First-time Home Buyer? DNJ Gateway Mortgage Is Here to Help!

Making the decision to buy your first home is both exciting and confusing. It’s more than just a financial decision – it’s a place to settle down, raise a family, plan for the future and become part of a community. Getting your first mortgage is unlike any financial transaction you’ll have likely made before, and the whole process can be overwhelming. Relax – we’re here to help.

Buying vs. Renting

Renting can be a good option for people who are right out of college, settling down into a new city or are just not ready to commit to a home. However, there are more benefits to owning than just being able to paint the walls any color you’d like. You’ll be building equity in your home, building your net worth and can deduct your mortgage loan interest from your federal income tax. That adds up to a lot of savings over the course of the year.

Want something else to think about? The Raleigh/Cary market was named the healthiest housing market in the country by Builder Magazine. Now is certainly the time to buy!

Are There Special Loans for First Time Buyers?

Yes! Some first-time home buyers can get a reduced rate and possibly down payment assistance if they meet very specific qualification requirements. In general, there are limits to the house price (less than $220,000) and restrictions on household income. If you qualify, this first-time home buyer program offers a great loan. See our NC Housing program info or apply online now.

How Much Home Can I Really Afford?

To find out the maximum home loan amount you can afford, DNJ Mortgage calculates your debt-to-income ratio (DTI) by comparing your gross (pre-tax) income to your current housing and non-housing expenses. Non-housing expenses include things like car and student loans payments, alimony, child support and monthly payments on credit cards. Your credit score and down-payment amount will also be considered.

Since every home loan is different, please contact us for a free debt-to-income analysis now!

Should I Get Pre-Approved? Yes!

A pre-approval takes the guesswork out of how much you can afford, what monthly payments will be, what your credit score is and whether or not you can qualify for a mortgage. Secondly, a pre-approval sends a clear message to the seller – you are ready, willing and able to buy a home, and your offer should be taken seriously.

The new real estate contract rules make pre-approval even more important. With the new contract, your earnest money is at risk if you don’t qualify for a loan in the time specified in the contract.

Ready to be pre-approved? Get started online now or give us a call to speak to one of our mortgage loan officers today!

How Much Money Should I Set Aside for a Down Payment?

Short answer? It depends! There are loans available with $0 down (USDA), home loans with $100 down (HUD foreclosures) and loans with very small down payments around $1,000 – $2,000 (NC Housing). Read more about low down payment options.

FHA loans are more common and have fewer restrictions. FHA mortgages require buyers to have 3.5% of the purchase price as the down payment. Learn more about FHA loans.

Know that when you make an offer, you’ll also have to put earnest money down. This can range anywhere from $500 to $2,000 or more, depending on the contract you negotiate with the seller. Earnest money acts as a deposit and will be applied to your down payment at closing.

At the start of a home transaction, you’ll also need money for the appraisal. By law, an appraisal is required for every purchase to determine the value of the home. This is an up-front fee of $425 that is generally paid by the borrower.

Beyond down payment you may have settlement costs, or closing costs, that are paid at the closing table. These costs cover things like attorney fees, origination charges, recording and title fees as well as lender fees. Keep in mind that closing costs may be negotiated into your sales contract as well or paid by the lender.

Other costs that may arise include home inspection and pest inspection fees, and costs for warranties and surveys. Your Realtor will be able to advise you on which of these you may need.

Have Questions? Call DNJ Mortgage!

At DNJ, our knowledgeable loan officers are here to help. Contact us for more information about the mortgage process and special programs for first-time home buyers. With loan offices in Raleigh, Greenville, and Wilmington, we’re proud to serve home buyers across North Carolina. We also offer mortgages in Delaware, Maryland, Virginia, Tennessee, South Carolina, Georgia and Florida.