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Lately, we've received many questions from first-time home buyers about how the mortgage process works. To demystify the process a bit, we brought in Jenny Green of Lincoln Savings Bank to answer some viewer questions.
How much money should you prepare to put down?
There are several products available for first-time home buyers. We have conventional loans (requires a 5% down payment), FHA loans (3.5% down), and USDA loans (0%), which are great for people who are looking to move into a rural area. Typically, we want our buyers to bring at least 3.5% of the down payment to the table.
Should buyers have an idea of
their credit standing before beginning the process?
First-time buyers should contact a mortgage banker and get a pre-qualification before they start looking. This will let you know what you can afford and what kind of payments you can comfortably make.
What are closing costs?
Typically, closing costs include appraisals, title costs, settlement agent's closing fees, and the credit report. Sometimes, we ask the sellers to pay some of the closing costs, and it usually works well. Sellers are typically good about giving $2,000-$3,000 toward the closing costs, which typically covers them all.
Are there any incentives for first-time home buyers?
The Iowa Finance Authority has a number of incentives for first-time home buyers, as well as for second- and third-time home buyers. They have a $2,500 grant that can go toward your down payment, your closing costs, or any of the other fees associated with the transaction.
If you would like to speak with Jenny about this topic in more detail, you can reach her by phone at (515) 222-0123 Ext. 2506 or by email at JenniferG@mylsb.com. As always, if you need real estate assistance of any kind, don't hesitate to reach out to us! We would love to hear from you!
Buying a Central Iowa home? Search all homes for sale
P.S. Thank you to all our contributors for their real estate questions from our past email. You will all be receiving a $25 gift card!
Lately, we've received many questions from first-time home buyers about how the mortgage process works. To demystify the process a bit, we brought in Jenny Green of Lincoln Savings Bank to answer some viewer questions.
How much money should you prepare to put down?
There are several products available for first-time home buyers. We have conventional loans (requires a 5% down payment), FHA loans (3.5% down), and USDA loans (0%), which are great for people who are looking to move into a rural area. Typically, we want our buyers to bring at least 3.5% of the down payment to the table.
Should buyers have an idea of
their credit standing before beginning the process?First-time buyers should contact a mortgage banker and get a pre-qualification before they start looking. This will let you know what you can afford and what kind of payments you can comfortably make.
What are closing costs?
Typically, closing costs include appraisals, title costs, settlement agent's closing fees, and the credit report. Sometimes, we ask the sellers to pay some of the closing costs, and it usually works well. Sellers are typically good about giving $2,000-$3,000 toward the closing costs, which typically covers them all.
Are there any incentives for first-time home buyers?
The Iowa Finance Authority has a number of incentives for first-time home buyers, as well as for second- and third-time home buyers. They have a $2,500 grant that can go toward your down payment, your closing costs, or any of the other fees associated with the transaction.
If you would like to speak with Jenny about this topic in more detail, you can reach her by phone at (515) 222-0123 Ext. 2506 or by email at JenniferG@mylsb.com. As always, if you need real estate assistance of any kind, don't hesitate to reach out to us! We would love to hear from you!
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