What’s the first thing I should do?

The idea of purchasing your first home is bound to bring many questions to mind. This is a natural reaction, as it is one of the biggest decisions you will ever make in your life. Rest assured our team is here to assist you in understanding the loan process with our goal being to make your experience a pleasant one.

Get a mortgage approval letter

Before you go shopping for anything, you need to know how much money you have available to spend. Shopping for a home is no different. Your Mortgage Banker can help you determine how much home you can afford, and put it in writing via a mortgage approval letter. Even if the first thing you do is contact a real estate agent, which many people do, the agent will most times insist you have mortgage approval letter so they know which price range of homes to show you.

Seeking complete approval for financing prior to making an offer on a property is a sound strategy that can help you get the best deal possible, especially if you plan to make a minimal down payment. The seller is often leery of the stability and reliability of the buyer if the buyer is only capable of making a down payment of 10% or less. This can cause you to lose a significant amount of negotiating ability, by being perceived as a weak buyer rather than a strong one. This is why it is very important to get full loan approval in advance and provide a written confirmation of the loan approval when an offer is made. Then you will be perceived as a cash buyer.

Get a real estate agent

The process of finding a home can often be more complex than you may expect. With the help of a real estate agent, you can be assured that you will receive the best service with far less hassle and worry than doing it on your own. If you don’t already have an agent, we work with many of them daily, and can certainly recommend any number of them to you.

Your real estate agent:

• Listens to your wants and needs to find the perfect match between what you can afford and the home that best fits your needs.
• Accesses, by computer, all of the properties for sale in your desired area. “For Sale” and newspaper ads are not always a true reflection of everything that is on the market. Your real estate agent knows everything that is available at a given time.
• Helps you negotiate. Once you’ve found the home you want to buy, your real estate agent will write up your offer and present it to the seller. This gives you the best opportunity to have your contract accepted.
• Gets the price right. Your real estate agent is a specialist who knows the market inside and out so you will get the best price possible.
• Allows you to make your own decisions. A professional agent works for you and respects your opinion. They will not try to force you into a decision you don’t feel comfortable with.
• Helps protect your rights. Real estate laws have become increasingly complicated. Therefore, your real estate agent is there to assist you in every way.
• Does not charge you anything. Your real estate agent’s services are absolutely free to you – the seller pays their commission.

Mortgage terms

To understand the mortgage process, you need to know the lingo. Here are some of the terms you’ll want to be familiar with:

Amortization

Means of loan payment by equal periodic payments calculated to pay off the debt at the end of a fixed period, including accrued interest on the outstanding balance.

Annual Percentage Rate (APR)

The interest rate that reflects the cost of a mortgage as a yearly rate. This rate is likely to be higher than the stated note rate or advertised rate on the mortgage, because it takes into account points and other credit costs. The APR allows home buyers to compare different types of mortgages based on the annual cost for each loan, however all lenders do not calculate APR the same way.

Discount Points

Prepaid interest assessed at closing by the lender. Each point is equal to one percent of the loan amount, i.e., one point on a $100,000 mortgage would cost $1,000.

Earnest Money

Money given by a buyer to a seller as part of the purchase price to bind a transaction or assure payment.

Index

A published interest rate against which lenders measure the difference between the current interest rate on an adjustable rate mortgage and that earned by other

investments (such as one-year, three-year, and five-year US Treasury Security yields, the monthly average interest rate on loans closed by savings and loan institutions, and the monthly average Costs-of-Funds incurred by savings and loans) which is then used to adjust the interest rate on an adjustable mortgage up or down.

Margin

The amount a lender adds to the index on an adjustable rate mortgage to establish the adjusted interest rate.

Origination Fee

The fee charged by the lender for issuing a loan; usually computed as a percentage of face value of the loan.

Title Insurance

A policy usually issued by a title insurance company, which insures a home buyer against errors in the title search. The cost of the policy is usually a function of the value of the property, and is often borne by the purchaser and/or seller.

To most Americans, home ownership represents “the good life” and is considered the American Dream. At Atlantic Bay we agree, and believe that one of the most basic human needs is the feeling of security. Of course there is no better symbol of security than owning a home. Unfortunately, many people do not realize how easy owning a home can be, or that they can afford to buy a home.

If you think that you need $10,000?$20,000 to buy a home, then we are here to help. Recently a couple was referred to us who were in the process of planning and paying for their wedding. They were so excited about the big day, and wanted to start their new life together in a brand new home that they could call their own. They were frustrated because everywhere they went everyone told them they needed at least a 5% down payment, and because of the wedding, they just did not have it. They both had good jobs but the wedding had gotten larger than they had expected.

We sat down with them and went over their goals and found out what was important to them. We showed them how they could buy a new home, in a great neighborhood, with one of our zero-down home loans. The seller of the home they found was even willing to pay the closing costs, so they only came out-of-pocket with a few hundred dollars. They were ecstatic!

We are here to help you and your friends and family achieve your dreams, just like this couple. Atlantic Bay still offers four home loan products that allow financing up to 101.5%. Our mortgage bankers are here to help you through the entire process from start to finish and be your Mortgage Consultant for Life. Contact us today for a free consultation on your personal situation.

Because of your honorable service to our country, Atlantic Bay Mortgage Group and the Department of Veterans affairs wants to help you purchase or refinance your home with a VA-Guaranteed Home Loan.

The main purpose of the VA home loan program is to help veterans finance the purchase or refinance of a home with favorable loan terms and at an interest rate which is usually lower than the rate charged on other types of mortgage loans. For VA loans the term “Veteran” includes certain members of the Selected Reserve, active duty service personnel and certain categories of spouses.

One of the great benefits of purchasing a home with a VA home loan is that you can receive 100% financing (zero down payment), no monthly mortgage insurance and competitive interest rates. Borrowers have the option to receive closing cost assistance from home sellers to pay all closing costs and even some consumer debt. These loans also have no prepayment penalty, flexible qualifying guidelines and are more lenient on credit scores.

The VA home loan allows eligible borrowers to refinance their current VA home loan and lower their rate with no qualification of credit, income or assets, no appraisal of value on the home and limited paperwork. Borrowers may also be eligible to take cash out of a property ­up to 90% of the value, with full qualifications.

Even if you have purchased a home before with a VA home loan or you currently own a home with a VA home loan on it, you may be eligible to buy another primary residence using a VA home loan.

Another great feature of a VA home loan is that the maximum loan amount with no down payment is $417,000 (some exceptions may apply depending upon the location of the home). Loan amounts can exceed $417,000, upwards to over $1 million, with a down payment on the property. Contact an Atlantic Bay Mortgage Banker for more information on VA home loans and a free pre-qualification on how much you could borrow for a new home.

They’re right here in the FREE report “Avoid Seven Costly Mistakes Made by Most Home Buyers.”

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