Home Buying Terminology - Closing Costs

Home Buying Terminology: An A-to-Z review of common terms you'll encounter during the home buying process.

Closing costs are what you incur on closing day (also known as "settlement"). Basically, closing costs are the price you (and/or the seller) will pay to transfer ownership of the property. Closing costs do not include the purchase price -- they are the "extras" above and beyond the actual purchase price.

Closing costs usually include fees for home appraisal, loan origination, survey and real estate agent's commission. They may also include prepayment of taxes and insurance. Closing costs usually range from 2 to 4 percent of the home's purchase price.

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Home Buying Terminology - The Closing

Home Buying Terminology: An A-to-Z review of common terms you'll encounter during the home buying process.

Closing - Closing (or settlement) is the formal transfer of home ownership from the seller to the buyer. A real estate closing usually takes place between the seller, buyer, settlement agent, and the seller's and buyer's real estate agents.

At closing, the buyer will sign the mortgage, the seller will receive payment for the property, and the buyer and/or seller will pay the closing costs.

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Home Buying Terminology - The Balloon Loan

Home Buying Terminology: An A-to-Z review of common terms you'll encounter during the home buying process.

Balloon Loan - With a balloon loan, the regular monthly mortgage payments are followed by a lump sum (or "balloon") payment of the remaining balance. The initial payment term is usually 5, 7 or 15 years -- after which you have to either refinance the loan or pay it off in a lump sum.

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Home Buying Terminology - The Appraisal

Home Buying Terminology: An A-to-Z review of common terms you'll encounter during the home buying process.

Appraisal - An appraisal is a professional appraiser's estimate a property's current value. Appraisers will account for such factors as market conditions, characteristics of the property, upgrades and more. Most mortgage lenders will require you to have a home appraised before they will loan you money.

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Increase Your Credit Score for Home Buying Success

You probably already know how important your credit is to the home buying process.

Good credit can lead to an easier qualification process, better rates on your mortgage loan, and a smoother home buying experience in general.

But how do you go about improving your credit? What steps should you take, now and in the future, to raise and sustain your credit score?

Martin Lukac has some advice for you. In his article (see below), Martin explains in detail what steps you can take to increase your credit score.

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Read Martin's article here
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Good luck and happy home buying!

~Brandon from HomeBuyingInstitute.com

14 Common Credit Mistakes

When buying a home, your credit will be the most important factor that determines the kind of home loan you'll qualify for.

So it pays -- literally -- to make good credit practices a way of life. There are no shortcuts to good credit, so you have to start early and maintain it constantly.

To understand how to improve your credit, you must first understand what leads to bad credit. Credit guru Jeanette Fisher has some advice for you. Specifically, she explains the 14 most common credit mistakes you should avoid.

Read Jeanette's Article:
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14 Common Credit Mistakes
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Home Buying Tip - Understand Your Credit Score

Purpose of this home buying tip: To explain the importance of good credit as it applies to the home buying process. To show you ways to maintain a good credit score.

When you apply for a home mortgage loan, you can bet that your credit will be examined under a financial microscope. Mortgage loan lenders will analyze your credit in order to determine your risk category.

When your credit score is high, your risk factor is low. In this scenario, you'll have a good chance of qualifying for a mortgage loan. But when the opposite is true (low credit score and high risk factor), you could have trouble obtaining a loan.

Obviously, you want to fall into the first category (high credit score, low risk factor). To that end, we offer you the following home buying tips for maintaining good credit.

Learn more by reading this article:
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5 Steps to a Higher Credit Score
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