Home Buying

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Phase 1: Preparation & Pre-Approval

Get your finances and team in place before you search.

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    Credit score Equifax Complete™ Premier. See attached printable budget.

    Remember that you not only need to afford the house payment at x rate but the property taxes, homeowner's insurance, Home Owner Association fees, and maintenance and repairs.

  • Frequently asked questions

    What are good questions to ask a lender?

    • Are you a direct lender or broker?
    • What types of loans do you offer?
    • Will you communicate directly with the listing agent on the properties I make offers on?
    • What is the source of the money that you lend?
    • Do you have access to down payment assistance programs that I can apply for?
    • What information do you need from me in order to determine the best loan for my situation?
    • How long does it take you to provide a pre-approval letter?
    • Do you offer any rate lock programs?
    • Can you provide references from within the BiggerPockets community?
    • Can you help me find other real estate professionals?

    What are some best practices when choosing a lender?

    • Compare rates and terms from multiple lenders on the same day.
    • Ask your lender about what may change between your initial loan estimate and the final rate and terms.
    • If your loan is a private money loan, understand what may change while you're under contract and what could cause your financing to fall through.
    • Consider the reliability of your lender in addition to comparing rates.
    • Carefully consider the pros and cons of fixed rate vs. adjustable rate mortgages.

    How much do I need for a down payment?

    Loan TypeMinimum Down Payment
    Conventional3%
    Conventional no PMI20%
    FHA3.5%
    VA0%
    Private money rehab loanVaries
    Private money rental loanVaries but typically 25%+

    How do lender fees work? Annual Percentage Rate (APR) is the total yearly cost of borrowing. Interest rate is the rate on your mortgage note. Points are a one-time fee expressed as a percentage of the loan amount. Ask your lender to disclose all fees upfront. Conventional lenders are required to provide a loan estimate.

    What's the difference between a direct lender and a broker? A direct lender lends their own money and has more influence over underwriting. A broker connects borrowers with lenders and can compare rates but charges a fee. Some lenders are both.

    What's the difference between conventional, private money, hard money, and commercial lender? Conventional lenders offer FHA and VA loans. Private money lenders provide loans for non-owner-occupied investment properties. Hard money lenders underwrite based on the asset. Commercial lenders specialize in large income-producing properties. Check licenses on the NMLS consumer access website.

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    AREC - Consumer Information

    Florida Realtors – Florida REALTORS®

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    Viewing listings online is helpful, but it is no substitute for seeing homes in person and getting to know the area and its amenities. The right neighborhood can be more important to you than the home itself. Start zooming in on the best neighborhoods where home prices fall within your budget.

    Be specific with your agent about what exactly you want, so they can find homes that match your wants and needs.

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Phase 2: The Search & Offer

Find the right home and get under contract.

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    Realtor.com® | Homes for Sale, Apartments & Houses for Rent

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Phase 3: Due Diligence & Finalizing

Inspect, appraise, and lock in your mortgage and insurance.

  • Importance of Home Inspections

    A home inspection is crucial when buying a house as it helps identify potential issues, ensures safety, and provides leverage for negotiations.

    1. Identify Hidden Problems: Reveals structural concerns, plumbing, electrical, and safety hazards. Saves you from unexpected repair costs.
    2. Negotiate Repairs or Price Adjustments: Use findings to negotiate repairs with the seller or adjust the purchase price.
    3. Maintenance Planning: The report often includes maintenance tasks to plan for future expenses.
    4. Peace of Mind: Make an informed decision and reduce the likelihood of unpleasant surprises after closing.
    5. Required for Certain Loans: Some lenders (e.g. FHA or VA) may require a home inspection to ensure the property is safe and habitable.
  • Why Order an Appraisal
    • Protects the Lender's Investment: Ensures the purchase price is not higher than the property's value.
    • Verifies Property Value: Professional assessment for mortgage approval and loan application.
    • Ensures Fairness: Independent and unbiased process.
    • Prevents Overpayment: Helps avoid overpaying and complications with mortgage approval.
    • Guides the Mortgage Process: Determines loan-to-value ratio and assesses financing risk.

    Ordering an appraisal is a prudent decision that can save time, money, and stress during the real estate purchase process.

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    Home insurance is important because:

    • It provides financial protection against property damage, personal liability, and loss of personal belongings.
    • It acts as a safety net for unexpected events (fires, storms) that could damage or destroy your home.
    • It covers additional living expenses if your home becomes uninhabitable due to a covered event.
    • It protects you from lawsuits from injuries or damages on your property.
    • Many mortgage lenders require homeowners to have insurance.

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Phase 4: Closing

Final walk-through, sign documents, and get your keys.

  • Why a final walkthrough matters
    • Verification of Condition: Ensures the home is in the same condition as when the offer was accepted.
    • Completion of Repairs: Confirms agreed-upon repairs are done and no new issues have arisen.
    • Protection of Investment: Last line of defense against last-minute surprises.
    • Accountability: Holds the seller accountable for maintaining the property through closing.

    The final walkthrough is a critical step, allowing buyers to inspect the property and verify everything is as agreed before closing.

  • Closing, termite bond, survey & title insurance

    A real estate closing (settlement) is the final process in the purchase. All legal and financial procedures are completed to transfer ownership. You sign documents, pay closing costs, and take official ownership of the property.

    Termite bond: Guarantees treatment if termites return at no extra charge. Provides inspections and peace of mind. Many lenders require a termite bond. For sellers, a termite letter (WDIR) can expedite the sale.

    Why you need a survey: Provides a detailed map of property boundaries and features; often required for title insurance; essential for planning improvements; gives peace of mind about what land is included.

    Title insurance is one-time coverage that protects you and your lender against ownership issues. Lender's title insurance is mandatory with a mortgage; owner's title insurance is optional but recommended. It protects against liens, boundary disputes, fraud, conflicting wills, and unknown easements. The premium is a one-time fee at closing (often 0.5%–1% of purchase price). Buyer typically pays lender's insurance; who pays owner's varies by region. Get owner's title insurance for long-term protection against hidden liens, unpaid taxes, or fraudulent claims.

  • Why claim your homestead

    Claiming your homestead at the tax assessor's office is essential:

    • Tax Savings: The homestead exemption reduces the taxable value of your home, leading to lower property taxes.
    • Legal Requirement: It is a legal requirement; failure to claim may result in higher property taxes.
    • Economic Benefits: Allows homeowners to retain more income for improvements and other expenses.
    • Residency Verification: Verifies residency for eligibility and exemption amount.
    • Compliance: Ensures compliance with local laws on property taxes and residency.

    By claiming your homestead exemption, you can significantly reduce your property taxes and enjoy the benefits of homeownership while complying with legal requirements.

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