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Frequently Asked Questions

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How do I know if I am ready to buy a home?

Deciding to purchase a home is a major decision for you and your family. You are doing the right thing by beginning with research. At Certainty Home Loans, we want to set our borrowers up for success, which is why our consultants are on hand to help you with your home buying considerations. Our experience in pairing thousands of families like yours with their dream homes has put us in a unique position to help you from the start.

Here are some good indicators that you are financially ready to purchase a home:

  • A steady or reliable source of income such as a job or savings/investments
  • Regular employment or reliable source of income
  • A record of paying loans or bills without default
  • Long-term income to debt ratio makes it manageable to meet fixed and unexpected expenses
  • Money available for down payment and the ability to pay a mortgage and home insurance each month
How do I begin the process of buying a home?

Begin by identifying what is important to you and your family. First, identify a general geographic location that will suit your lifestyle. Location considerations include the logistics surrounding work commutes, school districts, and outdoor space. Next, look at what your home should provide you. How many bedrooms and bathrooms would be ideal? Do you need office or entertaining/guest space? Are you interested in construction a home, a move-in ready home, or a fixer upper?

Next, meet with your Certainty Home Loans representative to lay the foundation for your loan. He or she will help you determine a feasible home budget based on your financial situation and goals. It is important to begin the home-buying process with your budget in mind. If you are a fan of the home-buying shows on networks such as HGTV, you’ve probably noticed that people always begin with the end in mind and shop only those homes that are close to their lifestyle and budgetary goals. Understanding your financial capabilities before you beginning your house hunt is essential and can only benefit you. You will be able to appropriately narrow your search, and you may quickly find out that when you are pre-approved for a home loan, you will likely move to the top of the list when multiple buyers are interested in a home and time is a factor for the seller.

After researching neighborhoods or homes that meet your criteria, make an appointment with your Realtor® to view a few homes. Take your time, ask questions, and take photos (if permissible) in order to “revisit” the top homes on your list.

What does a home inspector do, and how does an inspection factor into the purchase of a home?

An inspector checks the safety of your potential new home. Home inspectors focus especially on the structure, construction, and mechanical systems of the house and will make you aware of only repairs that are needed.

The inspector does not evaluate whether or not you are getting good value for your money. Generally, an inspector checks (and gives prices for repairs on): the electrical system, plumbing, waste disposal, water heater, insulation and ventilation, heating, ventilation, and air conditioning (HVAC) system, water source and quality, potential presence of pests, foundation, doors, windows, ceilings, walls, floors, and roof. Be sure to hire a home inspector that is both qualified and experienced.

It is a good idea to have an inspection before you sign a written offer since, once the deal is closed, you've bought the house “as is.” Or, you may want to include an inspection clause in the offer when negotiating for a home. An inspection clause gives you an “out” on buying the house if serious problems are found, or it gives you the ability to renegotiate the purchase price if repairs are needed. An inspection clause also can specify that the seller must fix the problem(s) before you purchase the house.

How does the lender help determine the right loan amount for my situation?

The lender considers your debt-to-income ratio, which is a comparison of your gross (pre-tax) income to housing and non-housing expenses. Non-housing expenses include such long-term debts as car or student loan payments, alimony, or child support. The lender also considers how much cash you are able to apply to your down payment and closing costs. Credit history, which can be obtained through a credit report {Link credit co. phone numbers that are provided in another answer} is also factored when determining your maximum loan amount.

How can I learn more about the school district for an area I am considering?

School districts are a big consideration for many families—one that many base their home-buying decisions on. You can obtain information about school systems by contacting the city or county school board. Your real estate agent also may be knowledgeable about schools in the area.

How can I find out the amounts homes are selling for in certain communities and neighborhoods?

Your real estate agent should be able to provide you with figures by showing you “comps” or comparable listings. If you are working with a Realtor®, ask him or her to access comparable sales and help you determine what price to offer, using comps as a factor.

Is an older home a better value than a new one?

The answer to this stems in personal preference and varies greatly from one person to the other based on what he or she values in a home. You should look at each home for its individual characteristics.

Generally, older homes may be in more established neighborhoods, offer more character, and have lower property tax rates. People who buy older homes, however, should be prepared to maintain their home and making some repairs.

Newer homes usually have modern architecture and systems, are usually easier to maintain, may be more energy-efficient, and can often be move-in ready. People who buy new homes may appreciate warranties that accompany their home systems or not want to be concerned with potential renovations and repairs in the short term.

What should I look for when walking through a home?

In addition to comparing a home to your minimum requirements and wish lists, use the HUD Home Scorecard [link/reference?] to consider the following:

  • Is there enough room for both your present and your projected future needs?
  • Are there enough bedrooms and bathrooms?
  • Is the house structurally sound?
  • Do the mechanical systems and appliances work?
  • Does the yard meet your needs?
  • Do you like the floor plan or structural “bones” of the space?
  • Will your furniture fit in the space? Is there enough storage space? (Bring a tape measure and general measurements of your largest furnishings to better answer these questions.)
  • Does anything need to be repaired or replaced? Will the seller repair or replace the items?
  • Imagine the house in good and bad weather and in each season. Will you be happy with it year-round?

Take your time and think carefully about each house you see. Ask your real estate agent to point out the pros and cons of each home from a professional standpoint.

What should I do if I am feeling excluded from certain neighborhoods?

The U.S. Department of Housing and Urban Development (HUD) can offer assistance if you think you are being unfairly excluded from a neighborhood or particular house. Contact HUD if you believe you are being discriminated against on the basis of race, color, religion, sex, nationality, familial status, or disability. HUD's Office of Fair Housing has a hotline for reporting incidents of discrimination: 1-800-669-9777 (1-800-927-9275 for the hearing impaired).

How does purchasing a home compare to renting?

You are not alone in weighing this list of pros and cons. This is one of the top questions we hear as lenders. On one hand, renting generally allows maintenance free living and fixed monthly expenses—a plus for many people. On the other hand, home ownership provides an opportunity to build equity, take advantage of tax benefits, and make permanent improvements to your dwelling while gaining equity in your home for doing so. Consider that while there are many benefits of owning a home, homeowners are also responsible for repairs and upkeep.

How do I apply for a home loan?

The first step in securing a loan is to complete an initial loan application. The initial application interview is the key to the loan process going smoothly and closing on time. After you have signed and returned the Intent to Proceed disclosure, your loan officer will obtain all pertinent documentation from you, so as to avoid unnecessary problems and delays. Additional documentation is often required as your lender moves forward in the process. The extent of additional documentation will be determined largely by your past history and credit record.

During the application process, the lender will order a credit report from a credit reporting agency and a professional appraisal of the property you want to purchase.

How do I choose the right lender for myself?

Look for a company with a history of financial stability and a reputation for customer satisfaction. Be sure to choose a company that gives helpful advice and that makes you feel comfortable. A lender that has the authority to approve and process your loan locally is preferable since it will be easier for you to monitor the status of your application and ask questions. Plus, it's beneficial when the lender knows home values and conditions in the local area. Do research and ask family, friends, and your real estate agent for recommendations.

Go to the lender's office and interview the loan officer or manager. As lenders, we can tell you that while we are often busy, it is refreshing when a purchaser or potential client takes an interest in how we handle our business. Your initial impression is usually right.

Be sure you are comfortable with the answers you receive to the questions you ask. If you visit with a loan officer on the phone or in person and are confused, it is best to keep interviewing until you find someone who can communicate with you clearly about the details of your transaction. Be cautious about selecting a lender who has the "lowest rate in town." Most lenders will vary only slightly from day to day in the interest rates they offer. Take all the extra time you need to shop for your lender. You will be up-close and personal with your lender for quite some time.