Frequently Asked Questions - Buyer

Questions about buying

The amount of debt you have when you apply for a mortgage loan can determine whether or not you get approved. The financial gurus recommend that your “ratios” do not exceed 28% for housing or 36% total obligations in relation to your monthly gross income. 

Most mortgage lenders prefer to see a credit score of 600 or higher. For FHA loan with 3.5% down minimum credit score is 580, you could qualify with a lower score, but in that case your downpayment need to be at least 10%. Tips for better mortgage loans. 

You don’t necessarily need to make a down payment of 20% when buying a home. But if your loan-to-value (LTV) ratio rises above 80%, you might be required to have mortgage insurance. You could qualify for a conventional mortgage with only 5% down. Mortgage calculator. 

While you could buy a property directly with a listing agent, we do not recommend it. The listing agent works for the seller with the seller’s interest in mind.

If you are buying a home, you don’t have to pay real estate agent commission; however, you still have to pay closing costs. On the other hand, if you are selling a home you pay commission to both your listing agent and the buyer’s agent when your house closes.

The commission is typically split evenly between the buyer’s agent and the listing agent. So if a home sells for $400,000 with a 6% commission, the seller’s agent and buyer’s agent will split the total commission of $24,000, with each agent receiving $12,000.

It’s important to also note that after the initial split, the commission may then be divided between the broker and the agent. On average, the actual agent may only get 1.5% of a 6% commission depending on the brokerage.

The home seller pays the realtor commission for both the seller’s agent and the buyer’s agent. But that doesn’t mean that there is no cost to the buyer. Sellers sometimes account for the fee they’ll be paying and pass costs along by raising their listing price.

Technically, an agent’s commission is not included in a home’s closing costs. Closing costs are an assortment of fees – separate from agent commissions – that must be paid at closing. Closing costs typically include but are not limited to things such as: taxes, title insurance, appraisal, lender fees, and other services carried out during closing:

Closing cost amounts vary depending on the buyer’s loan program, but they typically range from 2%–5% of the purchase price.

While using Zillow, realtor.com etc. is very convenient way to search homes, often times there are many properties that are no longer for sale, for example if for sale by owner listing is not removed by the owner it will still show available on Zillow. When you submit a tour request on jorjanisrealestate.com one of our agents with local knowledge will get in touch with you. Zillow sells advertisement space to real estate agents looking for leads and whoever pays the most will also most likely be calling you. 

What is contingent?

When a property is marked as contingent, an offer has been accepted by the seller. Contingent deals are still active listings because they are liable to fall out of contract if requested provisions are not met. If all goes well, contingent deals will advance to a pending state. Status could also indicate “Active with contract” at this stage the seller might entertain back-up offers. 

What is pending?

When a property is marked as pending, an offer has been accepted by the seller and all contingencies have been satisfactorily addressed or waived. Pending deals are no longer considered active listings. 

The short answer is no, an inspection is generally not required for buyers. But if you use a mortgage loan, your lender will likely require an appraisal to determine the market value and potentially an inspection as well since the property will be used as collateral for you loan.