Questions To Expect To Be Asked When Buying A Home
Questions To Expect To Be Asked When Buying A Home
QuestionsTo Expect To Be Asked When Buying A Home
WhatAre Some Of The Common Questions You Should Expect To Be AskedWhen Buying A Home?
Ifyou’re going to be buying a home in the near future there arecertain questions to expect to be asked. It doesn’t matter ifit will be the first home you’re purchasing or the twentieth home.
It’simportant that you understand that the questions you’ll be askedare not asked for the purpose of snooping. The questions toexpect are asked to help better serve you and make sure the homebuying process is an enjoyable and successful one.
Beloware the most common questions to expect to be asked by both a lenderand a real estate agent when buying a home. The mortgageconsultant and a real estate agent are two of the mostimportant professionals you will need during the home buying process. Having an understanding why these professionals ask thequestions that they do can truly make the home buying process mucheasier.
QuestionsTo Expect To Be Asked By A Lender When Buying A Home
Oneof the most important pieces to the home buying puzzle relates to thefinancing. It’s important when buying a home you understandwhat the topmortgage FAQs arebut also what questions to expect to be asked by a lender. Beloware some of the most common questions to expect to be asked by alender when buying a home.
WhereDo You Work & For How Long?
Oneof the first questions to expect to be asked by a mortgageconsultant relates to where you work and for how long you’ve workedat your current employer. One of the primary reasons thisquestion is asked is to help the mortgage consultant understand youremployment history.
Dependingon the type of financing a buyer is attempting to obtain, the lengthand type of employment factors into whether a buyer will be acceptedfor the mortgage or not. One of the most common reasonsa mortgage is denied after approval isdue to changes in employment.
Ifa buyer has frequent job changes over the past couple years, it willbe more challenging to obtain financing for a home purchase. Itcan also be challenging if a buyer changes their field of work.
Forexample, recently while attempting to help a buyerpurchase ahome in Rochester, NY,the buyer changed their career field from a salaried employee for acompany to self-employed in the past year. This ultimately ledto them not being able to purchase a home at the current momentdue to their short work history in their new field of work.
HowMuch Money Do You Make?
Anotherquestion to expect to be asked when buying a home will relate to yourincome. A mortgage consultant does not ask how much money youmake because they are curious. Knowing how much a buyer makesis critical in order to successfully get them approved for amortgage.
Theamount of money a buyer makes plays a huge role in how much of a homea buyer can purchase. The more money a buyer makes generallymeans the more expensive of a home they can purchase.
HowIs Your Income Paid (Hourly, Salary, Commission)?
Notonly is the amount of money a buyer makes important when buying ahome but how the income is paid is very important as well. Aquestion to expect to be asked when buying a home is how your incomeis paid. Are you an hourly employee? Do you have a yearlysalary? Are you straight commission?
Lotsof buyers don’t understand why they are asked how their income ispaid. The primary reason it’s important for the lender tounderstand how income is paid is so they know whether their incomewill be a stable and guaranteed amount after the loan isfunded.
Ifa buyer is self-employed the lender is going to require moredocumentation, primarily their tax returns for the previous 2-3years, prior to issuing a pre-approval. The reason a lender will ask for additional documentationfrom a self-employed applicant is to ensure they’ve earned a stableincome over the past several years. Generally a lender willaverage the past 2 years of net income, which is their incomeafter any deductions, from a buyers tax returns to use for qualifyingpurposes.
Lenderswill request similar documentation from buyers who have commissionbased incomes.
WhatDebts Do You Have?
Thedebt that a buyer has can sometimes make or break whether they canget approved for a mortgage or not. Another question to expectto be asked by a mortgage consultant when buying a home is about yourcurrent debts.
Abuyer who has a solid employment history and good income but has lotsof debts can have trouble obtaining a mortgage. A term that youwill hear being used in the mortgage industry is debtto income ratio. Depending on the type of financing a buyer is obtaining, thereare different maximum ratio levels.
Debtto income ratios play a big part in whether a buyer can get amortgage or not. Debt to income ratios have become a commonreason why millennialbuyers arenot able to get a mortgage due to their student loan debts.
Again,don’t be offended when a mortgage consultant asks you about thedebts that you have, they are just doing their job and making sureyour home buying experience is successful.
HowMuch Money Do You Have Saved In The Bank?
Somebuyers are uncomfortable talking about the money they have saved intheir bank accounts. It’s important to realize that theamount of money you have saved is a question to expect tobe asked.
Whilethere are waysto buy a home with very little money,it is still important for a mortgage consultant to know exactly howmuch money a buyer has to work with. Some mortgage productsrequire a buyer to contribute a certain amount of money towards thepurchase of a home.
Forexample, an FHA mortgage requires a down payment minimum of 3.5%. While there are ways to successfully negotiate a sellerconcession,it cannot be relied on that it is a guarantee a seller will bewilling to help with a buyers closing expenses.
Part two will be here in a few days so stay connected to see what else is to come.
Blogsubmitted by: Cyndi Cobb of The Real Estate Market Place –Servicing the Greater Fort Hood and surrounding areas which includes:Killeen, Harker Heights, Temple, Belton, Copperas Cove, Lampasas,Kempner, and Nolanville. Feel free to call if you have any questionsregarding Central Texas Real Estate.
Author:Cyndi Cobb Phone: 512-564-0381 Dated: January 7th 2016 Views: 563 About Cyndi: ...
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