FAQ
FAQ
Frequently Asked Questions
Am I Ready to Be a Homeowner?
Buying your first home is a major decision and financial commitment. However, there’s a couple of things you can do to start preparing for homeownership.
Have a budget – Know how much you can afford to pay per month and start saving for the down payment.
Improve your credit/FICO score, preferably 700 and up to receive lower interest rates.
Get pre-approved for a mortgage
Don’t be intimidated, Bestrow Real Estate can assist you from beginning to the end of your transaction.
What Is the Lender's Formula?
What is the formula banks use for mortgages?
The 28% / 38% Rule: Many lenders estimate that you’ll spend less than 28% of your pretax income on housing and 36% on total debt payments. If you spend 25% of your income on housing and 40% on total debt payments, they’ll assess the higher number and qualify you for a smaller amount as a result.
To learn more about how lenders evaluate a borrower’s financial situation contact Bestrow Real Estate and one of our specialists can assist you.
IS RENTING OR BUYING BETTER?
Renting or buying a home is relative to an individual personal situation and needs. Before you rent an apartment or buy a home you should consider the fundamentals: what are your short and long term goals?, do you have or plan on having a large family?, will renting be more than a mortgage or less?, are you looking for tax benefits?,do you need the freedom to renovate to your liking?
Do I Need a Home Warranty?
Will you need a home warranty? Imagine moving into your home and your heating unit breaks down in the middle of the winter.
A home warranty is a service contract that covers the cost of repairs or replacement of covered items, such as major kitchen appliances, as well as electrical, plumbing, heating and air conditioning systems.
What Should I Expect at Closing?
The day of the closing, the ownership of the property is transferred to you through a deed, which transfers the property from seller to buyer. This day consists of transferring funds from escrow, providing mortgage and title fees, you’ll also have to pay closing costs. These are some of the transactions you can expect.
At Bestrow Real Estate, we ask our clients if they are prepared for all the steps into finalizing this huge deal.
What Is Pre-approval?
Pre-Approval is as close as you can get to confirming your creditworthiness without having a purchase contract in place. You will complete a mortgage application and the lender will verify the information you provide. They’ll also perform a credit check. If you’re pre-approved, you’ll receive a preapproval letter, which is an offer (but not a commitment) to lend you a specific amount, good for 90 days.
Getting preapproved is a smart step to take when you are ready to put in an offer on a home. It shows sellers that you’re a serious homebuyer and that you can secure a mortgage – which makes it more likely that you’ll complete your purchase of the home.
Am I Ready to Rent?
Looking for and renting an apartment can be a very exciting yet daunting undertaking! There are many different areas and options to consider before making a final decision. For one, how is your credit/FICO score? A lot of landlords want to evaluate your credit worthiness. Also, it is important to ask yourself, am I ready for how much this is going to cost me, which is rent, security and sometimes a broker fee. It is very common for landlords to ask for a deposit of 1 to 3 month’s rent before your lease begins. In order for you to secure your ideal unit, you must have at least one month’s rent available to give to the landlord. This deposit will take the unit off the market for you! After the initial fees, paying for utilities is a more likely cost you’ll have to fit into your budget. Different buildings have different rules but that is all to be discussed with your landlord.
Whether you are looking to buy or rent, Bestrow Real Estate is here to help you every step of the way!
Can I Ask You for Advice?
Bestrow Real Estate has been in business for over 30 years. Whether you are renting or buying a home we have a team of associates that can answer your questions and assist you with making the best choice.