Q. How many homes should I plan to view and how should I make the final decision?

A. While exploring your needs and wants fully, it is a good idea to focus your search and save time.  Viewing a number of homes will help you become familiar with what you can expect to get for your money.  When you find a home you really like, it’s a good idea to go back and look at it at different times of the day.  This will give you greater insight into what it will be like living in the home.

Q. How can I check my credit rating before I apply for a mortgage?

A. Your credit rating is based on a combined score generated from three credit bureaus who look at your credit history, amount of credit available, and recent inquiries to determine what’s called your FICO score.  For a small fee, you can get your score or review your credit report by going online to www.myfico.com or contacting the credit bureaus directly at:

Equifax: (800) 685-1111

Experian: (888) 397-3742

TransUnion: (800) 916-8800

Q. Why should I consider paying points?

A. Buyers often choose to pay a one-time charge called mortgage “points” in exchange for a lower interest rate.  Usually paid at closing, each “point” costs 1% of the mortgage amount, or $2,000 on a $200,000 loan for example.  The lower rate reduces the monthly mortgage payment, and points paid in conjunction with the purchase of a home are generally tax-deductible in the year they’re paid (see tax advisor).  Monthly savings will often exceed what was paid in points in just a few years’ time.

Q. What is title insurance and why do I need it?

A. Basically, title insurance assures that you have clear title to the home you’re purchasing.  A title search is the primary component of “due diligence”, a process that will be started either by your attorney, if you are using one, or by the title company you choose.  The title search determines whether the seller actually owns the property and if there are any claims against it.

Q. What happens if the house I want to purchase does not appraise at the amount expected?

A.  If the house doesn’t appraise at the amount expected, other alternatives are typically found.  A second appraisal may be sought, the buyer may be willing to put more money down, the seller may adjust the price or offer other concessions, or the two sides may negotiate to split the difference between them.