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Securing funding & making an offer - A proposal to buy a property includes both the price and terms. In some cases, terms can represent thousands of dollars in additional value for buyers -- or additional costs, not included in the accepted sale price.
Loan types - There are thousands of loans available out there from a variety of lenders, but in general, the mortgage you choose will likely be determined by these key factors:
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How much down? Loans with 5 percent down or less are now widely available -- in fact, loans from major lenders with no money down have appeared in recent years. If you place less than 20 percent down, lenders will want the mortgage guaranteed by an outside third party such as the Veterans Administration (VA), the Federal Housing Administration (FHA) or a private mortgage insurer (PMI, or private mortgage insurance, is required by lender to protect against any mortgage defaults). More than 2.5 million VA, FHA and PMI loans are generated each year.
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How's your credit? The best rates and terms are only available to those with solid credit. To get the best loans, make a point of paying credit cards, installment payments, rent and mortgage bills in full and on time.
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Are you a first-time buyer? It might seem that "first-time buyer" means someone who has never owned property before, but under most state programs, the term refers to those who have not owned property within the past three years. State-backed first-timer programs often feature smaller down payments and below-market interest rates. For details, speak with your local Realtor
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Finding a loan - Mortgage financing is accessible through mortgage bankers, mortgage brokers, savings and loan associations, mutual savings banks, commercial banks, credit unions, and insurance companies. Our in-house lender, Concentric Capital offers an extensive range of lending programs and resources, click here to get pre-approved now.
To obtain a loan you must complete a written loan application and provide supporting documentation. Specific documents include recent pay stubs, rental checks and tax returns for the past two or three years if you are self-employed. During the prequalification procedure, the loan officer will describe the type of paperwork required.
Making an Offer - You sometimes hear that the amount of your offer should be X percent below the seller's asking price or Y percent less than you're really willing to pay. In practice, the offer depends on the basic laws of supply and demand: If many buyers are competing for homes, then sellers will likely get full-price offers and sometimes even more. If demand is weak, then offers below the asking price may be in order.
The process of making offers varies around the country. In a typical situation, you will complete an offer that the Realtor will present to the owner and the owner's representative. The owner, in turn, may accept the offer, reject it or make a counter-offer. Because counter-offers are common (any change in an offer can be considered a "counter-offer"), it's important for buyers to remain in close contact with their Realtor during the negotiation process so that any proposed changes can be quickly reviewed.
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