February 26, 2009

First time home buyer concerns & questions

I’ve recently had the pleasure of working with a young couple. They are first time home buyers and a bit fearful about “how does it all work?”

They had concerns with “how much earnest $
Who pays the broker?
How much of a down payment will they need?
Can down payment $ be a gift?

These two hardworking people had some very legitimate questions. As our first phone call progressed I discovered their budget was small, they are credit score challenged, (FHA loan vs. Conventional), they wanted to view homes in several areas, they did not have a home to sell and they didn’t have a lender in place. Because of my ABR (accredited buyer representative) training I was able to counsel & guide them onto the most prosperous path.

We were able to fine tune a lot of our initial obstacles by providing answers & solutions to all of their concerns.

Earnest $ typically should be 3% of the purchase price, in some cases I’ve even seen as low as $500.00
Normally the seller provides compensation
Down payment can be as low as 3.5% - 20%
Gift down payment – Yes, but there are guidelines

The group of homes that were our candidates were short sale homes, foreclosed homes and homes that were majorly distressed. We picked out the best ones and went shopping.