Frequently asked questions.
Why Should I Work With A Agent Instead Of Selling Or Buying On My Own ?
Attempting a real estate transaction without professional representation, often called FSBO, increases financial risk and exposure to errors.
A professional agent ensures optimal pricing by leveraging real-time market data and comparable sales, maximizing profit for sellers and preventing buyers from overpaying.
The agent critically manages all complex legal documents and deadlines, providing essential legal protection and mitigating costly liability. Furthermore, an agent offers unparalleled market exposure through the MLS and expert negotiation skills, resulting in a faster, safer, and more profitable closing.
What’s The Difference Between Pre-Qualification & Pre-Approval ?
Pre-Qualified is a quick, informal estimate based only on self-reported income and debt, and carries little weight. It is an initial budgeting guide.
Pre-Approved is a formal, conditional commitment where the lender has verified all your financial documents and run a credit check. This letter is crucial for submitting a competitive, serious offer, as it proves you are a qualified buyer ready to close.
In short: Prequalification is an educated guess; Pre-Approval is a financial fact backed by documentation. As a serious buyer, you need the Pre-Approval to compete effectively.
How Much Money Is Needed For Down Payment ?
The Minimum Down Payment: The minimum you need can be as low as 0% or 3% of the home's purchase price, depending on the loan program you qualify for.
While the minimums are low, you'll often hear about a 20% down payment, and for a good reason. If you put 20% down on a Conventional Loan, you avoid paying Private Mortgage Insurance (PMI).
What is PMI? It's an extra monthly fee that protects the lender if you default on the loan. It's automatically required on a Conventional Loan if you put down less than 20%.
The Benefit of 20%: Avoiding PMI saves you money on your monthly payment and over the life of the loan. It also means you start with more equity in your home.
The Reality: The median down payment for first-time buyers is closer to 6% to 9%. Don't let the 20% figure stop you from buying a house! You can always refinance or request to cancel PMI once your equity reaches 20%.
How To Determine The Listing Price Of My Home ?
The Comparative Market Analysis (CMA) is the foundation of our pricing strategy. It’s a detailed, data-driven report that determines your home's value based on what buyers are actually paying for similar properties nearby.
Solds: (The most important): Analyze homes that have closed in your immediate neighborhood within the last 3 to 6 months. These sold prices represent true market value, as the money has already changed hands.
Actives: (Your competition): These are the homes currently on the market. Their asking price tells us what you’re competing against right now.
Pending: (A look into the future): These homes have an accepted offer but haven't closed yet. They are a snapshot of the most recent market activity and trends.
How Long Does The Buying/Selling Process Take Usually Take ?
The short answer is: Plan for a timeline of 3 to 6 months from initial preparation to closing.
While the duration can vary significantly based on your local market, here is a general breakdown:
Preparing to List & Finding a Home: This stage typically takes 4 to 10 weeks. This includes getting your current home market-ready, securing your mortgage pre-approval, and finding a new property.
From Accepted Offer to Closing: Once all parties agree to a contract, the final legal and financing steps usually take 30 to 60 days.
The biggest variable is coordinating your sale and purchase. Your agent, should use strategic contract timing and negotiations to create the smoothest possible transition.
What Are Closing Cost, and How Much ?
Closing costs are the collective fees charged by lenders and third parties to finalize your real estate transaction. They are separate from your down payment and cover all the services required to officially transfer the property and secure your loan.
These cost vary by location and loan type, but generally from 2% to 5% of total loan amount
Buyer Expenses: Recording, Escrow, Attorney, Mortgage, Points, Document Prep, Origination, Appraisal, Home Inspection, Title Insurance
Seller Expenses: Abstract of Title, Real Estate Commission, Escrow, Attorney, Recording Deed, Release of Deed of Trust
What Credit Score Do I Need To Buy A Home ?
Your credit score is one of the most critical factors, as it tells the lender how reliable you are with debt and directly affects your interest rate.
The short answer is you might need as low as 500, but a score of 620 or higher opens up better and cheaper options.
While the minimums are helpful, here’s what I emphasize with all my clients:
A Higher Score Saves You Money: The single best thing you can do for your long-term finances is get your credit score as high as possible.
A score in the 740+ range generally qualifies you for the absolute best interest rates available, saving you thousands of dollars over the life of the loan.
Even moving from a 680 to a 720 can make a noticeable difference in your monthly payment.
Lender Requirements Vary: Even if a loan program says you can get approved with a 580, the individual bank or lender you work with may have a policy to only lend to those with a 620 or 640 minimum. This is why shopping for a lender is crucial!
Your Score is More Than a Number: Lenders look at your entire financial picture. If your score is on the lower side, other factors—like a stable job history, a lower debt-to-income (DTI) ratio, or a larger down payment—can act as compensating factors to help get your loan approved.
What Cost Are Involved In Selling My Home ?
The total cost to sell a home can range quite a bit, but as a rule of thumb, you should budget for approximately 7% to 10% of the final sale price to cover all expenses.
Real Estate Agent Commissions
Seller Closing Cost
Pre-Sale Preparation & Repair Cost
Potential Negotiated Cost (Seller Concessions)