HOMEBUYERS – Take These Steps Before Making An Offer in Milpitas CA!

HOMEBUYERS – Take These Steps Before Making An Offer In Milpitas CA

§ HOMEBUYERS – Take These Steps Before Making An Offer in Milpitas CA! Before going out to look for homes with a Realtor, seek out a loan officer, preferably one from a major bank or retail mortgage lender, and get yourself a pre-approval. You will eliminate much frustration in your search when you know how much property you can afford. Plus, sellers, especially asset managers of bank owned properties, will take your offer more seriously.

§ Because purchasing a home requires disciplined responsibility and a huge amount of debt you may not be accustomed to (unless you pay cash for your home), inform your loan officer of your budget and long term financial goals. Making sure your home purchase is affordable will make your life as a homeowner unperturbed.

§ Talk to your tax preparer and find out how much tax savings a home purchase can generate for you and the positive effect it can have on your income’s bottom line.

§ Most mortgages have a repayment term of 30 years. Many things can happen in 30 years. So if you can, this early, hire a financial planner to help you create a solid financial foundation to not only help you keep your home but to get out of mortgage debt earlier, have the financial resources to meet future expenses such as college, grow your savings for a comfortable retirement and afford insurance to protect your financial resources.

§ Documentation you will need for a pre-approval:

ü Most recent whole month paystubs

ü Most recent 2 years W-2’s and Tax Returns

ü Most recent 2 months Bank Statements

ü Latest Statements for Assets, Stocks, 401K, Pension Funds, etc.

ü Credit Report

§ Mortgage Payments Consist Of:

ü PITI:

v Principal Payment – money payments used to pay down the balance of a loan

v Interest – charge by the lender for the privilege of borrowing their money

v Taxes – property taxes paid to the county where your property is situated

v Insurance – refers to property and/or mortgage insurance. Property (or hazard) insurance protects your home from risks such as fire, theft, and some weather damage. Mortgage insurance guarantees full payment of the mortgage in the event of death or disability of the principal borrowers. Mortgage insurance can increase the amount of monthly mortgage payments. To avoid this, borrowers need to borrow 80% or less of the purchase price for a home.

ü HOA Dues – when your property is in a neighborhood that has a Homeowners Association, you will have HOA fees to pay. These fees may cover common utilities, lawn maintenance, neighborhood upkeep, homeowners insurance. Some special assessments can also be levied on homeowners.

§ Automated Loan Approval – in the past few years, the mortgage industry utilized computers to underwrite mortgage loans online. The benefits of the Automated Loan Approval are significant:

ü Quicker loan approvals

ü Reduced closing costs

ü Less documentation

ü Better chances of getting a loan approval because of the computer’s ability for accurate, faster, better underwriting.

To be sure there are no surprises at close of escrow, ask your Loan Officer to review the terms and conditions of the Automated Loan Approval with you.

§ Based on your credit qualifications, ask your loan officer to explain the different loan programs available to you so you can make an informed decision. Milpitas CA HOMEBUYERS – Take These Steps Before Making An Offer in Milpitas CA!