2226 E. Silver Spgs. Blvd.
Ocala, FL  34470
352-547-2723 office
352-812-3137  cell
352-427-7333 cell
352-547-2823  fax
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Cathy Robinson, CRS, GRI
Summer Robinson, GRI
What You Should Know Before Buying a Home
There are so many things to understand as you embark on purchasing a
home, especially if it's your first purchase. Learn the basics as you get
started and understand everything you need to know as it relates to
Here are 10 tips about financing:
1. Before you start looking for a home, get pre-qualified for a loan. Banks,
credit unions and mortgage bankers make home loans; mortgage brokers
process them. The lenders will take an application, process the loan
documents, and see the loan through to the funding stage.

2. If you have marginal or bad credit, consult your lender. You may be able
to qualify for a loan depending on how long ago and what reason(s) caused
the bad credit. A lender should be able to advise you on whether your credit
history will prevent you from qualifying for a home loan.

3. You will need a down payment. Down payment requirements vary
depending on the type of loan. Many down payment assistance programs
exist. These programs may loan or grant you the funds necessary for the
down payment. Consult with a lender about programs available in your area.

4. You will need funds for closing costs Closing costs are charges for
services related to the closing of your real estate transaction. They include,
but are not limited to:
* Escrow fees charged by the company handling the transaction
* Title policy issuance fees charged by the title insurance company
* Mortgage insurance fees
* Fire and homeowners insurance
* County Recorder fees for recording your deed
* Loan origination fees
Consult your lender for an actual estimate of these costs, as well as
information about loan programs which can assist in financing your closing

5. Some loans have "points" and some do not. A point is a loan origination fee
equivalent to 1% of the loan amount. Together with the interest rate they
constitute the yield on your loan for the lender. Some lenders charge a
higher interest rate to compensate for charging no points. It is important to
comparison shop lenders to make sure your loan is at a competitive yield.

6. Should you select a mortgage with a fixed rate or an adjustable rate? The
answer to this question depends on whether mortgage rates are at a high or a
low point when you purchase, and on how long you plan to live in the home.
If rates are high, an adjustable rate might be attractive since subsequent rate
drops could reduce your monthly payments. Additionally, lenders may offer
a low rate during the first few years of an adjustable mortgage to make it
appealing to you. If interest rates are low you might want to take a fixed rate
to protect yourself against the possibility of rising interest rates.

7. Be aware of the two main types of loan categories.
* Conventional Loans. Conventional mortgage loans are available with fixed
or adjustable interest rates. Some loans may require mortgage insurance.
* Government Loans. These include Federal Housing Administration (FHA)
fixed and adjustable rate mortgage loans, and Veterans Administration (VA)
fixed rate mortgage loan.

8. If you are a low or moderate income home buyer, there are special
programs designed to help you. These loans are available through private
lenders, as well as local and state housing agencies, like the SHIPP program.

9. Why might I have to pay mortgage insurance? Mortgage insurance
protects the lender from potential loss if you should default on your
mortgage loan payment. Generally, conventional loans that require larger
down payments do not require mortgage insurance. Mortgage insurance is
always required on FHA mortgage loans.

10. Many organizations offer home loan counseling to prospective home
buyers. These organizations provide classes for homebuyers to cover the
steps to homeownership. They will cover home selection, realtor services,
lenders, loan programs, homeownership responsibilities, saving for a down
payment, and other important pieces of information. Many first-time home
buyer programs require homebuyers to attend this type of class to be
eligible for selected programs.
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