Buying a home in the Boston area can be confusing - especially if it is your first time. There are a lot of questions and misconceptions out there. Nick discusses some of the questions he is asked most often as a Boston real estate expert. If you are thinking about buying this year, you don’t want to miss this blog post!
Does a buyer really need 20% down to buy a home in the Boston area?
No, they definitely don’t. There are plenty of programs from lenders that allow buyers to put less than 20% of the purchase price down. However, there are restrictions that come with lower downpayment loans such as minimum credit scores and maximum loan amounts which could affect someone’s ability in getting that type of loan.
The other factor to consider is the competition. To the seller, a lower down payment makes your offer less attractive vs. other buyers with higher down payments or no mortgage at all. A good agent should be able to help you navigate these types of scenarios but sometimes it ultimately comes down to who brings more money to the table.
Will using a buyer’s agent cost me more when I buy a home?
What many buyers don’t realize is that the commission paid to a buyer’s agent comes from the seller, not the buyer. When an agent takes a real estate listing, a commission % is agreed to, of which a portion will be allocated to a buyer’s agent if they are the one who brought the buyer to the transaction. This means that there is no additional charge for someone to use a buyer’s agent when purchasing a property!
What is the difference between an appraisal and home inspection?
Appraisals and home inspections happen in almost every real estate transaction but what is the difference?
Appraisals are required by lenders to determine the value of a property to make sure it is equal or greater than the actual purchase price. This is handled by a professional appraiser who visits the property and writes up a full analysis of its value for the bank.
Home inspections are something a buyer chooses to have done as part of their due diligence after their offer has been accepted. They hire a professional home inspector, at their own expense, to come in and inspect the property to determine its condition. If there are any major defects that were unexpected, and the buyer’s offer has a home inspection contingency in it, then a buyer has the right to renegotiate the price, ask for repairs to be made or to back out of the offer completely.