Common Concerns of a First Time Homebuyer
When you’re in the market for your home, you undoubtedly have questions, concerns, and no shortage of emotions. It’s no secret that purchasing a home is one of the largest financial decisions you’ll make, and of course, you don’t want to make a mistake. It is natural to have questions regarding buying your first home, and the concerns you feel are completely natural.
Here are some of the most common questions we receive in regards to purchasing a first home, along with answers that should help ease your mind during the process.
Am I ready for homeownership?
Though there are no concrete signs that you are ready to take the plunge into homeownership, there are clues you can look out for to give you an idea. A home is a long-term investment, so being in an area that you enjoy and plan to stay in for a while is important. Being financially secure enough to take on the extra burden of home ownership is something that cannot be ignored.
Why should I buy instead of renting?
Real estate markets are ever-changing, and if you can afford it, buying a home is a much more effective investment than renting. When you buy a home, you have equity in what you’re paying your mortgage towards each month, and you’re left with an investment that will increase in value over time.
How much do I need for a down payment?
Down payment amounts vary depending on the purchase price of the home, along with interest rates and the terms of the mortgage you’re applying for. FHA loans and others allow you to put as little as 3-5% down, though you may encounter private mortgage insurance, or PMI until you pay a certain amount of your mortgage off.
What is PMI?
PMI, or private mortgage insurance, is a means for lenders to protect themselves if a buyer defaults on their loan. PMI is paid each month in addition to their principal to help reimburse a lender if they default. This fee is typically rolled into your monthly mortgage payment until about 80% of the loan is paid off, at which point the PMI is canceled.
Let Us Help
We understand that buying your first home can seem like a daunting task, but the experts here at Butler Mortgage are here to help. Our lenders will do everything possible to make your home buying experience as painless as possible, so you can spend less time worrying, and more time enjoying your home. Call us today at 407-931-3800 with any questions.