How does buying a house work?

Question

Also what are mortgages, leases, financing, taxes, insurance, and whats the difference between debit and credit cards and how do they work?
Sorry so many questions! And try to make it as easy to understand as possible. Thanks!

Answer 1

ummm why are you interested in buying a house gurl!!

Answer 2

I'll go in reverse order.

Debit card: A card that pulls money (a "debit" is a removal of cash money from an account) out of a checking or savings account. You already have this money.

Credit card: a device by which a bank pays for your purchases, and you pay back the bank. Banks put an interest rate on this purchase. Basically the interest is a convenience fee.

Insurance: A fee that you pay to a company that covers the cost of damages that you or an accident causes. Auto insurance, for example, is money you pay to a company so that if you're ever in an accident, they write the checks. Companies hope you never have to use this. Homeowner's insurance works the same way as auto insurance, just without the cars getting into an accident part.

A lease: A monthly payment that you give to a company (like an auto manufacturer) that gives you the right to use their property (like a car) for a set time. Leases can cover televisions, cars, or apartments. In some leases there is a "purchase agreement" at the end that lets you buy that property from the company for a cost that is less than what you would have paid up front.

Financing means that you and a lender are working out a way to pay for something.

A mortgage is an agreement between two people: you and a bank. The bank pays an amount of money equal to what you owe to a property owner. Then you can own the house that the bank just paid for. Mortgages have interest associated with them, just like a loan or a credit card. You pay the bank a certain amount of money every month, plus some interest.

To buy a house, it goes like this:
1) you see a house for sale that you like
2) you contact a lender (or a mortgage broker), who will "pre-authorize" you to borrow a certain amount of money.
3) (usually) you find a real estate agent.
4) The agent negotiates on your behalf with the seller, who also has a real estate agent.
5) The seller agrees to a purchase price.
6) You buy title insurance (this protects you: the title company does a search to make sure nobody else can lay claim to the house. If you move in and someone else can claim the property, the title company pays you for the cost of the house).
7) You have the house inspected to make sure you know what you're buying.
8) You and the lender work out a deal for actual payments for whatever price you agreed to pay to the seller (this is the financing part)
9) You get homeowner's insurance, just in case.
10) You "close" on the mortgage. This means that you sign a bazillion sheets of paper that say yes, you know what you're getting into, you know how much you'll pay each month, and then the seller gets that money.
11) You move in.

Answer 3

1. you need about 20% down.
2. a clean credit record w/ a high fico score.
3. not much debt
4. find a house you like
5. work w/ an agent and at financial officer to see what you can afford
6. mortgage is the $ you need to payback that you borrowed from your lender. mortgage is the generic term for both the interest and prnicipal payments combined that you owe over the years.
7. lease is renting under a contract. if you have a year lease but move out before the years is up, you may have to pay the entire year's worth of rent. Read the contract for details. lease is a guaranteed rate.
8. financing is when you borrow money and need to pay it back in installments or in a lump sum.
9. taxes are what you pay uncle sam. if you buy property, you will need to buy property tax.
10. insurance is what you pay monthly in case of emergencies. There are different kinds of insurance. Fire, structural, etc. It depends on where you live. Read the policy.
11. debit cards take $ from your checking account. credit cards are a small loan. you establisth credit history when you use a credit card.

Good luck.

Answer 4

You go to a bank and apply for a loan, so you know how much to come up with as the down payment and how much the bank is willing to lend you.
Once you know your price range, you look for homes that meet your criteria. You can hire a realtor, unless you find a home which is for sale by owner. The realtor will charge you a commission for assisting you with finding a home, for example if the home cost is $400,000.00, and the realtor charges you 3%, his/her commission is $12,000.00. A realtor’s commission is negotiable and you should negotiate prior to having one assist you. When you find a home you like, your realtor will place a bid for you, which means he/she will make an offer to the realtor representing the seller, and if your offer is accepted, the purchase goes through. Your realtor will keep on bidding on homes you like, upon your approval of course, until you land one in which the seller accepts your offer.
If the home is for sale by owner, you can work with them and a title company which can secure the transaction. If you work with a realtor, the realtor will show you homes that meet your criteria; realtors won’t help you most of the time unless you have a pre approval letter from the bank, or many realtors are loan officers, and they can apply for a loan for you, through banks they work with.
Mortgage is the balance you owe the bank for your home or real property.
Lease is an agreement between you and the owner of real property, which can also be known as a rental agreement.
When you own real property, you pay real property taxes based on the value of your home to the County Assessor's in the County where your real property is situated.
When you owe a bank money for your home, they require that you have your home insured against fires, theft, or other natural catastrophes to secure the money they lent you in case there is a loss or damage to the property, the amount of insurance is based on the value of your home.
Debit cards are your bank cards which deduct from checking or savings.
Credit cards is an account which you borrow money from every time you use your card and accrues interest, sometimes you get an introductory 0% interest for a certain period of time which the company giving you credit will specify. Credit cards are unsecured, which means that they are not linked to your assets, they are linked to you, based on your credit standing.

Answer 5

Mortgage - A loan from a bank to buy a house. You pay the money back over a long time (usually 25 years). If at some point you can't afford to pay it back, the bank gets the house.

Lease - Where instead of buying a house, you rent one instead, usually for an agreed length of time.

Financing - A way of paying for something.

Taxes - Money you have to pay to the government (either money taken out of your wages, or money that is extra on the cost of things). It goes to pay for things like roads and schools.

Insurance - Where you pay money (called premiums) to an insurance company so that if something goes wrong with whatever you have insured, you won't need to pay for whatever needs to be fixed. Eg. If you insure your car and it gets stolen, the insurance company pays for a new one. If you insure your house and it burns down, the insurance company pays for you to have it rebuilt.

Credit Card - A card you use to pay for things. Each time you buy something you take out a small loan from the credit card company. You then make monthly payments to pay the money back.

Debit Card - A card linked to your bank account. Each time you pay for something the money is taken out of the money you already have in your account.

Answer 6

credit cards u have to pay later. debit card money comes out ur bank account.u choose a house. make an offer. negotiate with the seller. make a contract the seller agrees with. get a mortgage/home loan unless u got lots o cash.oh yea and be prepared for a down payment of like 5 to 10 percent of the selling price. go to the closing u and the seller sign the papers. and bam u got a house.

Answer 7

well usually you hand them money and they hand you keys, but ig uess you coudl steal a house, just barge in liek you own the place and evict the current owners than change the locks, if they lived in a mobile home you coudl take it whiel they were sleeping inside, that oudl be funny they get yup to ave their morning coffee and step out onto the pourch that is now a movign interstate

Answer 8

Uhhhhhh - maybe when you get a little older? See me then . . .

Answer 9

ebay baby

Answer 10

Just buy it. ☺