Homebuying 101
Purchasing a home is one of life’s largest milestones, whether it’s your very first home or an upgrade to a larger space, it’s a big deal! That’s where a knowledgeable and experienced Realtor (and lender) come into play.
The first step in the homebuying process is to connect with a Realtor that you’re excited to work with. From there, a good real estate agent should be able to give you recommendations for local & reputable lenders – so don’t worry if you are not preapproved yet. We will also hop on an initial Zoom call to have a casual discussion about the entire homebuying process and to see where you’re at.
As your real estate agent, I will advocate for you throughout the entire homebuying process, connect you with other incredible professionals (from lenders to home inspectors!), and educate and guide you from start to finish.
From day one I want clients to feel comfortable, empowered, and supported on their homebuying journey. Learn more about my process and how I approach real estate on the About Page above!
HOME BUYING
Frequently asked questions.
WHEN IS THE BEST TIME TO BUY A HOUSE?
If homeownership is a path you want to pursue, my advice to people is typically to buy a home as soon as you feel financially comfortable doing so.
Building equity and generational wealth are, in my opinion, some of the most important factors of homeownership.
For the average residential homebuyer like you and me, “timing the market just right” is a unicorn and rarely happens.
The market ebbs and flows with the changing of the seasons here in the Midwest, and there are pros and cons to each season.
For example, the Spring market provides more inventory to choose from but the market is substantially more competitive. In Winter, there are fewer houses on the market, but there is also less competition (fewer folks want to move in the winter).
WHAT ARE CLOSING COSTS?
Closing costs are fees and expenses that come from originating a mortgage. You will pay closing costs the day you close on your house – they are an additional expense beyond the down payment. They include things like title insurance, homeowners insurance, appraisals, taxes, and more.
Closing costs are typically around 2%-3% of the purchase price. Your lender will be able to give you a more accurate estimate of your actual closing costs when you meet with them.
DO I NEED A 20% DOWNPAYMENT?
No, you typically do not need a 20% downpayment to buy a home!
With conventional loans, you can have as little as 3% down. FHA loans are similar and have better terms for folks with lower credit scores or high debt-to-income ratios. Keep in mind with less money down other things will arise with your monthly payment though, like Private Mortgage Insurance (PMI).
This is all stuff you will talk to a lender about! A good lender will go through your finances with you and talk over all of your options.
HOW DO I FIND A GOOD LENDER?
Great question!
A good Realtor should have a circle of local, reputable lenders that they trust and have worked with extensively.
You can find some of my go-to trusted professionals on my resources page.
While you ultimately get to work with whomever you’d like, finding a lender that will help guide you through the process, be available after hours, and communicates thoroughly will make your homebuying experience much better and less stressful!
DO I PAY MY REALTOR'S COMMISSION?
If you are a homebuyer, typically, no.
Most of the time the Seller pays for both the listing agent’s commission and the buyer’s agent’s commission.
You will have to make note of broker administrative commissions. Most real estate brokerages have them and they typically range from $300-700 dollars and go directly to your agent’s brokerage, not into their own pocket. VIBE Realty’s is $495.
WHAT ARE SOME EXPECTED ADDITIONAL COSTS?
There are a few additional costs to consider besides your downpayment when buying a home.
The first thing to note is your closing costs. While we might be able to negotiate who will pay these, they will still have to be paid at the time of closing. They are typically around 2-3% of the purchase price.
Secondly, home inspections are always strongly encouraged! They start around $450 for a baseline inspection, and you can add some a la carte options like sewer scopes, radon tests, and more. Your Realtor will have a few great recommendations for all of these professionals.
Also, keep in mind any additional moving expenses, and some type of home emergency fund to be able to fix anything that might need repair while living in the home.