First Time Homebuyer FAQ

I know buying your first home can seem extremely overwhelming! Maybe you don't know where to start, who to talk to, or what even to do. Hopefully these answered questions can guide you a little to get started and understand the process a little better. Remember, talking to a professional Realtor should always be your first step! They can guide you through the home buying process.

How do I know if it's time to buy instead of rent?

If you have decided where you want to stay for minimum of 2 ish years, have a steady and secure income from your job, and are ready for the responsibilities of homeownership, then it is a great time to purchase and invest your money into owning a home!

How much do I need saved up for a down payment?

There are some loan options that require ZERO percent, if you qualify. There are other options that only require 3-3.5%. A mortgage lender can give you a better idea of what types of loans you can qualify for. I will say it a thousand times until people understand... YOU DO NOT NEED TO HAVE 20% DOWN AS A DOWN PAYMENT TO QUALIFY FOR A MORTGAGE.

How do I know if I qualify for a loan and how much I can afford?

You need to contact and speak to a mortgage lender. Speaking to a lender is completely free and the first step to purchasing a home. They look into your finances and see what you can afford, what you can be approved for, and what your mortgage payments will look like.

What does the lender need from me to give me a loan?

Usually lenders want you to provide your past two tax returns, as well as proof of income, sometimes bank statements, and they do a credit report. Throughout the process they will usually look deep into a few things and ask you for documentation.

What's the difference between pre-approved and pre-qualified?

Pre-qualification is an ESTIMATE based on the info you have provided the lender. Pre-approved is when you get that actual letter stating what exactly you can get afford. Once you get that pre-approval letter, you a free to put offers on homes.

What should I do when I see a house online that I like?

You should contact YOUR buyer's agent. You should choose ONE agent to work with to assist you in buying a home. They will invest a lot of time and energy showing you properties and taking you through the process. It is FREE to you to work with a buyer's agent, so respect them and choose one to work with through the transaction. If you see a home you like, tell your agent immediately to get a showing scheduled. Sometimes good homes move really fast off the market and you don't want to lose your dream home because you waiting to tell your agent that you want to see it.

Can you show me a house if it's not your listing?

Yes. As a buyer's agent, I am able to show you any house listed on the MLS, any FSBO, and any new construction you want to see. You want someone other than the listing agent to show you the property so you have someone that is advocating for you as the buyer. The listing agent advocates for the seller's of the home.

How do we write an offer?

Once we have found a home that you like, we sit down and determine the specifics of the offer. More goes into it besides the purchase price. We decide on what closing costs we want to ask for, length of due diligence period, closing date, earnest money, and any other addition terms that you want associated with the offer.

What if I want to back out of the contract?

You have the right to back out of the contract during the due diligence period without any penalty. You will get your earnest money back and can move on! You can also back out of the contract after that, but you may lose your earnest money deposit. It's best to speak with your agent about this because every situation could be different.

What happens if there are other offers on the house that I love?

If the house you love has received multiple offers, it is often best that you offer your "highest and best" and get your agent to find out specific things that are important to a seller to include in your offer. (See previous blog post about how to make your offer stand out to a seller)

What's the next step if my offer gets accepted?

After your offer gets accepted, then you have a binding contract and enter the due diligence period. Once you are in the due diligence period, you want to get an inspection and give your earnest money to your agent. Your agent will also submit a copy of the contract to your lender so they can start processing your mortgage application.

What does "under contract" mean?

Under contract means that both buyers and sellers have agreed on terms and signed the contract!

What is "earnest money"?

Earnest money is a "good faith deposit." It is usually about 1% of the purchase price but doesn't have to be. This just shows that you are serious to the buyers. It is deposited into an account and held there until closing day where you will receive it back to use towards down payment or closing costs or if you decide to back out of the contract during due diligence, you will receive it back.

What are closing costs?

Closing costs are fees from the closing attorney and lender to process your mortgage and get all of the contracts legally binding and recorded. They range from 3-5% of the purchase price. Closing costs are the buyers responsibility, but in most cases, you can negotiate for the seller to help out.

How much is an inspection and do I really need one?

Inspections can range from $300-$600, depending on how detailed the inspection is and how big the home is. I highly recommend getting an inspection done so you know exactly what you are getting into when you are purchasing the home.

As always, if you are in the North GA area or thinking of moving to the North GA area, please don't hesitate to reach out to me! I am always available to answer any questions you may have and I LOVE working with first time homebuyers!