Boston condos $450,000 for Sale. (Important questions to ask)
Before you start looking at Boston condos for sale in 2022, it’s wise to get your selection of a lender squared away first. Part of being prepared to get a loan is asking your mortgage company the right questions.
When you first start looking for a lender to help you buy a Boston Back Bay condo for sale, it is normal to feel like it’s a one-way street—you need the money, so anyone who will offer it to you seems like someone you should do your best to listen to.
When you’re buying your first Boston condo for sale, many things can seem foreign to you.
The terms and conditions you get on your mortgage will be crucial in your financial picture for years to come.
The following questions are ones you should be able to ask any lender or mortgage broker.
1. What Documents Will I Need to Get a Loan?
Depending on the loan program you end up you’ll more than likely need these things to grant a mortgage preapproval.
- Identification – either a driver’s license, passport, or official state/federal ID.
- Income – including 30 days of pay stubs, your previous two years of federal tax returns, your last two W-2s, proof of any additional income.
- Accounts – such as bank statements for the last two cycles, investment or retirement accounts.
- Property – a statement showing the settlement of your prior home if you had one.
- Additional documents – forms such as a gift letter from a family member helping financially, landlord contact info (if applicable), letter of explanation for such problems as credit issues, and divorce-related documents (if applicable).
Watch out for loan officers who start peppering you with options before listening to your story. Different types of loans make sense for different types of borrowers. Give the lender your financial picture and have the loan officer explain a breakdown of what options are available and how they would meet or not meet your needs.
There are tons of mortgage programs for buyers. Not every mortgage option is going to be suitable for your specific financial situation. Should you opt for an FHA loan? Does a conventional mortgage make the most sense? Are you a veteran? Maybe a VA loan will be your best option?
Quite often, Boston condo buyers will ask if they should go with an FHA loan or a conventional mortgage.
An exceptional mortgage broker will go over in detail which loan programs make the most sense for you and why. Getting the best mortgage terms for your needs will come down to asking the lender the right questions. The mortgage officer should then have the ability to plug in the best package for you.
Boston condo buyers who rush into getting a loan can find themselves stuck with bad financing terms.
You will find a wide variety of lenders out there, some with more capabilities than others. The loan officer is the person you interact with, but others will be involved, like the mortgage underwriter, who will determine if you get the loan for a Boston condo for sale.
A company that approves loans in-house will be better equipped to adapt to potential hurdles in your mortgage.
For example, if there is a problem in your credit report, an in-house underwriter could discuss it with the loan officer and get it ironed out.
An out-of-house underwriter might deny the loan and move on with the next application.
The standard 20% down payment is still desired by lenders, but that does not mean it is required to get a mortgage. In fact, far from it. The need for a twenty percent down payment is a myth that’s traveled far and wide for years.
Some lenders will work with you even if you have as little as 3% down. There are, in fact, three percent down conventional mortgages now available. And with specific specialized loan programs like FHA or VA loans, you can also get a loan with zero to 3.5% down.
Whatever the circumstances, you need to know the requirements for getting the loan before moving forward on your Boston condo sale
Keep in mind that if you have twenty percent to put down, it might be wise to do so. By having a twenty percent down payment, you will avoid paying private mortgage insurance, which can be costly in your monthly condo payments.
Those who put less than twenty percent down will see how much of a burden the PMI payments can be. They will end up researching how to stop paying private mortgage insurance as soon as they are able.
The origination fee is an expense charged by most lenders for setting up a loan. The lender you are dealing with may or may not have a fee. If they do, this expense may vary compared to the fee charged by other lenders. You may be able to negotiate on the origination fee. It can’t hurt to try!
Again it is vital to keep in mind the total cost of the loan. If one lender has an origination fee higher than another, that should not preclude you from choosing them. It is all about the total financial output on your part.
The interest rate you are charged on the loan is a significant factor you need to consider when picking a lender. You also need to pay attention to what the APR or annual percentage rate will be. The APR adds up the lender fees and the interest rate and divides them by the term of your mortgage.
A pre-approval letter can make you more competitive when trying to buy a home in a hot market.
Once a Boston Beacon Hill condo buyer sees that you have pre-approval, it makes the deal more likely to go through. Pre-approval is not a guarantee, but it is a big step in the process.
Keep in mind that pre-qualification is not the same as pre-approval. Pre-approval is harder to get but is much more reliable than pre-qualification.
With a mortgage pre-approval, a lender will verify your income, employment, and credit. With many lenders, a pre-qualification does none of these things.
If you are purchasing a home, the seller and listing agent will want a pre-approval letter. A pre-qualification is worthless.
A simple question but one you’ll probably be very interested in finding out for financial planning purposes.
Most buyers will want to know what monies they will need to bring to closing. This will obviously be a crucial question for your banker. You will more than likely need to bring a certified check.
There are many costs when buying a home, but a lender should break out their specific fees.
This last question to ask a lender or mortgage broker is an important one. Like any other company, you are hiring, doing your due diligence is vital. The loan officer you are using should be able to provide you with some satisfied clients.
While you may think the loan terms are the most important aspect, the service you receive should never be discounted.
Ask any real estate agent, and they are bound to be able to convey mortgage broker horror stories.
When you are meeting with your lender, take this series of questions with you. By having the list, there will be no questions you’ll forget to ask. Never underestimate the importance of who you pick to write your mortgage.
There are so many things to consider when buying a downtown Boston condo, so it’s no wonder that you have a lot of questions running through your mind right now. Fortunately, with the right guidance of an experienced Boston real estate broker, this doesn’t have to be so overwhelming and stressful as it might seem at first sight.
If you’re looking for a condo for sale in the Boston real estate market, make sure to hire a dependable local real estate company and reap all the perks of their involvement. They will provide you with all the necessary information and do their best to speed up the entire process. With the right kind of help, you might be able to move in your dream home much sooner than you anticipated.
To gather all the crucial info before you make the final decision and buy your favorite condo, here are a few questions that you should remember to ask:
One of the biggest perks of high rise condo living is that you are not responsible for handling the repairs on your own. Instead, you are required to pay monthly condo dues. In addition to confirming the amount you’ll need to allocate for this purpose, you will want to check what you will be getting for what you’ve paid.
Boston condo fees typically cover the costs of maintaining the common areas of the building and may cover some common utilities..
If you plan to apply for an FHA loan that requires a significantly lower downpayment in comparison to conventional loans, you need to verify that the condo you plan to buy is FHA-certified. Since this may limit your options, the best course of action is to hire a professional who will spare you all the hassle and help you find a condo that meets all your requirements.
Every condo association has a set of rules that the condo owners are expected to follow. So, before you sign off on a purchase, you should get familiar with all the regulations, including those that determine if there is a rental cap (it determines how many units can be rented simultaneously).
The usual limit for condos is 20%, so if you want to be sure that you’ll be allowed to rent out yours, this is definitely something that you should look into more closely. Both condos with and without rental caps have their advantages and disadvantages, so consulting with a skilled real estate agent might help you make the right decision regarding your next move.
Buying a new Beacon Hill or Seaport condo is not a process that should be rushed. Instead, take the time to do your research and, if possible, meet with the current owners to hear about their impressions and experiences. Also, consult with your real estate agent because they have years of experience in this filed and can easily spot any hidden issues that would have never crossed your mind otherwise.
Unfortunately, there are many condos embroiled in never-ending litigation, and that’s something you will want to avoid at all costs. To spare yourself a headache and avoid making a bad investment, talk to your real estate agent about this, and express your concerns timely. They will be there to guide you through it all and protect your interests.
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