We believe educating our real estate clients is one of the most critical aspects when buying a home. Here are the 5 most important things you should know when starting your home search.
1. A down payment of 20% or more is not required. Many home buyers we work with are putting 3%, 5%, or 10% down and choose loans specific to their needs like for first time home buyers. Our lending partners can always help find the best loan solution and most importantly, secure a down payment and mortgage option that works best for your circumstances.
2. You don't pay a fee when hiring us as a buyer's agent. No, we don't work for free, but in Massachusetts there is typically a listing agent who represents/negotiates specifically for the seller, and a buyer’s agent who represents/negotiates specifically for the buyer. Once the home is sold the seller pays a pre-negotiated commission amount which is often split between the listing agent and buyer’s agent.
3. There are no hidden fees to purchase a home. The three costs are your down payment, pre-paid costs, and closing costs.
We can also negotiate seller credits to pay for many of the pre-paid and closing costs.
Pre-paid costs consist of pre-paying your insurance, property taxes, and mortgage interest. The total costs are generally between $2,500-$5,000 depending on purchase price.
Closing costs consist of mortgage fees, attorney fees, and home appraisal. The total costs are generally between $4,500-$5,500.
4. Mortgage payments are often less than rent payments. After factoring in for tax savings, principal payments, and home appreciation even mortgage payments with a higher dollar figure than rent can have a lower net cost.
5. Don't try to time the market. If anyone knew how to do this consistently, they would be the most successful investor of all time. Timing the market is not anything a buyer or even real estate expert can do with accuracy.