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Many first time home buyers will ask how much they
can save by buying a home versus renting a home, read about an example
of tax savings for one of our clients. 
Buying your first home is probably one of the biggest commitments in your life. Knowing the most important features will help you narrow your search criteria. Criteria could be:
1. Minimum number of bedroom
2. Minimum number of bathroom
3. Special considerations such as Garden, Yard, Fireplace, Parking
4. Certain school or transportation
5. Move in condition or Fixer-Upper
Gives you benchmarks. Many buyers, especially those purchasing a home for the first time, do not have a realistic picture of how much they can afford to spend.
Saves time. By using the prequalification information, we can help you eliminate some homes early on, so you don't have to spend so much time looking.
Helps establish priorities. No home is going to be perfect, no matter how much you pay. Going through the prequalification process helps. You focus on which of the features you want in a home are most important.
Avoids frustration. Prequalification can eliminate the frustration you feel when you find the perfect house only to discover during the loan application process that you cannot afford it. Once this happens, the homes you can qualify for often don't match your expectations.
Below are some common terms and definitions to help you learn more about the financing process.
Closing costs - All real estate transactions involve a variety of expenses in addition to the purchase price, including such items as points, credit report fees, and title insurance. Make sure you deal with a reputable lender and that you understand what your closing costs will be before signing your contact.
Equity - Equity is the portion of your home's worth that you own free and clear. It's the current market value of your home minus the amount of your mortgage loan still outstanding.
P.I.T.I - The acronym stands for Principal, Interest, Taxes and Insurance. These components make up your total monthly mortgage payment. Most lenders will include annual property taxes and mortgage insurance fees in the total payment and distribute those fees for you when they become due.
PMI - PMT or Private Mortgage Insurance is usually required unless you make a down payment of 20% or more on your home, depending on your loan's structure.
Points - A point is a loan origination fee ( a one-time charge paid for the use of money) that is generally tax deductible. Check with your tax professional about deductions for homeowners. One point equals 1% of the amount borrowed.
Principal - Principals is the amount of money
borrowed or remaining unpaid on a loan. It's the part of your
monthly payment that reduces the remaining balance of your mortgage.
If you wish to receive a complimentary 15-page Buyer's Guide,
you can send us an email at info@parcbay.com.
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