General Questions
I want to buy a house. Where do I start?
If you want to buy a house the first place to start is with yourself. You should figure out what your current budget is by figuring out what you are willing and comfortable with paying. A good place to begin is with your current rental amount. Take that number and see how much more you are willing to add to it to help you pay for your mortgage. Then look at any miscellaneous bills that you have and seek to eliminate those bills and any habits that are taking away from your income. Once you have the set bills that you must pay, separate them from the bills that you can get rid of, you can take that amount and add it to your mortgage number. Then you will have an idea of what you are comfortable with paying for your mortgage.
Once you have established your mortgage budget, you can then contact a real estate agent or a mortgage lender and get approved by a lender. If you contact a real estate agent first, they may have preferred lenders that they can refer you to that can help you. They usually recommend lenders based on professional experience and the type of help you may need. (Down-payment assistance, renovation loans, etc.)
Are there any first-time homebuyer programs near me?
Many states and Lending Institutions have both first-time buyers’ down payment programs as well as regular down payment programs for buyers who have previously purchased a home. Some of the state down payment programs for Texas are: The Seth Program and the Texas State Affordable Housing Corporation also known as the TSAHC program. There are more lender-specific programs in addition to this, as well as Bank of America currently has a couple of good Homebuyer Grant Programs for first-time and non-first-time home buyers that you may qualify for in other states. * Their Home Buyer Grant Programs are America’s Home Grant which is a lender credit that covers up to $7,500 in eligible nonrecurring closing costs and America’s Home Grant plus Down Payment Grant program which covers up to $7,500 in eligible closing costs. Plus, up to $10,000 toward your down payment or 3% of the purchase price, whichever is less.
How do I find down-payment assistance programs?
Down-payment assistance programs can be state and community-specific as well as lender specific. You can either google your questions or contact a local real estate agent to see what programs their clients have worked with. If you are in the state of Texas, you can contact me to learn about the various down-payment assistance programs that my lenders work with or offer.
What are the current interest rates?
Interest rates change daily. Even though interest rates tend to change daily they are also buyer-specific. Your credit score, the type of buyer that you are (investor or owner occupant), the type of loan that you qualify for (FHA, VA, USDA, Conventional, Renovation loan, or Investor), and the amount of money that you put down on a home can all affect what your personal interest rate will be. The only way to know what interest rate you will have is to contact a mortgage lender and apply for a loan.
What is my home worth?
Let me start off by saying, from my experience “Your Zillow Zestimate does not always show the true value of your home.” Even the county appraisal district that your home is in does not always have the most accurate value of your home. Often, they have the square footage and number of bedrooms of your home off. Also, the appraisal district values your home yearly. So, it won’t always take into account the most recent home sales in your neighborhood. The best way to determine the best value of your home is to either order an appraisal for your home or contact a professional Real Estate Agent who can run comparable comps for your home. Realtors can run preliminary numbers sight unseen. However, to determine the true value a realtor will need to walk your home and review the condition to determine the best value.
How do I qualify for a mortgage?
Mortgage worthiness is based on a number of factors but the most important is your middle FICO credit score and your debt-to-income ratio.
I monitor my credit score through my bank, credit card company, and Credit Karma. Are these scores accurate for a mortgage?
In my personal and professional experience, I have found that www.myfico.com use the same scoring system that the lenders pull from. They focus on the middle score of your three FICO credit scores.
Should I use a Realtor to help me find a home?
I highly recommend that you hire a professional real estate agent to help you with all your real estate needs. Whether you are looking to rent, buy, sell, or invest in real estate. Having a licensed and experienced Realtor can help you navigate the real estate process. Realtors abide by a code of ethics. Of course, not all Realtors are built the same. But just like the dating process you have to put yourself out there and try. You must identify the characteristics that you want your realtor to have. Characteristics such as experience, confidence, respectability, approachability, communication, etc. And then once you have found your perfect match, let him or her help you find your dream home.
How do I find a Realtor?
Since Real Estate is a relationship business. A good place to begin is with your close friends and family who have purchased a home. Ask them how their experience was with the Realtor who helped them. If a realtor did not help them ask them, how did it feel to not have anyone looking out for their best interest. And ask them how they got their questions answered when they were confused or wavering between options. If they have had a good experience with their Realtor ask them to connect you with their Realtor so that you can see if you would be a good fit to work with each other. If you decide to choose a different Realtor, google is your best friend. Not only google realtors near you, but you can also google realtors that work in the cities or areas that you are interested in. You can also search on social media platforms such as Instagram, TikTok, Facebook, and YouTube. Watch their posts, especially the ones where they are talking and touring homes. You’ll get a sense of their character and personality but scheduling a call or meeting in person will really give you a better feel for them.
How do I invest in Real Estate?
Investing in real estate is the single-handed best and easiest way to build wealth. If you want to invest in real estate, you must first figure out if you are wanting to approach the investing process as an owner-occupant investor or as a non-owner-occupant investor. Owner-occupant buyers will have to put less money down (as little as 3%) than non-owner occupants. Non-owner-occupant investors must put down as much as 25%. Some lenders require only 15%-20% down for non-owner occupant investors but it is lender and buyer-specific.
If you only have a small amount of money saved such as $5,000 but nothing more, this is where a down-payment assistance program will come in handy if you qualify.
Once the type of investor you will be is established and you have your down payment and closing costs funds together, you can contact a Real Estate agent to get started. They will put you in contact with their preferred lenders to discuss your financial options.
Once the type of investor you will be is established then you can decide whether you will purchase a single-family home, multifamily property (2-4 units), or an apartment complex or property that has more than 4 units.
Why should I buy a house?
Why should you buy a house? Because you can. You should buy a house because housing will forever not be free. You will always have to pay to live somewhere. And you might as well pay to live in your own home so that you can pull equity out of it as your home value increases. That is what makes owning a home better than renting a home. When you rent a home, you throw money out the window every month. And you will never see a return on your investment. If you buy a house, every month you are putting money towards your principal. And as you continue to live in your home and make your principal payments, your neighbors or others in your area will continue to renovate and sell their homes. As they continue to sell their homes, your home value should increase too. *
Renting vs. Buying, which is better?
In my opinion, renting should only be for a temporary time not an extended period of time. As you transition into a new city, a new job, a new mindset. That’s where renting can be beneficial because you are building your mental and financial foundation. But once your foundation is set, you should look at your purchase options and find the best home that fits your financial affordability.
I want to build a home. Why do I need a Realtor to help me?
Building a home can be very overwhelming. First, you must research and find the best builder that offers the type of home and quality that will fit your needs. Then you must stay on them for 7-12 months or more depending on if you are going with a track home builder, a semi-custom home builder, or a full custom home builder.
You need a realtor because, in a builder scenario, the sales consultant works for the builder and represents the builder’s best interests. Your realtor will work for you alone and will be your biggest advocate.
Your realtor can save you time and energy by helping you research and select the best builders that fit your wants and needs.
Your realtor can help you find a lender that can help you shop rates against a builder’s lender. This will ensure that you are getting the best interest rate and all-around loan structure.
Your realtor can help you manage expectations when it comes to selecting the exterior, interior, and floor plan selections for your home. They can help you stay within budget and or not overpay for certain items that may not net you the type of return you would want on your home should you ever decide to sell in the future.
Your realtor can help you with navigating issues that may arise in the building process as well as help spot issues before they arise.
Your realtor can be a sounding board for you and there for you to answer questions and concerns outside of the builder’s business hours.
That’s why you should hire a realtor to help you when building a home.
What are the pros and cons of building a new construction home vs. buying a preowned home?
Let’s start with the pros of building a new construction. When you build a new construction you oftentimes are able to be a part of the building selection process by choosing the type of exterior and elevation that you like, color scheme, etc. You also have input on the interior selections such as flooring type, kitchen design, and overall floor plan of the home. The foundation and appliances will come with warranties and at least for the first year you should be able to contact the builder to repair items that may arise such as the foundation settling and cracks appearing, lighting issues, etc.*
The cons of building a new construction can often time be the quality of work. Depending on the builder, a home can be built in as little as 6 months. When homes are being thrown up left and right, sometimes shortcuts can be made, and cheaper quality materials will be used. (This is why researching and selecting a quality home builder is important.)
Closing time: Often a builder will never meet the original close date that they give. Especially in a period when certain materials are scarce such as windows, the closing can sometimes be pushed out 30-60 days or almost a year. During this time interest rates can go up which can sometimes cause buyers to fall out of contract because they can no longer afford the home that they are building.
How do rising interest rates affect me when I am building a new construction home or buying a preowned home?
The financing timeline is different when buying a new construction vs. a preowned home. With a preowned home typically, you will close within 21-30 days of going under contract. The time may be a little longer depending on the type of loan you are getting and your lender. However, once you are under contract your lender will lock you into an interest rate. If you close within the proper time frame your interest rate will remain the same even if interest rates are rising. But there is a rate lock expiration. This is determined by your lender but if for whatever reason your contract terminates before closing you will lose that interest rate.
If you are building a home, you can lock in your interest rate but it will cost you additional money every time the rate lock expires. To keep your rate from going up you must continue to pay whatever fee your lender charges to lock the rate. This can cost thousands of dollars and may not be worth the investment just to save a few hundred* dollars a month.
In the end, it is very important to weigh the pros and cons of building vs. buying preowned.
How do my financial obligations differ from when I buy a preowned home vs. new construction?
The big difference in your financial obligations is who typically* pays for the title policy and survey. When buying a preowned home, the title policy is always negotiable, however, buyers often ask the seller to pay for the title policy.
What is the title policy?
According to Texas.gov: Title insurance protects you from claims of ownership by other parties. It protects you against losses from problems that arose before you bought the property. The title company will defend you in court if there is a claim against your property and will pay for covered losses.
In times of multiple offers on a home, buyers often consider paying for the title policy themselves to help make their offer more desirable to the seller.
If a seller has a survey on a home they will often give the survey to the buyer. If for whatever reason, the survey is not acceptable then the buyer will more than likely pay for a new survey. But often times this is a fee that is saved.
When buying a new construction home, most of the time the buyer will almost always have to pay for the title policy and the survey.
What is a survey?
A property survey is a drawing accompanied by a written report which indicates the boundaries of real property along with the locations of any improvements on that property.
What is PMI and why do I have to have it?
PMI stands for private mortgage insurance. Most lenders require that you pay for PMI if you put less than 20% down on a home. PMI protects the lender if you default on your loan.
Should I get a 15-year or a 30-year mortgage?
A 15-year mortgage generally charges lower interest rates, but they typically have higher payments. Whereas 30-year mortgages typically have higher interest rates, buyers have more time to pay off the mortgage.
How do you handle helping clients from diverse backgrounds?
As an African American or Black woman, I have walked into many rooms where I was the only one who looked like me. This has been a part of my life for the past 15 years as a Real Estate Agent. It does not phase me one bit. People are who they are regardless of the color of their skin or their backgrounds. I am always respectful of my clients and their time. To help limit any misunderstandings I use clear and concise language when we communicate so that I can assure that we are on one accord. I also listen to body language, especially if I feel a shift in our conversation. I then seek to confirm everyone’s understanding.
Why should I choose you to help me lease, buy or sell my home?
With over 15 years of experience as a Realtor, I have learned that the most important key to a successful relationship is listening to understand and not listening to react. I have learned to listen to what my clients say and what they don’t say. I take my responsibility as your advocate very seriously. As your realtor, I will put your best interest first, listen to you and help you accomplish your real estate goals. I have the resources and the team to support me. Contact me today with all of your questions and concerns regarding the real estate process.