The first thing to do when looking to purchase a house is to get pre-approved for a mortgage. This is not only helpful in finding out what sort of price range you are looking for as well as the down payment needed, but also lets potential sellers know that you are a serious buyer.
Under normal market conditions, once the house has been selected and an offer has been accepted, it could take an average of 30 to 45 days to complete the escrow period.
The national average down payment for a home sits right around 11%. However, the average for first time home buyers sits closer to the 3-5% range due to several first time buyer programs. The FHA loan requires only 3.5% down while others like VA and USDA loans might require no down payment at all but are more restrictive.
A FICO score of 620 or better is what is required of most loan programs. It is not uncommon to find lenders who will approve buyers with a score of 580, however a higher down payment may be needed. Conversely, those borrowers with higher credit whom represent less risk to the lender might not have to provide as much of a down payment.
Earnest money is a payment sent with an official offer to represent to the seller your genuine and serious interest in purchasing the house. The amount is typically 1-2% of the purchase price of the house and essentially takes the house of the market. If a deal is made then the earnest money will be applied to the down payment and closing cost.
This number can vary but the timeframe should be stipulated in the offer. It is not uncommon to ask the sellers to respond within twenty-four hours.
Yes, absolutely! Many loan programs, like the FHA and VA loans, require a home inspection. However, even if it is not required by your lender it is still highly recommended because they can reveal easily overlooked defects in the house. A good home inspection will bring peace of mind to one of the largest investments of your lifetime.
While not required, it is highly recommended. This is an opportunity to make sure nothing has been changed that was not part of the original deal. This is especially important if changes or repairs were requested in order to make sure everything is as stated in the contract.