Your First Home: What You Need to Know

Presented by Alex Gorodinsky

Who we are:1. In business since 2004

2. Routinely rated Top 3 in Missouri Lenders on Zillow

3. Only licensed and specialize in Missouri

4. Both owners are Washington University graduates

5. Low Interest Rates and No Broker Fees

6. Specialize in First-Time Home Buyers

7. Why use a broker?

Advantages of owning a home

1. Stable housing costs - no landlord to raise your rent

2. Usually a good long-term investment– value will most likely increase over time

3. Deduct property taxes & interest payments from income taxes

Advantages of owning a home

4. Over time mortgage payments become cheaper in "real" dollars

5. Homeownership can enhance a family's sense of control over their lives & environment and promote stronger community ties

6. You can customize the home to suit your special needs & tastes more so than your rental place

Why Get Pre-Approved?

• You will know what you can afford to pay before you look for a house.

• You know if you are in a position to buy a home in your target neighborhood.

• It tells sellers that you are a qualified buyer.

• It lets you make an offer right away, before someone else does

• It makes it easier to get the service of a realtor.

Before You Buy: What to Do

• Check your credit– Fix any issues that may prevent you qualifying

for a mortgage• Determine a monthly payment that you

can afford– Based on this monthly payment – a home price

can be determined• Set your price range• Get Pre-Approved with a lender

Approval Documents

• Provide 3-4 pay stubs.• 2 years worth of tax returns and W2

forms.• Provide bank statement• Proof of any additional qualifying income

such as alimony and child support.

• Show a 2 year employment history– Note: we can use stipend income

• 600 is the minimum credit score that is considered

Credit: What you need to know

• A credit report is a record of your credit history.

• It records payment histories, amount of time accounts are open, credit inquiries, and any negative items

• A credit score can typically be between 350 and 800.

• It has the greatest effect on your interest rate.

• Get a copy of your credit report to see if any problems exist:– Free credit reports at -

www.annualcreditreport.com

How to Improve your Credit Score?

• Pay all bills on time• Keep credit card balances below 50%

of available credit limit• Don't close unused accounts. The zero

balance can help your score• Pay off recent collection accounts or

charge-offs• Let old negative items over 2 years

remain unpaid• Become an authorized user on someone's

credit card with a good payment history.

Loan Options

• Conventional Loans (typically 5% or more down)– Usually 30-year and 15-year maturities

• FHA (Government loans) – 3.5% down– Higher upfront costs, but more lax approval guidelines

• VA (Veterans loans) – 0% down• Fixed vs. Adjustable Loans

– When a 5-Yr or a 7-Yr adjustable loan makes sense

Understanding Closing Costs

• Costs associated with obtaining a mortgage– Lender & Broker Fees– Title Fees– Appraisal– Inspections & Survey– Home Insurance

• These costs typically range from $3,000 to $7,000

• Sellers are allowed to cover them for you

Buying a Home: Timeline1. Get Pre-Approved2. Find a Realtor3. Look at Homes4. Make a Purchase Offer5. Negotiate and Enter into a Contract6. Get a Home Inspection7. Pick a Loan Program & Lock Your Interest Rate8. Meet with your Loan Officer9. Submit your Loan Application10.Order an Appraisal11.Receive Loan Approval12.Attend Closing13.Join the Ranks of Homeowners

Questions?

1.This presentation is available at http://carlsonstl.com/washu2015/

2.Call Alex at 314-329-7314 with any questions

3. Find us on Facebook: – Carlson Mortgage– Alex Gorodinsky