Tuesday, July 19, 2011

First Time Home Buyers Louisville, KY

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Buying Your First Home in Louisville KY

Kentucky Housing Corporation down payment assistance to $4000
Buying your first home is an exciting time. Looking through all the properties on line, picking those you want to see and touring all the homes to find just the right place can be a great experience. But, if you have never bought a home before, there are a few things you will need to do to be prepared for the adventure of buying your first home.

What is the first Step?

Most important, before you do anything else, get pre approved for your mortgage. You want to make sure before you get excited about a specific house, just how much it is going to cost you to buy a home. You want to make sure your expectations and pocket book are on the same page. Avoid falling in love with a house and find out too late it is out of the price range. Not only will you need to know how much you will qualify for to find out your monthly payment, you will need to have a solid idea of how much it will cost up front to purchase your house. How much of a down payment will be required and how much closings costs (costs associated with getting the loan) and prepaid expenses (setting up escrows for taxes and insurance) are going to be will help you tighten up your search before you get started. 
There are several reputable banks and mortgage companies in town. It is encouraged to get quotes from several to make sure you are getting the best deal.

Don’t forget First Time Home Buyers Seminar

I will be holding First Time Home Buyers’ Seminars over the next several months. Let me know if you are intersted and we will get you signed up.
Call us today for a free preappoval 502-905-3708

How Much Money Will I Need?

This is a question I get a lot from first time home buyers in the Louisville, KY area. This might seem like a silly answer, but you will need all of it and then some. You need to come up with the entire purchase price plus, good faith money, closing costs, prepaid expenses and cost of inspections. 
Here is the Breakdown. Of course you will not have to save up every penny of the purchase price, but not a bad idea. The majority of the the purchase price typically comes from you mortgage. But here are some initial amounts you will need.
1. Good Faith Desposit- $500-$2500. This is given to the seller’s real estate broker at the time of your offer. If the offer is accepted, the Broker will deposit the check in their escrow account and hold it hostage until closing where you will be credited that amount toward down payments and closing costs. This puts a little skin in the game for the buyer, so they just don’twalk away from the deal for reasons not stipulated in the contract.
2. Down Payment- You may be looking at anywhere from 3.5%-20% of the purchase price for the down payment. The days of the 100% loans are but a distant memory, so start rolling those coins. FHA loans only requre 3.5% down and are the lowest down payment option for most folks.
3. Closing Costs and Pre Paid Expenses-here you are looking at about 3%-4% of the purchase price for closing costs (costs associated with getting the loan) and Pre-paid expenses (such as insurance, escrows for taxes and insurance if required).
4. Don’t forget about inspections-they are not always a required part of the purchase process, but I highly, highly without question, even on new construction encourage all buyers to have at least a Home Inspection and Wood Destroying Insect Inspection when they are buying a house. In Louisville, KY and the surrounding areas you should be able to get a home inspection done for $250-500, depending on the size of the house and $40-$50 for the “termite” inspection. These are usually paid to the service providers at the time of the inspections. Not at closing, so you will need to be prepared to scratch these checks, plus your Good Faith Deposit pretty soon after getting under contract, so at the very least, near that $1000 mark to get started.
The best way to get an accurate estimate of how much money you will need to get in to a house is to get pre-qualified with a mortgage professional and get a god faith estimate that breaks down the expenses and what your down payment will look like.

Let’s Start Looking at Houses

Now for the fun part. Once you have your pre approval in hand, know what your budget is and your target price range you can get down tobusiness. Now you can determine what you want in your first home.
Are you looking for a single family home or condo? How many bedrooms and baths? Do you want a basement? Is a garage or covered parking important? What part of town best meets your needs? And the list can go on and on. Now, unless budget and price does not matter to you might want to prioritize what you need in a house. You may be able to find everything, but you may also have to compromise a bit on a few things to hit your budget.

Fill out my free mortgage pre-qualification  form by clicking here<<<<<<<<<<<<