5 Mortgage Terms Every First-Time Home Buyer Should Know - Drew Mortgage

❏ Introduction ❏ ❏ ❏ ❏ ❏

Most home buyers find the process overwhelming.

They are often unaware of the mortgage and real estate terms.

Most first-time homebuyers rely on their real estate agents.

Mortgage lenders in Massachusetts know the homebuyers’ challenges.

Check the 5 mortgage terms to have a good home buying experience.

❏ Pre Approval

❏ The first smart step towards buying a home begins with Pre Approval. When homebuyers want prequalifying before starting the home search, they apply for mortgage pre-approval. ❏ This process helps home buyers to decide their budget. ❏ Mortgage lenders in MA ask for documents such as: - proof of income, credit history, bank statements, employment history, key assets, and more. ● Pre Approval solves most of the questions in the mind of a home buyer. ● The pre-approved loan may help you prove your financial means and interest in home buying to sellers.

❏ Pending

❏ Property on sale often has multiple interested buyers. ❏ Seller receives offers from several buyers, making different offers. ❏ Once the buyer is final, the property is called pending, indicating the selling process has begun. ❏ If you like a home that’s pending, you could talk to your real estate agent and make a backup contract on the home. ❏ This way, you will be ready to buy it in case the current buyer falls through.

❏ Escrow

❏ Escrow is home buying which starts when a seller accepts the buyer’s offer and initiates the purchase agreement. ❏ At the time of the agreement, the buyer makes an escrow deposit that compensates the seller if the purchase agreement falls through. ❏ After closing the home, this deposited money can be used to fund closing costs. ❏ To be on the safer side, this deposit is done in a third-party company account until closing. ❏ These funds can also help you pay insurance premiums, property taxes, and related homeownership costs.

❏ Appraisal ❏ As you take the first step towards the closing process, you need to order an appraisal. ❏ Your mortgage lender would typically order an appraisal to determine the true market value of your chosen property. ❏ The market value and sales value may differ. ❏ An appraiser visits the property and assesses the condition, location, amenities, acreage, and related factors. ❏ If the property’s value is lower than its contract price, the home buyer has all the right to negotiate with the seller or cancel the sale.

❏ Down Payment ● ● ● ● ● ●

Home buyers are required to make a certain percentage of home value upon closing.

This amount is called the Down Payment.

This percentage ensures that you own a certain percentage of your home upon payment.

It also depends upon the type of mortgage you are eligible for.

FDHA, VA loans have down payment options as low as 3%.

Check mortgage eligibility in advance to save down payment funds.

❏ Conclusion ● ● ● ● ●

Home buying is not easy as we all know.

Unawareness of the mortgage terms makes it more challenging.

Drew Mortgage consultants can assist you with mortgage solutions.

Time to get the right guidance & funds for your home buying process.

Get in touch with us today!

DREW MORTGAGE BRANCH OFFICES: Drew Mortgage Associates 196 Boston Turnpike Road, Shrewsbury, MA 01545 Phone: (508) 753-1656

Peabody Mortgage Lenders

Boston Mortgage Lenders

1 Mt Pleasant Drive Peabody, MA 01960

232 Commercial St.Boston, MA 02109

Phone : (978) 750-1080

Phone : (617) 523-3060