The first step in the home buying process is securing a mortgage approval. Because financing plays such a critical role in your real estate experience, you should have as much information as possible regarding mortgage options and costs.
There are hundreds of loans to choose from, and a mortgage lender will work with you to select the best option. There are 3 basic loan types: conventional, FHA, and VA; and many options within each category. Different loans generally vary in qualification requirements, and it’s important to find one best suited for you and your needs.
How much money do you need? There are now many loans with 5 percent down payment or less, depending on the type and where you qualify. This money will be paid at closing along with other fees called “closing costs.” These expenses include items such as title insurance, taxes, lender fees, title fees, etc…generally ranging from 3-5 percent of the sales price. For a general cost indication, your lender will provide a Good Faith Estimate that estimates the fees due at closing. The good news is that a contract can often be negotiated to ask the seller to pay many of the costs of closing for you!
Hampton Roads Real-e-statement is written by Alyssa Godwin, a Realtor with Liz Moore and Associates. For questions regarding the mortgage process, contact Alyssa at 757-329-6161 or firstname.lastname@example.org. You can also find Alyssa on Facebook or on the web at www.lizmoore.com/alyssagodwin.