Joey Condon
Realtor®
Read my blog below
How scary is a Real Estate Contract?
June 14th, 2010 Categories: 1, Buying Real Estate, Real Estate Contracts
Real Estate contracts are full of legal terms that can be difficult to understand. Be sure to ask before you sign – any misunderstanding may be costly to you in the future.
I am here to help you with any real estate question you may have. Here are a few definitions that I think may be helpful when thinking about buying a home.
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Adjustable-rate Mortgage (ARM) – A mortgage that does not have a fixed interest rate. Based on market conditions, the rate can increase or decrease, affecting your payment.
- Private Mortgage Insurance (PMI) – This fee protects the lender against a loss if a borrower defaults on the loan and is added to the monthly mortgage payment. PMI is usually required if the down payment is less than 20% of the purchase price. VA, FHA, VA Guarenteed loans fall into this catagory. Payments can be reduced sometimes by over $200 a month if you are able to put 20% down.
- Fixed-rate Loans – A mortgage that has a fixed interest rate throughout the life of the loan. Repayment terms are generally 15, 20, or 30 years. Payments stay the same unless refinancing is done.
- Escrow – Monies or documents held by a neutral third party before closing on a property. It can also be an account held by the lender, usually set up to pay for taxes and insurance on their investment.
- Loan Origination Fee – A fee charged be the lender for processing a loan. All lenders charge different amounts so it is always best to shop around, they will compete for your business.
- Points – These fees are paid to the lender for the loan, usually in relation to the interest rate. One point is equal to 1% of the principal amount of a mortgage loan. You can “buy down” your interest rate to lower your monthly payment.
- Lock-in - A written agreement setting a specific interest rate on a home loan. The lock-in is typically good for a specific time, usually 60 to 90 days.
- Offer – When one person proposes a contract to another; if the other person accepts the offer, a binding contract is formed.
When buying a house in College Station you always need to make sure you are making the right decision when filling out a contract or offer on a house. Buyer’s remorse is not something you want, I can make sure that doesn’t happen.
Call me with all your Real Estate Contract Questions!
Joey Condon, Realtor
Rock Solid Real Estate!
I just don’t why the investing market fall has got people in the gutter when there is such a huge opportunity!
Yes, I like what you posted, but not with all of it. Anyway, it’s all good material. Thanks!
Undoubtedly my mind drifted back to the famous words, “Men are only clever at shifting blame from their own shoulders to those of others..”.