There are several ways buyers can lose money when they buy a home even though they don’t pay the commission.
1. They don’t educate themselves to the process
2. They don’t explore their mortgage options
3. They don’t hire proper representation
Knowing your mortgage options is essential. There are many different programs out there and different lenders offer different programs. Hiring an expert Realtor who is knowledgeable about the various programs can save you money. An expert realtor is going to have contacts with reputable loan officers who are there to help you. The costs associated with the different types of mortgages varies. There are two basic types of mortgages FHA & Conventional.
FHA: This is a government-backed program that requires a 3.5% down payment. FHA loans are best for borrowers who have lower credit than it takes to qualify for a conventional loan. Still, those with higher credit might choose it for other reasons.
Conventional: This is an “open market” loan type. In other words, the loan is not directly backed by the government. Instead, investors on the open market buy investment instruments containing conventional loans. Since free market investors want low-risk investments, conventional loans are geared for lower risk – i.e. higher credit – borrowers.
Thinking about purchasing a home and want to explore your loan options? Contact The Swain Team, we would be happy to sit down with you and help connect you with the loan program that is right for you.
If you have a real estate topic that you would like to learn more about, please contact The Swain Team – we are happy to help!