1. You Need A Large Down Payment To Buy A House In Albuquerque
One of the biggest misconceptions about buying a house in Albuquerque is that you need a large down payment. Many home buyers believe they need a large down payment, but that isn’t always the case. There are a variety of loans available and a good lender will be able to help identify which ones you may qualify for. Don’t let the size of a down payment deter you from pursing your dream of homeownership. There are plenty of options available to make your homeownership dreams a reality. Here are some facts about down payments to buy a house:
- In Albuquerque, there is a first time home buyers program that allows first time home buyers to buy a home with an out of pocket payment of $500.
- There is another home loan called the Next Home, this home allows home buyers to purchase a home for as little as ½% down payment.
- Federal Housing Administration (FHA) loans require a down payment of only 3.5%.
- If you are a Veteran or active service and meet the VA requirements, you can purchase a home with 0 down payment.
- There are conventional loans with down payments of 3%, 5%, or 10%
- You will also need closing costs with all these loans except the first time home buyers loan and the VA home loan.
- Keep in mind that if you don’t pay 20 percent down, you’ll may be required to pay private mortgage insurance (PMI).
2. Your Only Up Front Cost Is A Down Payment
If you’re thinking of buying a house in Albuquerque, you might be wondering how much money you need to front for the down payment. While the down payment is usually the biggest cost associated with buying a house, there are other costs that come along with it too.
These can include earnest money deposits, closing costs, moving costs, and repairs. So, when budgeting for your new house, make sure to factor in all of these potential costs. That way, you’ll be sure to have enough money saved up when it comes time to buy.
3. You Need Excellent Credit To Buy A House In Albuquerque
You don’t have to have excellent credit to buy a house. Most people can get a mortgage with a credit score of 620. You usually need excellent credit to get the best mortgage rates available. If your credit is low, you will have to pay a higher interest rate or you may not be offered a mortgage at all.
4. Income Determines How Much You Can Borrow To Buy A House In Albuquerque
In fact it is a combination of your income, credit score, and your debt. Lenders will calculate something called debt to income ratio. There is a maximum debt to income ratio in order to buy a house. If your debt to income ratio is too high, you will not be able to get a mortgage.
5. Pre-Qualification Is The Same As Pre-Approval
Pre-qualification and pre-approval are not the same thing. In order to get pre-qualified, you provide your lender basic financial information about you, such as income, debts, assets, and employment history. The lender uses this information so they can determine what kind of loan you can qualify for and estimate how much you’d be eligible to borrow.
But not until the lender is ready to give you a loan by verifying the information you pro provided are you actually pre-approved. You’ll have to complete a mortgage application after your lender evaluates your financial background and credit ratings.
Sellers and real estate agents will not take you serious as a home buyer if you have not been pre-qualified or pre-approved. Get pre-approved to put yourself in the best negotiating position.
6. Seller Pays Buyer’s Closing Costs
Closing costs are usually paid by the seller and the buyer. Everything is negotiable in real estate transactions. In some cases the seller may be willing to pay some or most of the buyers closing costs. However, it must be negotiated and the seller must agree to pay the buyers closing costs. The type of real estate market, sales price, and seller’s motivation determine whether they are willing to pay buyers closing costs.
It’s important to understand the amount of money you need upfront for costs such as a down payment, escrow impounds, credit report, loan origination fees, recording fees, title services, property taxes, and property insurance. Typically, closing costs are 2 to 5 percent of the purchase price of the home.
7. Listing Price Is The Selling Price
The price a home sells for is dependent on the current real estate market. In a sellers’ market, it is common for homes to sell above listing price. In a buyer’s market, it is common for homes to sell for less than list price.
The motivation and the amount of equity in the home plays a big role in the sales price. Motivated sellers will sell their home for less than asking price. On the other hand some sellers do not have enough equity to sell their home without writing a check at closing. These sellers will over price their home and hope that some “sucker” will buy their house.
An experienced real estate agent with knowledge of the market can help you make the right decision when it comes to making an offer.
8. All Real Estate Agents Are The Same
Real estate agents are just like any other profession. There are great real estate agents and some, not so great. Myers & Myers Real Estate has some of the best real estate agents in Albuquerque. You need an agent that knows the market and has a lot of experience. Experience comes in the form of how many transactions do they complete per year. Some real estate agents work only part time as a real estate agent. Find an agent with experience, one you can trust, and one you can work with. Contact us Today to your home search started!
9. Seller Will Make Repairs Based On Inspections
It is critical to get the appropriate home inspections prior to buying a house in Albuquerque. After inspections, your real estate agent will assist you in negotiating repairs to be made by the seller.
The buyer and seller must come to an agreement acceptable to each other. If the buyer and seller cannot reach an agreement, the purchase agreement is terminated. And the buyer will have their earnest money returned to them. This is clearly defined in the Purchase Agreement used by real estate agents in the Albuquerque Metro area.
10. It’s Cheaper To Rent Than Buy A House In Albuquerque
This is one of the most controversial topics surrounding buying a house in Albuquerque versus renting. And it really does come down to a personal decision. There are benefits to buying a home and there are benefits to renting a home. You probably should not buy a home if you do not plan to stay in the home for at least 3 or 4 years. It will cost you about 9% to 10% of the sales price to sell your home. If homes are increasing in value by 3% per year, it will take you 3 years to cover costs to sell your home.
Myers & Myers Real Estate
Our team is here to help you and make the process as stress free as possible. Myers & Myers Real Estate has been helping home buyers and sellers since 2010.
Customer service is cornerstone to our business, and we’re available to answer your questions. We have top-notch, experienced, and knowledgeable Realtors®.
Check out Albuquerque homes for sale. Rio Rancho homes for sale.Corrales homes for sale. East Mountains homes for sale. Valencia County homes for sale. Los Lunas homes for sale.. Call us if you are looking to purchase a new house or to see how we position your home to sell at the best possible price.