all properties.

Work with lender, appraiser, inspector, insurance companies and others entities as required.

Negotiating the Purchase Contract

See sample purchase contract

Your agent will help you to present offers to the seller.

.

http://www.purchasing.cmich.edu/ptyacquisition/pdfs/sample-agreementtopurchaserealestate.pdf

Earnest Money- expect to pay earnest money when you submit your purchase contract.

Costs

Appraisal – a licensed professional conducts an indepth assessment of a property to determine it value.

Inspection

Licensed inspector determines the viability of the house

http://www.biggerpockets.com/renewsblog/2010/04/25/fha-property-inspection-checklist/

Termite Letter

http://lytletitle.com/pdf/sample-termite-letter.pdfhttp://www.youtube.com/watch?v=GNiZuHHBulU

Homeowner’s Insurance

Insures home from damage by fire, flood, storms, and other agreed upon protection dictated by the lender.

Title Insurance insures against a defect in the title (ownership).

Home Warranty protects agains defects in mechanicals and appliances for one year or more after purchase.

Closing

Your agent www.propertyagentwww.com will help with appraisals, termite letter, inspection, any paperwork and address any issues to make the closing go as quickly and as smoothly as possible

Warranty Deed- you have found a home and now you will receive closing documents and after filing at the courthouse a Deed to your property.

Sample Warranty Deed

Http://www.propertyagentwww.com

Live Well, Everywhere

propertyagentwww@gmail.com

Virginia Central Realty2420 Maplewood AveRichmond, Va 23220

1-804-355-4910 ext. 455