"My commitment to service and knowledge of the process,
will make buying a home smooth and enjoyable."
- Christina Brine, Realtor, ERA Broder Group
ERA Broder Group
First time Buyer's Guide
This package will answer many of your questions regarding your home buying process.
Below is a quick reference guide to the pages that follow. Please note that one of the first steps in buying a home is getting pre-qualified for a mortgage. It is important to know how much you can afford before beginning the search. We encourage you to start the prequalification process as soon as possible.
Page 1...The steps in the buying process
Page 2...Exclusive right to represent Buyer contract
Page 3...Financial worksheet
Page 4...Writing an offer
Page 5...Financing options
Page 6...Home Inspectors
Page 7...Homeowners Insurance
Page 8...Attorneys
Page 9...Utility Companies
Page 10..How much money will I need at closing?
Page 11..Closing day
Page 2
Exclusive Right to Represent Buyer
This agreement is to be filled out prior to me showing you homes. It is designed to create a commitment between you and me. In this agreement, you will see that I am given the right to represent you to the best of my ability. I will be able to show you houses, provide you with comparable sales for proper pricing, negotiate on your behalf and take you through the completion of the purchase to closing. In addition, you are giving your commitment to me that you will work exclusively with me during the term of the contract. The contract term and service fee are negotiable. Here in Hartford County, it is customary for the Seller to pay the commission/service fee.
Ready to start your search?
Contact Christina Brine: christina@brodergroup.com #860-313-1300 x306
Page 3
FINANCIAL WORKSHEET
So how much house can you afford? You can easily calculate the answer using two standard debt-to-income ratios:
- The housing expense , or front-end ratio, shows how much of your gross (pretax) monthly income would go toward the mortgage payment. As a general guideline, your monthly mortgage payment, including principal, interest, real estate taxes and homeowners insurance, should not exceed 28 percent of your gross monthly income. To calculate your housing expense, multiply your gross monthly income by 0.28. (Use the guide below to calculate your gross monthly income.) The answer is your maximum housing expense. You then can subtract an estimated monthly tax figure (ask your agent for an estimate) and an estimated monthly insurance figure. (usually $60.00). The remaining number is the amount you could apply to a principal and interest payment. So, while interest rates move up and down and vary from program to program, you can use 6% as a rate to give you a general idea of how much you can borrow. Therefore, take the remaining number and divide it by .006 and the resulting number is how much you can afford to borrow. You can then add your down payment to arrive at your purchase price.
- The total debt-to-income , or back-end ratio, shows how much of your gross income would go toward all of your debt obligations, including mortgage, car loans, child support and alimony, credit card bills, student loans and condominium fees. In general, your total monthly debt obligation should not exceed 36 percent of your gross income. To calculate your debt-to-income ratio, multiply your gross monthly income 0.36. The answer is your maximum allowable debt-to-income ratio.
For a list of Mortgage Representatives,
Contact Christina Brine: christina@brodergroup.com
#860-313-1300 x306
Page 4
WRITING AN OFFER
When the time comes to write the offer, we will go through every detail and I will explain the contract in full.
For more information,
Contact Christina Brine: christina@brodergroup.com
#860-313-1300 x306
Page 5
FINANCING OPTIONS
So now you know how much you can afford, what about the type of loan you should get? Your decision on whether to get a variable loan or a fixed loan, whether to put down 5, 10 or 20 percent, or whether to do a 15 year or a 30 year term is as important as the decision to buy itself.
Your mortgage broker will be able to help you decide which loan is best for you. However, here are a few things to consider when making your decision.
1) How long will you live there ?
2) How quickly you would like to pay down your mortgage?
3) How much money do you have to put down ?
4) Is 100% financing right for you?
REMEMBER: Shopping for a mortgage is like shopping for a car. Once you decide which type you want, you then need to find the best pricing. We suggest you get three rate quotes along with the fees each lender charges.
For a list of Mortgage Representatives,
Contact Christina Brine: christina@brodergroup.com
#860-313-1300 x306
Page 6
HOME INSPECTORS
As we move forward in the process, I will give you a list of inspectors to choose from. I recommend you talk with them about their pricing, what their inspection covers and how long they have been in business. In addition to home inspections, you may be doing a pest/wood destroying insect inspection, a septic inspection and a well inspection. You will want to make sure that your inspector has the knowledge to complete all of your desired inspections. Many times they have contacts and will arrange for the various inspections on your behalf.
Page 7
Homeowners Insurance
Like most buyers, if you are taking a loan to buy your home, your lender will require you to purchase a one year homeowners insurance policy prior to the closing. This insurance will cover you in the event of damage to your home from things like fire and frozen pipes as well as cover persons who may accidentally injured themselves on your property (liability). The insurance premium will be based on the replacement cost of your home, not the price you are paying for the home. Replacement cost is how much money it would cost to rebuild your home if it were completely destroyed. You will need to know certain things about your home when asking for an insurance quote. Most items you will need are on the MLS printout of the home you are buying, so you will want to have that handy when making inquiries. Again, we suggest you get 3 quotes for insurance. When comparing quotes, make sure you are getting the same coverage from each insurer.
Ask me about our AON Home Warranty Plan,
Contact Christina: christina@brodergroup.com
#860-313-1300 x306
Page 8
Closing Attorney
In the state of Connecticut, Hartford County, we use closing attorneys to complete the purchase process. You will have the option of hiring your own attorney to represent your interest in the transaction. However, most times, Buyer’s will use the same attorney that will be representing the mortgage company. This will save you money. How it works is as follows. Your lender, the place you choose to get the loan from, will assign your file to a closing attorney. This attorney will charge a fee for this which you, the consumer, will pay. Now you have a choice to hire this same attorney to represent your interest as well or hire a separate attorney to represent your interests. The thinking is that the attorney representing the lender has the same interest that you do with respect to the closing. Therefore there is no conflict of interest. Now typically the lenders’ attorney will charge you less to represent you because they have most of the paperwork on your behalf already completed. This is why most Buyers use the Lenders attorney as well. Attorney’s do vary in the fee they charge so do not be afraid to ask how much.
For more information,
Contact Christina Brine: christina@brodergroup.com
#860-313-1300 x306
Page 9
Utility Companies
As we move forward in the process, we will remind you of who to call and when. Please note that water is the only utility that is transferred by the closing attorneys so you will not need to make any calls for water.
For more information,
Contact Christina Brine: christina@brodergroup.com
#860-313-1300 x306
Page 10
How Much Will I Need at Closing?
The amount of money you will need at closing will vary on a number of things. It will be the combination of how much you are putting down on the house combined with your closing costs.
Your closing the attorney or their paralegal will get all the pieces together to come up with the amount of money you need to bring to the closing. They will instruct you on how much and who to make the check out to. The check is either a cashiers or bank check.
For more information,
Contact Christina Brine: christina@brodergroup.com
#860-313-1300 x306
Page 11
CLOSING DAY
The day has arrived and you are ready to go, so now what? I will arrange with you to walk through your soon-to-be home. You will walk through the property to make sure everything that is supposed to be there is, and that everything that is not supposed to be there has been removed. In addition, you will look for any damage that may have been caused by the seller moving out or a vacant home that developed a problem.
Once you have completed your walk through and have your bank check in the amount your closing attorney told you to get, it is off to the closing. You will need to bring some I.D., typically your drivers license... and that is it. Your closing attorney and I will take care of the rest.
Lets get started!
Contact
Christina Brine
Realtor
ERA Broder Group
43 North Main Street
West Hartford, CT 06107
860-313-1300 Office
860-796-7575 Cell
860-313-1333 Fax
christina@brodergroup.com |
