Buying a home in today's market takes confidence and experience. You can count on my experience and expertise as a REALTOR in Newton, IA to help you find and buy an affordable home with confidence. Here are some real estate tips & terms to help as you navigate homes for sale near you.
Home Loan Pre-Qualification Letter
The 1st Step is to get pre-qualified for a home loan from a local lender. It'll only take a few minutes and when done, ask for a copy of the pre-approval letter so you can give to your REALTOR. (Which is hopefully me if your reading this!) This will give us an idea of how much house you can afford to buy. I recommend shopping around, go to two or three different home loan places and compare the rates and monthly payments they give you, plus terms and conditions.
Looking for a home or acreage in the beautiful Jasper County, IA area?
I'd be happy to help guide you along the way if you'd love to buy an affordable home or acreage in the Newton and Jasper County, IA area. Just fill out the short questionnaire for free help, it'll only take a minute, I appreciate your time! Home Buyers Survey or Acreage Buyers Survey
My Recommendation: Choose a Local Lender
Some home-buyers like to shop for home loans totally online without ever actually meeting their banker in person. I prefer using local lenders like a Savings & Loan, Credit Union, Mortgage Company or Bank that has an actual person you can sit down with and discuss all the best financing options for you, your life and what your goals and dreams are. Let them help you and be a part of your team, that's what they're there for, including myself as a REALTOR. I also recommend shopping around, go to 2 or 3 different places and compare the loan rates they give you. They want your business so let them compete to get it!
I had a client the other day that was going to get his home loan on one of those Online Mortgage sites. He showed me the pre-qualification letter they'd sent him and things looked good so we got started on our search for his family's dream home in Baxter, IA. During our tour of homes he told me what they were going to charge him for interest on that loan and I couldn't believe it, it seemed horribly high! I recommended he talk with a local loan officer at a Credit Union just down the street from my RE/MAX Concepts office on Newton's town square. They were able to get him a loan rate a full 1% below what the online mortgage company was going to do. Over the course of a 30 year loan, that's a LOT of money saved!
What's the maximum can you afford to pay for a home loan? Do you really want to pay that much?
You and your loan officer need to start off with a basic number: What is the monthly payment range you can afford? Remember that life can throw unexpected challenges to our finances over the years so its best to play it conservative on monthly payments and keep them lower than what you can actually afford. This way you can build up an emergency or entertainment fund to use if you need it.
From there, we can calculate an affordable home loan that your comfortable with and look only at homes within your price range. You may not find every last feature of your dream home, but that doesn't mean you should give-up your dream to buy.
One solution, as your REALTOR in Newton Iowa, is for me to show you homes and acreages for sale in Jasper County, IA that are likely to show appreciation in value, so when you want to exchange your home in a few years for something closer to your dream home, it will pay off and be easier to make money on your investment.
BTW: You need a team of advisors on your side as you go through life, a list of professional people you could contact if you need them for big life moments. You should have a Lawyer, Loan Officer, REALTOR & Doctor on your list to contact. These are people who are on your side and want you to succeed, make sure you have your team together!
A Few Real Estate Tips & Terms
Here are a few real estate terms you may hear on the search for your dream home that you should have an understanding of:
- Earnest Money. Once the offer has been accepted, this is the amount of money you'll provide the listing real estate company to hold in a trust account and it shows that you are "earnest" and sincere about buying the home. You've now got some skin-in-the-game and less likely to walk away from a deal. The amount of Earnest Money varies by location, when buying real estate here in Central Iowa $500 - $1000 is a fairly common amount to offer that is credited to your account at closing.
- Adjustable Rate Mortgage. The initial interest rate on an ARM is lower than a conventional loan, thereby requiring lower monthly payments. The rate rises or falls at intervals, but within limits. Expect to shop among several lenders for the best terms.
- Fixed Rates. If you're more comfortable with the security of a higher-priced fixed-rate loan, opting for a longer term (30 years rather than 15) may put monthly payments within reach. Although you would pay more in interest over the life of the loan, most homeowners plan to move before 30 years are up.
- VA Loan. If you are an eligible veteran, the Department of Veterans Affairs requires no down payment (up to a specific sales price) for a VA mortgage. A great home loan program to definitely check out if you're a Veteran, thank you for your service to our Country!
- FHA Insured Loan. Insured by the Federal Housing Administration, your loan (obtained through an established lender) requires lower down payment and interest rate than most other mortgages. Down payment could be as low as 3% of the appraised value on the property. You are more limited in the types of houses you may buy with a FHA loan, generally the home has to be in good shape with little to no repairs needed.
- 1st Time Home-buyer Loan. This is another FHA insured type of home loan which offers 0% down and lower interest rates for First-time Homebuyers. As a REALTOR in Newton, IA specializing in real estate in the Jasper County area, I can refer you to the best Home Loan Agents in our area that offer 1st-Time Homebuyer Programs and would love to help you in your home buying process.
One of the things a loan officer will check is your credit score, First-Time Homebuyers should aim for a credit score of at least 600. If you need to raise your credit score, they'll be able to give you specific suggestions on things you can do to raise it higher so you'll see positive results quickly. Remember, a loan officer is on your side and wants you to succeed with the purchase of a home.
- Private Mortgage Insurance. You insure your mortgage privately, to allow you to take out a mortgage with less than a 20% down payment. Your PMI covers your lender's risk (should you fail to make mortgage payments.)
- Mortgage Assumption. When you assume an existing loan, your "down payment" is the difference between the sales price and the loan balance. By finding an assumption with a high unpaid balance, you may reduce your down payment. If the loan has a lower-than-market interest rate, you'll also reduce your monthly payments.
- Co-Signed Loan. A loan co-signer can help you qualify for a larger loan on a longer term, making monthly payments smaller. The co-signer should be cautious, however, because they'll be responsible for paying the debt if the borrower defaults on the loan.
- Graduated Payment Mortgage. The initial interest rate of a GPM is lower than a conventional loan and it has scheduled increases in following years - as your income presumably is on the rise. This type of financing may work well if you expect your income to rise in the following years.
- Shared Equity. You buy your home with a parent, relative, friend or other qualified investor who makes the down payment. You share the purchase costs, the maintenance, the monthly payments - and equity profits on sale.
I hope learning about these real estate tips & terms will help guide you as you search for homes near you. Always have a REALTOR on your side helping guide you along the way and one who is motivated to help you get the best deal possible.
If you're looking at houses for sale and need a real estate agent in the Newton, IA area please contact me today so I can help you find your dream place. Buying a home or acreage is a major life choice. Whatever your real estate needs I can help you reach your goals with confidence. My expertise of the Newton and Jasper County, Iowa area will give you the best possible experience from start to finish.
Thank you for taking time to read my Blog today!
Scott Neasham, REALTOR
120 N 2nd Ave W
Newton, IA 50208
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A little about my blog:
To me, my REALTOR blog is a gathering of my thoughts & notes, I’m always scribbling things down and bookmarking websites. This is me trying to pull those random ideas together from lots of sources and hopefully arranging them in a somewhat coherent way.
My blog is intended primarily for Homebuyers & Homesellers in the Newton & Jasper County, Iowa area. I’m hoping it’s an effective way to reach and help educate them on real estate matters in our local community that I feel may be important to know.
This blog is also a great way to help me to pull ideas together which, I hope, will make be a better Real Estate agent for my Newton, IA clients.
If you'd like to know more about myself & real estate business, feel free to Browse My Website!
Scott Neasham, REALTOR
120 N 2nd Ave W
Newton, IA 50208